Allegheny Power 2013 Annual Report Download - page 22

7
Nuclear Refueling Outages
The following table includes details for the two refueling outages in 2013:
Unit Outage Start Returned to Service
Perry March 18, 2013 May 2, 2013
Beaver Valley Unit 1 September 30, 2013 November 4, 2013
On March 18, 2013, Perry Nuclear Power Plant safely shut down for scheduled refueling, maintenance and a turbine upgrade.
While the unit was off-line, 280 of the 748 fuel assemblies were replaced, and numerous safety inspections were conducted on the
unit's reactor vessel, turbine and generator. In addition, preventative maintenance was performed on major components, including
testing more than 160 valves, replacing several control rod blades and inspecting and cleaning cooling tower piping. During the
outage, Perry's three low pressure turbines were replaced with new 175-ton turbine rotors.
On September 30, 2013, the 911 MW Beaver Valley Unit 1 entered into a scheduled refueling and maintenance outage, including
a turbine upgrade that is designed to improve efficiency and reliability. During the outage, 60 of the 157 fuel assemblies were
exchanged. Numerous inspections, maintenance activities and improvement projects designed to ensure continued safe and reliable
operations have occurred. Prior to the outage, Beaver Valley operated safely and reliably for 507 consecutive days since the
completion of its last refueling outage in May 2012.
Beaver Valley Unit 1 returned to service January 29, 2014, following replacement and testing of the Main Unit Transformer associated
with a fault that occurred on January 6, 2014 that resulted in an automatic shutdown. In addition, during January 2014, given higher
customer usage associated with extreme weather conditions and unit unavailability, including Beaver Valley Unit 1, FirstEnergy's
Competitive Energy Services segment (including FES) was required to purchase higher volumes of power. Given the market
conditions in PJM, the Competitive Energy Services segment (including FES) also experienced increased levels of transmission
charges, primarily associated with ancillary expenses, such as synchronous and operating reserves, which are intended for reliability
purposes and are socialized across all load serving entities based on load share. Certain of these transmission charges are expected
to be billed to retail customers.
On February 1, 2014, the Davis-Besse Nuclear Power Station entered into an outage to install two new steam generators, replace
about a third of the unit’s 177 fuel assemblies and perform numerous safety inspections and preventative maintenance activities.
During the preliminary stages of the outage an area of concrete that was not filled to the expected thickness within the shield building
wall was discovered at the top of the temporary construction opening that was created as part of the 2011 outage. The 2011
temporary construction opening was created to install the new reactor head. FENOC has assessed the as-found condition of the
concrete and has determined the shield building would have performed its design functions. This condition within the shield building
wall will be repaired during this outage to conform to its original design configuration. This condition is not expected to extend the
outage.
Regulatory Matters
Ohio Alternative Energy Rider Update
Under SB221 the Ohio Companies are required to serve part of their load from renewable energy sources. During 2009 through
2011, the Ohio Companies, in accordance with SB221, conducted RFPs to secure RECs. On August 7, 2013 the PUCO disallowed
the Ohio Companies' recovery of $43.4 million, plus interest, that related to 2011 RECs that were purchased in the August 2010
RFP. The Ohio Companies, along with other parties, timely filed applications for rehearing on September 6, 2013. On December
18, 2013, the PUCO denied all of the applications for rehearing. Based on the PUCO ruling, a regulatory charge of approximately
$51 million, including interest, was recorded in the fourth quarter of 2013 included in Amortization of regulatory assets, net within
the Consolidated Statement of Income. On December 24, 2013, the Ohio Companies filed a notice of appeal and a motion for stay
of the PUCO's order with the Supreme Court of Ohio. On February 10, 2014, the Supreme Court of Ohio granted the Ohio Companies'
motion for stay, which went into effect on February 14, 2014. On February 18, 2014, the Office of Consumers' Counsel and the
Environmental Law and Policy Center also filed appeals of the PUCO's order.
Pennsylvania Marginal Transmission Losses
On September 30, 2013, the U.S. District Court granted the PPUC’s motion to dismiss. As a result of the U.S. District Court's
September 30, 2013 decision, FirstEnergy recorded a regulatory asset impairment charge of approximately $254 million (pre-tax)
in the quarter ended September 30, 2013 included in Amortization of regulatory assets, net within the Consolidated Statement of
Income. The balance of marginal transmission losses was fully refunded to customers by the second quarter of 2013. On October
29, 2013, ME and PN filed a Notice of Appeal of the U.S. District Court’s decision to dismiss the complaint with the United States
Court of Appeals for the Third Circuit. On December 30, 2013, ME and PN filed a brief with the Third Circuit that explained why it
was legal error for the U.S. District Court to dismiss the complaint. The PPUC filed its brief on February 3, 2014, and ME and PN
filed a reply brief on February 21, 2014. Oral argument has been scheduled for April 9, 2014.