Electric restructuring in Ohio took a bite out of FirstEnergy Corp. earnings. The company reported net income for the first quarter was $106.2 million, or 49 cents per share, compared with $140.9 million, or 63 cents per share in 1Q2000. After adoption of new accounting standards for derivative transactions, net income was $97.7 million, or 45 cents per share of common stock. The Akron-based company said results are on track with annual earnings projections, which reflect higher amortization of transition costs during the first quarter as a result of the company’s rate plan under Ohio’s new deregulation law. For the year, total transition cost amortization is expected to be lower than last year’s accelerated cost amortization under the former regulatory rate plans for the company’s operating subsidiaries. Consolidated generation kilowatt-hour sales increased 13.1% for the quarter. Regulated distribution deliveries to residential customers rose 8.1%, and industrial sales gained 3.6%, while commercial sales were off 1.3%. Revenues were $2 billion, compared with $1.6 billion for the year-earlier quarter. FirstEnergy made significant progress in obtaining regulatory approvals of its proposed $4.5 billion merger with Morristown, NJ-based GPU, Inc. The merger still requires approvals from the Pennsylvania Public Utility Commission, the New Jersey Board of Public Utilities and the Securities and Exchange Commission. The transaction is expected to be immediately accretive to cash flow and earnings and produce other benefits, including cost savings of at least $150 million annually from the combination of operations. Upon completion, FirstEnergy will be the fourth largest investor-owned electric system in the nation, based on serving 4.3 million customers within 37,000 square miles of Ohio, Pennsylvania and New Jersey.

Connecticut Gov. G. Rowland hit the switch to start the production line Tuesday at FuelCell Energy’s new manufacturing facility in Torrington, CT. The governor also announced the State of Connecticut’s intention to purchase a 250 kW Direct FuelCell power plant through the state’s Clean Energy Fund. The site of this power plant is to be determined. FuelCell Energy’s new 65,000-square foot facility will allow for the expansion of manufacturing capacity to meet near term demand for the company’s orders for commercial field trials that will be installed in locations worldwide in the coming year. The facility has the potential to expand to an annual production capacity of more than of 400 MW by 2004. “We’re committed to meeting our commercialization milestones and this facility puts us another step closer,” said Jerry D. Leitman, company president. Currently, FuelCell Energy employs 56 people in Torrington and 110 at its Danbury, CT, corporate and research headquarters.

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