First Energy: An overview
First Energy Corporation (FE) is an electric utility company headquartered in Akron, Ohio. Like most power companies operating in the United States, First Energy operates as a holding company to its subsidiaries and affiliates related to the energy business.
First Energy began in 1993 as an investment banking and research service provider in the energy domain to its clients in Canada. The company is the result of the merger of Ohio Edison and Centerior Energy in 1997.
Since then, the company has looked to grow both organically and inorganically. First Energy merged with GPU, Inc. in 2001 and Allegheny Energy in 2011.
First Energy’s operations
First Energy’s operations include all aspects of the power business, including electricity generation, electricity sales, and transmission and delivery of electricity to end consumers. First Energy owns assets worth $50 billion and 18,000 megawatts (or MW) of power generation capacity. It serves six million customers in six U.S. states.
As shown in the above graph, First Energy is the eighth largest power company in the United States by revenues. For fiscal year 2013, First Energy generated revenues of $14.9 billion. A mere $0.2 billion to $0.7 billion separate First Energy from Pacific Gas and Electric Company (PCG), American Electric Power (AEP), and NextEra Energy, Inc. (NEE), which form the fifth, sixth, and seventh largest power companies, respectively, by revenue.
First Energy forms 2.72% of the Utilities Select Sector Standard & Poors depositary receipt (or SPDR) (XLU).
Let’s analyze the business model of First Energy in detail in the next part of this series.