FirstEnergy's Cross-State Crews Make Headway in Storm Recovery—But Risks Remain

The severe storms that battered Pennsylvania and West Virginia in late April 2025 left over 430,000 FirstEnergy (FE) customers without power. Now, with crews from 18 states working around the clock, progress has been made—but lingering challenges and regulatory risks still cloud the utility’s outlook.

Progress on the Ground

By May 3, 2025, FirstEnergy had restored power to 87% of customers affected by the storms, with approximately 150,000 remaining without service. Subsidiary-specific updates reveal uneven recovery timelines:

• Mon Power (West Virginia): 96% of 36,300 affected customers have been restored, with final outages expected by May 2.
• Penn Power (Pennsylvania): 96% of 13,600 customers are back online, with 500 remaining outages to be resolved by May 3.
• Penelec (Pennsylvania): 92% of 124,200 customers are restored, but 9,600—primarily in rural areas—face delays until May 4–5.
• West Penn Power (Pennsylvania): The hardest-hit subsidiary, with 197,000 customers affected, has restored only 79%, leaving 41,250 customers in the dark. Key areas like Armstrong and Westmoreland counties face ETRs as late as May 5.

The delays stem from both weather and infrastructure challenges. Straight-line winds up to 120 mph in Cambria County caused widespread damage to utility poles, substations, and service drops (wires connecting homes to power lines). A subsequent storm on May 1 with 40–50 mph winds further hampered repairs, as crews cannot operate safely in high winds.

The Financial and Regulatory Tightrope

While the immediate crisis is manageable, FirstEnergy’s broader risks remain in focus:

1. Q1 2025 Results: FirstEnergy reported core earnings of $0.67 per share, a 37% increase from 2024, driven by rate hikes in Pennsylvania and West Virginia. The company reaffirmed its 2025 guidance of $2.40–$2.60 per share.
2. Infrastructure Costs: The storms highlight the need for grid modernization. FirstEnergy’s $28 billion Energize365 plan, aimed at hardening infrastructure against extreme weather, will be critical to avoiding similar outages.
3. Regulatory Headwinds:
4. The lingering Ohio HB 6 scandal continues to drain resources, with $0.03 per share in annual costs.
5. Environmental liabilities from retired coal plants add another $0.05 per share annually.

Why Investors Should Care

The stock trades at a 15.3x trailing P/E ratio—below peers like Dominion Energy (D) at 23x—reflecting market skepticism about these risks. However, FirstEnergy’s rate base growth (+6–8% annually through 2029) and regulated utility model provide a defensive profile.

Conclusion: Progress, but Prudence Advised

FirstEnergy’s cross-state crews are on track to restore most customers by May 5, but the path ahead is fraught with risks. Investors should weigh the utility’s strong Q1 results and infrastructure plans against unresolved legal costs and climate-related threats. While the stock’s valuation offers some safety margin, the company’s ability to execute on grid modernization and resolve regulatory issues will be the ultimate test.

For now, the storm recovery is a success—if crews can navigate the final hurdles. But as FirstEnergy’s CEO noted, “This is the second-worst storm in a decade.” In an era of intensifying climate volatility, the utility’s long-term resilience hinges on more than just today’s outages.

Data as of May 3, 2025. FirstEnergy stock price and P/E ratio sourced from Yahoo Finance.