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FirstEnergy Agrees To $230 Million Penalty For Nuclear Bailout Bribery Scheme

FirstEnergy Davis-Besse Nuclear Power Station in Oak Harbor, Ohio.
Ron Schwane
FirstEnergy Davis-Besse Nuclear Power Station in Oak Harbor, Ohio.

FirstEnergy will pay $230 million after entering into a deferred prosecution agreement over charges that bribed then-Ohio House Speaker Larry Householder and former Public Utilities of Ohio Commission chair Sam Randazzo.

The company admitted it "conspired with public officials and other individuals and entities," according to a release from Acting U.S. Attorney for the Southern District of Ohio Vipal J. Patel. FirstEnergy is charged with conspiring to commit honest services wire fraud. A formal announcement is expected Thursday afternoon in Cincinnati.

A year ago yesterday, five people were arrested in connection with the effort to pass House Bill 6, the law that created subsidies for Ohio's two nuclear power plants, and the effort to stop a repeal of the law.

Those arrested included then-House Speaker Larry Householder (R-Glenford), former Ohio Republican Party Chair Matt Borges, lobbiysts Neil Clark and Juan Cespedes, and Householder operative Jeff Longstreth.

Prosecutors said Householder and the other defendants took part in a $61 million bribery scheme that helped Householder rise to power in order for him to pass the bailout.

Two entities were also named - the 501(c)4 group Generation Now, which fought the attempt to repeal House Bill 6, and a utility widely believed - and now confirmed - to be FirstEnergy. FirstEnergy's former subsidiary Energy Harbor, which had been known as FirstEnergy Solutions, owned the nuclear power plants.

Longstreth and Cespedes have pleaded guilty. Clark died by suicide in Florida in March. Borges and Householderhave maintained their innocence. Householder was ousted from his leadership position not long after his arrest, and expelled from the House last month.

Generation Now pleaded to a racketeering charge in February.

Sam Randazzo resigned from the Public Utilities Commission after his home was raided by the FBI. No charges have been filed against him. But FirstEnergy disclosed in an SEC filing that it paid $4 million to end a consulting agreement with a company associated with an individual who went on to become a state regulatory official.

State lawmakers have repealed the nuclear subsidies in House Bill 6. But the law also created subsidies for two coal-burning power plants and six solar projects, and cut renewable energy standards and energy efficiency standards for utilities.

This story will be updated.

Karen Kasler
Contact Karen at 614/578-6375 or at kkasler@statehousenews.org.