NEW YORK (Reuters) - FirstEnergy Corp said late on Saturday its nuclear and coal power plant units filed for bankruptcy court protection as the company looks to restructure, sell assets and win government support to cope with competitors using lower-cost natural gas.
The Chapter 11 filing was made by FirstEnergy Solutions and FirstEnergy Nuclear Operating Co. The companies said they have over $550 million in cash and “sufficient liquidity to continue normal operations” while restructuring.
The company’s chief executive signaled earlier this year that FirstEnergy Solutions was headed for bankruptcy protection..
The legal move came after FirstEnergy urged the federal government on Thursday to evoke little-used emergency powers to help it keep several struggling nuclear and coal-fired power plants open, a move critics described as an appeal for a corporate bailout.
On Wednesday, Ohio-based FirstEnergy said it would shut several nuclear plants in Ohio and Pennsylvania in the next three years without some kind of state or federal relief. In November 2017 the company had said it would exit the competitive, non-regulated power generation business.
The units in bankruptcy operate three nuclear power plants, two coal-fired plants, one gas-and-oil plant and one pet-coke plant.
FirstEnergy has sought government relief by calling on U.S. Energy Secretary Rick Perry to use the emergency powers to order PJM Interconnection, the regional power grid operator, to negotiate a contract that would compensate owners of coal and nuclear plants for providing reliable power and jobs.
Coal and nuclear power plant operators have struggled in recent years because of low natural gas prices delivered by the shale boom.
“The Chapter 11 filing represents our best path forward as we continue to pursue opportunities for restructuring, asset sales and legislative and regulatory relief,” Donald Schneider, president of FirstEnergy Solutions, said in announcing the filing.
Reporting by David Henry in New York; Editing by Bill Rigby