FirstEnergy (FE) Q2 FY26 earnings call: guidance and Q&A

What is the open capacity on the transmission system in West Virginia for data centers, and what is the incremental investment opportunity per gigawatt of new demand?

There is existing near-term capacity for early entrants (100-200 MW), with opportunities to build out for larger needs in later years. The company estimates about $250 million of investment for each gigawatt of capacity added.

“In the near term, we have some capacity. So if someone wants to add, say, a gigawatt of capacity we have the opportunity for people early in the queue to add maybe 100 or 200 megawatts in the near term and then the opportunity to build into remaining 900 or 800 [ megawatts ] that we have. So there is existing capacity for people who are in that queue and we've contracted with. And then in the later years, we have the opportunity to build out to meet that need. As we talked about before, we think there's, on average, about $250 million of investment for each gigawatt of capacity that we add, and that's in play here as well.”

asked by Shahriar Pourreza · answered by Brian Tierney

Why file a rate case now in New Jersey given potential BPU scrutiny and changes to cost of capital, and what is the company's view on the regulatory environment?

The company does not anticipate trouble, finding the BPU and administration collaborative. They have invested significantly in reliability, increasing it by 16% ('24-'25) and 38% (YTD '25-'26), and need to seek recovery for these investments. The BPU's Phase 1 report is a menu of options, and the company will comment on it.

“I think we found the commission there and the administration to be much more collaborative than prior rhetoric might have led people to believe. And the first part of the study that came out in New Jersey was kind of a menu of things that are available to the commission and they're asking for comments on that in Phase II. And I just think that whether they do some form of market -- performance-based rate making or something like that. We don't view it's going to be not constructive in New Jersey.”

asked by Shahriar Pourreza · answered by Brian Tierney

What would be the regulatory process for a Genco type structure in West Virginia, and how would it differ from the current CPCN process?

A Genco would likely require FERC approval for wholesale sales and West Virginia PSC approval for the contract between the Genco and Mon Power. This process is expected to be considerably faster than a traditional CPCN, benefiting speed to power.

“If we created a Genco, that would obviously require, I think, FERC approval to sell at wholesale. But then the contract between the Genco and Mon Power, for instance, would need to be approved by the West Virginia Public Service Commission. But I think that process would be considerably faster than the traditional CPCN process, and that would be a benefit to getting speed to power quicker.”

asked by Nicholas Campanella · answered by Brian Tierney

How did the hearings for the Maidsville Energy Center CPCN go, particularly regarding the gas vs. coal debate, and what is the confidence level for approval?

The hearings went very well, laying out the need for the plant. Opposition from coal was expected but the plant is additive, not a replacement. The company is confident in a positive order given the supportive executive and commission's understanding of the need for new generation.

“I think the hearings went very well. I think our witnesses laid out very well the need for the plant Remember, the expedited schedule that we requested was granted. So I think there's some urgency on the state of the -- on the part of the commission to get this properly vetted, properly looked at and properly ordered on.”

asked by Carly Davenport · answered by Brian Tierney

Will new CapEx for the West Virginia gas plant and transmission be incremental or reallocated from other jurisdictions? What is the outlook for CapEx in Pennsylvania?

The West Virginia gas plant CapEx will be incremental to the current $36 billion plan. In Pennsylvania, the company is operating under a recent rate case and utilizing the LTIP DISC program for 66% of current CapEx. They would only move capital if negative recovery is experienced, which is not anticipated.

“If the plant is approved as we expected, will be incremental to the CapEx plan. and that will be in the updated period that we'll be updating for. So that's new CapEx that's not in the current $36 billion plan. In regards to Pennsylvania. So today, we're operating in a rate -- base rate environment that went into place 1/1 25. So we've recently been in for a rate case there. We are spending 66% of our CapEx this year is under the LTIP with this recovery for that.”

asked by Andrew Weisel · answered by Brian Tierney

How much of the investment associated with the 6.4 GW contracted data center demand is outside the $36 billion plan, and what are the milestones for incorporating this into the capital plan?

Approximately $400 million related to the 2.2 GW contracted since Q1 is outside the plan, mostly falling in 2030-2032. Once demand is contracted, plans are shared with PJM at TEAC meetings and incorporated into the annual RTEP process if a regional solution is needed; otherwise, upgrades are handled internally.

“There's probably about $400 million that's outside of the plan. So that's related to the 2.2 gigawatts that we contracted since Q1. Most of that will fall in the 30, 31 and 32 period.”

asked by Nicolas Woods · answered by K. Taylor