Dec. 23 at 8:25 PM
S&P Global Ratings upgraded FirstEnergy Corp. to ’BBB+’ from ’BBB’ with a stable outlook, citing improved governance following the company’s response to the HB 6 bribery scandal. S&P highlighted stronger risk management, internal controls, leadership changes, board independence, and enhanced ethics oversight.
The rating agency noted that issues tied to PUCO and HB 6 are largely resolved, allowing management to focus on regulatory risk. A recent rate case order was described as broadly constructive, with authorized ROE of 9.63% and equity layers of 51.2%.
While Ohio utilities may face
$250–280 million in pre-tax penalties, S&P expects only a modest impact on consolidated credit metrics despite high capital spending. FirstEnergy is expected to maintain FFO-to-debt of 12%–14%.
S&P also upgraded most FirstEnergy utility subsidiaries by one notch, while affirming ’BBB’ ratings on Mon Power and Potomac Edison with a positive outlook.
$FE