FAIRMONT, W.Va. - Mon Power, a subsidiary of FirstEnergy Corp. (NYSE: NYSE:FE), has been granted $5 million in federal funding to enhance electric service reliability for over 3,000 customers in rural West Virginia. The U.S. Department of Energy's Office of Clean Energy Demonstrations (OCED) awarded the funding through the Energy Improvements in Rural or Remote Areas (ERA) program, part of the Bipartisan Infrastructure Law.
The investment will fund the reconstruction of over 23 miles of power lines across Pocahontas, Braxton, and Clay counties, and the connection of a two-mile backup power line to a substation in Petersburg, Grant County. This initiative is aimed at improving service stability and reducing the frequency and duration of power outages by providing an alternative power feed during repairs.
Jim Myers, Vice President of FirstEnergy's West Virginia Operations, expressed gratitude for the federal support and emphasized the project's significance for enhancing customer experience in the targeted rural areas. Mon Power's proposal, submitted in 2023, was one of 19 selected community-led projects to develop sustainable clean energy solutions or expand reliable energy access in rural and remote communities across the United States.
Construction on the project is slated to begin in 2025. Mon Power has been proactive in engaging with local and state agencies, nonprofit organizations, and the community to gather input and update plans. The company also aims to collaborate with community-based organizations to bridge workforce disparity gaps in historically underserved communities.
Mon Power provides electricity to approximately 395,000 customers in 34 counties in West Virginia, while its sister company, Potomac Edison, serves customers in Maryland and the Eastern Panhandle of West Virginia. FirstEnergy, the parent company, operates one of the nation's largest investor-owned electric systems, with a customer base of over six million in the Midwest and Mid-Atlantic regions.
This funding initiative is part of FirstEnergy's commitment to operational excellence, with a focus on safety, reliability, and integrity. The information for this report is based on a press release statement from FirstEnergy Corp.
In other recent news, FirstEnergy Corp. has experienced a series of significant developments. The company has reported a 9% increase in revenue and a 19% increase in operating earnings for the second quarter of 2024, reaching $0.56 per share. This is a marked improvement from $0.47 per share in the same quarter of 2023.
The utility company has also successfully navigated several legal and regulatory challenges. It has reached settlements with both state prosecutors and the Securities and Exchange Commission (SEC), incorporating a $100 million civil penalty. Additionally, FirstEnergy has settled all pending disputes with the Ohio Attorney General and the Summit County Prosecutor's Office.
Analysts have responded to these developments with optimism. Argus has upgraded FirstEnergy's stock from Hold to Buy, setting a new price target of $50.00. Meanwhile, Scotiabank has maintained its Sector Perform rating for the company, expressing confidence in its fundamental outlook.
FirstEnergy's management has also taken proactive steps to improve the company's financial position, implementing two recent dividend hikes. The company's ongoing Energize365 capital investment program and ongoing regulatory proceedings in Ohio, Pennsylvania, and New Jersey are also noteworthy recent developments.
FirstEnergy has reaffirmed its 2024 operating earnings guidance of $2.61 to $2.81 per share, demonstrating confidence in its future earnings growth.
InvestingPro Insights
FirstEnergy Corp. (NYSE: FE) has demonstrated its commitment to improving infrastructure and service reliability through its subsidiary Mon Power's recent $5 million federal funding award. This investment aligns with the company's broader financial and operational strategies, as reflected in recent InvestingPro data.
According to InvestingPro, FirstEnergy has a market capitalization of $24.63 billion, indicating its significant presence in the utility sector. The company's revenue for the last twelve months as of Q2 2024 stood at $13.02 billion, with a modest growth of 2.5% over the same period. This steady revenue stream supports FirstEnergy's ability to invest in long-term projects like the rural electrification improvements in West Virginia.
An InvestingPro Tip highlights that FirstEnergy "has maintained dividend payments for 27 consecutive years," underscoring the company's financial stability and commitment to shareholder returns. This consistent dividend history is particularly relevant in the context of utility companies, which are often favored by income-seeking investors. The current dividend yield of 4.02% further enhances the stock's appeal for such investors.
Another InvestingPro Tip notes that the stock "generally trades with low price volatility," which may be attractive to risk-averse investors looking for stable utility investments. This characteristic is particularly pertinent given the company's focus on long-term infrastructure projects that require stable financial planning.
For investors interested in a deeper analysis, InvestingPro offers additional tips and metrics that could provide valuable insights into FirstEnergy's financial health and market position. The platform lists 7 more tips for FE, which could be crucial for making informed investment decisions in the utility sector.
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