The costs associated with FirstEnergy meeting Ohio’s energy efficiency mandates are socialized amongst their customers, by rate class, through the DSE2 charge under the Energy Efficiency Rider.  This charge became effective for service on and after May 18^th.  Then, on June 1^st, FirstEnergy filed for changes in the DSE 1 and DSE2 rates that will take effect on July 1^st.  The attached file shows the rate changes by utility and rate schedule:  DSE Riders 07012011 Note that we expect the DSE2 rates will increase in future years as the utility’s cost of compliance increases.

Mercantile customers (defined as non-residential customers who use more than 700,000 kWh per year or are part of a national account) who are able to offer up energy efficiency projects to FirstEnergy have the ability to become exempt from the DSE2 charge.  In addition, on April 11, FirstEnergy launched several new energy efficiency rebate programs for commercial and industrial customers.  This first set of programs provides rebates for lighting and motor projects.  However, a mercantile customer cannot use the same project for both the rebate program and exemption from the DSE2 charge under the energy efficiency rider.  Mercantile customers should weigh the pros and cons of a rebate versus rider exemption.