FirstEnergy Corp. Transfers Assests to its New Subsidiary

FirstEnergy Corp. said that it will transfer its transmission assets into a new subsidiary, called American Transmission Systems, Inc., with the goal of becoming part of a larger independent regional transmission company (TransCo). FirstEnergy plans to initially transfer the operating authority of its transmission system to American Transmission Systems.

The subsidiary will own and operate FirstEnergy's major, high-voltage transmission facilities approximately 5,200 miles of transmission lines with voltages of generally 138 kilovolts and higher and approximately 160 transmission substations - and will have 35 interconnections with 8 regional utilities. The formation of the new subsidiary will not affect customers now receiving transmission service from FirstEnergy. They will continue to receive service from the new subsidiary according to the same provisions.

A TransCo addresses Federal Energy Regulatory Commission's stated goals of providing non-discriminatory treatment of all transmission users; eliminating pancaked rates; managing system congestion; eliminating inter-regional loop flows; and managing short-term reliability. A TransCo also ties together control, planning, maintenance and financial responsibility, resulting in a truly independent, streamlined, and cost-efficient operation.

FirstEnergy is a diversified energy services holding company with 2.2 million customers in northern and central Ohio and western Pennsylvania. Its electric utility operating companies - Ohio Edison and its subsidiary Pennsylvania Power, The Illuminating Company and Toledo Edison - comprise the nation's 12th largest investor-owned electric system. FirstEnergy has $18 billion in assets, including ownership in 18 power plants.