First Energy Pays $230M Fine for Bribery in Ohio Nuclear, Coal Plant Bailout | Columbus Ohio Dump Trucks

Ohio energy provider FirstEnergy Corp. has agreed to pay a $230 million fine for its role in bankrolling the $1.1-billion bailout of its own nuclear and coal plants in 2019.

Federal attorneys filed a deferred prosecution agreement with FirstEnergy in U.S. District Court in Cincinnati July 22. FirstEnergy was charged with conspiracy to commit honest services fraud in the largest bribery scandal in Ohio history. The deferred prosecution will require the utility to pay $230 million, develop a stronger compliance and ethics program, remain in compliance for three years and cooperate with the government in its investigation of the men involved.

The fraud charge will be dismissed, pending FirstEnergy's cooperation under the terms of the agreement. Only former Ohio House Speaker Larry Householder (R) and former Ohio Republican Party Chairman Matt Borges are fighting the bribery and conspiracy charges. The other men involved have agreed to cooperate with the government.

According to court documents, a 501c4 organization called Generation Now was created by Householder, Borges and three other state officials, former officials and lobbyists. Generation Now was funded entirely by $61 million in donations from FirstEnergy and its subsidiary FirstEnergy Solutions, which in 2016 owned the two nuclear plants in danger of closing.

The donations benefited Householder and other state politicians who backed House Bill 6 in 2019, which became law and provided FirstEnergy a $1 billion bailout of the two aging nuclear plants on Lake Erie. The two plants are still in operation and are now owned by Energy Harbor, which was created when FirstEnergy Solutions emerged from bankruptcy and was spun off into a new company.

HB6 also bailed out two FirstEnergy coal plants that it said at the time would have otherwise closed.

Generation Now received regular payments from FirstEnergy from late 2016 to 2019 of up to $250,000, detailed in the criminal complaint against FirstEnergy, with payments coming to Generation Now for everything from running local house campaigns that resulted in Householder winning the speakership in 2019 to repairs to his Perry County farm. Vipal J. Patel, acting United States Attorney for the Southern District of Ohio, said at press conference July 22 the utility must change the way it does business to fulfill the terms of the agreement.

"They had a corporate compliance agreement that didn't seem to work," Patel said. "Something wasn't working."

Patel said the deal was the largest penalty in the history of the state of Ohio, but green energy and consumer advocates say it is simply not stiff enough and does not undo the damage that FirstEnergy's lobbying did to the state's energy grid.

"It's a drop in the bucket," said Tom Bullock, executive director of the Citizens Utility Board of Ohio. "FirstEnergy admitted to taking part in a bribery scheme that cost taxpayers $1 billion. We absolutely need consumers to be made whole. We also need to address weatherization and how Ohio's entire clean energy system was dismantled by House Bill 6. This is still costing the taxpayers."

While part of HB6 has been repealed, the two nuclear plants as well as the coal plants are still in operation under Energy Harbor's management and, Bullock said, the loss of investment in clean energy solutions such as wind and solar created by the bailout of the coal and nuclear plants has left development of those technologies in Ohio behind other states.