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As reported previously, on February 3, 2026, FirstEnergy PA filed its DSP VII Petition for the period beginning June 1, 2027.

The FirstEnergy PA Petition proposes major modifications to the structure and workings to current energy retail shopping and interplay with the utility’s default service program.

Among other things, FirstEnergy PA proposes to modify the consent requirement for customers taking electric service from an Electric Generation Supplier (EGS).

For example, under FirstEnergy PA’s petition proposes changes that would require EGSs to return residential customers to default service at the conclusion of their fixed duration contracts, unless that customer provides affirmative consent to remain with the EGS.

The utility also proposes a new requirement that residential customers must “provide an attestation of affirmative consent” every quarter to be served by variable-priced month-to-month products.

FirstEnergy PA also presents proposal to purportedly address abuses of its Purchase of Receivable (POR) program. Under FirstEnergy’s proposal would require that EGSs wanting to receive the benefits of consolidated billing, use “rate ready billing” and charge a rate that is at or below the PTC at the time of enrollment. FE PA argues that this will reduce FE PA’s and customers’ exposure to unreasonable and excessive EGS-driven write-offs.

PREHEARING MEMORANDUM – RETAIL ENERGY SUPPLY ASSOCIATION – “As explained in its Petition to Intervene, many RESA members are licensed to provide electric supply to retail customers in FirstEnergy’s service territory and will be specifically and substantially affected by the outcome of this proceeding, which may alter the terms and conditions under which EGSs provide service to retail end users.

Issues that RESA has preliminarily identified to be addressed in this proceeding include the following:

• FirstEnergy’s proposal that EGSs entering into new residential contracts after June 1, 2026 be required to return those customers to default service at the conclusion of the fixed duration contract term absent affirmative choice by the customer;
• The Company’s proposal that, effective June 1, 2027, EGSs be required to provide attestation of affirmative customer consent on a quarterly basis for all residential customers on variable-priced month-to-month products;
• Regarding the Purchase of Receivables (“POR”) program, FirstEnergy’s proposal that for all contracts entered into after June 1, 2027, EGSs on utility consolidated billing must use rate-ready billing and charge a rate that is at or below the Price to Compare (“PTC”) are the time of customer enrollment, otherwise the Company will not purchase the receivables of EGSs whose rates are not in compliance. FirstEnergy is also proposing to discontinue the current POR clawback mechanism and the Company’s standard offer customer referral program; {Emphasis added}
• FirstEnergy’s proposals regarding the wholesale default service supply process, such as shifting the responsibility for cost recovery of Network Integration Transmission Service (“NITS”) from wholesale default service suppliers to FirstEnergy only on behalf of default service customers; {Emphasis added}
• FirstEnergy’s requests for waivers of Commission regulations that, if granted, would allow FirstEnergy to deviate significantly from a number of regulatory standards that directly affect EGSs’ ability to provide service to retail customers in the Company’s service territory; and
• FirstEnergy’s other proposals regarding the rules and requirements for the procurement of wholesale default service supply.”

PREHEARING MEMORANDUM – WGL ENERGY – “The FirstEnergy DSP includes three proposals which, if enacted, would create a parallel regulatory framework for the residential retail electricity market in the First Energy territory that dramatically differs from the statewide framework that is codified in the Commission’s regulations. Specifically, FirstEnergy’s DSP includes the following proposals for its parallel regulatory framework:

1. FirstEnergy is proposing to unilaterally abolish automatic customer contract renewals and return customers to default service without authorization at the end of their contract term. FirstEnergy’s contract renewal proposal directly conflicts with the Commission’s well-established customer contract renewal regulations and prior Commission Orders.
2. FirstEnergy is seeking to unilaterally impose new ongoing customer consent requirements for month-to-month customer enrollments and impose new quarterly “certification” requirements on retail suppliers related to these consent requirements, neither of which are required by the Public Utility Code or the Commission’s regulations or orders. c. FirstEnergy is proposing to drastically limit the types of products that retail suppliers may offer in its service territory by requiring “bill-ready” billing, and by eliminating the eligibility for suppliers to participate in FirstEnergy’s purchase of receivables (“POR) program except for a limited category of products that FirstEnergy has self-selected.
3. WGLES’s preliminary review of the FirstEnergy DSP indicates a need for Commission action and determination on the following issues:

(a) Whether FirstEnergy may lawfully use a Default Service Proceeding to implement its own bespoke customer contract renewal processes and restrictions that directly conflict with Commission regulations that were promulgated via the formal rulemaking process. {Emphasis added}

(b) Whether FirstEnergy’s proposal to modify contract renewal procedures and unilaterally return customers to default service without consent violates the Public Utility Code and the Commission’s regulations and orders or is otherwise unlawful, unjust, unreasonable or contrary to public policy.

(c) Whether FirstEnergy may lawfully use a Default Service Proceeding to seek to implement new customer consent requirements and retail supplier certification requirements in its service territory.

(d) Whether FirstEnergy’ proposal to impose new customer consent requirements and retail supplier certification requirements violates the Public Utility Code and the Commission’s regulations and orders or is otherwise unlawful, unjust, unreasonable or contrary to public policy.

(e) Whether FirstEnergy may lawfully use a Default Service Proceeding to implement billing and POR modifications that would restrict the types of products that retail suppliers may offer in FirstEnergy’s service territory.

(f) Whether FirstEnergy’s proposal to implement billing and POR modifications that would restrict the types of products that retail suppliers may offer in FirstEnergy’s service territory violates the Public Utility Code and the Commission’s regulations and orders or is otherwise unlawful, unjust, unreasonable or contrary to public policy.

“WGLES’s position is that the proposals that FirstEnergy is making are drastic in nature and would have severe consequences for a wide range of stakeholders if enacted. Furthermore, FirstEnergy’s proposals differ so dramatically from the established statewide processes as codified in the Commission’s regulations that they should not be permitted to be considered in the context of a fast-tracked Default Service Proceeding. Instead, changes of the type that FirstEnergy is proposing should only be considered as part of a formal rulemaking process, that ensures that all interested and impacted parties are accorded the appropriate due process rights and protections. {Emphasis added.}

PREHEARING MEMORANDUM – DLC – “As indicated in its Petition for Intervention, recent price increases in the wholesale market have placed heightened awareness on customer affordability. FirstEnergy PA has proposed several modifications in its DSP that are matters of first impression for the Commission. Duquesne Light is concerned with these affordability issues related to shopping rule modifications and purchase of receivable requirements”

“Importantly, FirstEnergy PA’s default service schedule is on a different four-year cycle from all other major electric utilities. As such, issues raised for the first time in this proceeding will likely not be addressed by other utilities for an additional two years. Duquesne Light’s participation in this proceeding, at this time, will help to ensure that the Commission has a complete and timely record of the issues that are affecting all Pennsylvanians today.”

PREHEARING MEMORANDUM – SEIA AND CCSA – “Based on an initial review of FirstEnergy’s petition, the Joint Solar Advocates are deeply concerned that the proposed changes to FirstEnergy’s tariff unlawfully target customer-generators under the Act; will reduce compensation that certain net-metered customer-generators receive for excess generation; and will dramatically reduce investment and development of alternative energy sources (like solar photovoltaic) in FirstEnergy’s service territory. These resources are intended to comply with and contribute to achieving the Act’s purpose “to foster economic development and encourage reliance on more diverse and environmentally friendly sources of energy,” as the Commission has described.

Based on this initial review, the Joint Solar Advocates have identified the following issues:

1. Whether FirstEnergy’s DSP, which proposes tariff revisions designed to change the default service rate classification of certain customer-generators is just, reasonable, lawful, and nondiscriminatory.
2. Whether FirstEnergy’s proposed revision to the definition of maximum registered peak load in its tariff—to account for a customer’s net demand contribution impact to FirstEnergy’s default service procurement activity, as determined by the customer’s net power flow from or into the distribution or transmission system—is just, reasonable, lawful, and nondiscriminatory.
3. Whether certain of FirstEnergy’s proposed tariff and rate classifications with respect to customer-generators violate the Act, the Electricity Generation Customer Choice and Competition Act, 66 Pa.C.S. § 2814, et seq. and other provisions of the law and are unjust, unreasonable and not in the public interest.”

PREHEARING MEMORANDUM – SHIPLEY ENERGY AND INTERSTATE GAS – “The EGS Parties are at this time still formulating their positions on the issues presented by the DSP VII Petition. Based on preliminary review, the EGS Parties expect that potential issues will include, inter alia, the manner in which FE is proposing to conduct default service. In particular, FE has proposed a number of modifications to their provision of default service and to the manner in which EGS’s interact with FE and customers. These include the elimination of customer referral programs, and restrictions on renewal of customer contracts with EGSs that are contrary to prior Commission guidance, and which are not supported by law, and restrictions on POR participation that are discriminatory and likewise contrary to law. The EGS Parties reserve their right to address other issues as they deem appropriate.”

PREHEARING MEMORANDUM – WALMART INC – “Walmart is still evaluating FE PA’s DSP VII Petition and anticipates being informed by the record created in this case. At this preliminary stage, however, Walmart plans to pay careful attention to FE PA’s proposed criteria for determining if a non-residential default service customer is served under FE PA’s Price to Compare Default Service Rate Rider or Hourly Pricing Default Service Rate Rider. Walmart anticipates pursuing this issue during this proceeding and reserves the right to raise further issues and to respond to all matters raised by other parties.”

PREHEARING MEMORANDUM – INDUSTRIAL CUSTOMER GROUPS – “As users of substantial volumes of electricity in the Company’s service territory, the Industrial Customer Groups are in a unique position to comment to the Commission on the customer impact of the proposed DSP VII and the consequences for Large Commercial and Industrial (“C&I”) customers. The Industrial Customer Groups are concerned with issues regarding the terms and conditions of their members’ electricity service and, therefore, intend to examine issues related to the applicability of FE PA’s proposed DSP VII to Large C&I customers. The Industrial Customer Groups also reserve the right to raise further issues as necessary and appropriate during the course of this proceeding and to respond to issues raised by other parties.”

PREHEARING MEMORANDUM – OCA  – “Upon a preliminary analysis of the Company’s Petition, the OCA identified several significant issues that require further review. These issues include the following:

Procurement Methodology: The OCA will examine the type and variety of products that the Companies proposes to solicit to determine whether the proposal will provide the least cost over time for residential default service customers in accordance with the Commission’s regulations and Act 129. The OCA will also examine the Company’s procurement plan including the laddered fixed-price tranche structure, the mix of 12-, 24-, and 60-month contracts, and the continued use of contingency plans, to ensure compliance with Pennsylvania law and Commission regulations and to evaluate whether the structure appropriately balances cost, risk, price stability, and long-term customer impacts.

Supplier Master Agreement Modifications: The OCA will review the proposed modifications to the Supplier Master Agreement, including changes related to AEPS compliance responsibility, the removal of NITS charges from the auction product, the proposed pass-through of certain Department of Energy emergency order costs, and revisions to the CPP true-up process, to ensure compliance with Commission regulations and to confirm that the changes do not harm default service customers or the competitive retail market.

Rate Design: The OCA will review the Company’s rate design practices, including the continued use of flat per-kWh rates for residential and commercial customers, demand-based rates for industrial customers, and revised non-residential customer classifications based on demand and MRPL thresholds, to ensure appropriate allocation of costs and risk, minimize cross-subsidization, maintain a reliable and 9 competitive default service structure, and for compliance with the Commission’s regulations.

TOU Rates: The OCA will review the proposed TOU Rates, including the shortened on-peak window, consolidated rider multipliers, synchronized semi annualized adjustments, reconciliation methodology, and enrollment limitations, to ensure the program promotes fair pricing, effective load-shifting incentives, predictable cost recovery, and compliance with existing law and the Commission’s regulations.

Discontinuance of the SPVRC Rider: The OCA will review the proposed discontinuance of the SPVRC Rider to ensure that all legacy solar contract costs have been fully recovered, that no remaining obligations or liabilities remain, that eliminating the rider will not result in under-recovery or future surcharges to customers, and that removal is consistent with prior Commission approvals and Pennsylvania law.

Elimination of MISO and MTEP Exit Fees: The OCA will review the proposed elimination of the MISO and MTEP exit fees for the Penn Rate District to confirm that all costs associated with Penn Power’s transition from MISO to PJM have been fully recovered, that no residual liabilities remain, and that removing the fees will not result in under-recovery or future charges to customers.

Customer Referral Program: The OCA will review the proposed discontinuance of the CRP to determine whether ending the program appropriately reflects declining participation and limited customer engagement, prevents unnecessary charges to default service customers, and ensures that any remaining costs or obligations are properly accounted for and aligned with cost-causation principles.

Supplier Coordination Tariff Changes: The OCA will review the proposed supplier coordination tariff changes, including provisions affecting the return of customers to default service, modifications to POR eligibility, removal of mandatory POR for UCB, and updates to the POR Clawback Provision, to ensure the changes promote transparency, equitable risk allocation, strong consumer protections, and compliance with applicable law and Commission regulations.

PREHEARING MEMORANDUM – CAUSE-PA – “CAUSE-PA is actively investigating FE PA’s proposed DSP, and has preliminarily identified the following issues which affect its members:

1. Whether FE PA’s proposed energy procurement strategy will ensure that default service is available at the least cost over time to residential consumers who choose to remain on default service. (FE PA Pet. at ¶ 13);
2. Whether FE PA’s proposed Standard Offer Customer Referral Program (SOP) is appropriately designed to protect low income consumers from excessive pricing. (FE PA Pet. at 22-23);
3. Whether FE PA’s proposed implementation of a definition of maximum registered peak load (MRPL), and its proposal to apply the Hourly Pricing Default Service Rate Rider (HP Rider), are appropriately designed to protect low-income and small commercial consumers from unreasonable or unstable pricing. (FE PA Pet. ¶¶ 14, 32);
4. Whether FE PA’s proposal to continue its Time-of-Use (TOU) rates and programs, including the continued exemption of Customer Assistance Program (CAP) customers from TOU rates, is appropriately designed to protect low income consumers enrolled in CAP from excessive pricing and to ensure CAP remains cost-effective. (FE PA Pet. at 16);
5. Whether FE PA’s proposal to eliminate its Customer Referral Program (CRP) is appropriately designed to protect residential and low income consumers from excessive pricing. (FE PA Pet. at 48–49);
6. Whether FE PA’s proposed competitive market reforms are adequately designed to protect low income consumers from unfair marketing practices. (FE PA Pet. ¶¶ 50– 52);
7. Whether FE PA’s proposal to require EGSs to provide quarterly attestations of affirmative customer consent for residential customers on variable‑priced, month‑to‑month products is appropriately designed to protect low income consumers from unaffordable utility costs. (FE PA Pet. at ¶ 51); 4
8. Whether FE PA’s proposal to reform its purchase of receivables (POR) program, including limiting POR eligibility to EGSs using rate‑ready billing and charging a rate at or below the price‑to‑compare at the time of enrollment or rate change is appropriately designed to protect low income consumers from excessive pricing and mitigate uncollectible expense. (FE PA Pet. ¶ 55);
9. Whether an adjustment to FE PA’s maximum CAP credits is necessary to protect low income customers from excessive energy burdens given the significant increase in default service rates since FE PA’s prior DSP.

Review all comments here.