|
Commission
|
|
Registrant; State of Incorporation;
|
|
I.R.S. Employer
|
File Number
|
|
Address; and Telephone Number
|
|
Identification No.
|
|
|
|
|
|
333-21011
|
|
FIRSTENERGY CORP.
|
|
34-1843785
|
|
|
(An Ohio Corporation)
|
|
|
|
|
76 South Main Street
|
|
|
|
|
Akron, OH 44308
|
|
|
|
|
Telephone (800)736
-
3402
|
|
|
|
|
|
|
|
000-53742
|
|
FIRSTENERGY SOLUTIONS CORP.
|
|
31-1560186
|
|
|
(An Ohio Corporation)
|
|
|
|
|
c/o FirstEnergy Corp.
|
|
|
|
|
76 South Main Street
|
|
|
|
|
Akron, OH 44308
|
|
|
|
|
Telephone (800)736-3402
|
|
|
Registrant
|
|
Title of Each Class
|
|
Name of Each Exchange
on Which Registered
|
|
|
|
|
|
FirstEnergy Corp.
|
|
Common Stock, $0.10 par value
|
|
New York Stock Exchange
|
Registrant
|
|
Title of Each Class
|
|
|
|
FirstEnergy Solutions Corp.
|
|
Common Stock, no par value per share
|
Yes
þ
No
o
|
|
FirstEnergy Corp.
|
Yes
o
No
þ
|
|
FirstEnergy Solutions Corp.
|
Yes
o
No
þ
|
|
FirstEnergy Corp. and FirstEnergy Solutions Corp.
|
Yes
þ
No
o
|
|
FirstEnergy Corp. and FirstEnergy Solutions Corp.
|
Yes
þ
No
o
|
|
FirstEnergy Corp. and FirstEnergy Solutions Corp.
|
o
|
|
FirstEnergy Corp.
|
o
|
|
FirstEnergy Solutions Corp.
|
Large Accelerated Filer
þ
|
FirstEnergy Corp.
|
|
|
Accelerated Filer
o
|
N/A
|
|
|
Non-accelerated Filer (Do not check
if a smaller reporting company) þ |
FirstEnergy Solutions Corp.
|
|
|
Smaller Reporting Company
o
|
N/A
|
Yes
o
No
þ
|
|
FirstEnergy Corp. and FirstEnergy Solutions Corp.
|
|
|
OUTSTANDING
|
|
CLASS
|
|
AS OF JANUARY 31, 2016
|
|
FirstEnergy Corp., $0.10 par value
|
|
423,650,645
|
|
FirstEnergy Solutions Corp., no par value
|
|
7
|
|
|
|
PART OF FORM 10-K INTO WHICH
|
DOCUMENT
|
|
DOCUMENT IS INCORPORATED
|
|
|
|
Proxy Statement for 2016 Annual Meeting of Shareholders to be held May 17, 2016
|
|
Parts II and III
|
|
TABLE OF CONTENTS
|
|
|
Page
|
|
|
|
|
Part I.
|
|
|
|
Item 1. Business
|
|
|
|
Maryland Regulatory Matters
|
|
West Virginia Regulatory Matters
|
|
FirstEnergy Web
site and Other Social Media Sites and Applications
|
|
|
|
|
|
|
|
|
|
|
|
Item 4.
Mine Safety Disclosures
|
|
|
|
|
|
|
|
|
|
Item 7. Management’s Discussion and Analysis of
Financial Condition and Results of Operations
|
|
|
|
AE
|
Allegheny Energy, Inc., a Maryland utility holding company that merged with a subsidiary of FirstEnergy on February 25, 2011, which subsequently merged with and into FE on January 1, 2014
|
AESC
|
Allegheny Energy Service Corporation, which provided legal, financial and other corporate support services to the former AE subsidiaries
|
AE Supply
|
Allegheny Energy Supply Company, LLC, an unregulated generation subsidiary
|
AGC
|
Allegheny Generating Company, a generation subsidiary of AE Supply and equity method investee of MP
|
ATSI
|
American Transmission Systems, Incorporated, formerly a direct subsidiary of FE that became a subsidiary of FET in April 2012, which owns and operates transmission facilities
|
Buchanan Energy
|
Buchanan Energy Company of Virginia, LLC, a subsidiary of AE Supply
|
Buchanan Generation
|
Buchanan Generation, LLC, a joint venture between AE Supply and CNX Gas Corporation
|
CEI
|
The Cleveland Electric Illuminating Company, an Ohio electric utility operating subsidiary
|
CES
|
Competitive Energy Services, a reportable operating segment of FirstEnergy
|
FE
|
FirstEnergy Corp., a public utility holding company
|
FELHC
|
FELHC, Inc.
|
FENOC
|
FirstEnergy Nuclear Operating Company, which operates nuclear generating facilities
|
FES
|
FirstEnergy Solutions Corp., which provides energy-related products and services
|
FESC
|
FirstEnergy Service Company, which provides legal, financial and other corporate support services
|
FET
|
FirstEnergy Transmission, LLC, formerly known as Allegheny Energy Transmission, LLC, which is the parent of ATSI and TrAIL and has a joint venture in PATH
|
FEV
|
FirstEnergy Ventures Corp., which invests in certain unregulated enterprises and business ventures
|
FG
|
FirstEnergy Generation, LLC, a wholly-owned subsidiary of FES, which owns and operates non-nuclear generating facilities
|
FGMUC
|
FirstEnergy Generation Mansfield Unit 1 Corp., a wholly-owned subsidiary of FG, which owns various leasehold interests in Bruce Mansfield Unit 1
|
FirstEnergy
|
FirstEnergy Corp., together with its consolidated subsidiaries
|
Global Holding
|
Global Mining Holding Company, LLC, a joint venture between FEV, WMB Marketing Ventures, LLC and Pinesdale LLC
|
Global Rail
|
Global Rail Group, LLC, a subsidiary of Global Holding that owns coal transportation operations near Roundup, Montana
|
GPU
|
GPU, Inc., former parent of JCP&L, ME and PN, that merged with FE on November 7, 2001
|
Green Valley
|
Green Valley Hydro, LLC, which owned hydro generating stations
|
JCP&L
|
Jersey Central Power & Light Company, a New Jersey electric utility operating subsidiary
|
MAIT
|
Mid-Atlantic Interstate Transmission, LLC, a subsidiary of FET, formed to own and operate transmission facilities
|
ME
|
Metropolitan Edison Company, a Pennsylvania electric utility operating subsidiary
|
MP
|
Monongahela Power Company, a West Virginia electric utility operating subsidiary
|
NG
|
FirstEnergy Nuclear Generation, LLC, a subsidiary of FES, which owns nuclear generating facilities
|
OE
|
Ohio Edison Company, an Ohio electric utility operating subsidiary
|
Ohio Companies
|
CEI, OE and TE
|
PATH
|
Potomac-Appalachian Transmission Highline, LLC, a joint venture between FE and a subsidiary of AEP
|
PATH-Allegheny
|
PATH Allegheny Transmission Company, LLC
|
PATH-WV
|
PATH West Virginia Transmission Company, LLC
|
PE
|
The Potomac Edison Company, a Maryland and West Virginia electric utility operating subsidiary
|
Penn
|
Pennsylvania Power Company, a Pennsylvania electric utility operating subsidiary of OE
|
Pennsylvania Companies
|
ME, PN, Penn and WP
|
PN
|
Pennsylvania Electric Company, a Pennsylvania electric utility operating subsidiary
|
PNBV
|
PNBV Capital Trust, a special purpose entity created by OE in 1996
|
Shippingport
|
Shippingport Capital Trust, a special purpose entity created by CEI and TE in 1997
|
Signal Peak
|
Signal Peak Energy, LLC, an indirect subsidiary of Global Holding that owns mining operations near Roundup, Montana
|
TE
|
The Toledo Edison Company, an Ohio electric utility operating subsidiary
|
TrAIL
|
Trans-Allegheny Interstate Line Company, a subsidiary of FET, which owns and operates transmission facilities
|
Utilities
|
OE, CEI, TE, Penn, JCP&L, ME, PN, MP, PE and WP
|
WP
|
West Penn Power Company, a Pennsylvania electric utility operating subsidiary
|
GLOSSARY OF TERMS,
Continued
|
|
|
|
The following abbreviations and acronyms are used to identify frequently used terms in this report:
|
|
AAA
|
American Arbitration Association
|
AEP
|
American Electric Power Company, Inc.
|
AFS
|
Available-for-sale
|
AFUDC
|
Allowance for Funds Used During Construction
|
ALJ
|
Administrative Law Judge
|
AMT
|
Alternative Minimum Tax
|
AOCI
|
Accumulated Other Comprehensive Income
|
Apple®
|
Apple®, iPad® and iPhone® are registered trademarks of Apple Inc.
|
ARO
|
Asset Retirement Obligation
|
ARR
|
Auction Revenue Right
|
ASLB
|
Atomic Safety and Licensing Board
|
ASU
|
Accounting Standards Update
|
BGS
|
Basic Generation Service
|
BNSF
|
BNSF Railway Company
|
BRA
|
PJM RPM Base Residual Auction
|
CAA
|
Clean Air Act
|
CBA
|
Collective Bargaining Agreement
|
CCR
|
Coal Combustion Residuals
|
CDWR
|
California Department of Water Resources
|
CERCLA
|
Comprehensive Environmental Response, Compensation, and Liability Act of 1980
|
CFL
|
Compact Fluorescent Light
|
CFR
|
Code of Federal Regulations
|
CFTC
|
Commodity Futures Trading Commission
|
CO
2
|
Carbon Dioxide
|
CONE
|
Cost-of-New-Entry
|
CPP
|
EPA's Clean Power Plan
|
CSAPR
|
Cross-State Air Pollution Rule
|
CSX
|
CSX Transportation, Inc.
|
CTA
|
Consolidated Tax Adjustment
|
CWA
|
Clean Water Act
|
DCPD
|
Deferred Compensation Plan for Outside Directors
|
DCR
|
Delivery Capital Recovery
|
DOE
|
United States Department of Energy
|
DR
|
Demand Response
|
DSIC
|
Distribution System Improvement Charge
|
DSP
|
Default Service Plan
|
EDC
|
Electric Distribution Company
|
EDCP
|
Executive Deferred Compensation Plan
|
EE&C
|
Energy Efficiency and Conservation
|
EGS
|
Electric Generation Supplier
|
ELPC
|
Environmental Law & Policy Center
|
EMAAC
|
Eastern Mid-Atlantic Area Council of PJM
|
EmPOWER Maryland
|
EmPOWER Maryland Energy Efficiency Act
|
ENEC
|
Expanded Net Energy Cost
|
EPA
|
United States Environmental Protection Agency
|
EPRI
|
Electric Power Research Institute
|
ERO
|
Electric Reliability Organization
|
ESOP
|
Employee Stock Ownership Plan
|
ESP
|
Electric Security Plan
|
GLOSSARY OF TERMS,
Continued
|
|
ESTIP
|
Executive Short-Term Incentive Program
|
Facebook®
|
Facebook is a registered trademark of Facebook, Inc.
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
Fitch
|
Fitch Ratings
|
FMB
|
First Mortgage Bond
|
FPA
|
Federal Power Act
|
FTR
|
Financial Transmission Right
|
GAAP
|
Accounting Principles Generally Accepted in the United States of America
|
GHG
|
Greenhouse Gases
|
GWH
|
Gigawatt-hour
|
HCl
|
HydroChloric Acid
|
IBEW
|
International Brotherhood of Electrical Workers
|
ICE
|
IntercontinentalExchange, Inc.
|
ICP 2007
|
FirstEnergy Corp. 2007 Incentive Plan
|
ICP 2015
|
FirstEnergy Corp. 2015 Incentive Compensation Plan
|
IRS
|
Internal Revenue Service
|
ISO
|
Independent System Operator
|
kV
|
Kilovolt
|
KWH
|
Kilowatt-hour
|
KPI
|
Key Performance Indicator
|
LBR
|
Little Blue Run
|
LCAPP
|
Long-Term Capacity Agreement Pilot Program
|
LED
|
Light Emitting Diode
|
LMP
|
Locational Marginal Price
|
LOC
|
Letter of Credit
|
LSE
|
Load Serving Entity
|
LTIIPs
|
Long-Term Infrastructure Improvement Plans
|
MAAC
|
Mid-Atlantic Area Council of PJM
|
MATS
|
Mercury and Air Toxics Standards
|
MDPSC
|
Maryland Public Service Commission
|
MISO
|
Midcontinent Independent System Operator, Inc.
|
MLP
|
Master Limited Partnership
|
mmBTU
|
One Million British Thermal Units
|
Moody’s
|
Moody’s Investors Service, Inc.
|
MVP
|
Multi-Value Project
|
MW
|
Megawatt
|
MWD
|
Megawatt-day
|
MWH
|
Megawatt-hour
|
NAAQS
|
National Ambient Air Quality Standards
|
NDT
|
Nuclear Decommissioning Trust
|
NEIL
|
Nuclear Electric Insurance Limited
|
NERC
|
North American Electric Reliability Corporation
|
NGO
|
Non-Governmental Organization
|
Ninth Circuit
|
United States Court of Appeals for the Ninth Circuit
|
NJBPU
|
New Jersey Board of Public Utilities
|
NMB
|
Non-Market Based
|
NOL
|
Net Operating Loss
|
NOV
|
Notice of Violation
|
NOx
|
Nitrogen Oxide
|
NPDES
|
National Pollutant Discharge Elimination System
|
GLOSSARY OF TERMS,
Continued
|
|
NPNS
|
Normal Purchases and Normal Sales
|
NRC
|
Nuclear Regulatory Commission
|
NRG
|
NRG Energy, Inc.
|
NSR
|
New Source Review
|
NUG
|
Non-Utility Generation
|
NYISO
|
New York Independent System Operator
|
NYPSC
|
New York State Public Service Commission
|
OCA
|
Office of Consumer Advocate
|
OCC
|
Ohio Consumers' Counsel
|
OEPA
|
Ohio Environmental Protection Agency
|
OPEB
|
Other Post-Employment Benefits
|
OPEIU
|
Office and Professional Employees International Union
|
OTC
|
Over The Counter
|
OTTI
|
Other-Than-Temporary Impairments
|
OVEC
|
Ohio Valley Electric Corporation
|
PA DEP
|
Pennsylvania Department of Environmental Protection
|
PCB
|
Polychlorinated Biphenyl
|
PCRB
|
Pollution Control Revenue Bond
|
PJM
|
PJM Interconnection, L.L.C.
|
PJM Region
|
The aggregate of the zones within PJM
|
PJM Tariff
|
PJM Open Access Transmission Tariff
|
PM
|
Particulate Matter
|
POLR
|
Provider of Last Resort
|
POR
|
Purchase of Receivables
|
PPA
|
Purchase Power Agreement
|
PPB
|
Parts per Billion
|
PPUC
|
Pennsylvania Public Utility Commission
|
PSA
|
Power Supply Agreement
|
PSD
|
Prevention of Significant Deterioration
|
PTC
|
Price-to-Compare
|
PUCO
|
Public Utilities Commission of Ohio
|
PURPA
|
Public Utility Regulatory Policies Act of 1978
|
R&D
|
Research and Development
|
RCRA
|
Resource Conservation and Recovery Act
|
REC
|
Renewable Energy Credit
|
Regulation FD
|
Regulation Fair Disclosure promulgated by the SEC
|
REIT
|
Real Estate Investment Trust
|
RFC
|
Reliability
First
Corporation
|
RFP
|
Request for Proposal
|
RGGI
|
Regional Greenhouse Gas Initiative
|
RMR
|
Reliability Must-Run
|
ROE
|
Return on Equity
|
RPM
|
Reliability Pricing Model
|
RRS
|
Retail Rate Stability
|
RSS
|
Rich Site Summary
|
RTEP
|
Regional Transmission Expansion Plan
|
RTO
|
Regional Transmission Organization
|
S&P
|
Standard & Poor’s Ratings Service
|
SAIDI
|
System Average Interruption Duration Index
|
SAIFI
|
System Average Interruption Frequency Index
|
SB221
|
Amended Substitute Senate Bill No. 221
|
GLOSSARY OF TERMS,
Continued
|
|
SB310
|
Substitute Senate Bill No. 310
|
SBC
|
Societal Benefits Charge
|
SEC
|
United States Securities and Exchange Commission
|
SERTP
|
Southeastern Regional Transmission Planning
|
Seventh Circuit
|
United States Court of Appeals for the Seventh Circuit
|
SF
6
|
Sulfur Hexafluoride
|
SIP
|
State Implementation Plan(s) Under the Clean Air Act
|
SO
2
|
Sulfur Dioxide
|
SOS
|
Standard Offer Service
|
SPE
|
Special Purpose Entity
|
SREC
|
Solar Renewable Energy Credit
|
SSO
|
Standard Service Offer
|
TDS
|
Total Dissolved Solid
|
TMI-2
|
Three Mile Island Unit 2
|
TO
|
Transmission Owner
|
TTS
|
Temporary Transaction Surcharge
|
Twitter®
|
Twitter is a registered trademark of Twitter, Inc.
|
U.S. Court of Appeals for the D.C. Circuit
|
United States Court of Appeals for the District of Columbia Circuit
|
UWUA
|
Utility Workers Union of America
|
VIE
|
Variable Interest Entity
|
VRR
|
Variable Resource Requirement
|
VSCC
|
Virginia State Corporation Commission
|
WVDEP
|
West Virginia Department of Environmental Protection
|
WVPSC
|
Public Service Commission of West Virginia
|
ITEM 1.
|
BUSINESS
|
•
|
A base distribution rate freeze through May 31, 2016;
|
•
|
Collection of lost distribution revenues associated with energy efficiency and peak demand reduction programs;
|
•
|
Economic development and assistance to low-income customers for the
two
-year plan period at levels established in the prior ESP;
|
•
|
A
6%
generation rate discount to certain low income customers provided by the Ohio Companies through a bilateral wholesale contract with FES (FES is one of the wholesale suppliers to the Ohio Companies);
|
•
|
A requirement to provide power to non-shopping customers at a market-based price set through an auction process;
|
•
|
Rider DCR that allows continued investment in the distribution system for the benefit of customers;
|
•
|
A commitment not to recover from retail customers certain costs related to transmission cost allocations for the longer of the five-year period from June 1, 2011 through May 31, 2016 or when the amount of costs avoided by customers for certain types of products totals $360 million, subject to the outcome of certain FERC proceedings;
|
•
|
Securing generation supply for a longer period of time by conducting an auction for a
three
-year period rather than a
one
-year period, in each of October 2012 and January 2013, to mitigate any potential price spikes for the Ohio Companies' utility customers who do not switch to a competitive generation supplier; and
|
•
|
Extending the recovery period for costs associated with purchasing RECs mandated by SB221, Ohio's renewable energy and energy efficiency standard, through the end of the new ESP 3 period. This is expected to initially reduce the monthly renewable energy charge for all non-shopping utility customers of the Ohio Companies by spreading out the costs over the entire ESP period.
|
•
|
An
eight
-year term (June 1, 2016 - May 31, 2024);
|
•
|
Contemplates continuing a base distribution rate freeze through May 31, 2024;
|
•
|
An Economic Stability Program that flows through charges or credits through Rider RRS representing the net result of the price paid to FES through a proposed
eight
-year FERC-jurisdictional PPA for the output of the Sammis and Davis-Besse plants and FES’ share of OVEC against the revenues received from selling such output into the PJM markets over the same period, subject to the PUCO’s termination of Rider RRS charges/credits associated with any plants or units that may be sold or transferred;
|
•
|
Continuing to provide power to non-shopping customers at a market-based price set through an auction process;
|
•
|
Continuing Rider DCR with increased revenue caps of approximately
$30 million
per year from June 1, 2016 through May 31, 2019;
$20 million
per year from June 1, 2019 through May 31, 2022; and
$15 million
per year from June 1, 2022 through May 31, 2024 that supports continued investment related to the distribution system for the benefit of customers;
|
•
|
Collection of lost distribution revenues associated with energy efficiency and peak demand reduction programs;
|
•
|
A risk-sharing mechanism that would provide guaranteed credits under Rider RRS in years five through eight to customers as follows: $10 million in year five, $20 million in year six, $30 million in year seven and $40 million in year eight;
|
•
|
A continuing commitment not to recover from retail customers certain costs related to transmission cost allocations for the longer of the five-year period from June 1, 2011 through May 31, 2016 or when the amount of such costs avoided by customers for certain types of products totals $360 million, including such costs from MISO along with such costs from PJM, subject to the outcome of certain FERC proceedings;
|
•
|
Potential procurement of
100
MW of new Ohio wind or solar resources subject to a demonstrated need to procure new renewable energy resources as part of a strategy to further diversify Ohio's energy portfolio;
|
•
|
An agreement to file a case with the PUCO by April 3, 2017, seeking to transition to decoupled base rates for residential customers;
|
•
|
An agreement to file by February 29, 2016, a Grid Modernization Business Plan for PUCO consideration and approval;
|
•
|
A contribution of $3 million per year ($24 million over the eight year term) to fund energy conservation programs, economic development and job retention in the Ohio Companies service territory;
|
•
|
Contributions of $2.4 million per year ($19 million over the eight year term) to fund a fuel-fund in each of the Ohio Companies service territories to assist low-income customers; and
|
•
|
A contribution of $1 million per year ($8 million over the eight year term) to establish a Customary Advisory Council to ensure preservation and growth of the competitive market in Ohio.
|
|
2016 - 2017
|
|
2017 - 2018
|
|
2018 - 2019*
|
||||||||||||||||||
|
Legacy Obligation
|
|
Capacity Performance
|
|
Legacy Obligation
|
|
Capacity Performance
|
|
Base Generation
|
|
Capacity Performance
|
||||||||||||
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
ATSI
|
2,765
|
|
$114.23
|
|
4,210
|
|
$134.00
|
|
375
|
|
$120.00
|
|
6,245
|
|
$151.50
|
|
—
|
|
$149.98
|
|
6,245
|
|
$164.77
|
RTO
|
875
|
|
$59.37
|
|
3,675
|
|
$134.00
|
|
985
|
|
$120.00
|
|
3,565
|
|
$151.50
|
|
240
|
|
$149.98
|
|
3,930
|
|
$164.77
|
All Other Zones
|
135
|
|
$119.13
|
|
—
|
|
$134.00
|
|
150
|
|
$120.00
|
|
—
|
|
$151.50
|
|
35
|
|
**
|
|
20
|
|
**
|
|
3,775
|
|
|
|
7,885
|
|
|
|
1,510
|
|
|
|
9,810
|
|
|
|
275
|
|
|
|
10,195
|
|
|
Operating Company
|
|
2015 Actual
(1)
|
|
2015 Pension/OPEB Mark-to-Market Capital Costs
|
|
2015 Actual Excluding Pension/OPEB Mark-to-Market Capital Costs
|
|
||||||
|
|
(In millions)
|
|||||||||||
OE
|
|
$
|
198
|
|
|
$
|
37
|
|
|
$
|
161
|
|
|
Penn
|
|
60
|
|
|
8
|
|
|
52
|
|
|
|||
CEI
|
|
122
|
|
|
(3
|
)
|
|
125
|
|
|
|||
TE
|
|
45
|
|
|
(1
|
)
|
|
46
|
|
|
|||
JCP&L
|
|
303
|
|
|
45
|
|
|
258
|
|
|
|||
ME
|
|
120
|
|
|
20
|
|
|
100
|
|
|
|||
PN
|
|
163
|
|
|
23
|
|
|
140
|
|
|
|||
MP
|
|
248
|
|
|
(4
|
)
|
|
252
|
|
|
|||
PE
|
|
99
|
|
|
(2
|
)
|
|
101
|
|
|
|||
WP
|
|
137
|
|
|
—
|
|
|
137
|
|
|
|||
ATSI
|
|
617
|
|
|
—
|
|
|
617
|
|
|
|||
TrAIL
|
|
212
|
|
|
—
|
|
|
212
|
|
|
|||
FES
|
|
512
|
|
|
1
|
|
|
511
|
|
|
|||
AE Supply
|
|
82
|
|
|
—
|
|
|
82
|
|
|
|||
Other subsidiaries
|
|
98
|
|
|
3
|
|
|
95
|
|
|
|||
Total
|
|
$
|
3,016
|
|
|
$
|
127
|
|
|
$
|
2,889
|
|
|
Reportable Segment
|
|
2015 Actual
(1)
|
|
2015 Pension/OPEB Mark-to-Market Capital Costs
|
|
2015 Actual Excluding Pension/OPEB Mark-to-Market Capital Costs
|
|
||||||
|
|
(In millions)
|
|||||||||||
Regulated Distribution
|
|
$
|
1,290
|
|
|
$
|
113
|
|
|
$
|
1,177
|
|
|
Regulated Transmission
|
|
986
|
|
|
10
|
|
|
976
|
|
|
|||
CES
|
|
626
|
|
|
4
|
|
|
622
|
|
|
|||
Corporate/Other
|
|
114
|
|
|
—
|
|
|
114
|
|
|
|||
Total
|
|
$
|
3,016
|
|
|
$
|
127
|
|
|
$
|
2,889
|
|
|
(1)
|
Includes an increase of approximately $127 million related to the capital component of the non-cash pension and OPEB mark-to-market adjustment.
|
|
2016
|
|
2017-2020
|
|
Total
|
||||||
|
(In millions)
|
||||||||||
FirstEnergy
|
$
|
1,039
|
|
|
$
|
6,934
|
|
|
$
|
7,973
|
|
FES
|
$
|
414
|
|
|
$
|
1,762
|
|
|
$
|
2,176
|
|
(1)
|
PNBV purchased a portion of the lease obligation bonds associated with certain sale and leaseback transactions. These arrangements effectively reduce lease costs related to those transactions.
|
Station
|
|
In-Service Date
|
|
Current License Expiration
|
Beaver Valley Unit 1
|
|
1976
|
|
2036
|
Beaver Valley Unit 2
|
|
1987
|
|
2047
|
Perry
|
|
1986
|
|
2026
|
Davis-Besse
|
|
1977
|
|
2037
|
•
|
OE—
5,391
MW on
July 29, 2015
;
|
•
|
Penn—
983
MW on
July 29, 2015
;
|
•
|
CEI—
4,057
MW on
August 19, 2015
;
|
•
|
TE—
2,149
MW on
September 8, 2015
;
|
•
|
JCP&L—
5,789
MW on
July 20, 2015
;
|
•
|
ME—
2,770
MW on
July 20, 2015
;
|
•
|
PN—
3,024
MW on
February 19, 2015
;
|
•
|
MP—
2,031
MW on
January 7, 2015
;
|
•
|
PE—
3,631
MW on
February 20, 2015
; and
|
•
|
WP—
3,942
MW on
February 20, 2015
.
|
Executive Officers as of February 16, 2016
|
||||||
Name
|
|
Age
|
|
Positions Held During Past Five Years
|
|
Dates
|
G. D. Benz
|
|
56
|
|
Senior Vice President, Strategy (B)
|
|
2015-present
|
|
|
|
|
Vice President, Supply Chain (B)
|
|
2012-2015
|
|
|
|
|
|
|
|
L. M. Cavalier
|
|
64
|
|
Chief Human Resources Officer (B)
|
|
2015-present
|
|
|
|
|
Senior Vice President, Human Resources (B)
|
|
*-2015
|
|
|
|
|
|
|
|
D. M. Chack
|
|
65
|
|
Senior Vice President, Marketing and Branding (B)
|
|
2015-present
|
|
|
|
|
President, Ohio Operations (B)
|
|
2011-2015
|
|
|
|
|
Vice President (C)
|
|
2011-2015
|
|
|
|
|
Regional President (M)
|
|
*-2011
|
|
|
|
|
|
|
|
M. J. Dowling
|
|
51
|
|
Senior Vice President, External Affairs (B)
|
|
2011-present
|
|
|
|
|
Vice President, External Affairs (B)
|
|
*-2011
|
|
|
|
|
|
|
|
B. L. Gaines
|
|
62
|
|
Senior Vice President, Corporate Services and Chief Information Officer (B)
|
|
2012-present
|
|
|
|
|
Vice President, Corporate Services and Chief Information Officer (B)
|
|
2011-2012
|
|
|
|
|
Vice President, Shared Services, Administration and Chief Information Officer (B)
|
|
*-2011
|
|
|
|
|
|
|
|
C. E. Jones
|
|
60
|
|
President and Chief Executive Officer (A)(B)
|
|
2015-present
|
|
|
|
|
Chief Executive Officer (F)
|
|
2015-present
|
|
|
|
|
Executive Vice President & President, FirstEnergy Utilities (A)(B)
|
|
2014
|
|
|
|
|
Senior Vice President & President, FirstEnergy Utilities (B)
|
|
*-2013
|
|
|
|
|
President (H)(I)
|
|
2011-2015
|
|
|
|
|
President (C)(D)(L)
|
|
*-2015
|
|
|
|
|
Senior Vice President & President, FirstEnergy Utilities (A)
|
|
*-2011
|
|
|
|
|
|
|
|
J. H. Lash
|
|
65
|
|
Executive Vice President & President, FE Generation (A)(B)
|
|
2015-present
|
|
|
|
|
President, FE Generation (B)
|
|
2011-2015
|
|
|
|
|
President (G)(J)
|
|
2011-present
|
|
|
|
|
Chief Nuclear Officer (F)
|
|
2011-2012
|
|
|
|
|
President and Chief Nuclear Officer (F)
|
|
*-2011
|
|
|
|
|
President, FirstEnergy Nuclear Operating Company (B)
|
|
*-2011
|
|
|
|
|
|
|
|
C. D. Lasky
|
|
53
|
|
Senior Vice President, Human Resources (B)
|
|
2015-present
|
|
|
|
|
Vice President, Fossil Operations (J)
|
|
2014-2015
|
|
|
|
|
Vice President, Fossil Operations & Engineering (J)
|
|
2014
|
|
|
|
|
Vice President (G)
|
|
2011-2015
|
|
|
|
|
Vice President, Fossil Fleet Operations (J)
|
|
2011-2013
|
|
|
|
|
Vice President (J)
|
|
*-2011
|
|
|
|
|
Vice President, Fossil Operations (E)
|
|
*-2011
|
|
|
|
|
|
|
|
J. F. Pearson
|
|
61
|
|
Executive Vice President and Chief Financial Officer (A)(B)(C)(D)(E)(F)(G)(H)(I)(J)(L)
|
|
2015-present
|
|
|
|
|
Senior Vice President and Chief Financial Officer (A)(B)(C)(D)(E)(F)(G)(H)(I)(J)(L)
|
|
2013-2015
|
|
|
|
|
Senior Vice President and Treasurer (A)(B)(C)(D)(E)(F)(G)(H)(I)(J)(L)
|
|
2012
|
|
|
|
|
Vice President and Treasurer (A)(B)(C)(D)(E)(F)(J)(L)
|
|
*-2012
|
|
|
|
|
Vice President and Treasurer (G)(H)(I)
|
|
2011-2012
|
|
|
|
|
|
|
|
D. R. Schneider
|
|
54
|
|
President (E)
|
|
*-present
|
|
|
|
|
|
|
|
S. E. Strah
|
|
52
|
|
Senior Vice President & President, FirstEnergy Utilities (B)
|
|
2015-present
|
|
|
|
|
President (C)(D)(H)(I)(L)
|
|
2015-present
|
|
|
|
|
Vice President, Distribution Support (B)
|
|
2011-2015
|
|
|
|
|
Regional President (K)
|
|
*-2011
|
|
|
|
|
|
|
|
K. J. Taylor
|
|
42
|
|
Vice President, Controller and Chief Accounting Officer (A)(B)
|
|
2013-present
|
|
|
|
|
Vice President and Controller (C)(D)(E)(F)(G)(H)(I)(J)(L)
|
|
2013-present
|
|
|
|
|
Vice President and Assistant Controller (A)(B)(C)(D)(E)(F)(G)(H)(I)(J)(L)
|
|
2012-2013
|
|
|
|
|
Assistant Controller (A)(B)(C)(D)(L)
|
|
*-2012
|
|
|
|
|
Assistant Controller (H)(I)
|
|
2011-2012
|
|
|
|
|
Assistant Controller (E)(F)(G)(J)
|
|
2012
|
|
|
|
|
|
|
|
L. L. Vespoli
|
|
56
|
|
Executive Vice President, Markets & Chief Legal Officer (A)(B)(C)(D)(E)(F)(G)(H)(I)(J)(L)
|
|
2014-present
|
|
|
|
|
Executive Vice President and General Counsel (A)(B)(C)(D)(E)(F)(J)(L)
|
|
*-2013
|
|
|
|
|
Executive Vice President and General Counsel (G)(H)(I)
|
|
2011-2013
|
|
|
|
|
|
|
|
* Indicates position held at least since January 1, 2011
|
(E) Denotes executive officer of FES
|
(J) Denotes executive officer of FG
|
(A) Denotes executive officer of FE
|
(F) Denotes executive officer of FENOC
|
(K) Denotes executive officer of OE
|
(B) Denotes executive officer of FESC
|
(G) Denotes executive officer of AGC
|
(L) Denotes executive officer of ATSI
|
(C) Denotes executive officer of OE, CEI and TE
|
(H) Denotes executive officer of MP, PE and WP
|
(M) Denotes executive officer of CEI
|
(D) Denotes executive officer of ME, PN and Penn
|
(I) Denotes executive officer of TrAIL and FET
|
|
|
Total
Employees
|
|
Bargaining
Unit
Employees
|
||
FESC
|
4,179
|
|
|
614
|
|
OE
|
1,087
|
|
|
713
|
|
CEI
|
945
|
|
|
635
|
|
TE
|
331
|
|
|
237
|
|
Penn
|
190
|
|
|
137
|
|
JCP&L
|
1,378
|
|
|
1,082
|
|
ME
|
658
|
|
|
501
|
|
PN
|
756
|
|
|
503
|
|
FES
|
125
|
|
|
—
|
|
FG
|
1,738
|
|
|
1,070
|
|
FENOC
|
2,653
|
|
|
1,186
|
|
MP
|
589
|
|
|
382
|
|
PE
|
460
|
|
|
283
|
|
WP
|
692
|
|
|
448
|
|
Total
|
15,781
|
|
|
7,791
|
|
ITEM 1A.
|
RISK FACTORS
|
•
|
the potential harmful effects on the environment and human health, including loss of life, resulting from unplanned radiological releases associated with the operation of our nuclear facilities and the storage, handling and disposal of radioactive materials;
|
•
|
limitations on the amounts and types of insurance commercially available to cover losses that might arise in connection with our nuclear operations, including any incidents of unplanned radiological release, or those of others in the United States;
|
•
|
uncertainties with respect to contingencies and assessments if insurance coverage is inadequate; and
|
•
|
uncertainties with respect to the technological and financial aspects of spent fuel storage and decommissioning nuclear plants, including but not limited to, waste disposal at the end of their licensed operation and increases in minimum funding requirements or costs of decommissioning.
|
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 2.
|
PROPERTIES
|
|
|
|
|
|
|
Competitive
|
|
|
|||||||
Plant (Location)
|
|
Unit
|
|
Total
|
|
FES
|
|
AE Supply
|
|
Regulated
|
|||||
|
|
|
|
Net Demonstrated Capacity (MW)
|
|||||||||||
Super-critical Coal-fired:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Bruce Mansfield (Shippingport, PA)
|
|
1
|
|
|
830
|
|
(1)
|
830
|
|
|
—
|
|
|
—
|
|
Bruce Mansfield (Shippingport, PA)
|
|
2
|
|
|
830
|
|
|
830
|
|
|
—
|
|
|
—
|
|
Bruce Mansfield (Shippingport, PA)
|
|
3
|
|
|
830
|
|
|
830
|
|
|
—
|
|
|
—
|
|
Harrison (Haywood, WV)
|
|
1-3
|
|
|
1,984
|
|
|
—
|
|
|
—
|
|
|
1,984
|
|
Pleasants (Willow Island, WV)
|
|
1-2
|
|
|
1,300
|
|
|
—
|
|
|
1,300
|
|
|
—
|
|
W. H. Sammis (Stratton, OH)
|
|
6-7
|
|
|
1,200
|
|
|
1,200
|
|
|
—
|
|
|
—
|
|
Fort Martin (Maidsville, WV)
|
|
1-2
|
|
|
1,098
|
|
|
—
|
|
|
—
|
|
|
1,098
|
|
|
|
|
|
8,072
|
|
|
3,690
|
|
|
1,300
|
|
|
3,082
|
|
|
Sub-critical and Other Coal-fired:
|
|
|
|
|
|
|
|
|
|
|
|||||
W. H. Sammis (Stratton, OH)
|
|
1-5
|
|
|
1,010
|
|
|
1,010
|
|
|
—
|
|
|
—
|
|
Bay Shore (Toledo, OH)
|
|
1
|
|
|
136
|
|
|
136
|
|
|
—
|
|
|
—
|
|
OVEC (Cheshire, OH) (Madison, IN)
|
|
1-11
|
|
|
188
|
|
(2)
|
110
|
|
|
67
|
|
|
11
|
|
|
|
|
|
|
1,334
|
|
|
1,256
|
|
|
67
|
|
|
11
|
|
Nuclear:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Beaver Valley (Shippingport, PA)
|
|
1
|
|
|
939
|
|
|
939
|
|
|
—
|
|
|
—
|
|
Beaver Valley (Shippingport, PA)
|
|
2
|
|
|
933
|
|
(3)
|
933
|
|
|
—
|
|
|
—
|
|
Davis-Besse (Oak Harbor, OH)
|
|
1
|
|
|
908
|
|
|
908
|
|
|
—
|
|
|
—
|
|
Perry (N. Perry Village, OH)
|
|
1
|
|
|
1,268
|
|
(4)
|
1,268
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
4,048
|
|
|
4,048
|
|
|
—
|
|
|
—
|
|
Gas/Oil-fired:
|
|
|
|
|
|
|
|
|
|
|
|
||||
AE Nos. 1, 2, 3, 4 & 5 (Springdale, PA)
|
|
1-5
|
|
|
638
|
|
|
—
|
|
|
638
|
|
|
—
|
|
West Lorain (Lorain, OH)
|
|
1-6
|
|
|
545
|
|
|
545
|
|
|
—
|
|
|
—
|
|
AE Nos. 12 & 13 (Chambersburg, PA)
|
|
12-13
|
|
|
88
|
|
|
—
|
|
|
88
|
|
|
—
|
|
AE Nos. 8 & 9 (Gans, PA)
|
|
8-9
|
|
|
88
|
|
|
—
|
|
|
88
|
|
|
—
|
|
Forked River (Ocean County, NJ)
|
|
2
|
|
|
86
|
|
|
86
|
|
|
—
|
|
|
—
|
|
Hunlock CT (Hunlock Creek, PA)
|
|
1
|
|
|
45
|
|
|
—
|
|
|
45
|
|
|
—
|
|
Buchanan (Oakwood, VA)
|
|
1-2
|
|
|
43
|
|
(5)
|
—
|
|
|
43
|
|
|
—
|
|
Other
|
|
|
|
59
|
|
|
59
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
1,592
|
|
|
690
|
|
|
902
|
|
|
—
|
|
|
Pumped-storage Hydro:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Bath County (Warm Springs, VA)
|
|
1-6
|
|
|
1,200
|
|
(6)
|
—
|
|
|
713
|
|
|
487
|
|
Yard’s Creek (Blairstown Twp., NJ)
|
|
1-3
|
|
|
210
|
|
(7)
|
—
|
|
|
—
|
|
|
210
|
|
|
|
|
|
1,410
|
|
|
—
|
|
|
713
|
|
|
697
|
|
|
Wind and Solar Power
|
|
|
|
|
496
|
|
(8)
|
496
|
|
|
—
|
|
|
—
|
|
Total
|
|
|
|
16,952
|
|
|
10,180
|
|
|
2,982
|
|
|
3,790
|
|
(1)
|
Includes FE's leasehold interest of
93.83%
(
779
MW) from non-affiliates.
|
(2)
|
Represents FG's
4.85%
, AE Supply's
3.01%
and MP's
0.49%
entitlement based on their participation in OVEC.
|
(3)
|
Includes OE’s leasehold interest of
2.60%
(
24
MW) from non-affiliates of which FES purchases all the output pursuant to full output cost-of-service PSAs.
|
(4)
|
Includes OE’s leasehold interest of
3.75%
(
48
MW) from non-affiliates of which FES purchases all the output pursuant to full output cost-of-service PSAs.
|
(5)
|
Represents Buchanan Energy's 50% interest. Buchanan Energy is a subsidiary of AE Supply. CNX Gas Corporation and Buchanan Energy have equal ownership interests in Buchanan Generation, LLC. AE Supply operates and dispatches
100%
of Buchanan Generation, LLC's
86
MWs.
|
(6)
|
Represents AGC's 40% interest in Bath County, a pumped-storage hydroelectric station. The station is operated by 60% owner Virginia Electric and Power Company. AGC is 59% owned by AE Supply and 41% owned by MP.
|
(7)
|
Represents JCP&L’s
50%
ownership interest.
|
(8)
|
Includes
167
MW from leased facilities and
329
MW under power purchase agreements.
|
|
Distribution
Lines
(1)
|
|
Transmission
Lines
(1)
|
|
Substation
Transformer
Capacity
(2)
|
|||
|
|
|
kV Amperes
|
|||||
OE
|
61,181
|
|
|
377
|
|
|
7,651,995
|
|
Penn
|
13,537
|
|
|
—
|
|
|
1,090,120
|
|
CEI
|
33,368
|
|
|
—
|
|
|
10,388,929
|
|
TE
|
18,999
|
|
|
73
|
|
|
3,025,373
|
|
JCP&L
|
23,277
|
|
|
2,573
|
|
|
22,367,086
|
|
ME
|
18,859
|
|
|
1,497
|
|
|
11,230,635
|
|
PN
|
27,459
|
|
|
2,755
|
|
|
16,694,883
|
|
ATSI
(3)
|
—
|
|
|
7,773
|
|
|
32,328,674
|
|
WP
|
24,365
|
|
|
4,290
|
|
|
18,489,266
|
|
MP
|
22,062
|
|
|
2,559
|
|
|
15,098,632
|
|
PE
|
25,575
|
|
|
2,098
|
|
|
15,672,209
|
|
TrAIL
|
—
|
|
|
216
|
|
|
575,000
|
|
Total
|
268,682
|
|
|
24,211
|
|
|
154,612,802
|
|
(1)
|
Circuit Miles
|
(2)
|
Top rating of in-service power transformers only. Excludes grounding banks, station power transformers, and generator and customer-owned transformers.
|
(3)
|
Represents transmission line assets of
69
kV and greater located in the service territories of OE, Penn, CEI and TE.
|
ITEM 3.
|
LEGAL PROCEEDINGS
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
For the Years Ended December 31,
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||
Revenues
|
|
$
|
15,026
|
|
|
$
|
15,049
|
|
|
$
|
14,892
|
|
|
$
|
15,255
|
|
|
$
|
16,087
|
|
Income From Continuing Operations
|
|
$
|
578
|
|
|
$
|
213
|
|
|
$
|
375
|
|
|
$
|
755
|
|
|
$
|
856
|
|
Earnings Available to FirstEnergy Corp.
|
|
$
|
578
|
|
|
$
|
299
|
|
|
$
|
392
|
|
|
$
|
770
|
|
|
$
|
885
|
|
Earnings per Share of Common Stock:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic - Continuing Operations
|
|
$
|
1.37
|
|
|
$
|
0.51
|
|
|
$
|
0.90
|
|
|
$
|
1.81
|
|
|
$
|
2.19
|
|
Basic - Discontinued Operations (Note 19)
|
|
—
|
|
|
0.20
|
|
|
0.04
|
|
|
0.04
|
|
|
0.03
|
|
|||||
Basic - Earnings Available to FirstEnergy Corp.
|
|
$
|
1.37
|
|
|
$
|
0.71
|
|
|
$
|
0.94
|
|
|
$
|
1.85
|
|
|
$
|
2.22
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted - Continuing Operations
|
|
$
|
1.37
|
|
|
$
|
0.51
|
|
|
$
|
0.90
|
|
|
$
|
1.80
|
|
|
$
|
2.18
|
|
Diluted - Discontinued Operations (Note 19)
|
|
—
|
|
|
0.20
|
|
|
0.04
|
|
|
0.04
|
|
|
0.03
|
|
|||||
Diluted - Earnings Available to FirstEnergy Corp.
|
|
$
|
1.37
|
|
|
$
|
0.71
|
|
|
$
|
0.94
|
|
|
$
|
1.84
|
|
|
$
|
2.21
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted Average Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
422
|
|
|
420
|
|
|
418
|
|
|
418
|
|
|
399
|
|
|||||
Diluted
|
|
424
|
|
|
421
|
|
|
419
|
|
|
419
|
|
|
401
|
|
|||||
Dividends Declared per Share of Common Stock
|
|
$
|
1.44
|
|
|
$
|
1.44
|
|
|
$
|
1.65
|
|
|
$
|
2.20
|
|
|
$
|
2.20
|
|
Total Assets
(1)
|
|
$
|
52,187
|
|
|
$
|
51,648
|
|
|
$
|
50,058
|
|
|
$
|
50,175
|
|
|
$
|
47,410
|
|
Capitalization as of December 31:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Equity
|
|
$
|
12,422
|
|
|
$
|
12,422
|
|
|
$
|
12,695
|
|
|
$
|
13,093
|
|
|
$
|
13,299
|
|
Long-Term Debt and Other Long-Term Obligations
|
|
19,192
|
|
|
19,176
|
|
|
15,831
|
|
|
15,179
|
|
|
15,716
|
|
|||||
Total Capitalization
|
|
$
|
31,614
|
|
|
$
|
31,598
|
|
|
$
|
28,526
|
|
|
$
|
28,272
|
|
|
$
|
29,015
|
|
|
2015
|
|
2014
|
||||||||||||
|
High
|
|
Low
|
|
High
|
|
Low
|
||||||||
First Quarter
|
$
|
41.68
|
|
|
$
|
33.82
|
|
|
$
|
34.28
|
|
|
$
|
30.10
|
|
Second Quarter
|
$
|
37.05
|
|
|
$
|
32.46
|
|
|
$
|
35.59
|
|
|
$
|
31.17
|
|
Third Quarter
|
$
|
35.09
|
|
|
$
|
30.31
|
|
|
$
|
34.95
|
|
|
$
|
29.98
|
|
Fourth Quarter
|
$
|
33.00
|
|
|
$
|
28.89
|
|
|
$
|
40.84
|
|
|
$
|
33.04
|
|
Yearly
|
$
|
41.68
|
|
|
$
|
28.89
|
|
|
$
|
40.84
|
|
|
$
|
29.98
|
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF REGISTRANT AND SUBSIDIARIES
|
•
|
The speed and nature of increased competition in the electric utility industry, in general, and the retail sales market in particular.
|
•
|
The ability to experience growth in the Regulated Distribution and Regulated Transmission segments and to successfully implement our sales strategy for the CES segment.
|
•
|
The accomplishment of our regulatory and operational goals in connection with our transmission investment plan, including but not limited to, the proposed transmission asset transfer to MAIT, and the effectiveness of our strategy to reflect a more regulated business profile.
|
•
|
Changes in assumptions regarding economic conditions within our territories, assessment of the reliability of our transmission system, or the availability of capital or other resources supporting identified transmission investment opportunities.
|
•
|
The impact of the regulatory process on the pending matters at the federal level and in the various states in which we do business including, but not limited to, matters related to rates and the ESP IV in Ohio.
|
•
|
The impact of the federal regulatory process on FERC-regulated entities and transactions, in particular FERC regulation of wholesale energy and capacity markets, including PJM markets and FERC-jurisdictional wholesale transactions; FERC regulation of cost-of-service rates, including FERC Opinion No. 531’s revised ROE methodology for FERC-jurisdictional wholesale generation and transmission utility service; and FERC’s compliance and enforcement activity, including compliance and enforcement activity related to NERC’s mandatory reliability standards.
|
•
|
The uncertainties of various cost recovery and cost allocation issues resulting from ATSI's realignment into PJM.
|
•
|
Economic or weather conditions affecting future sales and margins such as a polar vortex or other significant weather events, and all associated regulatory events or actions.
|
•
|
Changing energy, capacity and commodity market prices including, but not limited to, coal, natural gas and oil prices, and their availability and impact on margins and asset valuations.
|
•
|
The continued ability of our regulated utilities to recover their costs.
|
•
|
Costs being higher than anticipated and the success of our policies to control costs and to mitigate low energy, capacity and market prices.
|
•
|
Other legislative and regulatory changes, and revised environmental requirements, including, but not limited to, the effects of the EPA's CPP, CCR, CSAPR and MATS programs, including our estimated costs of compliance, CWA waste water effluent limitations for power plants, and CWA 316(b) water intake regulation.
|
•
|
The uncertainty of the timing and amounts of the capital expenditures that may arise in connection with any litigation, including NSR litigation, or potential regulatory initiatives or rulemakings (including that such initiatives or rulemakings could result in our decision to deactivate or idle certain generating units).
|
•
|
The uncertainties associated with the deactivation of certain older regulated and competitive fossil units, including the impact on vendor commitments and as it relates to the reliability of the transmission grid, the timing thereof.
|
•
|
The impact of other future changes to the operational status or availability of our generating units and any capacity performance charges associated with unit unavailability.
|
•
|
Adverse regulatory or legal decisions and outcomes with respect to our nuclear operations (including, but not limited to the revocation or non-renewal of necessary licenses, approvals or operating permits by the NRC or as a result of the incident at Japan's Fukushima Daiichi Nuclear Plant).
|
•
|
Issues arising from the indications of cracking in the shield building at Davis-Besse.
|
•
|
The risks and uncertainties associated with litigation, arbitration, mediation and like proceedings, including, but not limited to, any such proceedings related to vendor commitments.
|
•
|
The impact of labor disruptions by our unionized workforce.
|
•
|
Replacement power costs being higher than anticipated or not fully hedged.
|
•
|
The ability to comply with applicable state and federal reliability standards and energy efficiency and peak demand reduction mandates.
|
•
|
Changes in customers' demand for power, including, but not limited to, changes resulting from the implementation of state and federal energy efficiency and peak demand reduction mandates.
|
•
|
The ability to accomplish or realize anticipated benefits from strategic and financial goals, including, but not limited to, the ability to continue to reduce costs and to successfully execute our financial plans designed to improve our credit metrics and strengthen our balance sheet through, among other actions, our cash flow improvement plan and other proposed capital raising initiatives.
|
•
|
Our ability to improve electric commodity margins and the impact of, among other factors, the increased cost of fuel and fuel transportation on such margins.
|
•
|
Changing market conditions that could affect the measurement of certain liabilities and the value of assets held in our NDTs, pension trusts and other trust funds, and cause us and/or our subsidiaries to make additional contributions sooner, or in amounts that are larger than currently anticipated.
|
•
|
The impact of changes to material accounting policies.
|
•
|
The ability to access the public securities and other capital and credit markets in accordance with our financial plans, the cost of such capital and overall condition of the capital and credit markets affecting us and our subsidiaries.
|
•
|
Actions that may be taken by credit rating agencies that could negatively affect us and/or our subsidiaries' access to financing, increase the costs thereof, and increase requirements to post additional collateral to support outstanding commodity positions, LOCs and other financial guarantees.
|
•
|
Changes in national and regional economic conditions affecting us, our subsidiaries and/or our major industrial and commercial customers, and other counterparties with which we do business, including fuel suppliers.
|
•
|
The impact of any changes in tax laws or regulations or adverse tax audit results or rulings.
|
•
|
Issues concerning the stability of domestic and foreign financial institutions and counterparties with which we do business.
|
•
|
The risks associated with cyber-attacks and other disruptions to our information technology system that may compromise our generation, transmission and/or distribution services and data security breaches of sensitive data, intellectual property and proprietary or personally identifiable information regarding our business, employees, shareholders, customers, suppliers, business partners and other individuals in our data centers and on our networks.
|
•
|
The risks and other factors discussed from time to time in our SEC filings, and other similar factors.
|
•
|
The Ohio Companies' ESP IV,
Powering Ohio’s Progress:
The ESP IV, including the impact of filed stipulations in the case, contemplates continuing a distribution rate freeze through May 2024 while helping ensure continued availability of more than 3,200 MWs of FirstEnergy’s critical baseload generating assets primarily located in the state and serving the long-term energy needs of Ohio customers. Evidentiary hearings commenced in August 2015. On December 1, 2015, FirstEnergy's Ohio Companies filed an additional settlement at the PUCO, which included the PUCO Staff as a signatory party, that sets forth ambitious steps to help safeguard customers against retail generation price increases in future years, deploy new energy efficiency programs, and provide a clear path to a cleaner energy future by establishing a goal to substantially reduce carbon emissions. The settlement includes an eight-year rate provision (Rider RRS) designed to help protect customers against rising retail price increases and market volatility, while helping preserve vital baseload power plants that serve Ohio customers and provide thousands of family-sustaining jobs in the state. The plants involved include the Davis-Besse Nuclear Power Station, the W.H. Sammis Plant, and a portion of the output of OVEC units in Gallipolis, Ohio, and Madison, Indiana. A decision is anticipated in March 2016. On January 27, 2016, certain parties filed a complaint at FERC against FES, OE, CEI, and TE that requests FERC review of the ESP IV PPA under Section 205 of the FPA. In addition to such proceeding, parties have expressed an intention to challenge, in the courts and/or before FERC, the PPA or PUCO approval of the ESP IV, if approved. Management intends to vigorously defend against such challenges.
|
•
|
Implementation of New Rates in Pennsylvania for ME, PN, Penn and WP: The new rates were approved in April 2015 and went into effect in May 2015
,
providing for an increase in annual revenues of approximately $293 million and approximately $88 million of additional annual operating expenses. Furthermore, in October 2015, the Pennsylvania companies filed LTIIPs with the PPUC for infrastructure improvements over the 2016 to 2020 period totaling nearly $245 million, which were approved on February 11, 2016. The Pennsylvania Companies filed DSIC riders on February 16, 2016, for quarterly cost recovery associated with the projects approved in the LTIIPs.
|
•
|
Implementation of New Rates in West Virginia for MP and PE:
The new rates were approved and went into effect in February 2015, resulting in recovery of $63 million annually for reliability investments and expenses, storm damage expenses, and investments in operating improvements and environmental compliance at MP’s and PE’s regulated coal-fired power plants in West Virginia. MP and PE also received orders in December 2015 in their ENEC case and their biennial vegetation management program surcharge reconciliation, resulting in revenue increases, effective January 1, 2016, totaling $96.9 million and $36.7 million, respectively, to recover deferred costs.
|
|
2016 - 2017
|
|
2017 - 2018
|
|
2018 - 2019*
|
||||||||||||||||||
|
Legacy Obligation
|
|
Capacity Performance
|
|
Legacy Obligation
|
|
Capacity Performance
|
|
Base Generation
|
|
Capacity Performance
|
||||||||||||
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
ATSI
|
2,765
|
|
$114.23
|
|
4,210
|
|
$134.00
|
|
375
|
|
$120.00
|
|
6,245
|
|
$151.50
|
|
—
|
|
$149.98
|
|
6,245
|
|
$164.77
|
RTO
|
875
|
|
$59.37
|
|
3,675
|
|
$134.00
|
|
985
|
|
$120.00
|
|
3,565
|
|
$151.50
|
|
240
|
|
$149.98
|
|
3,930
|
|
$164.77
|
All Other Zones
|
135
|
|
$119.13
|
|
—
|
|
$134.00
|
|
150
|
|
$120.00
|
|
—
|
|
$151.50
|
|
35
|
|
**
|
|
20
|
|
**
|
|
3,775
|
|
|
|
7,885
|
|
|
|
1,510
|
|
|
|
9,810
|
|
|
|
275
|
|
|
|
10,195
|
|
|
•
|
The decrease in revenue at CES resulted from a 31 million MWHs decline in contract sales, in line with CES’ strategy discussed above, partially offset by higher wholesale sales, including increased capacity revenue associated with higher capacity auction prices.
|
•
|
The increase in revenue at Regulated Distribution resulted from the implementation of new rates at certain operating companies as well as a year-over-year increase in retail generation revenue, resulting from a lower number of customers shopping with an alternative generation supplier and higher retail transmission revenue, which is recovering higher transmission related expenses. Distribution deliveries decreased 0.8%, or 1.1 million MWHs, as weather adjusted sales declined as a result of energy efficiency mandates and products and decreases in certain industrial sectors, partially offset by an increase in weather-related sales.
|
•
|
The increase at Regulated Transmission primarily reflected a higher rate base and recovery of incremental operating expenses as well as ATSI’s transition to a forward-looking rate, effective January 1, 2015. These increases were partially offset by a lower ROE at ATSI in the last six months of 2015 as part of the FERC-approved settlement discussed above.
|
•
|
Fuel expense declined
$425 million
, primarily at CES, resulting from lower fossil generation associated with low energy prices, lower unit costs, and lower settlement and termination charges on fuel and transportation contracts.
|
•
|
Purchased power decreased
$398 million
, primarily reflecting lower volumes at CES, resulting from lower contract sales, partially offset by higher volumes at Regulated Distribution due to lower customer shopping as discussed above, and higher capacity expense associated with higher capacity rates.
|
•
|
Other operating expenses decreased
$213 million
, primarily reflecting a decrease at CES associated with lower PJM transmission, mark-to-market and retail-related costs partially offset by higher nuclear planned outage costs, partially offset by an increase at Regulated Distribution, resulting from higher network transmission expenses, which are recovered through transmission rates as discussed above, and higher operating and maintenance expenses associated with reliability improvements.
|
•
|
Amortization of regulatory assets, net increased
$256 million
primarily reflecting the recovery of deferred costs, including storm costs, associated with the implementation of new rates discussed above.
|
•
|
The increase in revenue at Regulated Distribution resulted from higher wholesale generation sales associated with the Harrison/Pleasants asset transfer whereby MP acquired 1,476 MWs of generation from AE Supply.
|
•
|
The increase at Regulated Transmission primarily reflected a higher rate base and recovery of incremental operating expenses.
|
•
|
The decrease at CES resulted from lower contract sales as in 2014, CES began to reduce its exposure to weather sensitive load to more effectively hedge its generation, targeting annual contract sales of 65 to 75 million MWHs as compared to the 109 million MWHs sold in 2013. This change in strategy resulted in a 9% decrease in MWH sales in 2014 as compared to 2013.
|
•
|
Lower fuel expense of $216 million, primarily reflected the deactivation of power plants in 2013 and increased outages. Fuel expense at CES and Regulated Distribution was further impacted by the October 2013 Harrison/Pleasants asset transfer.
|
•
|
Purchased power increased $753 million, primarily reflecting higher CES purchases resulting from plant deactivations, increased outages and the asset transfer discussed above as well as higher unit pricing and capacity expense. The increase in unit pricing primarily resulted from market conditions associated with the extreme weather events in the first quarter of 2014, which included the polar vortex
.
|
•
|
Other operating expenses increased $369 million primarily resulting from higher costs at Regulated Distribution associated with network transmission expenses, increased vegetation management expenses in West Virginia, as well as higher operating and maintenance associated with reliability improvements, storm restoration costs and the Harrison/Pleasants asset transfer. CES' increase in other operating expenses was primarily attributable to higher transmission costs, which resulted from the market conditions associated with the extreme weather events in the first quarter of 2014, and higher mark-to-market expenses on derivative contracts, partially offset by lower generation operating and maintenance costs primarily resulting from the deactivation of generating plants and the Harrison/Pleasants asset transfer.
|
|
|
|
|
Increase (Decrease)
|
||||||||||||||||
|
|
2015
|
|
2014
|
|
2013
|
|
2015 vs 2014
|
|
2014 vs 2013
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||
Net Income (Loss) By Business Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Regulated Distribution
|
|
$
|
618
|
|
|
$
|
465
|
|
|
$
|
501
|
|
|
$
|
153
|
|
|
$
|
(36
|
)
|
Regulated Transmission
|
|
298
|
|
|
223
|
|
|
214
|
|
|
75
|
|
|
9
|
|
|||||
Competitive Energy Services
|
|
89
|
|
|
(331
|
)
|
|
(218
|
)
|
|
420
|
|
|
(113
|
)
|
|||||
Corporate/Other
(1)
|
|
(427
|
)
|
|
(58
|
)
|
|
(105
|
)
|
|
(369
|
)
|
|
47
|
|
|||||
Net Income
|
|
$
|
578
|
|
|
$
|
299
|
|
|
$
|
392
|
|
|
$
|
279
|
|
|
$
|
(93
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
|
$
|
1.37
|
|
|
$
|
0.51
|
|
|
$
|
0.90
|
|
|
$
|
0.86
|
|
|
$
|
(0.39
|
)
|
Discontinued operations (Note 19)
|
|
—
|
|
|
0.20
|
|
|
0.04
|
|
|
(0.20
|
)
|
|
0.16
|
|
|||||
Earnings per basic share
|
|
$
|
1.37
|
|
|
$
|
0.71
|
|
|
$
|
0.94
|
|
|
$
|
0.66
|
|
|
$
|
(0.23
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
|
$
|
1.37
|
|
|
$
|
0.51
|
|
|
$
|
0.90
|
|
|
$
|
0.86
|
|
|
$
|
(0.39
|
)
|
Discontinued operations (Note 19)
|
|
—
|
|
|
0.20
|
|
|
0.04
|
|
|
(0.20
|
)
|
|
0.16
|
|
|||||
Earnings per diluted share
|
|
$
|
1.37
|
|
|
$
|
0.71
|
|
|
$
|
0.94
|
|
|
$
|
0.66
|
|
|
$
|
(0.23
|
)
|
2015 Financial Results
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Competitive
Energy Services |
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
External
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Electric
|
|
$
|
9,429
|
|
|
$
|
1,011
|
|
|
$
|
4,493
|
|
|
$
|
(173
|
)
|
|
$
|
14,760
|
|
Other
|
|
196
|
|
|
—
|
|
|
205
|
|
|
(135
|
)
|
|
266
|
|
|||||
Internal
|
|
—
|
|
|
—
|
|
|
686
|
|
|
(686
|
)
|
|
—
|
|
|||||
Total Revenues
|
|
9,625
|
|
|
1,011
|
|
|
5,384
|
|
|
(994
|
)
|
|
15,026
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Fuel
|
|
533
|
|
|
—
|
|
|
1,322
|
|
|
—
|
|
|
1,855
|
|
|||||
Purchased power
|
|
3,548
|
|
|
—
|
|
|
1,456
|
|
|
(686
|
)
|
|
4,318
|
|
|||||
Other operating expenses
|
|
2,242
|
|
|
154
|
|
|
1,670
|
|
|
(317
|
)
|
|
3,749
|
|
|||||
Pension and OPEB mark-to-market
|
|
179
|
|
|
3
|
|
|
60
|
|
|
—
|
|
|
242
|
|
|||||
Provision for depreciation
|
|
672
|
|
|
156
|
|
|
394
|
|
|
60
|
|
|
1,282
|
|
|||||
Amortization of regulatory assets, net
|
|
261
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
268
|
|
|||||
General taxes
|
|
703
|
|
|
102
|
|
|
140
|
|
|
33
|
|
|
978
|
|
|||||
Impairment of long-lived assets
|
|
8
|
|
|
—
|
|
|
34
|
|
|
—
|
|
|
42
|
|
|||||
Total Operating Expenses
|
|
8,146
|
|
|
422
|
|
|
5,076
|
|
|
(910
|
)
|
|
12,734
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Income
|
|
1,479
|
|
|
589
|
|
|
308
|
|
|
(84
|
)
|
|
2,292
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Loss on debt redemptions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Investment income (loss)
|
|
42
|
|
|
—
|
|
|
(16
|
)
|
|
(48
|
)
|
|
(22
|
)
|
|||||
Impairment of equity method investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(362
|
)
|
|
(362
|
)
|
|||||
Interest expense
|
|
(586
|
)
|
|
(161
|
)
|
|
(192
|
)
|
|
(193
|
)
|
|
(1,132
|
)
|
|||||
Capitalized financing costs
|
|
25
|
|
|
44
|
|
|
39
|
|
|
9
|
|
|
117
|
|
|||||
Total Other Expense
|
|
(519
|
)
|
|
(117
|
)
|
|
(169
|
)
|
|
(594
|
)
|
|
(1,399
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income From Continuing Operations Before Income Taxes
|
|
960
|
|
|
472
|
|
|
139
|
|
|
(678
|
)
|
|
893
|
|
|||||
Income taxes
|
|
342
|
|
|
174
|
|
|
50
|
|
|
(251
|
)
|
|
315
|
|
|||||
Income From Continuing Operations
|
|
618
|
|
|
298
|
|
|
89
|
|
|
(427
|
)
|
|
578
|
|
|||||
Discontinued Operations, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net Income
|
|
$
|
618
|
|
|
$
|
298
|
|
|
$
|
89
|
|
|
$
|
(427
|
)
|
|
$
|
578
|
|
2014 Financial Results
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Competitive
Energy Services |
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
External
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Electric
|
|
$
|
8,898
|
|
|
$
|
769
|
|
|
$
|
5,281
|
|
|
$
|
(193
|
)
|
|
$
|
14,755
|
|
Other
|
|
204
|
|
|
—
|
|
|
189
|
|
|
(99
|
)
|
|
294
|
|
|||||
Internal
|
|
—
|
|
|
—
|
|
|
819
|
|
|
(819
|
)
|
|
—
|
|
|||||
Total Revenues
|
|
9,102
|
|
|
769
|
|
|
6,289
|
|
|
(1,111
|
)
|
|
15,049
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Fuel
|
|
567
|
|
|
—
|
|
|
1,713
|
|
|
—
|
|
|
2,280
|
|
|||||
Purchased power
|
|
3,385
|
|
|
—
|
|
|
2,150
|
|
|
(819
|
)
|
|
4,716
|
|
|||||
Other operating expenses
|
|
2,081
|
|
|
139
|
|
|
2,075
|
|
|
(333
|
)
|
|
3,962
|
|
|||||
Pension and OPEB mark-to-market
|
|
506
|
|
|
2
|
|
|
327
|
|
|
—
|
|
|
835
|
|
|||||
Provision for depreciation
|
|
658
|
|
|
127
|
|
|
387
|
|
|
48
|
|
|
1,220
|
|
|||||
Amortization of regulatory assets, net
|
|
1
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|||||
General taxes
|
|
693
|
|
|
70
|
|
|
171
|
|
|
28
|
|
|
962
|
|
|||||
Impairment of long-lived assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total Operating Expenses
|
|
7,891
|
|
|
349
|
|
|
6,823
|
|
|
(1,076
|
)
|
|
13,987
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Income (Loss)
|
|
1,211
|
|
|
420
|
|
|
(534
|
)
|
|
(35
|
)
|
|
1,062
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Loss on debt redemptions
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|||||
Investment income
|
|
56
|
|
|
—
|
|
|
54
|
|
|
(38
|
)
|
|
72
|
|
|||||
Impairment of equity method investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Interest expense
|
|
(589
|
)
|
|
(131
|
)
|
|
(189
|
)
|
|
(164
|
)
|
|
(1,073
|
)
|
|||||
Capitalized financing costs
|
|
14
|
|
|
55
|
|
|
37
|
|
|
12
|
|
|
118
|
|
|||||
Total Other Expense
|
|
(519
|
)
|
|
(76
|
)
|
|
(106
|
)
|
|
(190
|
)
|
|
(891
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) From Continuing Operations Before Income Taxes (Benefits)
|
|
692
|
|
|
344
|
|
|
(640
|
)
|
|
(225
|
)
|
|
171
|
|
|||||
Income taxes (benefits)
|
|
227
|
|
|
121
|
|
|
(223
|
)
|
|
(167
|
)
|
|
(42
|
)
|
|||||
Income (Loss) From Continuing Operations
|
|
465
|
|
|
223
|
|
|
(417
|
)
|
|
(58
|
)
|
|
213
|
|
|||||
Discontinued Operations, net of tax
|
|
—
|
|
|
—
|
|
|
86
|
|
|
—
|
|
|
86
|
|
|||||
Net Income (Loss)
|
|
$
|
465
|
|
|
$
|
223
|
|
|
$
|
(331
|
)
|
|
$
|
(58
|
)
|
|
$
|
299
|
|
Changes Between 2015 and 2014 Financial Results Increase (Decrease)
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Competitive
Energy Services |
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
External
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Electric
|
|
$
|
531
|
|
|
$
|
242
|
|
|
$
|
(788
|
)
|
|
$
|
20
|
|
|
$
|
5
|
|
Other
|
|
(8
|
)
|
|
—
|
|
|
16
|
|
|
(36
|
)
|
|
(28
|
)
|
|||||
Internal
|
|
—
|
|
|
—
|
|
|
(133
|
)
|
|
133
|
|
|
—
|
|
|||||
Total Revenues
|
|
523
|
|
|
242
|
|
|
(905
|
)
|
|
117
|
|
|
(23
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Fuel
|
|
(34
|
)
|
|
—
|
|
|
(391
|
)
|
|
—
|
|
|
(425
|
)
|
|||||
Purchased power
|
|
163
|
|
|
—
|
|
|
(694
|
)
|
|
133
|
|
|
(398
|
)
|
|||||
Other operating expenses
|
|
161
|
|
|
15
|
|
|
(405
|
)
|
|
16
|
|
|
(213
|
)
|
|||||
Pension and OPEB mark-to-market
|
|
(327
|
)
|
|
1
|
|
|
(267
|
)
|
|
—
|
|
|
(593
|
)
|
|||||
Provision for depreciation
|
|
14
|
|
|
29
|
|
|
7
|
|
|
12
|
|
|
62
|
|
|||||
Amortization of regulatory assets, net
|
|
260
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
256
|
|
|||||
General taxes
|
|
10
|
|
|
32
|
|
|
(31
|
)
|
|
5
|
|
|
16
|
|
|||||
Impairment of long-lived assets
|
|
8
|
|
|
—
|
|
|
34
|
|
|
—
|
|
|
42
|
|
|||||
Total Operating Expenses
|
|
255
|
|
|
73
|
|
|
(1,747
|
)
|
|
166
|
|
|
(1,253
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Income (Loss)
|
|
268
|
|
|
169
|
|
|
842
|
|
|
(49
|
)
|
|
1,230
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Loss on debt redemptions
|
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|||||
Investment income
|
|
(14
|
)
|
|
—
|
|
|
(70
|
)
|
|
(10
|
)
|
|
(94
|
)
|
|||||
Impairment of equity method investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(362
|
)
|
|
(362
|
)
|
|||||
Interest expense
|
|
3
|
|
|
(30
|
)
|
|
(3
|
)
|
|
(29
|
)
|
|
(59
|
)
|
|||||
Capitalized financing costs
|
|
11
|
|
|
(11
|
)
|
|
2
|
|
|
(3
|
)
|
|
(1
|
)
|
|||||
Total Other Expense
|
|
—
|
|
|
(41
|
)
|
|
(63
|
)
|
|
(404
|
)
|
|
(508
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) From Continuing Operations Before Income Taxes (Benefits)
|
|
268
|
|
|
128
|
|
|
779
|
|
|
(453
|
)
|
|
722
|
|
|||||
Income taxes (benefits)
|
|
115
|
|
|
53
|
|
|
273
|
|
|
(84
|
)
|
|
357
|
|
|||||
Income (Loss) From Continuing Operations
|
|
153
|
|
|
75
|
|
|
506
|
|
|
(369
|
)
|
|
365
|
|
|||||
Discontinued Operations, net of tax
|
|
—
|
|
|
—
|
|
|
(86
|
)
|
|
—
|
|
|
(86
|
)
|
|||||
Net Income (Loss)
|
|
$
|
153
|
|
|
$
|
75
|
|
|
$
|
420
|
|
|
$
|
(369
|
)
|
|
$
|
279
|
|
|
|
For the Years Ended December 31,
|
|
Increase
|
||||||||
Revenues by Type of Service
|
|
2015
|
|
2014
|
|
(Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
Distribution services
|
|
$
|
3,993
|
|
|
$
|
3,694
|
|
|
$
|
299
|
|
|
|
|
|
|
|
|
||||||
Generation sales:
|
|
|
|
|
|
|
||||||
Retail
|
|
4,303
|
|
|
4,043
|
|
|
260
|
|
|||
Wholesale
|
|
508
|
|
|
661
|
|
|
(153
|
)
|
|||
Total generation sales
|
|
4,811
|
|
|
4,704
|
|
|
107
|
|
|||
|
|
|
|
|
|
|
||||||
Transmission sales:
|
|
|
|
|
|
|
|
|||||
Retail
|
|
513
|
|
|
352
|
|
|
161
|
|
|||
Wholesale
|
|
112
|
|
|
148
|
|
|
(36
|
)
|
|||
Total transmission sales
|
|
625
|
|
|
500
|
|
|
125
|
|
|||
Other
|
|
196
|
|
|
204
|
|
|
(8
|
)
|
|||
Total Revenues
|
|
$
|
9,625
|
|
|
$
|
9,102
|
|
|
$
|
523
|
|
|
|
For the Years Ended December 31,
|
|
Increase
|
|||||
Electric Distribution MWH Deliveries
|
|
2015
|
|
2014
|
|
(Decrease)
|
|||
|
|
(In thousands)
|
|
|
|||||
Residential
|
|
54,466
|
|
|
54,766
|
|
|
(0.5
|
)%
|
Commercial
|
|
43,091
|
|
|
42,925
|
|
|
0.4
|
%
|
Industrial
|
|
50,269
|
|
|
51,276
|
|
|
(2.0
|
)%
|
Other
|
|
585
|
|
|
586
|
|
|
(0.2
|
)%
|
Total Electric Distribution MWH Deliveries
|
|
148,411
|
|
|
149,553
|
|
|
(0.8
|
)%
|
Source of Change in Generation Revenues
|
|
Increase (Decrease)
|
||
|
|
(In millions)
|
||
Retail:
|
|
|
|
|
Effect of increase in sales volumes
|
|
$
|
146
|
|
Change in prices
|
|
114
|
|
|
|
|
260
|
|
|
Wholesale:
|
|
|
||
Effect of decrease in sales volumes
|
|
(133
|
)
|
|
Change in prices
|
|
(75
|
)
|
|
Capacity revenue
|
|
55
|
|
|
|
|
(153
|
)
|
|
Increase in Generation Revenues
|
|
$
|
107
|
|
•
|
Fuel expense decreased $
34 million
in
2015
primarily related to lower economic dispatch resulting from low spot market energy prices.
|
•
|
Purchased power costs were
$163 million
higher in
2015
primarily due to increased volumes reflecting lower customer shopping as described above, higher unit costs related to higher default service auction results, and higher capacity expense at MP, partially offset by lower purchases resulting from the termination of certain NUG contracts at JCP&L and PN.
|
Source of Change in Purchased Power
|
|
Increase(Decrease)
|
|||
|
|
(In millions)
|
|||
Purchases from non-affiliates:
|
|
|
|||
Change due to increased unit costs
|
|
$
|
66
|
|
|
Change due to increased volumes
|
|
185
|
|
||
|
|
251
|
|
||
Purchases from affiliates:
|
|
|
|||
Change due to decreased unit costs
|
|
(21
|
)
|
||
Change due to decreased volumes
|
|
(113
|
)
|
||
|
|
(134
|
)
|
||
Capacity expense
|
|
36
|
|
||
Amortization of deferred costs
|
|
10
|
|
||
Increase in Purchased Power Costs
|
|
$
|
163
|
|
•
|
Other operating expenses increased
$161 million
primarily due to:
|
•
|
Higher transmission expenses of $73 million primarily due to an increase in network transmission expenses at the Ohio Companies, partially offset by lower congestion expenses at MP. The differences between current retail transmission revenues and transmission costs incurred are deferred for future recovery, resulting in no material impact on current period earnings.
|
•
|
Increased regulated generation operating and maintenance expenses of $7 million, reflecting higher planned outage expenses in 2015 compared to 2014.
|
•
|
Higher retirement benefit costs of $22 million, reflecting higher net benefit costs before the pension and OPEB mark-to-market adjustment described below.
|
•
|
Higher distribution operating and maintenance expenses of $54 million, reflecting increased reliability maintenance in New Jersey and the Pennsylvania companies and other employee benefit costs, partially offset by lower storm restoration costs.
|
•
|
Pension and OPEB mark-to-market adjustment decreased
$327 million
to
$179 million
, which was impacted by lower than expected asset returns, partially offset by an increase in the discount rate used to measure benefit obligations.
|
•
|
Depreciation expense increased
$14 million
due to a higher asset base, partially offset by lower depreciation rates at JCP&L effective with the implementation of new rates from its distribution base rate case as well as lower depreciation rates in Pennsylvania based on updated asset life studies approved by the PPUC.
|
•
|
Net regulatory asset amortization increased
$260 million
primarily due to:
|
•
|
Recovery of storm costs in New Jersey, Pennsylvania, and West Virginia effective with the implementation of new rates as discussed above ($66 million),
|
•
|
Higher energy efficiency program cost recovery ($66 million),
|
•
|
Lower deferral of TTS costs in West Virginia ($37 million),
|
•
|
Higher amortizations of above-market NUG costs in Pennsylvania and New Jersey ($36 million),
|
•
|
Lower deferral of West Virginia vegetation management expenses ($31 million),
|
•
|
Higher default generation service cost amortization ($28 million), and
|
•
|
Recovery of Pennsylvania legacy meter costs ($22 million); partially offset by
|
•
|
Higher cost deferral of Ohio network transmission expenses ($33 million).
|
•
|
General taxes increased
$10 million
primarily due to higher revenue-related taxes in Pennsylvania, partially offset by lower property taxes in Ohio.
|
|
|
For the Years Ended December 31,
|
|
|
||||||||
Revenues by Transmission Asset Owner
|
|
2015
|
|
2014
|
|
Increase
|
||||||
|
|
(In millions)
|
||||||||||
ATSI
|
|
$
|
446
|
|
|
$
|
242
|
|
|
$
|
204
|
|
TrAIL
|
|
252
|
|
|
214
|
|
|
38
|
|
|||
PATH
|
|
13
|
|
|
13
|
|
|
—
|
|
|||
Utilities
|
|
300
|
|
|
300
|
|
|
—
|
|
|||
Total Revenues
|
|
$
|
1,011
|
|
|
$
|
769
|
|
|
$
|
242
|
|
|
|
For the Years Ended December 31,
|
|
Increase (Decrease)
|
||||||||
Revenues by Type of Service
|
|
2015
|
|
2014
|
|
|||||||
|
|
(In millions)
|
||||||||||
Contract Sales:
|
|
|
|
|
|
|
||||||
Direct
|
|
$
|
1,269
|
|
|
$
|
2,359
|
|
|
$
|
(1,090
|
)
|
Governmental Aggregation
|
|
1,012
|
|
|
1,184
|
|
|
(172
|
)
|
|||
Mass Market
|
|
265
|
|
|
452
|
|
|
(187
|
)
|
|||
POLR
|
|
712
|
|
|
902
|
|
|
(190
|
)
|
|||
Structured Sales
|
|
558
|
|
|
522
|
|
|
36
|
|
|||
Total Contract Sales
|
|
3,816
|
|
|
5,419
|
|
|
(1,603
|
)
|
|||
Wholesale
|
|
1,225
|
|
|
461
|
|
|
764
|
|
|||
Transmission
|
|
138
|
|
|
220
|
|
|
(82
|
)
|
|||
Other
|
|
205
|
|
|
189
|
|
|
16
|
|
|||
Total Revenues
|
|
$
|
5,384
|
|
|
$
|
6,289
|
|
|
$
|
(905
|
)
|
|
|
|
|
|
|
|
|
|
For the Years Ended December 31,
|
|
Increase (Decrease)
|
|||||
MWH Sales by Channel
|
|
2015
|
|
2014
|
|
||||
|
|
(In thousands)
|
|
|
|||||
Contract Sales:
|
|
|
|
|
|
|
|||
Direct
|
|
23,585
|
|
|
44,012
|
|
|
(46.4
|
)%
|
Governmental Aggregation
|
|
15,443
|
|
|
19,569
|
|
|
(21.1
|
)%
|
Mass Market
|
|
3,878
|
|
|
6,773
|
|
|
(42.7
|
)%
|
POLR
|
|
11,950
|
|
|
15,708
|
|
|
(23.9
|
)%
|
Structured Sales
|
|
12,902
|
|
|
12,814
|
|
|
0.7
|
%
|
Total Contract Sales
|
|
67,758
|
|
|
98,876
|
|
|
(31.5
|
)%
|
Wholesale
|
|
7,326
|
|
|
680
|
|
|
977.4
|
%
|
Total MWH Sales
|
|
75,084
|
|
|
99,556
|
|
|
(24.6
|
)%
|
|
|
|
|
|
|
|
|
|
Source of Change in Revenues
|
||||||||||||||||||
|
|
Increase (Decrease)
|
||||||||||||||||||
MWH Sales Channel:
|
|
Sales Volumes
|
|
Prices
|
|
Gain on Settled Contracts
|
|
Capacity Revenue
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Direct
|
|
$
|
(1,095
|
)
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,090
|
)
|
Governmental Aggregation
|
|
(249
|
)
|
|
77
|
|
|
—
|
|
|
—
|
|
|
(172
|
)
|
|||||
Mass Market
|
|
(193
|
)
|
|
6
|
|
|
—
|
|
|
—
|
|
|
(187
|
)
|
|||||
POLR
|
|
(216
|
)
|
|
26
|
|
|
—
|
|
|
—
|
|
|
(190
|
)
|
|||||
Structured Sales
|
|
3
|
|
|
33
|
|
|
—
|
|
|
—
|
|
|
36
|
|
|||||
Wholesale
|
|
197
|
|
|
(8
|
)
|
|
107
|
|
|
468
|
|
|
764
|
|
•
|
Fuel costs decreased
$391 million
primarily due to lower economic dispatch of fossil units resulting from low spot market energy prices and lower nuclear unit prices, resulting from the suspension of the DOE nuclear disposal fee, effective May 16, 2014. Additionally, fuel costs were impacted by a decrease in settlement and termination costs related to coal and transportation contracts. The impact of terminations and settlements of coal and transportation contracts resulted in a pre-tax loss of $67 million and $166 million in 2015 and 2014, respectively.
|
•
|
Purchased power costs decreased
$694 million
due to lower volumes ($888 million), partially offset by higher unit prices ($39 million) and higher capacity expenses ($155 million). Lower volumes were primarily due to decreased load requirements resulting from lower sales as discussed above, partially offset by lower fossil generation as discussed above. The higher unit prices are primarily due to higher losses on financially settled contracts, partially offset by lower market prices in 2015 as compared to 2014. The increase in capacity expense, which is a component of CES' retail price, was primarily the result of higher capacity rates associated with CES' retail sales obligations.
|
•
|
Nuclear operating costs increased $84 million as a result of higher planned outage costs and higher employee benefit expenses. There were three planned refueling outages in 2015 as compared to two planned outages in 2014.
|
•
|
Transmission expenses decreased $273 million primarily due to lower operating reserve and market-based ancillary costs associated with market conditions resulting from the extreme weather events in 2014.
|
•
|
General taxes decreased
$31 million
primarily due to lower gross receipts taxes associated with decreased retail sales volumes.
|
•
|
Pension and OPEB mark-to-market adjustment decreased
$267 million
to $60 million, which was impacted by lower than expected asset returns, partially offset by an increase in the discount rate used to measure benefit obligations.
|
•
|
Other operating expenses decreased $212 million primarily due to a $141 million decrease in mark-to-market expenses on commodity contract positions reflecting lower market prices and a $71 million decrease in retail-related costs.
|
•
|
Impairments of long-lived assets increased $34 million due to impairment charges associated with non-core assets.
|
2014 Financial Results
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Competitive
Energy Services |
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
External
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Electric
|
|
$
|
8,898
|
|
|
$
|
769
|
|
|
$
|
5,281
|
|
|
$
|
(193
|
)
|
|
$
|
14,755
|
|
Other
|
|
204
|
|
|
—
|
|
|
189
|
|
|
(99
|
)
|
|
294
|
|
|||||
Internal
|
|
—
|
|
|
—
|
|
|
819
|
|
|
(819
|
)
|
|
—
|
|
|||||
Total Revenues
|
|
9,102
|
|
|
769
|
|
|
6,289
|
|
|
(1,111
|
)
|
|
15,049
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Fuel
|
|
567
|
|
|
—
|
|
|
1,713
|
|
|
—
|
|
|
2,280
|
|
|||||
Purchased power
|
|
3,385
|
|
|
—
|
|
|
2,150
|
|
|
(819
|
)
|
|
4,716
|
|
|||||
Other operating expenses
|
|
2,081
|
|
|
139
|
|
|
2,075
|
|
|
(333
|
)
|
|
3,962
|
|
|||||
Pension and OPEB mark-to-market
|
|
506
|
|
|
2
|
|
|
327
|
|
|
—
|
|
|
835
|
|
|||||
Provision for depreciation
|
|
658
|
|
|
127
|
|
|
387
|
|
|
48
|
|
|
1,220
|
|
|||||
Amortization of regulatory assets, net
|
|
1
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|||||
General taxes
|
|
693
|
|
|
70
|
|
|
171
|
|
|
28
|
|
|
962
|
|
|||||
Impairment of long-lived assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total Operating Expenses
|
|
7,891
|
|
|
349
|
|
|
6,823
|
|
|
(1,076
|
)
|
|
13,987
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Income (loss)
|
|
1,211
|
|
|
420
|
|
|
(534
|
)
|
|
(35
|
)
|
|
1,062
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Loss on debt redemptions
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|||||
Investment income
|
|
56
|
|
|
—
|
|
|
54
|
|
|
(38
|
)
|
|
72
|
|
|||||
Interest expense
|
|
(589
|
)
|
|
(131
|
)
|
|
(189
|
)
|
|
(164
|
)
|
|
(1,073
|
)
|
|||||
Capitalized interest
|
|
14
|
|
|
55
|
|
|
37
|
|
|
12
|
|
|
118
|
|
|||||
Total Other Expense
|
|
(519
|
)
|
|
(76
|
)
|
|
(106
|
)
|
|
(190
|
)
|
|
(891
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) From Continuing Operations Before Income Taxes (Benefits)
|
|
692
|
|
|
344
|
|
|
(640
|
)
|
|
(225
|
)
|
|
171
|
|
|||||
Income taxes (benefits)
|
|
227
|
|
|
121
|
|
|
(223
|
)
|
|
(167
|
)
|
|
(42
|
)
|
|||||
Income (Loss) From Continuing Operations
|
|
465
|
|
|
223
|
|
|
(417
|
)
|
|
(58
|
)
|
|
213
|
|
|||||
Discontinued Operations, net of tax
|
|
—
|
|
|
—
|
|
|
86
|
|
|
—
|
|
|
86
|
|
|||||
Net Income (Loss)
|
|
$
|
465
|
|
|
$
|
223
|
|
|
$
|
(331
|
)
|
|
$
|
(58
|
)
|
|
$
|
299
|
|
2013 Financial Results
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Competitive
Energy Services |
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
External
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Electric
|
|
$
|
8,499
|
|
|
$
|
731
|
|
|
$
|
5,542
|
|
|
$
|
(161
|
)
|
|
$
|
14,611
|
|
Other
|
|
221
|
|
|
—
|
|
|
186
|
|
|
(126
|
)
|
|
281
|
|
|||||
Internal
|
|
—
|
|
|
—
|
|
|
770
|
|
|
(770
|
)
|
|
—
|
|
|||||
Total Revenues
|
|
8,720
|
|
|
731
|
|
|
6,498
|
|
|
(1,057
|
)
|
|
14,892
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Fuel
|
|
377
|
|
|
—
|
|
|
2,119
|
|
|
—
|
|
|
2,496
|
|
|||||
Purchased power
|
|
3,308
|
|
|
—
|
|
|
1,425
|
|
|
(770
|
)
|
|
3,963
|
|
|||||
Other operating expenses
|
|
1,773
|
|
|
131
|
|
|
2,007
|
|
|
(318
|
)
|
|
3,593
|
|
|||||
Pension and OPEB mark-to-market
|
|
(149
|
)
|
|
—
|
|
|
(107
|
)
|
|
—
|
|
|
(256
|
)
|
|||||
Provision for depreciation
|
|
606
|
|
|
114
|
|
|
439
|
|
|
43
|
|
|
1,202
|
|
|||||
Amortization of regulatory assets, net
|
|
529
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
539
|
|
|||||
General taxes
|
|
697
|
|
|
54
|
|
|
202
|
|
|
25
|
|
|
978
|
|
|||||
Impairment of long-lived assets
|
|
322
|
|
|
—
|
|
|
473
|
|
|
—
|
|
|
795
|
|
|||||
Total Operating Expenses
|
|
7,463
|
|
|
309
|
|
|
6,558
|
|
|
(1,020
|
)
|
|
13,310
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Income (Loss)
|
|
1,257
|
|
|
422
|
|
|
(60
|
)
|
|
(37
|
)
|
|
1,582
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gain (loss) on debt redemptions
|
|
—
|
|
|
—
|
|
|
(149
|
)
|
|
17
|
|
|
(132
|
)
|
|||||
Investment income
|
|
57
|
|
|
—
|
|
|
14
|
|
|
(38
|
)
|
|
33
|
|
|||||
Interest expense
|
|
(543
|
)
|
|
(93
|
)
|
|
(222
|
)
|
|
(158
|
)
|
|
(1,016
|
)
|
|||||
Capitalized interest
|
|
31
|
|
|
14
|
|
|
42
|
|
|
16
|
|
|
103
|
|
|||||
Total Other Expense
|
|
(455
|
)
|
|
(79
|
)
|
|
(315
|
)
|
|
(163
|
)
|
|
(1,012
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) From Continuing Operations Before Income Taxes (Benefits)
|
|
802
|
|
|
343
|
|
|
(375
|
)
|
|
(200
|
)
|
|
570
|
|
|||||
Income taxes (benefits)
|
|
301
|
|
|
129
|
|
|
(140
|
)
|
|
(95
|
)
|
|
195
|
|
|||||
Income From Continuing Operations
|
|
501
|
|
|
214
|
|
|
(235
|
)
|
|
(105
|
)
|
|
375
|
|
|||||
Discontinued Operations, net of tax
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
17
|
|
|||||
Net Income (Loss)
|
|
$
|
501
|
|
|
$
|
214
|
|
|
$
|
(218
|
)
|
|
$
|
(105
|
)
|
|
$
|
392
|
|
Changes Between 2014 and 2013 Financial Results Increase (Decrease)
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Competitive
Energy Services |
|
Corporate/Other and Reconciling Adjustments
|
|
FirstEnergy Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
External
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Electric
|
|
$
|
399
|
|
|
$
|
38
|
|
|
$
|
(261
|
)
|
|
$
|
(32
|
)
|
|
$
|
144
|
|
Other
|
|
(17
|
)
|
|
—
|
|
|
3
|
|
|
27
|
|
|
13
|
|
|||||
Internal
|
|
—
|
|
|
—
|
|
|
49
|
|
|
(49
|
)
|
|
—
|
|
|||||
Total Revenues
|
|
382
|
|
|
38
|
|
|
(209
|
)
|
|
(54
|
)
|
|
157
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Fuel
|
|
190
|
|
|
—
|
|
|
(406
|
)
|
|
—
|
|
|
(216
|
)
|
|||||
Purchased power
|
|
77
|
|
|
—
|
|
|
725
|
|
|
(49
|
)
|
|
753
|
|
|||||
Other operating expenses
|
|
308
|
|
|
8
|
|
|
68
|
|
|
(15
|
)
|
|
369
|
|
|||||
Pension and OPEB mark-to-market
|
|
655
|
|
|
2
|
|
|
434
|
|
|
—
|
|
|
1,091
|
|
|||||
Provision for depreciation
|
|
52
|
|
|
13
|
|
|
(52
|
)
|
|
5
|
|
|
18
|
|
|||||
Amortization of regulatory assets, net
|
|
(528
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(527
|
)
|
|||||
General taxes
|
|
(4
|
)
|
|
16
|
|
|
(31
|
)
|
|
3
|
|
|
(16
|
)
|
|||||
Impairment of long-lived assets
|
|
(322
|
)
|
|
—
|
|
|
(473
|
)
|
|
—
|
|
|
(795
|
)
|
|||||
Total Operating Expenses
|
|
428
|
|
|
40
|
|
|
265
|
|
|
(56
|
)
|
|
677
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Income (Loss)
|
|
(46
|
)
|
|
(2
|
)
|
|
(474
|
)
|
|
2
|
|
|
(520
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Loss on debt redemptions
|
|
—
|
|
|
—
|
|
|
141
|
|
|
(17
|
)
|
|
124
|
|
|||||
Investment income
|
|
(1
|
)
|
|
—
|
|
|
40
|
|
|
—
|
|
|
39
|
|
|||||
Interest expense
|
|
(46
|
)
|
|
(38
|
)
|
|
33
|
|
|
(6
|
)
|
|
(57
|
)
|
|||||
Capitalized interest
|
|
(17
|
)
|
|
41
|
|
|
(5
|
)
|
|
(4
|
)
|
|
15
|
|
|||||
Total Other Expense
|
|
(64
|
)
|
|
3
|
|
|
209
|
|
|
(27
|
)
|
|
121
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) From Continuing Operations Before Income Taxes (Benefits)
|
|
(110
|
)
|
|
1
|
|
|
(265
|
)
|
|
(25
|
)
|
|
(399
|
)
|
|||||
Income taxes (benefits)
|
|
(74
|
)
|
|
(8
|
)
|
|
(83
|
)
|
|
(72
|
)
|
|
(237
|
)
|
|||||
Income (Loss) From Continuing Operations
|
|
(36
|
)
|
|
9
|
|
|
(182
|
)
|
|
47
|
|
|
(162
|
)
|
|||||
Discontinued Operations, net of tax
|
|
—
|
|
|
—
|
|
|
69
|
|
|
—
|
|
|
69
|
|
|||||
Net Income (Loss)
|
|
$
|
(36
|
)
|
|
$
|
9
|
|
|
$
|
(113
|
)
|
|
$
|
47
|
|
|
$
|
(93
|
)
|
|
|
For the Years Ended December 31,
|
|
Increase
|
||||||||
Revenues by Type of Service
|
|
2014
|
|
2013
|
|
(Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
Distribution services
|
|
$
|
3,694
|
|
|
$
|
3,762
|
|
|
$
|
(68
|
)
|
|
|
|
|
|
|
|
||||||
Generation sales:
|
|
|
|
|
|
|
||||||
Retail
|
|
4,043
|
|
|
3,959
|
|
|
84
|
|
|||
Wholesale
|
|
661
|
|
|
330
|
|
|
331
|
|
|||
Total generation sales
|
|
4,704
|
|
|
4,289
|
|
|
415
|
|
|||
|
|
|
|
|
|
|
||||||
Transmission sales:
|
|
|
|
|
|
|
||||||
Retail
|
|
352
|
|
|
347
|
|
|
5
|
|
|||
Wholesale
|
|
148
|
|
|
101
|
|
|
47
|
|
|||
Total transmission sales
|
|
500
|
|
|
448
|
|
|
52
|
|
|||
Other
|
|
204
|
|
|
221
|
|
|
(17
|
)
|
|||
Total Revenues
|
|
$
|
9,102
|
|
|
$
|
8,720
|
|
|
$
|
382
|
|
|
|
For the Years Ended December 31,
|
|
|
|||||
Electric Distribution MWH Deliveries
|
|
2014
|
|
2013
|
|
Increase
|
|||
|
|
(In thousands)
|
|
|
|||||
Residential
|
|
54,766
|
|
|
54,479
|
|
|
0.5
|
%
|
Commercial
|
|
42,925
|
|
|
42,582
|
|
|
0.8
|
%
|
Industrial
|
|
51,276
|
|
|
50,243
|
|
|
2.1
|
%
|
Other
|
|
586
|
|
|
584
|
|
|
0.3
|
%
|
Total Electric Distribution MWH Deliveries
|
|
149,553
|
|
|
147,888
|
|
|
1.1
|
%
|
Source of Change in Generation Revenues
|
|
Increase
|
||
|
|
(In millions)
|
||
Retail:
|
|
|
|
|
Effect of increase in sales volumes
|
|
$
|
14
|
|
Change in prices
|
|
70
|
|
|
|
|
84
|
|
|
Wholesale:
|
|
|
||
Effect of increase in sales volumes
|
|
166
|
|
|
Change in prices
|
|
79
|
|
|
Capacity revenue
|
|
86
|
|
|
|
|
331
|
|
|
Increase in Generation Revenues
|
|
$
|
415
|
|
•
|
Fuel expense was
$190 million
higher in 2014 primarily related to increased generation as a result of the October 2013 Harrison/Pleasants asset transfer.
|
•
|
Purchased power costs were
$77 million
higher in
2014
primarily due to increased unit prices and capacity expense reflecting higher auction clearing prices, partially offset by a decrease in purchased volumes required.
|
Source of Change in Purchased Power
|
|
Increase(Decrease)
|
|||
|
|
(In millions)
|
|||
Purchases from non-affiliates:
|
|
|
|||
Change due to increased unit costs
|
|
$
|
127
|
|
|
Change due to decreased volumes
|
|
(134
|
)
|
||
|
|
(7
|
)
|
||
Purchases from affiliates:
|
|
|
|||
Change due to increased unit costs
|
|
39
|
|
||
Change due to increased volumes
|
|
2
|
|
||
|
|
41
|
|
||
Capacity expense
|
|
58
|
|
||
Increase in costs deferred
|
|
(15
|
)
|
||
Increase in Purchased Power Costs
|
|
$
|
77
|
|
•
|
Higher transmission expenses of $130 million primarily due to PJM transmission costs associated with higher congestion rates at MP as a result of market conditions related to extreme weather events in January 2014 and higher PJM transmission costs resulting from the October 2013 Harrison/Pleasants asset transfer. The differences between current transmission revenues and transmission costs incurred are deferred for future recovery, resulting in no material impact on current period earnings.
|
•
|
Higher distribution operating and maintenance expenses of $75 million resulting from higher maintenance activities and storm related restoration expenses, including $26 million of storm expenses deferred for future recovery.
|
•
|
Higher vegetation management expenses in West Virginia of $33 million, which were deferred for future recovery per authorization of the WVPSC.
|
•
|
Higher retirement benefit costs of $33 million primarily reflecting higher net periodic benefit costs before the pension and OPEB mark-to-market adjustments discussed below.
|
•
|
Increased regulated generation operating and maintenance expenses of $23 million, reflecting increased costs associated with the October 2013 Harrison/Pleasants asset transfer and a planned outage at Fort Martin.
|
•
|
Pension and OPEB mark-to-market adjustments increased
$655 million
to
$506 million
, primarily reflecting a lower discount rate and revisions to mortality assumptions extending the expected life in key demographics used to measure related obligations in 2014.
|
•
|
Depreciation expense increased
$52 million
due to a higher asset base, including $22 million at MP associated with the October 2013 Harrison/Pleasants asset transfer.
|
•
|
Net regulatory asset amortization decreased
$528 million
primarily due to:
|
◦
|
Impairment charges on regulatory assets of $305 million associated with the recovery of marginal transmission losses at ME and PN ($254 million) and the recovery of RECs for the Ohio Companies ($51 million) that occurred in 2013,
|
◦
|
Decreased energy efficiency amortization reflecting a rate decrease associated with certain programs for the Pennsylvania Companies ($67 million),
|
◦
|
Lower default generation service and NUG costs recovery in Pennsylvania ($48 million),
|
◦
|
Increased deferral of West Virginia vegetation management expenses ($33 million) and customer refunds associated with the gain on the Pleasants plant resulting from the October 2013 Harrison/Pleasants asset transfer ($36 million), and
|
◦
|
Higher storm cost deferrals ($26 million).
|
•
|
General taxes decreased
$4 million
primarily due to lower revenue-related taxes, partially offset by higher property taxes and an increase in the West Virginia business and occupation tax as a result of the October 2013 Harrison/Pleasants asset transfer.
|
•
|
The 2013 impairment of long-lived assets of
$322 million
reflects MP's charge to reduce the net book value of the Harrison plant to the amount permitted to be included in rate base as part of the October 2013 Harrison/Pleasants asset transfer.
|
|
|
For the Years Ended December 31,
|
|
|
||||||||
Revenues by Transmission Asset Owner
|
|
2014
|
|
2013
|
|
Increase (Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
ATSI
|
|
$
|
242
|
|
|
$
|
209
|
|
|
$
|
33
|
|
TrAIL
|
|
214
|
|
|
207
|
|
|
7
|
|
|||
PATH
|
|
13
|
|
|
20
|
|
|
(7
|
)
|
|||
Utilities
|
|
300
|
|
|
295
|
|
|
5
|
|
|||
Total Revenues
|
|
$
|
769
|
|
|
$
|
731
|
|
|
$
|
38
|
|
|
|
For the Years Ended December 31,
|
|
Increase
|
||||||||
Revenues by Type of Service
|
|
2014
|
|
2013
|
|
(Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
Contract Sales:
|
|
|
|
|
|
|
||||||
Direct
|
|
$
|
2,359
|
|
|
$
|
2,913
|
|
|
$
|
(554
|
)
|
Governmental Aggregation
|
|
1,184
|
|
|
1,185
|
|
|
(1
|
)
|
|||
Mass Market
|
|
452
|
|
|
448
|
|
|
4
|
|
|||
POLR
|
|
902
|
|
|
858
|
|
|
44
|
|
|||
Structured Sales
|
|
522
|
|
|
421
|
|
|
101
|
|
|||
Total Contract Sales
|
|
5,419
|
|
|
5,825
|
|
|
(406
|
)
|
|||
Wholesale
|
|
461
|
|
|
343
|
|
|
118
|
|
|||
Transmission
|
|
220
|
|
|
144
|
|
|
76
|
|
|||
Other
|
|
189
|
|
|
186
|
|
|
3
|
|
|||
Total Revenues
|
|
$
|
6,289
|
|
|
$
|
6,498
|
|
|
$
|
(209
|
)
|
|
|
|
|
|
|
|
|
|
For the Years Ended December 31,
|
|
Increase
|
|||||
MWH Sales by Channel
|
|
2014
|
|
2013
|
|
(Decrease)
|
|||
|
|
(In thousands)
|
|
|
|||||
Contract Sales:
|
|
|
|
|
|
|
|||
Direct
|
|
44,012
|
|
|
56,145
|
|
|
(21.6
|
)%
|
Governmental Aggregation
|
|
19,569
|
|
|
20,859
|
|
|
(6.2
|
)%
|
Mass Market
|
|
6,773
|
|
|
6,761
|
|
|
0.2
|
%
|
POLR
|
|
15,708
|
|
|
15,758
|
|
|
(0.3
|
)%
|
Structured Sales
|
|
12,814
|
|
|
9,047
|
|
|
41.6
|
%
|
Total Contract Sales
|
|
98,876
|
|
|
108,570
|
|
|
(8.9
|
)%
|
Wholesale
|
|
680
|
|
|
1,250
|
|
|
(45.6
|
)%
|
Total MWH Sales
|
|
99,556
|
|
|
109,820
|
|
|
(9.3
|
)%
|
|
|
|
|
|
|
|
|
|
Source of Change in Revenues
|
||||||||||||||||||
|
|
Increase (Decrease)
|
||||||||||||||||||
MWH Sales Channel:
|
|
Sales Volumes
|
|
Prices
|
|
Gain on Settled Contracts
|
|
Capacity Revenue
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Direct
|
|
$
|
(629
|
)
|
|
$
|
75
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(554
|
)
|
Governmental Aggregation
|
|
(73
|
)
|
|
72
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||
Mass Market
|
|
1
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
POLR
|
|
(3
|
)
|
|
47
|
|
|
—
|
|
|
—
|
|
|
44
|
|
|||||
Structured Sales
|
|
176
|
|
|
(75
|
)
|
|
—
|
|
|
—
|
|
|
101
|
|
|||||
Wholesale
|
|
(17
|
)
|
|
—
|
|
|
(21
|
)
|
|
156
|
|
|
118
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
•
|
Fuel costs decreased $406 million primarily due to lower generation volumes resulting from the October 2013 Harrison/Pleasants asset transfer, the deactivation of certain power plants in 2013 and increased outages as compared to the same period of 2013. Higher unit prices, primarily driven by increased peaking generation, was partially offset by the suspension of the DOE nuclear disposal fee, which was effective May
2014
. Additionally, fuel costs were impacted by an increase in settlement and termination costs related to coal and transportation contracts. Terminations and settlements associated with damages on coal and transportation contracts were approximately $166 million and $128 million in
2014
and 2013, respectively.
|
•
|
Purchased power costs increased $725 million due to higher volumes ($252 million), increased unit prices ($565 million) and higher capacity expenses ($311 million), partially offset by lower losses on financially settled contracts ($403 million). Higher purchased volumes were primarily due to lower available generation due to outages, the October 2013 Harrison/Pleasants asset transfer and the deactivation of certain power plants in 2013, partially offset by lower contract sales as described above. The increase in unit prices was primarily a result of market conditions related to extreme weather events in January
2014
, partially offset by lower losses on financially settled contracts. The increase in capacity expense, which is a component of the segment's retail price, was primarily the result of higher capacity rates associated with the segment's retail sales obligations.
|
•
|
Fossil operating costs decreased $73 million primarily due to lower contractor, labor and materials and equipment costs resulting from previously deactivated units and the October 2013 Harrison/Pleasants asset transfer.
|
•
|
Nuclear operating costs increased $6 million as a result of higher labor, contractor, materials and equipment costs. There were two refueling outages in each of
2014
and 2013, however, the duration of the outages in 2014 exceeded the prior year.
|
•
|
Transmission expenses increased $80 million primarily due to higher operating reserve and market-based ancillary costs associated with market conditions related to extreme weather events in
2014
. Additionally, effective June 1, 2013, network expenses associated with POLR sales in Pennsylvania became the responsibility of suppliers.
|
•
|
General taxes decreased $31 million primarily due to lower gross receipts taxes resulting from reduced retail sales volumes, lower payroll taxes as a result of lower labor costs noted above, lower property taxes due to the October 2013 Harrison/Pleasants asset transfer, and reduced Ohio personal property taxes.
|
•
|
Impairments of long-lived assets decreased $473 million due to the impairment of two unregulated, coal-fired generating plants recognized in 2013.
|
•
|
Depreciation expense decreased $52 million primarily due to a reduction in the asset base as a result of the plant deactivations and the October 2013 Harrison/Pleasants asset transfer noted above.
|
•
|
Pension and OPEB mark-to-market adjustments increased $434 million to $327 million, primarily reflecting a lower discount rate and revisions to mortality assumptions extending the expected life in key demographics used to measure related obligations in
2014
.
|
•
|
Other operating expenses increased $55 million primarily due to an increase in mark-to-market expenses on commodity contract positions, and an impairment of deferred advertising costs of $23 million associated with the elimination of future selling efforts in the Mass Market and certain Direct sales channels, partially offset by lower retail and marketing related costs.
|
Regulatory Assets (Liabilities) by Source
|
|
December 31,
2015 |
|
December 31,
2014 |
|
Increase
(Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
Regulatory transition costs
|
|
$
|
185
|
|
|
$
|
240
|
|
|
$
|
(55
|
)
|
Customer receivables for future income taxes
|
|
355
|
|
|
370
|
|
|
(15
|
)
|
|||
Nuclear decommissioning and spent fuel disposal costs
|
|
(272
|
)
|
|
(305
|
)
|
|
33
|
|
|||
Asset removal costs
|
|
(372
|
)
|
|
(254
|
)
|
|
(118
|
)
|
|||
Deferred transmission costs
|
|
115
|
|
|
90
|
|
|
25
|
|
|||
Deferred generation costs
|
|
243
|
|
|
281
|
|
|
(38
|
)
|
|||
Deferred distribution costs
|
|
335
|
|
|
182
|
|
|
153
|
|
|||
Contract valuations
|
|
186
|
|
|
153
|
|
|
33
|
|
|||
Storm-related costs
|
|
403
|
|
|
465
|
|
|
(62
|
)
|
|||
Other
|
|
170
|
|
|
189
|
|
|
(19
|
)
|
|||
Net Regulatory Assets included on the Consolidated Balance Sheets
|
|
$
|
1,348
|
|
|
$
|
1,411
|
|
|
$
|
(63
|
)
|
Currently Payable Long-Term Debt
|
|
(In millions)
|
||
PCRBs supported by bank LOCs
(1)
|
|
$
|
92
|
|
FMBs
|
|
245
|
|
|
Unsecured notes
|
|
300
|
|
|
Unsecured PCRBs
(1)
|
|
391
|
|
|
Collateralized lease obligation bonds
|
|
23
|
|
|
Sinking fund requirements
|
|
87
|
|
|
Other notes
|
|
28
|
|
|
|
|
$
|
1,166
|
|
(1)
|
These PCRBs are classified as currently payable long-term debt because the applicable interest rate mode permits individual debt holders to put the respective debt back to the issuer prior to maturity.
|
Borrower(s)
|
|
Type
|
|
Maturity
|
|
Commitment
|
|
Available Liquidity
|
||||
|
|
|
|
|
|
(In millions)
|
||||||
FirstEnergy
(1)
|
|
Revolving
|
|
March 2019
|
|
$
|
3,500
|
|
|
$
|
1,595
|
|
FES / AE Supply
|
|
Revolving
|
|
March 2019
|
|
1,500
|
|
|
1,442
|
|
||
FET
(2)
|
|
Revolving
|
|
March 2019
|
|
1,000
|
|
|
1,000
|
|
||
|
|
|
|
Subtotal
|
|
$
|
6,000
|
|
|
$
|
4,037
|
|
|
|
|
|
Cash
|
|
—
|
|
|
63
|
|
||
|
|
|
|
Total
|
|
$
|
6,000
|
|
|
$
|
4,100
|
|
(1)
|
FE and the Utilities.
|
(2)
|
Includes FET, ATSI and TrAIL.
|
Borrower
|
|
FirstEnergy Revolving
Credit Facility
Sub-Limit
|
|
FES/AE Supply Revolving
Credit Facility
Sub-Limit
|
|
FET Revolving
Credit Facility
Sub-Limit
|
|
Regulatory and
Other Short-Term Debt Limitations
|
|
|
||||||||||||
|
|
(In millions)
|
|
|
||||||||||||||||||
FE
|
|
|
$
|
3,500
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
(1)
|
|
FES
|
|
|
—
|
|
|
|
1,500
|
|
|
|
—
|
|
|
|
—
|
|
(2)
|
|
||||
AE Supply
|
|
|
—
|
|
|
|
1,000
|
|
|
|
—
|
|
|
|
—
|
|
(2)
|
|
||||
FET
|
|
|
—
|
|
|
|
—
|
|
|
|
1,000
|
|
|
|
—
|
|
(1)
|
|
||||
OE
|
|
|
500
|
|
|
|
—
|
|
|
|
—
|
|
|
|
500
|
|
(3)
|
|
||||
CEI
|
|
|
500
|
|
|
|
—
|
|
|
|
—
|
|
|
|
500
|
|
(3)
|
|
||||
TE
|
|
|
500
|
|
|
|
—
|
|
|
|
—
|
|
|
|
500
|
|
(3)
|
|
||||
JCP&L
|
|
|
600
|
|
|
|
—
|
|
|
|
—
|
|
|
|
500
|
|
(3)
|
|
||||
ME
|
|
|
300
|
|
|
|
—
|
|
|
|
—
|
|
|
|
500
|
|
(3)
|
|
||||
PN
|
|
|
300
|
|
|
|
—
|
|
|
|
—
|
|
|
|
300
|
|
(3)
|
|
||||
WP
|
|
|
200
|
|
|
|
—
|
|
|
|
—
|
|
|
|
200
|
|
(3)
|
|
||||
MP
|
|
|
500
|
|
|
|
—
|
|
|
|
—
|
|
|
|
500
|
|
(3)
|
|
||||
PE
|
|
|
150
|
|
|
|
—
|
|
|
|
—
|
|
|
|
150
|
|
(3)
|
|
||||
ATSI
|
|
|
—
|
|
|
|
—
|
|
|
|
500
|
|
|
|
500
|
|
(3)
|
|
||||
Penn
|
|
|
50
|
|
|
|
—
|
|
|
|
—
|
|
|
|
100
|
|
(3)
|
|
||||
TrAIL
|
|
|
—
|
|
|
|
—
|
|
|
|
400
|
|
|
|
400
|
|
(3)
|
|
(1)
|
No limitations.
|
(2)
|
No limitation based upon blanket financing authorization from the FERC under existing market-based rate tariffs.
|
(3)
|
Includes amounts which may be borrowed under the regulated companies' money pool.
|
Bank
|
|
Aggregate Amount
(1)
|
|
Termination Date
|
|
Reimbursements of Draws Due
|
||
|
|
(In millions)
|
|
|
|
|
||
The Bank of Nova Scotia
|
|
$
|
92
|
|
|
March 2017
|
|
March 2017
|
(1)
|
Excludes approximately
$1 million
of applicable interest coverage.
|
|
|
Senior Secured
|
|
Senior Unsecured
|
||||||
Issuer
|
|
S&P
|
|
Moody’s
|
|
S&P
|
|
Moody’s
|
|
Fitch
|
FE
|
|
—
|
|
—
|
|
BB+
|
|
Baa3
|
|
BB+
|
FES
|
|
BBB-
|
|
—
|
|
BBB-
|
|
Baa3
|
|
—
|
AE Supply
|
|
BBB-
|
|
—
|
|
BBB-
|
|
Baa3
|
|
—
|
AGC
|
|
—
|
|
—
|
|
BBB-
|
|
Baa3
|
|
—
|
ATSI
|
|
—
|
|
—
|
|
BBB-
|
|
Baa2
|
|
—
|
CEI
|
|
BBB+
|
|
Baa1
|
|
BBB-
|
|
Baa3
|
|
—
|
FET
|
|
—
|
|
—
|
|
BB+
|
|
Baa3
|
|
|
JCP&L
|
|
—
|
|
—
|
|
BBB-
|
|
Baa2
|
|
—
|
ME
|
|
—
|
|
—
|
|
BBB-
|
|
Baa1
|
|
—
|
MP
|
|
BBB+
|
|
A3
|
|
—
|
|
—
|
|
—
|
OE
|
|
BBB+
|
|
A2
|
|
BBB-
|
|
Baa1
|
|
—
|
PN
|
|
—
|
|
—
|
|
BBB-
|
|
Baa2
|
|
—
|
Penn
|
|
—
|
|
A2
|
|
—
|
|
—
|
|
—
|
PE
|
|
BBB+
|
|
A3
|
|
—
|
|
—
|
|
—
|
TE
|
|
BBB
|
|
Baa1
|
|
—
|
|
—
|
|
—
|
TrAIL
|
|
—
|
|
—
|
|
BBB-
|
|
A3
|
|
—
|
WP
|
|
BBB+
|
|
A2
|
|
—
|
|
—
|
|
—
|
•
|
Distribution rate increases associated with the implementation of new rates, partially offset by a year-over-year decline in distribution deliveries;
|
•
|
Higher transmission revenue and earnings, reflecting recovery of incremental operating expenses, a higher rate base and forward-looking rates at ATSI;
|
•
|
Higher capacity revenues at CES, partially offset by a decline in sales volume;
|
•
|
Lower disbursements for fuel and purchased power resulting from the lower sales volumes; and
|
•
|
Lower posted collateral; partially offset by,
|
•
|
A $143 million contribution to the qualified pension plan in 2015.
|
|
|
For the Years Ended December 31,
|
||||||||||
Securities Issued or Redeemed / Repaid
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
(In millions)
|
||||||||||
New Issues
|
|
|
|
|
|
|
|
|
|
|||
Unsecured notes
|
|
$
|
475
|
|
|
$
|
2,400
|
|
|
$
|
2,300
|
|
PCRBs
|
|
339
|
|
|
878
|
|
|
—
|
|
|||
FMBs
|
|
295
|
|
|
200
|
|
|
1,000
|
|
|||
Term loan
|
|
200
|
|
|
1,050
|
|
|
—
|
|
|||
Senior secured notes
|
|
2
|
|
|
—
|
|
|
445
|
|
|||
|
|
$
|
1,311
|
|
|
$
|
4,528
|
|
|
$
|
3,745
|
|
|
|
|
|
|
|
|
||||||
Redemptions / Repayments
|
|
|
|
|
|
|
|
|
|
|||
Unsecured notes
|
|
$
|
—
|
|
|
$
|
(600
|
)
|
|
$
|
(2,284
|
)
|
PCRBs
|
|
(313
|
)
|
|
(793
|
)
|
|
(470
|
)
|
|||
FMBs
|
|
(215
|
)
|
|
(175
|
)
|
|
(420
|
)
|
|||
Term loan
|
|
(200
|
)
|
|
—
|
|
|
—
|
|
|||
Senior secured notes
|
|
(151
|
)
|
|
(191
|
)
|
|
(376
|
)
|
|||
Long-term revolving credit
|
|
—
|
|
|
—
|
|
|
(50
|
)
|
|||
|
|
$
|
(879
|
)
|
|
$
|
(1,759
|
)
|
|
$
|
(3,600
|
)
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
Tender premiums paid on debt redemptions
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(110
|
)
|
|
|
|
|
|
|
|
||||||
Short-term borrowings, net
|
|
$
|
(91
|
)
|
|
$
|
(1,605
|
)
|
|
$
|
1,435
|
|
|
|
|
|
|
|
|
||||||
Common stock dividend payments
|
|
$
|
(607
|
)
|
|
$
|
(604
|
)
|
|
$
|
(920
|
)
|
|
|
For the Years Ended December 31,
|
||||||||||
Cash Used for Investing Activities
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
(In millions)
|
||||||||||
Property Additions:
|
|
|
|
|
|
|
||||||
Regulated distribution
|
|
$
|
1,108
|
|
|
$
|
972
|
|
|
$
|
1,272
|
|
Regulated transmission
|
|
952
|
|
|
1,329
|
|
|
461
|
|
|||
Competitive energy services
|
|
588
|
|
|
939
|
|
|
827
|
|
|||
Other and reconciling adjustments
|
|
56
|
|
|
72
|
|
|
78
|
|
|||
Nuclear fuel
|
|
190
|
|
|
233
|
|
|
250
|
|
|||
Proceeds from asset sales
|
|
(20
|
)
|
|
(394
|
)
|
|
(4
|
)
|
|||
Investments
|
|
107
|
|
|
68
|
|
|
72
|
|
|||
Asset removal costs
|
|
142
|
|
|
153
|
|
|
146
|
|
|||
Other
|
|
(1
|
)
|
|
(13
|
)
|
|
(9
|
)
|
|||
|
|
$
|
3,122
|
|
|
$
|
3,359
|
|
|
$
|
3,093
|
|
•
|
a decrease of
$351 million
at CES, resulting from the absence of capital investments associated with the Davis-Besse steam generators that were placed into service in May 2014,
|
•
|
a decrease of
$377 million
at Regulated Transmission primarily relating to the timing of capital investments associated with its
Energizing the Future
investment program
,
partially offset by
|
•
|
an increase of
$136 million
at Regulated Distribution relating to utility specific project investments and costs associated with the Pennsylvania smart meter program.
|
Contractual Obligations
|
|
Total
|
|
2016
|
|
2017-2018
|
|
2019-2020
|
|
Thereafter
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Long-term debt
(1)
|
|
$
|
20,238
|
|
|
$
|
1,039
|
|
|
$
|
3,435
|
|
|
$
|
3,499
|
|
|
$
|
12,265
|
|
Short-term borrowings
|
|
1,708
|
|
|
1,708
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Interest on long-term debt
(2)
|
|
12,523
|
|
|
1,015
|
|
|
1,839
|
|
|
1,500
|
|
|
8,169
|
|
|||||
Operating leases
(3)
|
|
2,083
|
|
|
184
|
|
|
254
|
|
|
207
|
|
|
1,438
|
|
|||||
Capital leases
(3)
|
|
150
|
|
|
36
|
|
|
55
|
|
|
32
|
|
|
27
|
|
|||||
Fuel and purchased power
(4)
|
|
13,578
|
|
|
1,812
|
|
|
2,539
|
|
|
2,117
|
|
|
7,110
|
|
|||||
Capital expenditures
(5)
|
|
2,213
|
|
|
877
|
|
|
938
|
|
|
398
|
|
|
—
|
|
|||||
Pension funding
|
|
3,564
|
|
|
381
|
|
|
1,122
|
|
|
787
|
|
|
1,274
|
|
|||||
Total
|
|
$
|
56,057
|
|
|
$
|
7,052
|
|
|
$
|
10,182
|
|
|
$
|
8,540
|
|
|
$
|
30,283
|
|
(1)
|
Excludes unamortized discounts and premiums, fair value accounting adjustments and capital leases.
|
(2)
|
Interest on variable-rate debt based on rates as of
December 31, 2015
.
|
(3)
|
See Note 6, Leases, of the Combined Notes to Consolidated Financial Statements.
|
(4)
|
Amounts under contract with fixed or minimum quantities based on estimated annual requirements.
|
(5)
|
Amounts represent committed capital expenditures as of December 31, 2015.
|
Guarantees and Other Assurances
|
|
Maximum Exposure
|
||
|
|
(In millions)
|
||
FE's Guarantees on Behalf of its Subsidiaries
|
|
|
|
|
Energy and Energy-Related Contracts
(1)
|
|
$
|
33
|
|
Deferred compensation arrangements
|
|
533
|
|
|
Other
(2)
|
|
17
|
|
|
|
|
583
|
|
|
Subsidiaries’ Guarantees
|
|
|
||
Energy and Energy-Related Contracts
(3)
|
|
251
|
|
|
FES’ guarantee of NG’s nuclear property insurance
|
|
98
|
|
|
FES' guarantee of nuclear decommissioning costs
|
|
21
|
|
|
FES’ guarantee of FG’s sale and leaseback obligations
|
|
1,767
|
|
|
|
|
2,137
|
|
|
FE's Guarantees on Behalf of Business Ventures
|
|
|
||
Global Holding Facility
|
|
300
|
|
|
|
|
|
||
Other Assurances
|
|
|
||
Surety Bonds - Wholly Owned Subsidiaries
|
|
398
|
|
|
Surety Bonds
|
|
22
|
|
|
FES' LOC (long-term tax-exempt debt)
(4)
|
|
93
|
|
|
LOCs
(5)
|
|
154
|
|
|
|
|
667
|
|
|
Total Guarantees and Other Assurances
|
|
$
|
3,687
|
|
(1)
|
Issued for open-ended terms, with a 10-day termination right by FirstEnergy.
|
(2)
|
Includes guarantees of $
4 million
for nuclear decommissioning funding assurances, $
7 million
for railcar leases, and $
6 million
for various leases.
|
(3)
|
Includes energy and energy-related contracts associated with FES of approximately $
248 million
.
|
(4)
|
Reflects the $1 million of interest coverage portion of LOCs issued in support of floating rate PCRBs with various maturities and the principal amount of floating-rate PCRBs of $
92 million
, all of which is reflected in currently payable long-term debt on FirstEnergy's consolidated balance sheets.
|
(5)
|
Includes $
54 million
issued for various terms pursuant to LOC capacity available under FirstEnergy's revolving credit facilities, $
88 million
issued in connection with energy and energy related contracts, $
2 million
issued in connection with railcar leases, $
7 million
pledged in connection with the sale and leaseback of the Beaver Valley Unit 2 by OE and $
3 million
pledged in connection with the sale and leaseback of Perry by OE.
|
Collateral Provisions
|
|
FES
|
|
AE Supply
|
|
Utilities
|
|
Total
|
||||||||
|
|
(In millions)
|
||||||||||||||
Split Rating (One rating agency's rating below investment grade)
|
|
$
|
198
|
|
|
$
|
6
|
|
|
$
|
41
|
|
|
$
|
245
|
|
BB+/Ba1 Credit Ratings
|
|
$
|
231
|
|
|
$
|
6
|
|
|
$
|
41
|
|
|
$
|
278
|
|
Full impact of credit contingent contractual obligations
|
|
$
|
363
|
|
|
$
|
16
|
|
|
$
|
41
|
|
|
$
|
420
|
|
Source of Information-
Fair Value by Contract Year
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
|
Total
|
||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||
Prices actively quoted
(1)
|
|
$
|
(6
|
)
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(5
|
)
|
Other external sources
(2)
|
|
18
|
|
|
(1
|
)
|
|
(21
|
)
|
|
(26
|
)
|
|
—
|
|
|
—
|
|
|
(30
|
)
|
|||||||
Prices based on models
|
|
(4
|
)
|
|
2
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(9
|
)
|
|||||||
Total
(3)
|
|
$
|
8
|
|
|
$
|
2
|
|
|
$
|
(21
|
)
|
|
$
|
(26
|
)
|
|
$
|
(7
|
)
|
|
$
|
—
|
|
|
$
|
(44
|
)
|
(1)
|
Represents exchange traded New York Mercantile Exchange futures and options.
|
(2)
|
Primarily represents contracts based on broker and ICE quotes.
|
(3)
|
Includes
$(136) million
in non-hedge derivative contracts that are primarily related to NUG contracts at certain of the Utilities. NUG contracts are subject to regulatory accounting and do not impact earnings.
|
Comparison of Carrying Value to Fair Value
|
||||||||||||||||||||||||||||||||
Year of Maturity
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
There-after
|
|
Total
|
|
Fair Value
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Investments Other Than Cash and Cash Equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fixed Income
|
|
$
|
5
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,794
|
|
|
$
|
1,801
|
|
|
$
|
1,802
|
|
Average interest rate
|
|
8.9
|
%
|
|
8.9
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
3.6
|
%
|
|
3.6
|
%
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Long-term Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fixed rate
|
|
$
|
660
|
|
|
$
|
1,517
|
|
|
$
|
1,330
|
|
|
$
|
1,035
|
|
|
$
|
541
|
|
|
$
|
13,867
|
|
|
$
|
18,950
|
|
|
$
|
20,225
|
|
Average interest rate
|
|
5.5
|
%
|
|
6.1
|
%
|
|
4.8
|
%
|
|
6.5
|
%
|
|
5.5
|
%
|
|
5.2
|
%
|
|
5.3
|
%
|
|
|
|||||||||
Variable rate
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
6
|
|
|
$
|
1,000
|
|
|
$
|
200
|
|
|
$
|
86
|
|
|
$
|
1,294
|
|
|
$
|
1,294
|
|
Average interest rate
|
|
—
|
%
|
|
3.5
|
%
|
|
—
|
%
|
|
2.2
|
%
|
|
1.9
|
%
|
|
—
|
%
|
|
2.0
|
%
|
|
|
•
|
A base distribution rate freeze through May 31, 2016;
|
•
|
Collection of lost distribution revenues associated with energy efficiency and peak demand reduction programs;
|
•
|
Economic development and assistance to low-income customers for the
two
-year plan period at levels established in the prior ESP;
|
•
|
A
6%
generation rate discount to certain low income customers provided by the Ohio Companies through a bilateral wholesale contract with FES (FES is one of the wholesale suppliers to the Ohio Companies);
|
•
|
A requirement to provide power to non-shopping customers at a market-based price set through an auction process;
|
•
|
Rider DCR that allows continued investment in the distribution system for the benefit of customers;
|
•
|
A commitment not to recover from retail customers certain costs related to transmission cost allocations for the longer of the five-year period from June 1, 2011 through May 31, 2016 or when the amount of costs avoided by customers for certain types of products totals $360 million, subject to the outcome of certain FERC proceedings;
|
•
|
Securing generation supply for a longer period of time by conducting an auction for a
three
-year period rather than a
one
-year period, in each of October 2012 and January 2013, to mitigate any potential price spikes for the Ohio Companies' utility customers who do not switch to a competitive generation supplier; and
|
•
|
Extending the recovery period for costs associated with purchasing RECs mandated by SB221, Ohio's renewable energy and energy efficiency standard, through the end of the new ESP 3 period. This is expected to initially reduce the monthly renewable energy charge for all non-shopping utility customers of the Ohio Companies by spreading out the costs over the entire ESP period.
|
•
|
An
eight
-year term (June 1, 2016 - May 31, 2024);
|
•
|
Contemplates continuing a base distribution rate freeze through May 31, 2024;
|
•
|
An Economic Stability Program that flows through charges or credits through Rider RRS representing the net result of the price paid to FES through a proposed
eight
-year FERC-jurisdictional PPA for the output of the Sammis and Davis-Besse plants and FES’ share of OVEC against the revenues received from selling such output into the PJM markets over the same period, subject to the PUCO’s termination of Rider RRS charges/credits associated with any plants or units that may be sold or transferred;
|
•
|
Continuing to provide power to non-shopping customers at a market-based price set through an auction process;
|
•
|
Continuing Rider DCR with increased revenue caps of approximately
$30 million
per year from June 1, 2016 through May 31, 2019;
$20 million
per year from June 1, 2019 through May 31, 2022; and
$15 million
per year from June 1, 2022 through May 31, 2024 that supports continued investment related to the distribution system for the benefit of customers;
|
•
|
Collection of lost distribution revenues associated with energy efficiency and peak demand reduction programs;
|
•
|
A risk-sharing mechanism that would provide guaranteed credits under Rider RRS in years five through eight to customers as follows: $10 million in year five, $20 million in year six, $30 million in year seven and $40 million in year eight;
|
•
|
A continuing commitment not to recover from retail customers certain costs related to transmission cost allocations for the longer of the five-year period from June 1, 2011 through May 31, 2016 or when the amount of such costs avoided by customers for certain types of products totals $360 million, including such costs from MISO along with such costs from PJM, subject to the outcome of certain FERC proceedings;
|
•
|
Potential procurement of
100
MW of new Ohio wind or solar resources subject to a demonstrated need to procure new renewable energy resources as part of a strategy to further diversify Ohio's energy portfolio;
|
•
|
An agreement to file a case with the PUCO by April 3, 2017, seeking to transition to decoupled base rates for residential customers;
|
•
|
An agreement to file by February 29, 2016, a Grid Modernization Business Plan for PUCO consideration and approval;
|
•
|
A contribution of $3 million per year ($24 million over the eight year term) to fund energy conservation programs, economic development and job retention in the Ohio Companies service territory;
|
•
|
Contributions of $2.4 million per year ($19 million over the eight year term) to fund a fuel-fund in each of the Ohio Companies service territories to assist low-income customers; and
|
•
|
A contribution of $1 million per year ($8 million over the eight year term) to establish a Customary Advisory Council to ensure preservation and growth of the competitive market in Ohio.
|
|
2016 - 2017
|
|
2017 - 2018
|
|
2018 - 2019*
|
||||||||||||||||||
|
Legacy Obligation
|
|
Capacity Performance
|
|
Legacy Obligation
|
|
Capacity Performance
|
|
Base Generation
|
|
Capacity Performance
|
||||||||||||
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
ATSI
|
2,765
|
|
$114.23
|
|
4,210
|
|
$134.00
|
|
375
|
|
$120.00
|
|
6,245
|
|
$151.50
|
|
—
|
|
$149.98
|
|
6,245
|
|
$164.77
|
RTO
|
875
|
|
$59.37
|
|
3,675
|
|
$134.00
|
|
985
|
|
$120.00
|
|
3,565
|
|
$151.50
|
|
240
|
|
$149.98
|
|
3,930
|
|
$164.77
|
All Other Zones
|
135
|
|
$119.13
|
|
—
|
|
$134.00
|
|
150
|
|
$120.00
|
|
—
|
|
$151.50
|
|
35
|
|
**
|
|
20
|
|
**
|
|
3,775
|
|
|
|
7,885
|
|
|
|
1,510
|
|
|
|
9,810
|
|
|
|
275
|
|
|
|
10,195
|
|
|
Postemployment Benefits Expense (Credits)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
(In millions)
|
||||||||||
Pension
|
|
$
|
316
|
|
|
$
|
939
|
|
|
$
|
(134
|
)
|
OPEB
|
|
(61
|
)
|
|
(101
|
)
|
|
(196
|
)
|
|||
Total
|
|
$
|
255
|
|
|
$
|
838
|
|
|
$
|
(330
|
)
|
Assumption
|
|
Adverse Change
|
|
Pension
|
|
OPEB
|
|
Total
|
||||
|
|
|
|
|
|
(In millions)
|
|
|
||||
Discount rate
|
|
Decrease by .25%
|
|
273
|
|
|
19
|
|
|
$
|
292
|
|
Long-term return on assets
|
|
Decrease by .25%
|
|
13
|
|
|
1
|
|
|
$
|
14
|
|
Health care trend rate
|
|
Increase by 1.0%
|
|
N/A
|
|
|
25
|
|
|
$
|
25
|
|
•
|
Future Energy and Capacity Prices:
FirstEnergy used observable market information for near term forward power prices, PJM auction results for near term capacity pricing, and a longer-term pricing model for energy and capacity that considered the impact of key factors such as load growth, plant retirements, carbon and other environmental regulations, and natural gas pipeline construction, as well as coal and natural gas pricing.
|
•
|
Retail Sales and Margin:
FirstEnergy used CES' current retail targeted portfolio to estimate future retail sales volume as well as historical financial results to estimate retail margins.
|
•
|
Operating and Capital Costs:
FirstEnergy used estimated future operating and capital costs, including the estimated impact on costs of pending carbon and other environmental regulations, as well as costs associated with capacity performance reforms in the PJM market.
|
•
|
Discount Rate:
A discount rate of
8.25%
, based on a capital structure, return on debt and return on equity of selected comparable companies.
|
•
|
Terminal Value:
A terminal value of
7.0x
earnings before interest, taxes, depreciation and amortization based on consideration of peer group data and analyst consensus expectations.
|
|
|
For the Years Ended December 31,
|
|
Increase
|
||||||||
Revenues by Type of Service
|
|
2015
|
|
2014
|
|
(Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
Contract Sales:
|
|
|
|
|
|
|
||||||
Direct
|
|
$
|
1,269
|
|
|
$
|
2,356
|
|
|
$
|
(1,087
|
)
|
Governmental Aggregation
|
|
1,012
|
|
|
1,184
|
|
|
(172
|
)
|
|||
Mass Market
|
|
265
|
|
|
452
|
|
|
(187
|
)
|
|||
POLR
|
|
712
|
|
|
893
|
|
|
(181
|
)
|
|||
Structured Sales
|
|
535
|
|
|
498
|
|
|
37
|
|
|||
Total Contract Sales
|
|
3,793
|
|
|
5,383
|
|
|
(1,590
|
)
|
|||
Wholesale
|
|
902
|
|
|
394
|
|
|
508
|
|
|||
Transmission
|
|
122
|
|
|
198
|
|
|
(76
|
)
|
|||
Other
|
|
188
|
|
|
169
|
|
|
19
|
|
|||
Total Revenues
|
|
$
|
5,005
|
|
|
$
|
6,144
|
|
|
$
|
(1,139
|
)
|
|
|
For the Years Ended December 31,
|
|
Increase
|
|||||
MWH Sales by Channel
|
|
2015
|
|
2014
|
|
(Decrease)
|
|||
|
|
(In thousands)
|
|
|
|||||
Contract Sales:
|
|
|
|
|
|
|
|||
Direct
|
|
23,585
|
|
|
43,961
|
|
|
(46.4
|
)%
|
Governmental Aggregation
|
|
15,443
|
|
|
19,569
|
|
|
(21.1
|
)%
|
Mass Market
|
|
3,878
|
|
|
6,773
|
|
|
(42.7
|
)%
|
POLR
|
|
11,950
|
|
|
15,559
|
|
|
(23.2
|
)%
|
Structured Sales
|
|
12,486
|
|
|
12,393
|
|
|
0.8
|
%
|
Total Contract Sales
|
|
67,342
|
|
|
98,255
|
|
|
(31.5
|
)%
|
Wholesale
|
|
2,188
|
|
|
14
|
|
|
15,528.6
|
%
|
Total MWH Sales
|
|
69,530
|
|
|
98,269
|
|
|
(29.2
|
)%
|
|
|
Source of Change in Revenues
|
||||||||||||||||||
|
|
Increase (Decrease)
|
||||||||||||||||||
MWH Sales Channel:
|
|
Sales Volumes
|
|
Prices
|
|
Gain on Settled Contracts
|
|
Capacity Revenue
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Direct
|
|
$
|
(1,092
|
)
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,087
|
)
|
Governmental Aggregation
|
|
(249
|
)
|
|
77
|
|
|
—
|
|
|
—
|
|
|
(172
|
)
|
|||||
Mass Market
|
|
(193
|
)
|
|
6
|
|
|
—
|
|
|
—
|
|
|
(187
|
)
|
|||||
POLR
|
|
(207
|
)
|
|
26
|
|
|
—
|
|
|
—
|
|
|
(181
|
)
|
|||||
Structured Sales
|
|
4
|
|
|
33
|
|
|
—
|
|
|
—
|
|
|
37
|
|
|||||
Wholesale
|
|
62
|
|
|
(11
|
)
|
|
34
|
|
|
423
|
|
|
508
|
|
|
|
Source of Change
|
||||||||||||||||||
|
|
Increase (Decrease)
|
||||||||||||||||||
Operating Expense
|
|
Volumes
|
|
Prices
|
|
Loss on Settled Contracts
|
|
Capacity Expense
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Fossil Fuel
|
|
$
|
(212
|
)
|
|
$
|
(14
|
)
|
|
$
|
(150
|
)
|
|
$
|
—
|
|
|
$
|
(376
|
)
|
Nuclear Fuel
|
|
5
|
|
|
(11
|
)
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||||
Affiliated Purchased Power
|
|
(8
|
)
|
|
22
|
|
|
68
|
|
|
—
|
|
|
82
|
|
|||||
Non-affiliated Purchased Power
(1)
|
|
(1,477
|
)
|
|
(259
|
)
|
|
496
|
|
|
153
|
|
|
(1,087
|
)
|
•
|
Nuclear operating costs increased $84 million as a result of higher planned outage costs and higher employee benefit expenses. There were three planned refueling outages in 2015 as compared to two planned outages in 2014.
|
•
|
Transmission expenses decreased $185
million primarily due to lower operating reserve and market-based ancillary costs associated with market conditions resulting from the extreme weather events in 2014.
|
•
|
Other operating expenses decreased $186 million primarily due to a $142 million decrease in mark-to-market expenses on commodity contract positions reflecting lower market prices and a $78 million decrease in retail-related costs, partially offset by a $34 million impairment charge associated with non-core assets.
|
Source of Information-
Fair Value by Contract Year
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
|
Total
|
||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||
Prices actively quoted
(1)
|
|
$
|
(6
|
)
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(5
|
)
|
Other external sources
(2)
|
|
61
|
|
|
29
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
99
|
|
|||||||
Prices based on models
|
|
(5
|
)
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||||
Total
|
|
$
|
50
|
|
|
$
|
32
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
91
|
|
(1)
|
Represents exchange traded New York Mercantile Exchange futures and options.
|
(2)
|
Primarily represents contracts based on broker and ICE quotes.
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
|
|
For the Years Ended December 31,
|
||||||||||
(In millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
|
|
|
|
|
||||||
REVENUES:
|
|
|
|
|
|
|
||||||
Electric utilities
|
|
$
|
10,636
|
|
|
$
|
9,871
|
|
|
$
|
9,451
|
|
Unregulated businesses
|
|
4,390
|
|
|
5,178
|
|
|
5,441
|
|
|||
Total revenues*
|
|
15,026
|
|
|
15,049
|
|
|
14,892
|
|
|||
|
|
|
|
|
|
|
||||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
||||||
Fuel
|
|
1,855
|
|
|
2,280
|
|
|
2,496
|
|
|||
Purchased power
|
|
4,318
|
|
|
4,716
|
|
|
3,963
|
|
|||
Other operating expenses
|
|
3,749
|
|
|
3,962
|
|
|
3,593
|
|
|||
Pension and OPEB mark-to-market adjustment
|
|
242
|
|
|
835
|
|
|
(256
|
)
|
|||
Provision for depreciation
|
|
1,282
|
|
|
1,220
|
|
|
1,202
|
|
|||
Amortization of regulatory assets, net
|
|
268
|
|
|
12
|
|
|
539
|
|
|||
General taxes
|
|
978
|
|
|
962
|
|
|
978
|
|
|||
Impairment of long-lived assets
|
|
42
|
|
|
—
|
|
|
795
|
|
|||
Total operating expenses
|
|
12,734
|
|
|
13,987
|
|
|
13,310
|
|
|||
|
|
|
|
|
|
|
||||||
OPERATING INCOME
|
|
2,292
|
|
|
1,062
|
|
|
1,582
|
|
|||
|
|
|
|
|
|
|
||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
||||||
Loss on debt redemptions
|
|
—
|
|
|
(8
|
)
|
|
(132
|
)
|
|||
Investment income (loss)
|
|
(22
|
)
|
|
72
|
|
|
33
|
|
|||
Impairment of equity method investment
|
|
(362
|
)
|
|
—
|
|
|
—
|
|
|||
Interest expense
|
|
(1,132
|
)
|
|
(1,073
|
)
|
|
(1,016
|
)
|
|||
Capitalized financing costs
|
|
117
|
|
|
118
|
|
|
103
|
|
|||
Total other expense
|
|
(1,399
|
)
|
|
(891
|
)
|
|
(1,012
|
)
|
|||
|
|
|
|
|
|
|
||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (BENEFITS)
|
|
893
|
|
|
171
|
|
|
570
|
|
|||
|
|
|
|
|
|
|
||||||
INCOME TAXES (BENEFITS)
|
|
315
|
|
|
(42
|
)
|
|
195
|
|
|||
|
|
|
|
|
|
|
||||||
INCOME FROM CONTINUING OPERATIONS
|
|
578
|
|
|
213
|
|
|
375
|
|
|||
|
|
|
|
|
|
|
||||||
Discontinued operations (net of income taxes of $0, $69 and $9, respectively) (Note 19)
|
|
—
|
|
|
86
|
|
|
17
|
|
|||
|
|
|
|
|
|
|
||||||
NET INCOME
|
|
$
|
578
|
|
|
$
|
299
|
|
|
$
|
392
|
|
|
|
|
|
|
|
|
||||||
EARNINGS PER SHARE OF COMMON STOCK:
|
|
|
|
|
|
|
||||||
Basic - Continuing Operations
|
|
$
|
1.37
|
|
|
$
|
0.51
|
|
|
$
|
0.90
|
|
Basic - Discontinued Operations (Note 19)
|
|
—
|
|
|
0.20
|
|
|
0.04
|
|
|||
Basic - Net Income
|
|
$
|
1.37
|
|
|
$
|
0.71
|
|
|
$
|
0.94
|
|
|
|
|
|
|
|
|
||||||
Diluted - Continuing Operations
|
|
$
|
1.37
|
|
|
$
|
0.51
|
|
|
$
|
0.90
|
|
Diluted - Discontinued Operations (Note 19)
|
|
—
|
|
|
0.20
|
|
|
0.04
|
|
|||
Diluted - Net Income
|
|
$
|
1.37
|
|
|
$
|
0.71
|
|
|
$
|
0.94
|
|
|
|
|
|
|
|
|
||||||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING:
|
|
|
|
|
|
|
||||||
Basic
|
|
422
|
|
|
420
|
|
|
418
|
|
|||
Diluted
|
|
424
|
|
|
421
|
|
|
419
|
|
|||
|
|
|
|
|
|
|
||||||
DIVIDENDS DECLARED PER SHARE OF COMMON STOCK
|
|
$
|
1.44
|
|
|
$
|
1.44
|
|
|
$
|
1.65
|
|
*
|
Includes excise tax collections of
$416 million
,
$420 million
and
$458 million
in
2015
,
2014
and
2013
, respectively.
|
|
|
For the Years Ended December 31,
|
||||||||||
(In millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
|
|
|
|
|
||||||
NET INCOME
|
|
$
|
578
|
|
|
$
|
299
|
|
|
$
|
392
|
|
|
|
|
|
|
|
|
||||||
OTHER COMPREHENSIVE INCOME (LOSS):
|
|
|
|
|
|
|
||||||
Pension and OPEB prior service costs
|
|
(116
|
)
|
|
(76
|
)
|
|
(160
|
)
|
|||
Amortized gains (losses) on derivative hedges
|
|
5
|
|
|
(2
|
)
|
|
3
|
|
|||
Change in unrealized gain on available-for-sale securities
|
|
(11
|
)
|
|
26
|
|
|
(10
|
)
|
|||
Other comprehensive loss
|
|
(122
|
)
|
|
(52
|
)
|
|
(167
|
)
|
|||
Income tax benefits on other comprehensive loss
|
|
(47
|
)
|
|
(14
|
)
|
|
(66
|
)
|
|||
Other comprehensive loss, net of tax
|
|
(75
|
)
|
|
(38
|
)
|
|
(101
|
)
|
|||
|
|
|
|
|
|
|
||||||
COMPREHENSIVE INCOME AVAILABLE TO FIRSTENERGY CORP.
|
|
$
|
503
|
|
|
$
|
261
|
|
|
$
|
291
|
|
(In millions, except share amounts)
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
ASSETS
|
|
|
|
|
|
|
||
CURRENT ASSETS:
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
131
|
|
|
$
|
85
|
|
Receivables-
|
|
|
|
|
|
|
||
Customers, net of allowance for uncollectible accounts of $69 in 2015 and $59 in 2014
|
|
1,415
|
|
|
1,554
|
|
||
Other, net of allowance for uncollectible accounts of $5 in 2015 and 2014
|
|
180
|
|
|
225
|
|
||
Materials and supplies, at average cost
|
|
785
|
|
|
817
|
|
||
Prepaid taxes
|
|
135
|
|
|
128
|
|
||
Derivatives
|
|
157
|
|
|
159
|
|
||
Collateral
|
|
70
|
|
|
230
|
|
||
Other
|
|
167
|
|
|
160
|
|
||
|
|
3,040
|
|
|
3,358
|
|
||
PROPERTY, PLANT AND EQUIPMENT:
|
|
|
|
|
|
|
||
In service
|
|
49,952
|
|
|
47,484
|
|
||
Less — Accumulated provision for depreciation
|
|
15,160
|
|
|
14,150
|
|
||
|
|
34,792
|
|
|
33,334
|
|
||
Construction work in progress
|
|
2,422
|
|
|
2,449
|
|
||
|
|
37,214
|
|
|
35,783
|
|
||
INVESTMENTS:
|
|
|
|
|
|
|
||
Nuclear plant decommissioning trusts
|
|
2,282
|
|
|
2,341
|
|
||
Other
|
|
506
|
|
|
881
|
|
||
|
|
2,788
|
|
|
3,222
|
|
||
DEFERRED CHARGES AND OTHER ASSETS:
|
|
|
|
|
|
|
||
Goodwill
|
|
6,418
|
|
|
6,418
|
|
||
Regulatory assets
|
|
1,348
|
|
|
1,411
|
|
||
Other
|
|
1,379
|
|
|
1,456
|
|
||
|
|
9,145
|
|
|
9,285
|
|
||
|
|
$
|
52,187
|
|
|
$
|
51,648
|
|
LIABILITIES AND CAPITALIZATION
|
|
|
|
|
|
|
||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
||
Currently payable long-term debt
|
|
$
|
1,166
|
|
|
$
|
804
|
|
Short-term borrowings
|
|
1,708
|
|
|
1,799
|
|
||
Accounts payable
|
|
1,075
|
|
|
1,279
|
|
||
Accrued taxes
|
|
519
|
|
|
490
|
|
||
Accrued compensation and benefits
|
|
334
|
|
|
329
|
|
||
Derivatives
|
|
106
|
|
|
167
|
|
||
Other
|
|
694
|
|
|
693
|
|
||
|
|
5,602
|
|
|
5,561
|
|
||
CAPITALIZATION:
|
|
|
|
|
|
|
||
Common stockholders’ equity-
|
|
|
|
|
|
|
||
Common stock, $0.10 par value, authorized 490,000,000 shares -
423,560,397
and 421,102,570 shares outstanding as of December 31, 2015 and December 31, 2014, respectively
|
|
42
|
|
|
42
|
|
||
Other paid-in capital
|
|
9,952
|
|
|
9,847
|
|
||
Accumulated other comprehensive income
|
|
171
|
|
|
246
|
|
||
Retained earnings
|
|
2,256
|
|
|
2,285
|
|
||
Total common stockholders’ equity
|
|
12,421
|
|
|
12,420
|
|
||
Noncontrolling interest
|
|
1
|
|
|
2
|
|
||
Total equity
|
|
12,422
|
|
|
12,422
|
|
||
Long-term debt and other long-term obligations
|
|
19,192
|
|
|
19,176
|
|
||
|
|
31,614
|
|
|
31,598
|
|
||
NONCURRENT LIABILITIES:
|
|
|
|
|
|
|
||
Accumulated deferred income taxes
|
|
6,773
|
|
|
6,539
|
|
||
Retirement benefits
|
|
4,245
|
|
|
3,932
|
|
||
Asset retirement obligations
|
|
1,410
|
|
|
1,387
|
|
||
Deferred gain on sale and leaseback transaction
|
|
791
|
|
|
824
|
|
||
Adverse power contract liability
|
|
197
|
|
|
217
|
|
||
Other
|
|
1,555
|
|
|
1,590
|
|
||
|
|
14,971
|
|
|
14,489
|
|
||
COMMITMENTS, GUARANTEES AND CONTINGENCIES (Note 15)
|
|
|
|
|
|
|
||
|
|
$
|
52,187
|
|
|
$
|
51,648
|
|
|
|
Common Stock
|
|
Other Paid-In Capital
|
|
Accumulated Other Comprehensive Income
|
|
Retained Earnings
|
|||||||||||
(In millions, except share amounts)
|
|
Number of Shares
|
|
Par Value
|
|
|
|
||||||||||||
Balance, January 1, 2013
|
|
418,216,437
|
|
|
$
|
42
|
|
|
$
|
9,769
|
|
|
$
|
385
|
|
|
$
|
2,888
|
|
Net income
|
|
|
|
|
|
|
|
|
|
392
|
|
||||||||
Amortized losses on derivative hedges, net of $1 million of income taxes
|
|
|
|
|
|
|
|
2
|
|
|
|
||||||||
Change in unrealized gain on investments, net of $4 million of income tax benefits
|
|
|
|
|
|
|
|
(6
|
)
|
|
|
||||||||
Pension and OPEB, net of $63 million of income tax benefits (Note 3)
|
|
|
|
|
|
|
|
(97
|
)
|
|
|
||||||||
Stock-based compensation
|
|
|
|
|
|
(4
|
)
|
|
|
|
|
||||||||
Cash dividends declared on common stock
|
|
|
|
|
|
|
|
|
|
|
(690
|
)
|
|||||||
Stock issuance - employee benefits
|
|
412,122
|
|
|
|
|
11
|
|
|
|
|
|
|||||||
Balance, December 31, 2013
|
|
418,628,559
|
|
|
42
|
|
|
9,776
|
|
|
284
|
|
|
2,590
|
|
||||
Net income
|
|
|
|
|
|
|
|
|
|
299
|
|
||||||||
Amortized gains on derivative hedges, net of $1 million of income tax benefits
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
||||||||
Change in unrealized gain on investments, net of $10 million of income taxes
|
|
|
|
|
|
|
|
16
|
|
|
|
||||||||
Pension and OPEB, net of $23 million of income tax benefits (Note 3)
|
|
|
|
|
|
|
|
(53
|
)
|
|
|
||||||||
Stock-based compensation
|
|
|
|
|
|
20
|
|
|
|
|
|
||||||||
Cash dividends declared on common stock
|
|
|
|
|
|
|
|
|
|
(604
|
)
|
||||||||
Stock issuance - employee benefits
|
|
2,474,011
|
|
|
|
|
|
51
|
|
|
|
|
|
|
|
||||
Balance, December 31, 2014
|
|
421,102,570
|
|
|
42
|
|
|
9,847
|
|
|
246
|
|
|
2,285
|
|
||||
Net income
|
|
|
|
|
|
|
|
|
|
578
|
|
||||||||
Amortized gains on derivative hedges, net of $1 million of income taxes
|
|
|
|
|
|
|
|
4
|
|
|
|
||||||||
Change in unrealized gain on investments, net of $4 million of income tax benefits
|
|
|
|
|
|
|
|
(7
|
)
|
|
|
||||||||
Pension and OPEB, net of $44 million of income tax benefits (Note 3)
|
|
|
|
|
|
|
|
(72
|
)
|
|
|
||||||||
Stock-based compensation
|
|
|
|
|
|
45
|
|
|
|
|
|
||||||||
Cash dividends declared on common stock
|
|
|
|
|
|
|
|
|
|
(607
|
)
|
||||||||
Stock issuance - employee benefits
|
|
2,457,827
|
|
|
|
|
60
|
|
|
|
|
|
|
||||||
Balance, December 31, 2015
|
|
423,560,397
|
|
|
$
|
42
|
|
|
$
|
9,952
|
|
|
$
|
171
|
|
|
$
|
2,256
|
|
|
|
For the Years Ended December 31,
|
||||||||||
(In millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Net Income
|
|
$
|
578
|
|
|
$
|
299
|
|
|
$
|
392
|
|
Adjustments to reconcile net income to net cash from operating activities-
|
|
|
|
|
|
|
||||||
Depreciation and amortization, including nuclear fuel, regulatory assets, net, and customer intangible amortization
|
|
1,836
|
|
|
1,563
|
|
|
2,022
|
|
|||
Impairments of long-lived assets
|
|
42
|
|
|
—
|
|
|
795
|
|
|||
Investment impairment, including equity method investment
|
|
464
|
|
|
37
|
|
|
90
|
|
|||
Pension and OPEB mark-to-market adjustment
|
|
242
|
|
|
835
|
|
|
(256
|
)
|
|||
Deferred income taxes and investment tax credits, net
|
|
284
|
|
|
162
|
|
|
243
|
|
|||
Deferred costs on sale leaseback transaction, net
|
|
48
|
|
|
48
|
|
|
48
|
|
|||
Deferred purchased power and other costs
|
|
(105
|
)
|
|
(115
|
)
|
|
(76
|
)
|
|||
Asset removal costs charged to income
|
|
55
|
|
|
28
|
|
|
20
|
|
|||
Retirement benefits
|
|
(20
|
)
|
|
(53
|
)
|
|
(168
|
)
|
|||
Commodity derivative transactions, net (Note 10)
|
|
(73
|
)
|
|
64
|
|
|
(3
|
)
|
|||
Pension trust contributions
|
|
(143
|
)
|
|
—
|
|
|
—
|
|
|||
Gain on sale of investment securities held in trusts
|
|
(23
|
)
|
|
(64
|
)
|
|
(56
|
)
|
|||
Loss on debt redemptions
|
|
—
|
|
|
8
|
|
|
132
|
|
|||
Make-whole premiums paid on debt redemptions
|
|
—
|
|
|
—
|
|
|
(187
|
)
|
|||
Lease payments on sale and leaseback transaction
|
|
(131
|
)
|
|
(137
|
)
|
|
(136
|
)
|
|||
Income from discontinued operations (Note 19)
|
|
—
|
|
|
(86
|
)
|
|
(17
|
)
|
|||
Changes in current assets and liabilities-
|
|
|
|
|
|
|
||||||
Receivables
|
|
184
|
|
|
139
|
|
|
(114
|
)
|
|||
Materials and supplies
|
|
(15
|
)
|
|
(65
|
)
|
|
96
|
|
|||
Prepayments and other current assets
|
|
(10
|
)
|
|
126
|
|
|
(126
|
)
|
|||
Accounts payable
|
|
(243
|
)
|
|
42
|
|
|
(25
|
)
|
|||
Accrued taxes
|
|
29
|
|
|
(165
|
)
|
|
85
|
|
|||
Accrued interest
|
|
(6
|
)
|
|
31
|
|
|
(10
|
)
|
|||
Accrued compensation and benefits
|
|
5
|
|
|
(22
|
)
|
|
19
|
|
|||
Other current liabilities
|
|
75
|
|
|
23
|
|
|
(62
|
)
|
|||
Cash collateral, net
|
|
140
|
|
|
(54
|
)
|
|
(36
|
)
|
|||
Other
|
|
234
|
|
|
69
|
|
|
(8
|
)
|
|||
Net cash provided from operating activities
|
|
3,447
|
|
|
2,713
|
|
|
2,662
|
|
|||
|
|
|
|
|
|
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
||||||
New Financing-
|
|
|
|
|
|
|
||||||
Long-term debt
|
|
1,311
|
|
|
4,528
|
|
|
3,745
|
|
|||
Short-term borrowings, net
|
|
—
|
|
|
—
|
|
|
1,435
|
|
|||
Redemptions and Repayments-
|
|
|
|
|
|
|
||||||
Long-term debt
|
|
(879
|
)
|
|
(1,759
|
)
|
|
(3,600
|
)
|
|||
Short-term borrowings, net
|
|
(91
|
)
|
|
(1,605
|
)
|
|
—
|
|
|||
Tender premiums paid on debt redemptions
|
|
—
|
|
|
—
|
|
|
(110
|
)
|
|||
Common stock dividend payments
|
|
(607
|
)
|
|
(604
|
)
|
|
(920
|
)
|
|||
Other
|
|
(13
|
)
|
|
(47
|
)
|
|
(73
|
)
|
|||
Net cash (used for) provided from financing activities
|
|
(279
|
)
|
|
513
|
|
|
477
|
|
|||
|
|
|
|
|
|
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Property additions
|
|
(2,704
|
)
|
|
(3,312
|
)
|
|
(2,638
|
)
|
|||
Nuclear fuel
|
|
(190
|
)
|
|
(233
|
)
|
|
(250
|
)
|
|||
Proceeds from asset sales
|
|
20
|
|
|
394
|
|
|
4
|
|
|||
Sales of investment securities held in trusts
|
|
1,534
|
|
|
2,133
|
|
|
2,047
|
|
|||
Purchases of investment securities held in trusts
|
|
(1,648
|
)
|
|
(2,236
|
)
|
|
(2,096
|
)
|
|||
Cash investments
|
|
7
|
|
|
35
|
|
|
(23
|
)
|
|||
Asset removal costs
|
|
(142
|
)
|
|
(153
|
)
|
|
(146
|
)
|
|||
Other
|
|
1
|
|
|
13
|
|
|
9
|
|
|||
Net cash used for investing activities
|
|
(3,122
|
)
|
|
(3,359
|
)
|
|
(3,093
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net change in cash and cash equivalents
|
|
46
|
|
|
(133
|
)
|
|
46
|
|
|||
Cash and cash equivalents at beginning of period
|
|
85
|
|
|
218
|
|
|
172
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
131
|
|
|
$
|
85
|
|
|
$
|
218
|
|
|
|
|
|
|
|
|
||||||
SUPPLEMENTAL CASH FLOW INFORMATION:
|
|
|
|
|
|
|
||||||
Cash paid (received) during the year -
|
|
|
|
|
|
|
|
|||||
Interest (net of amounts capitalized)
|
|
$
|
1,028
|
|
|
$
|
931
|
|
|
$
|
969
|
|
Income taxes (received), net of refunds
|
|
$
|
37
|
|
|
$
|
(103
|
)
|
|
$
|
36
|
|
|
|
For the Years Ended December 31,
|
||||||||||
(In millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
|
|
|
|
|
||||||
STATEMENTS OF INCOME (LOSS)
|
|
|
|
|
|
|
|
|||||
REVENUES:
|
|
|
|
|
|
|
|
|||||
Electric sales to non-affiliates
|
|
$
|
4,153
|
|
|
$
|
5,114
|
|
|
$
|
5,378
|
|
Electric sales to affiliates
|
|
664
|
|
|
861
|
|
|
652
|
|
|||
Other
|
|
188
|
|
|
169
|
|
|
143
|
|
|||
Total revenues*
|
|
5,005
|
|
|
6,144
|
|
|
6,173
|
|
|||
|
|
|
|
|
|
|
||||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
|||
Fuel
|
|
871
|
|
|
1,253
|
|
|
1,262
|
|
|||
Purchased power from affiliates
|
|
353
|
|
|
271
|
|
|
486
|
|
|||
Purchased power from non-affiliates
|
|
1,684
|
|
|
2,771
|
|
|
2,333
|
|
|||
Other operating expenses
|
|
1,341
|
|
|
1,635
|
|
|
1,487
|
|
|||
Pension and OPEB mark-to-market adjustment
|
|
57
|
|
|
297
|
|
|
(81
|
)
|
|||
Provision for depreciation
|
|
324
|
|
|
319
|
|
|
306
|
|
|||
General taxes
|
|
98
|
|
|
128
|
|
|
138
|
|
|||
Total operating expenses
|
|
4,728
|
|
|
6,674
|
|
|
5,931
|
|
|||
|
|
|
|
|
|
|
||||||
OPERATING INCOME (LOSS)
|
|
277
|
|
|
(530
|
)
|
|
242
|
|
|||
|
|
|
|
|
|
|
||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|
|||
Loss on debt redemptions
|
|
—
|
|
|
(6
|
)
|
|
(103
|
)
|
|||
Investment income (loss)
|
|
(14
|
)
|
|
61
|
|
|
16
|
|
|||
Miscellaneous income
|
|
3
|
|
|
6
|
|
|
28
|
|
|||
Interest expense — affiliates
|
|
(7
|
)
|
|
(7
|
)
|
|
(10
|
)
|
|||
Interest expense — other
|
|
(147
|
)
|
|
(146
|
)
|
|
(160
|
)
|
|||
Capitalized interest
|
|
35
|
|
|
34
|
|
|
39
|
|
|||
Total other expense
|
|
(130
|
)
|
|
(58
|
)
|
|
(190
|
)
|
|||
|
|
|
|
|
|
|
||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
|
147
|
|
|
(588
|
)
|
|
52
|
|
|||
|
|
|
|
|
|
|
||||||
INCOME TAXES (BENEFITS)
|
|
65
|
|
|
(228
|
)
|
|
6
|
|
|||
|
|
|
|
|
|
|
||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS
|
|
82
|
|
|
(360
|
)
|
|
46
|
|
|||
|
|
|
|
|
|
|
||||||
Discontinued operations (net of income taxes of $70 and $8, respectively) (Note 19)
|
|
—
|
|
|
116
|
|
|
14
|
|
|||
|
|
|
|
|
|
|
||||||
NET INCOME (LOSS)
|
|
$
|
82
|
|
|
$
|
(244
|
)
|
|
$
|
60
|
|
|
|
|
|
|
|
|
||||||
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
NET INCOME (LOSS)
|
|
$
|
82
|
|
|
$
|
(244
|
)
|
|
$
|
60
|
|
|
|
|
|
|
|
|
||||||
OTHER COMPREHENSIVE INCOME (LOSS):
|
|
|
|
|
|
|
|
|
|
|||
Pension and OPEB prior service costs
|
|
(6
|
)
|
|
(6
|
)
|
|
(15
|
)
|
|||
Amortized gains on derivative hedges
|
|
(3
|
)
|
|
(10
|
)
|
|
(6
|
)
|
|||
Change in unrealized gain on available-for-sale securities
|
|
(9
|
)
|
|
21
|
|
|
(8
|
)
|
|||
Other comprehensive income (loss)
|
|
(18
|
)
|
|
5
|
|
|
(29
|
)
|
|||
Income taxes (benefits) on other comprehensive income (loss)
|
|
(7
|
)
|
|
2
|
|
|
(11
|
)
|
|||
Other comprehensive income (loss), net of tax
|
|
(11
|
)
|
|
3
|
|
|
(18
|
)
|
|||
|
|
|
|
|
|
|
||||||
COMPREHENSIVE INCOME (LOSS)
|
|
$
|
71
|
|
|
$
|
(241
|
)
|
|
$
|
42
|
|
*
|
Includes excise tax collections of
$44 million
,
$69 million
and
$78 million
in
2015
,
2014
and
2013
, respectively.
|
(In millions, except share amounts)
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
ASSETS
|
|
|
|
|
|
|
||
CURRENT ASSETS:
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
2
|
|
|
$
|
2
|
|
Receivables-
|
|
|
|
|
|
|
||
Customers, net of allowance for uncollectible accounts of $8 in 2015 and $18 in 2014
|
|
275
|
|
|
415
|
|
||
Affiliated companies
|
|
451
|
|
|
525
|
|
||
Other, net of allowance for uncollectible accounts of $3 in 2015 and 2014
|
|
59
|
|
|
107
|
|
||
Notes receivable from affiliated companies
|
|
11
|
|
|
—
|
|
||
Materials and supplies
|
|
470
|
|
|
492
|
|
||
Derivatives
|
|
154
|
|
|
147
|
|
||
Collateral
|
|
70
|
|
|
229
|
|
||
Prepayments and other
|
|
66
|
|
|
68
|
|
||
|
|
1,558
|
|
|
1,985
|
|
||
PROPERTY, PLANT AND EQUIPMENT:
|
|
|
|
|
|
|
||
In service
|
|
14,311
|
|
|
13,596
|
|
||
Less — Accumulated provision for depreciation
|
|
5,765
|
|
|
5,208
|
|
||
|
|
8,546
|
|
|
8,388
|
|
||
Construction work in progress
|
|
1,157
|
|
|
1,010
|
|
||
|
|
9,703
|
|
|
9,398
|
|
||
INVESTMENTS:
|
|
|
|
|
|
|
||
Nuclear plant decommissioning trusts
|
|
1,327
|
|
|
1,365
|
|
||
Other
|
|
10
|
|
|
10
|
|
||
|
|
1,337
|
|
|
1,375
|
|
||
|
|
|
|
|
||||
DEFERRED CHARGES AND OTHER ASSETS:
|
|
|
|
|
|
|
||
Customer intangibles
|
|
61
|
|
|
78
|
|
||
Goodwill
|
|
23
|
|
|
23
|
|
||
Property taxes
|
|
40
|
|
|
41
|
|
||
Derivatives
|
|
79
|
|
|
52
|
|
||
Other
|
|
384
|
|
|
331
|
|
||
|
|
587
|
|
|
525
|
|
||
|
|
$
|
13,185
|
|
|
$
|
13,283
|
|
LIABILITIES AND CAPITALIZATION
|
|
|
|
|
|
|
||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
||
Currently payable long-term debt
|
|
$
|
512
|
|
|
$
|
506
|
|
Short-term borrowings-
|
|
|
|
|
||||
Affiliated companies
|
|
—
|
|
|
35
|
|
||
Other
|
|
8
|
|
|
99
|
|
||
Accounts payable-
|
|
|
|
|
|
|
||
Affiliated companies
|
|
542
|
|
|
416
|
|
||
Other
|
|
139
|
|
|
248
|
|
||
Accrued taxes
|
|
76
|
|
|
102
|
|
||
Derivatives
|
|
104
|
|
|
166
|
|
||
Other
|
|
181
|
|
|
184
|
|
||
|
|
1,562
|
|
|
1,756
|
|
||
CAPITALIZATION:
|
|
|
|
|
|
|
||
Common stockholder's equity-
|
|
|
|
|
|
|
||
Common stock, without par value, authorized 750 shares- 7 shares outstanding as of December 31, 2015 and 2014
|
|
3,613
|
|
|
3,594
|
|
||
Accumulated other comprehensive income
|
|
46
|
|
|
57
|
|
||
Retained earnings
|
|
1,946
|
|
|
1,934
|
|
||
Total common stockholder's equity
|
|
5,605
|
|
|
5,585
|
|
||
Long-term debt and other long-term obligations
|
|
2,527
|
|
|
2,608
|
|
||
|
|
8,132
|
|
|
8,193
|
|
||
NONCURRENT LIABILITIES:
|
|
|
|
|
|
|
||
Deferred gain on sale and leaseback transaction
|
|
791
|
|
|
824
|
|
||
Accumulated deferred income taxes
|
|
600
|
|
|
484
|
|
||
Retirement benefits
|
|
332
|
|
|
324
|
|
||
Asset retirement obligations
|
|
831
|
|
|
841
|
|
||
Derivatives
|
|
38
|
|
|
14
|
|
||
Other
|
|
899
|
|
|
847
|
|
||
|
|
3,491
|
|
|
3,334
|
|
||
COMMITMENTS, GUARANTEES AND CONTINGENCIES (Note 15)
|
|
|
|
|
|
|
||
|
|
$
|
13,185
|
|
|
$
|
13,283
|
|
|
|
Common Stock
|
|
Accumulated Other Comprehensive Income
|
|
Retained Earnings
|
|||||||||
(In millions, except share amounts)
|
|
Number of Shares
|
|
Carrying Value
|
|
|
|||||||||
Balance, January 1, 2013
|
|
7
|
|
|
$
|
1,573
|
|
|
$
|
72
|
|
|
$
|
2,118
|
|
Net income
|
|
|
|
|
|
|
|
60
|
|
||||||
Amortized loss on derivative hedges, net of $2 million of income tax benefits
|
|
|
|
|
|
(4
|
)
|
|
|
||||||
Change in unrealized gain on investments, net of $3 million of income tax benefits
|
|
|
|
|
|
(5
|
)
|
|
|
||||||
Pension and OPEB, net of $6 million of income tax benefits (Note 3)
|
|
|
|
|
|
(9
|
)
|
|
|
||||||
Equity contribution from parent
|
|
|
|
1,500
|
|
|
|
|
|
||||||
Stock-based compensation
|
|
|
|
1
|
|
|
|
|
|
||||||
Consolidated tax benefit allocation
|
|
|
|
6
|
|
|
|
|
|
||||||
Balance, December 31, 2013
|
|
7
|
|
|
3,080
|
|
|
54
|
|
|
2,178
|
|
|||
Net loss
|
|
|
|
|
|
|
|
(244
|
)
|
||||||
Amortized loss on derivative hedges, net of $4 million of income tax benefits
|
|
|
|
|
|
(6
|
)
|
|
|
||||||
Change in unrealized gain on investments, net of $8 million of income taxes
|
|
|
|
|
|
13
|
|
|
|
||||||
Pension and OPEB, net of $2 million of income tax benefits (Note 3)
|
|
|
|
|
|
(4
|
)
|
|
|
||||||
Equity contribution from parent
|
|
|
|
500
|
|
|
|
|
|
||||||
Stock-based compensation
|
|
|
|
7
|
|
|
|
|
|
||||||
Consolidated tax benefit allocation
|
|
|
|
7
|
|
|
|
|
|
||||||
Balance, December 31, 2014
|
|
7
|
|
|
3,594
|
|
|
57
|
|
|
1,934
|
|
|||
Net income
|
|
|
|
|
|
|
|
82
|
|
||||||
Amortized loss on derivative hedges, net of $1 million of income tax benefits
|
|
|
|
|
|
(2
|
)
|
|
|
||||||
Change in unrealized gain on investments, net of $4 million of income tax benefits
|
|
|
|
|
|
(5
|
)
|
|
|
||||||
Pension and OPEB, net of $2 million of income tax benefits (Note 3)
|
|
|
|
|
|
(4
|
)
|
|
|
||||||
Stock-based compensation
|
|
|
|
10
|
|
|
|
|
|
||||||
Consolidated tax benefit allocation
|
|
|
|
9
|
|
|
|
|
|
||||||
Cash dividends declared on common stock
|
|
|
|
|
|
|
|
(70
|
)
|
||||||
Balance, December 31, 2015
|
|
7
|
|
|
$
|
3,613
|
|
|
$
|
46
|
|
|
$
|
1,946
|
|
|
|
For the Years Ended December 31,
|
||||||||||
(In millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
|
|
|
|
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Net Income (loss)
|
|
$
|
82
|
|
|
$
|
(244
|
)
|
|
$
|
60
|
|
Adjustments to reconcile net income (loss) to net cash from operating activities-
|
|
|
|
|
|
|
||||||
Depreciation and amortization, including nuclear fuel and customer intangible amortization
|
|
569
|
|
|
599
|
|
|
533
|
|
|||
Investment impairments
|
|
90
|
|
|
33
|
|
|
79
|
|
|||
Pension and OPEB mark-to-market adjustment
|
|
57
|
|
|
297
|
|
|
(81
|
)
|
|||
Deferred income taxes and investment tax credits, net
|
|
119
|
|
|
7
|
|
|
309
|
|
|||
Deferred costs on sale and leaseback transaction, net
|
|
48
|
|
|
48
|
|
|
48
|
|
|||
Gain on investment securities held in trusts
|
|
(24
|
)
|
|
(61
|
)
|
|
(49
|
)
|
|||
Commodity derivative transactions, net (Note 10)
|
|
(74
|
)
|
|
65
|
|
|
5
|
|
|||
Loss on debt redemptions
|
|
—
|
|
|
6
|
|
|
103
|
|
|||
Make-whole premiums paid on debt redemptions
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
|||
Lease payments on sale and leaseback transaction
|
|
(131
|
)
|
|
(131
|
)
|
|
(131
|
)
|
|||
Income from discontinued operations (Note 19)
|
|
—
|
|
|
(116
|
)
|
|
(14
|
)
|
|||
Change in current assets and liabilities-
|
|
|
|
|
|
|
||||||
Receivables
|
|
277
|
|
|
674
|
|
|
(393
|
)
|
|||
Materials and supplies
|
|
(25
|
)
|
|
(44
|
)
|
|
57
|
|
|||
Prepayments and other current assets
|
|
14
|
|
|
14
|
|
|
(39
|
)
|
|||
Accounts payable
|
|
(76
|
)
|
|
(477
|
)
|
|
(145
|
)
|
|||
Accrued taxes
|
|
(26
|
)
|
|
(50
|
)
|
|
(207
|
)
|
|||
Accrued compensation and benefits
|
|
(4
|
)
|
|
(11
|
)
|
|
2
|
|
|||
Other current liabilities
|
|
47
|
|
|
(7
|
)
|
|
15
|
|
|||
Cash collateral, net
|
|
159
|
|
|
(92
|
)
|
|
(34
|
)
|
|||
Other
|
|
49
|
|
|
61
|
|
|
(9
|
)
|
|||
Net cash provided from operating activities
|
|
1,151
|
|
|
571
|
|
|
78
|
|
|||
|
|
|
|
|
|
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
||||||
New financing-
|
|
|
|
|
|
|
||||||
Long-term debt
|
|
341
|
|
|
878
|
|
|
—
|
|
|||
Short-term borrowings, net
|
|
—
|
|
|
—
|
|
|
431
|
|
|||
Equity contribution from parent
|
|
—
|
|
|
500
|
|
|
1,500
|
|
|||
Redemptions and repayments-
|
|
|
|
|
|
|
||||||
Long-term debt
|
|
(411
|
)
|
|
(816
|
)
|
|
(1,202
|
)
|
|||
Short-term borrowings, net
|
|
(126
|
)
|
|
(301
|
)
|
|
—
|
|
|||
Tender premiums paid on debt redemptions
|
|
—
|
|
|
—
|
|
|
(67
|
)
|
|||
Common stock dividend payments
|
|
(70
|
)
|
|
—
|
|
|
—
|
|
|||
Other
|
|
(6
|
)
|
|
(15
|
)
|
|
(9
|
)
|
|||
Net cash (used for) provided from financing activities
|
|
(272
|
)
|
|
246
|
|
|
653
|
|
|||
|
|
|
|
|
|
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Property additions
|
|
(627
|
)
|
|
(839
|
)
|
|
(717
|
)
|
|||
Nuclear fuel
|
|
(190
|
)
|
|
(233
|
)
|
|
(250
|
)
|
|||
Proceeds from asset sales
|
|
13
|
|
|
307
|
|
|
21
|
|
|||
Sales of investment securities held in trusts
|
|
733
|
|
|
1,163
|
|
|
940
|
|
|||
Purchases of investment securities held in trusts
|
|
(791
|
)
|
|
(1,219
|
)
|
|
(1,000
|
)
|
|||
Cash investments
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
|||
Loans to affiliated companies, net
|
|
(11
|
)
|
|
—
|
|
|
276
|
|
|||
Other
|
|
4
|
|
|
4
|
|
|
(2
|
)
|
|||
Net cash used for investing activities
|
|
(879
|
)
|
|
(817
|
)
|
|
(732
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net change in cash and cash equivalents
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||
Cash and cash equivalents at beginning of period
|
|
2
|
|
|
2
|
|
|
3
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|
|
|
|
|
|
|
||||||
SUPPLEMENTAL CASH FLOW INFORMATION:
|
|
|
|
|
|
|
||||||
Cash paid (received) during the year -
|
|
|
|
|
|
|
||||||
Interest (net of amounts capitalized)
|
|
$
|
114
|
|
|
$
|
118
|
|
|
$
|
157
|
|
Income taxes paid, net of refunds (received, net of payments)
|
|
$
|
(5
|
)
|
|
$
|
(384
|
)
|
|
$
|
23
|
|
Regulatory Assets by Source
|
|
December 31,
2015 |
|
December 31,
2014 |
|
Increase
(Decrease)
|
||||||
|
|
(In millions)
|
||||||||||
Regulatory transition costs
|
|
$
|
185
|
|
|
$
|
240
|
|
|
$
|
(55
|
)
|
Customer receivables for future income taxes
|
|
355
|
|
|
370
|
|
|
(15
|
)
|
|||
Nuclear decommissioning and spent fuel disposal costs
|
|
(272
|
)
|
|
(305
|
)
|
|
33
|
|
|||
Asset removal costs
|
|
(372
|
)
|
|
(254
|
)
|
|
(118
|
)
|
|||
Deferred transmission costs
|
|
115
|
|
|
90
|
|
|
25
|
|
|||
Deferred generation costs
|
|
243
|
|
|
281
|
|
|
(38
|
)
|
|||
Deferred distribution costs
|
|
335
|
|
|
182
|
|
|
153
|
|
|||
Contract valuations
|
|
186
|
|
|
153
|
|
|
33
|
|
|||
Storm-related costs
|
|
403
|
|
|
465
|
|
|
(62
|
)
|
|||
Other
|
|
170
|
|
|
189
|
|
|
(19
|
)
|
|||
Net Regulatory Assets included on the Consolidated Balance Sheets
|
|
$
|
1,348
|
|
|
$
|
1,411
|
|
|
$
|
(63
|
)
|
Customer Receivables
|
|
FirstEnergy
|
|
FES
|
||||
|
|
(In millions)
|
||||||
December 31, 2015
|
|
|
|
|
||||
Billed
|
|
$
|
836
|
|
|
$
|
165
|
|
Unbilled
|
|
579
|
|
|
110
|
|
||
Total
|
|
$
|
1,415
|
|
|
$
|
275
|
|
|
|
|
|
|
||||
December 31, 2014
|
|
|
|
|
||||
Billed
|
|
$
|
914
|
|
|
$
|
239
|
|
Unbilled
|
|
640
|
|
|
176
|
|
||
Total
|
|
$
|
1,554
|
|
|
$
|
415
|
|
Reconciliation of Basic and Diluted Earnings per Share of Common Stock
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
(In millions, except per share amounts)
|
||||||||||
|
|
|
|
|
|
|
||||||
Income from continuing operations available to common shareholders
|
|
$
|
578
|
|
|
$
|
213
|
|
|
$
|
375
|
|
Discontinued operations (Note 19)
|
|
—
|
|
|
86
|
|
|
17
|
|
|||
Net income
|
|
$
|
578
|
|
|
$
|
299
|
|
|
$
|
392
|
|
|
|
|
|
|
|
|
||||||
Weighted average number of basic shares outstanding
|
|
422
|
|
|
420
|
|
|
418
|
|
|||
Assumed exercise of dilutive stock options and awards
(1)
|
|
2
|
|
|
1
|
|
|
1
|
|
|||
Weighted average number of diluted shares outstanding
|
|
424
|
|
|
421
|
|
|
419
|
|
|||
|
|
|
|
|
|
|
||||||
Earnings per share:
|
|
|
|
|
|
|
||||||
Basic earnings per share:
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
$
|
1.37
|
|
|
$
|
0.51
|
|
|
$
|
0.90
|
|
Discontinued operations (Note 19)
|
|
—
|
|
|
0.20
|
|
|
0.04
|
|
|||
Earnings per basic share
|
|
$
|
1.37
|
|
|
$
|
0.71
|
|
|
$
|
0.94
|
|
|
|
|
|
|
|
|
||||||
Diluted earnings per share:
|
|
|
|
|
|
|
||||||
Continuing operations
|
|
$
|
1.37
|
|
|
$
|
0.51
|
|
|
$
|
0.90
|
|
Discontinued operations (Note 19)
|
|
—
|
|
|
0.20
|
|
|
0.04
|
|
|||
Earnings per diluted share
|
|
$
|
1.37
|
|
|
$
|
0.71
|
|
|
$
|
0.94
|
|
(1)
|
For the years ended
December 31, 2015
,
2014
and 2013, approximately
one million
,
two million
, and
two million
shares were excluded from the calculation of diluted shares outstanding, respectively, as their inclusion would be antidilutive.
|
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||||||||
Property, Plant and Equipment
|
|
In Service
(2)
|
|
Accum. Depr.
|
|
Net Plant
|
|
In Service
(2)
|
|
Accum. Depr.
|
|
Net Plant
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
Regulated Distribution
|
|
$
|
24,553
|
|
|
$
|
(7,058
|
)
|
|
$
|
17,495
|
|
|
$
|
23,973
|
|
|
$
|
(6,759
|
)
|
|
$
|
17,214
|
|
Regulated Transmission
|
|
7,703
|
|
|
(1,647
|
)
|
|
6,056
|
|
|
6,634
|
|
|
(1,595
|
)
|
|
5,039
|
|
||||||
Competitive Energy Services
(1)
|
|
17,214
|
|
|
(6,213
|
)
|
|
11,001
|
|
|
16,442
|
|
|
(5,598
|
)
|
|
10,844
|
|
||||||
Corporate/Other
|
|
482
|
|
|
(242
|
)
|
|
240
|
|
|
435
|
|
|
(198
|
)
|
|
237
|
|
||||||
Total
|
|
$
|
49,952
|
|
|
$
|
(15,160
|
)
|
|
$
|
34,792
|
|
|
$
|
47,484
|
|
|
$
|
(14,150
|
)
|
|
$
|
33,334
|
|
Goodwill
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Competitive Energy Services
|
|
Consolidated
|
||||||||
|
|
(In millions)
|
|
|
|
|
|
|
||||||||
Balance as of December 31, 2015
|
|
$
|
5,092
|
|
|
$
|
526
|
|
|
$
|
800
|
|
|
$
|
6,418
|
|
•
|
Future Energy and Capacity Prices:
FirstEnergy used observable market information for near term forward power prices, PJM auction results for near term capacity pricing, and a longer-term pricing model for energy and capacity that considered the impact of key factors such as load growth, plant retirements, carbon and other environmental regulations, and natural gas pipeline construction, as well as coal and natural gas pricing.
|
•
|
Retail Sales and Margin:
FirstEnergy used CES' current retail targeted portfolio to estimate future retail sales volume as well as historical financial results to estimate retail margins.
|
•
|
Operating and Capital Costs:
FirstEnergy used estimated future operating and capital costs, including the estimated impact on costs of pending carbon and other environmental regulations, as well as costs associated with capacity performance reforms in the PJM market.
|
•
|
Discount Rate:
A discount rate of
8.25%
, based on a capital structure, return on debt and return on equity of selected comparable companies.
|
•
|
Terminal Value:
A terminal value of
7.0x
earnings before interest, taxes, depreciation and amortization based on consideration of peer group data and analyst consensus expectations.
|
FirstEnergy
|
|
|
|
|
|
|
|
|
||||||||
|
|
Gains & Losses on Cash Flow Hedges
|
|
Unrealized Gains on AFS Securities
|
|
Defined Benefit Pension & OPEB Plans
|
|
Total
|
||||||||
|
|
(In millions)
|
||||||||||||||
AOCI Balance, January 1, 2013
|
|
$
|
(38
|
)
|
|
$
|
15
|
|
|
$
|
408
|
|
|
$
|
385
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income before reclassifications
|
|
—
|
|
|
46
|
|
|
35
|
|
|
81
|
|
||||
Amounts reclassified from AOCI
|
|
3
|
|
|
(56
|
)
|
|
(195
|
)
|
|
(248
|
)
|
||||
Other comprehensive income (loss)
|
|
3
|
|
|
(10
|
)
|
|
(160
|
)
|
|
(167
|
)
|
||||
Income tax (benefits) on other comprehensive income (loss)
|
|
1
|
|
|
(4
|
)
|
|
(63
|
)
|
|
(66
|
)
|
||||
Other comprehensive income (loss), net of tax
|
|
2
|
|
|
(6
|
)
|
|
(97
|
)
|
|
(101
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
AOCI Balance, December 31, 2013
|
|
$
|
(36
|
)
|
|
$
|
9
|
|
|
$
|
311
|
|
|
$
|
284
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income before reclassifications
|
|
—
|
|
|
89
|
|
|
92
|
|
|
181
|
|
||||
Amounts reclassified from AOCI
|
|
(2
|
)
|
|
(63
|
)
|
|
(168
|
)
|
|
(233
|
)
|
||||
Other comprehensive income (loss)
|
|
(2
|
)
|
|
26
|
|
|
(76
|
)
|
|
(52
|
)
|
||||
Income tax (benefits) on other comprehensive income (loss)
|
|
(1
|
)
|
|
10
|
|
|
(23
|
)
|
|
(14
|
)
|
||||
Other comprehensive income (loss), net of tax
|
|
(1
|
)
|
|
16
|
|
|
(53
|
)
|
|
(38
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|||||||
AOCI Balance, December 31, 2014
|
|
$
|
(37
|
)
|
|
$
|
25
|
|
|
$
|
258
|
|
|
$
|
246
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income before reclassifications
|
|
—
|
|
|
14
|
|
|
10
|
|
|
24
|
|
||||
Amounts reclassified from AOCI
|
|
5
|
|
|
(25
|
)
|
|
(126
|
)
|
|
(146
|
)
|
||||
Other comprehensive income (loss)
|
|
5
|
|
|
(11
|
)
|
|
(116
|
)
|
|
(122
|
)
|
||||
Income tax (benefits) on other comprehensive income (loss)
|
|
1
|
|
|
(4
|
)
|
|
(44
|
)
|
|
(47
|
)
|
||||
Other comprehensive income (loss), net of tax
|
|
4
|
|
|
(7
|
)
|
|
(72
|
)
|
|
(75
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
AOCI Balance, December 31, 2015
|
|
$
|
(33
|
)
|
|
$
|
18
|
|
|
$
|
186
|
|
|
$
|
171
|
|
|
|
|
|
|
|
|
|
|
FES
|
|
|
|
|
|
|
|
|
||||||||
|
|
Gains & Losses on Cash Flow Hedges
|
|
Unrealized Gains on AFS Securities
|
|
Defined Benefit Pension & OPEB Plans
|
|
Total
|
||||||||
|
|
(In millions)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
AOCI Balance, January 1, 2013
|
|
$
|
3
|
|
|
$
|
13
|
|
|
$
|
56
|
|
|
$
|
72
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income before reclassifications
|
|
—
|
|
|
41
|
|
|
5
|
|
|
46
|
|
||||
Amounts reclassified from AOCI
|
|
(6
|
)
|
|
(49
|
)
|
|
(20
|
)
|
|
(75
|
)
|
||||
Other comprehensive loss
|
|
(6
|
)
|
|
(8
|
)
|
|
(15
|
)
|
|
(29
|
)
|
||||
Income tax benefits on other comprehensive loss
|
|
(2
|
)
|
|
(3
|
)
|
|
(6
|
)
|
|
(11
|
)
|
||||
Other comprehensive loss, net of tax
|
|
(4
|
)
|
|
(5
|
)
|
|
(9
|
)
|
|
(18
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
AOCI Balance, December 31, 2013
|
|
$
|
(1
|
)
|
|
$
|
8
|
|
|
$
|
47
|
|
|
$
|
54
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income before reclassifications
|
|
—
|
|
|
80
|
|
|
13
|
|
|
93
|
|
||||
Amounts reclassified from AOCI
|
|
(10
|
)
|
|
(59
|
)
|
|
(19
|
)
|
|
(88
|
)
|
||||
Other comprehensive income (loss)
|
|
(10
|
)
|
|
21
|
|
|
(6
|
)
|
|
5
|
|
||||
Income tax (benefits) on other comprehensive income (loss)
|
|
(4
|
)
|
|
8
|
|
|
(2
|
)
|
|
2
|
|
||||
Other comprehensive income (loss), net of tax
|
|
(6
|
)
|
|
13
|
|
|
(4
|
)
|
|
3
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
AOCI Balance, December 31, 2014
|
|
$
|
(7
|
)
|
|
$
|
21
|
|
|
$
|
43
|
|
|
$
|
57
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income before reclassifications
|
|
—
|
|
|
15
|
|
|
10
|
|
|
25
|
|
||||
Amounts reclassified from AOCI
|
|
(3
|
)
|
|
(24
|
)
|
|
(16
|
)
|
|
(43
|
)
|
||||
Other comprehensive loss
|
|
(3
|
)
|
|
(9
|
)
|
|
(6
|
)
|
|
(18
|
)
|
||||
Income tax benefits on other comprehensive loss
|
|
(1
|
)
|
|
(4
|
)
|
|
(2
|
)
|
|
(7
|
)
|
||||
Other comprehensive loss, net of tax
|
|
(2
|
)
|
|
(5
|
)
|
|
(4
|
)
|
|
(11
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
AOCI Balance, December 31, 2015
|
|
$
|
(9
|
)
|
|
$
|
16
|
|
|
$
|
39
|
|
|
$
|
46
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension
|
|
OPEB
|
||||||||||||
Obligations and Funded Status
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In millions)
|
||||||||||||||
Change in benefit obligation:
|
|
|
|
|
|
|
|
|
||||||||
Benefit obligation as of January 1
|
|
$
|
9,249
|
|
|
$
|
8,263
|
|
|
$
|
757
|
|
|
$
|
879
|
|
|
|
|
|
|
|
|
|
|
||||||||
Service cost
|
|
193
|
|
|
167
|
|
|
5
|
|
|
9
|
|
||||
Interest cost
|
|
383
|
|
|
402
|
|
|
29
|
|
|
39
|
|
||||
Plan participants’ contributions
|
|
—
|
|
|
—
|
|
|
6
|
|
|
16
|
|
||||
Plan amendments
|
|
—
|
|
|
5
|
|
|
(10
|
)
|
|
(97
|
)
|
||||
Medicare retiree drug subsidy
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Actuarial (gain) loss
|
|
(277
|
)
|
|
1,123
|
|
|
(2
|
)
|
|
13
|
|
||||
Benefits paid
|
|
(469
|
)
|
|
(711
|
)
|
|
(62
|
)
|
|
(102
|
)
|
||||
Benefit obligation as of December 31
|
|
$
|
9,079
|
|
|
$
|
9,249
|
|
|
$
|
724
|
|
|
$
|
757
|
|
|
|
|
|
|
|
|
|
|
||||||||
Change in fair value of plan assets:
|
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets as of January 1
|
|
$
|
5,824
|
|
|
$
|
6,171
|
|
|
$
|
464
|
|
|
$
|
495
|
|
Actual return (losses) on plan assets
|
|
(178
|
)
|
|
349
|
|
|
6
|
|
|
38
|
|
||||
Company contributions
|
|
161
|
|
|
15
|
|
|
17
|
|
|
17
|
|
||||
Plan participants’ contributions
|
|
—
|
|
|
—
|
|
|
6
|
|
|
16
|
|
||||
Benefits paid
|
|
(469
|
)
|
|
(711
|
)
|
|
(62
|
)
|
|
(102
|
)
|
||||
Fair value of plan assets as of December 31
|
|
$
|
5,338
|
|
|
$
|
5,824
|
|
|
$
|
431
|
|
|
$
|
464
|
|
|
|
|
|
|
|
|
|
|
||||||||
Funded Status:
|
|
|
|
|
|
|
|
|
||||||||
Qualified plan
|
|
$
|
(3,366
|
)
|
|
$
|
(3,064
|
)
|
|
|
|
|
||||
Non-qualified plans
|
|
(375
|
)
|
|
(361
|
)
|
|
|
|
|
||||||
Funded Status
|
|
$
|
(3,741
|
)
|
|
$
|
(3,425
|
)
|
|
$
|
(293
|
)
|
|
$
|
(293
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Accumulated benefit obligation
|
|
$
|
8,579
|
|
|
$
|
8,744
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amounts Recognized on the Balance Sheet:
|
|
|
|
|
|
|
|
|
||||||||
Current liabilities
|
|
$
|
(18
|
)
|
|
$
|
(17
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Noncurrent liabilities
|
|
(3,723
|
)
|
|
(3,408
|
)
|
|
(293
|
)
|
|
(293
|
)
|
||||
Net liability as of December 31
|
|
$
|
(3,741
|
)
|
|
$
|
(3,425
|
)
|
|
$
|
(293
|
)
|
|
$
|
(293
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Amounts Recognized in AOCI:
|
|
|
|
|
|
|
|
|
||||||||
Prior service cost (credit)
|
|
$
|
37
|
|
|
$
|
45
|
|
|
$
|
(355
|
)
|
|
$
|
(479
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Assumptions Used to Determine Benefit Obligations
|
|
|
|
|
|
|
|
|
||||||||
(as of December 31)
|
|
|
|
|
|
|
|
|
||||||||
Discount rate
|
|
4.50
|
%
|
|
4.25
|
%
|
|
4.25
|
%
|
|
4.00
|
%
|
||||
Rate of compensation increase
|
|
4.20
|
%
|
|
4.20
|
%
|
|
N/A
|
|
|
N/A
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Assumed Health Care Cost Trend Rates
|
|
|
|
|
|
|
|
|
||||||||
(as of December 31)
|
|
|
|
|
|
|
|
|
||||||||
Health care cost trend rate assumed (pre/post-Medicare)
|
|
N/A
|
|
|
N/A
|
|
|
6.0-5.5%
|
|
|
7.5-7.0%
|
|
||||
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)
|
|
N/A
|
|
|
N/A
|
|
|
4.5
|
%
|
|
4.5
|
%
|
||||
Year that the rate reaches the ultimate trend rate
|
|
N/A
|
|
|
N/A
|
|
|
2026
|
|
|
2026
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Allocation of Plan Assets (as of December 31)
|
|
|
|
|
|
|
|
|
||||||||
Equity securities
|
|
40
|
%
|
|
36
|
%
|
|
51
|
%
|
|
49
|
%
|
||||
Bonds
|
|
34
|
%
|
|
33
|
%
|
|
43
|
%
|
|
40
|
%
|
||||
Absolute return strategies
|
|
7
|
%
|
|
14
|
%
|
|
—
|
%
|
|
1
|
%
|
||||
Real estate
|
|
11
|
%
|
|
7
|
%
|
|
—
|
%
|
|
1
|
%
|
||||
Derivatives
|
|
—
|
%
|
|
1
|
%
|
|
—
|
%
|
|
—
|
%
|
||||
Cash and short-term securities
|
|
8
|
%
|
|
9
|
%
|
|
6
|
%
|
|
9
|
%
|
||||
Total
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
Pension
|
|
OPEB
|
||||||||||||||||||||
Components of Net Periodic Benefit Costs
|
|
2015
|
|
2014
|
|
2013
|
|
2015
|
|
2014
|
|
2013
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
Service cost
|
|
$
|
193
|
|
|
$
|
167
|
|
|
$
|
197
|
|
|
$
|
5
|
|
|
$
|
9
|
|
|
$
|
13
|
|
Interest cost
|
|
383
|
|
|
402
|
|
|
372
|
|
|
29
|
|
|
39
|
|
|
37
|
|
||||||
Expected return on plan assets
|
|
(443
|
)
|
|
(462
|
)
|
|
(501
|
)
|
|
(33
|
)
|
|
(34
|
)
|
|
(34
|
)
|
||||||
Amortization of prior service cost (credit)
|
|
8
|
|
|
8
|
|
|
12
|
|
|
(134
|
)
|
|
(176
|
)
|
|
(207
|
)
|
||||||
Pension & OPEB mark-to-market adjustment
|
|
344
|
|
|
1,235
|
|
|
(267
|
)
|
|
25
|
|
|
8
|
|
|
(129
|
)
|
||||||
Net periodic cost (credit)
|
|
$
|
485
|
|
|
$
|
1,350
|
|
|
$
|
(187
|
)
|
|
$
|
(108
|
)
|
|
$
|
(154
|
)
|
|
$
|
(320
|
)
|
Assumptions Used to Determine Net Periodic Benefit Cost
for Years Ended December 31
|
|
Pension
|
|
OPEB
|
||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015
|
|
2014
|
|
2013
|
|||||||
Weighted-average discount rate
|
|
4.25
|
%
|
|
5.00
|
%
|
|
4.25
|
%
|
|
4.00
|
%
|
|
4.75
|
%
|
|
4.00
|
%
|
Expected long-term return on plan assets
|
|
7.75
|
%
|
|
7.75
|
%
|
|
7.75
|
%
|
|
7.75
|
%
|
|
7.75
|
%
|
|
7.75
|
%
|
Rate of compensation increase
|
|
4.20
|
%
|
|
4.20
|
%
|
|
4.70
|
%
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
|
December 31, 2015
|
|
Asset Allocation
|
|||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
||||||||||
|
|
(In millions)
|
|
|
|||||||||||||||
Cash and short-term securities
|
|
$
|
—
|
|
|
$
|
427
|
|
|
$
|
—
|
|
|
$
|
427
|
|
|
8
|
%
|
Equity investments
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Domestic
|
|
869
|
|
|
75
|
|
|
—
|
|
|
944
|
|
|
18
|
%
|
||||
International
|
|
395
|
|
|
794
|
|
|
—
|
|
|
1,189
|
|
|
22
|
%
|
||||
Fixed income
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Government bonds
|
|
—
|
|
|
232
|
|
|
—
|
|
|
232
|
|
|
4
|
%
|
||||
Corporate bonds
|
|
—
|
|
|
1,115
|
|
|
—
|
|
|
1,115
|
|
|
21
|
%
|
||||
High yield debt
|
|
—
|
|
|
438
|
|
|
—
|
|
|
438
|
|
|
8
|
%
|
||||
Mortgage-backed securities (non-government)
|
|
—
|
|
|
31
|
|
|
—
|
|
|
31
|
|
|
1
|
%
|
||||
Alternatives
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Hedge funds (Absolute return)
|
|
—
|
|
|
343
|
|
|
—
|
|
|
343
|
|
|
7
|
%
|
||||
Derivatives
|
|
—
|
|
|
15
|
|
|
—
|
|
|
15
|
|
|
—
|
%
|
||||
Private equity funds
|
|
—
|
|
|
—
|
|
|
24
|
|
|
24
|
|
|
—
|
%
|
||||
Real estate funds
|
|
—
|
|
|
—
|
|
|
587
|
|
|
587
|
|
|
11
|
%
|
||||
Total
(1)
|
|
$
|
1,264
|
|
|
$
|
3,470
|
|
|
$
|
611
|
|
|
$
|
5,345
|
|
|
100
|
%
|
(1)
|
Excludes
$(7) million
as of
December 31, 2015
of receivables, payables, taxes and accrued income associated with financial instruments reflected within the fair value table.
|
|
|
December 31, 2014
|
|
Asset Allocation
|
|||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
||||||||||
|
|
(In millions)
|
|
|
|||||||||||||||
Cash and short-term securities
|
|
$
|
—
|
|
|
$
|
517
|
|
|
$
|
—
|
|
|
$
|
517
|
|
|
9
|
%
|
Equity investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Domestic
|
|
1,266
|
|
|
8
|
|
|
—
|
|
|
1,274
|
|
|
22
|
%
|
||||
International
|
|
355
|
|
|
414
|
|
|
—
|
|
|
769
|
|
|
14
|
%
|
||||
Fixed income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Government bonds
|
|
—
|
|
|
159
|
|
|
—
|
|
|
159
|
|
|
3
|
%
|
||||
Corporate bonds
|
|
—
|
|
|
1,386
|
|
|
—
|
|
|
1,386
|
|
|
24
|
%
|
||||
High yield debt
|
|
—
|
|
|
300
|
|
|
—
|
|
|
300
|
|
|
5
|
%
|
||||
Mortgage-backed securities (non-government)
|
|
—
|
|
|
37
|
|
|
—
|
|
|
37
|
|
|
1
|
%
|
||||
Alternatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Hedge funds (Absolute return)
|
|
—
|
|
|
809
|
|
|
—
|
|
|
809
|
|
|
14
|
%
|
||||
Derivatives
|
|
—
|
|
|
35
|
|
|
—
|
|
|
35
|
|
|
1
|
%
|
||||
Private equity funds
|
|
—
|
|
|
—
|
|
|
25
|
|
|
25
|
|
|
—
|
%
|
||||
Real estate funds
|
|
—
|
|
|
—
|
|
|
421
|
|
|
421
|
|
|
7
|
%
|
||||
Total
(1)
|
|
$
|
1,621
|
|
|
$
|
3,665
|
|
|
$
|
446
|
|
|
$
|
5,732
|
|
|
100
|
%
|
(1)
|
Excludes
$92 million
as of
December 31, 2014
of receivables, payables, taxes and accrued income associated with financial instruments reflected within the fair value table.
|
|
|
Private Equity Funds
|
|
Real Estate Funds
|
||||
|
|
(In millions)
|
||||||
Balance as of January 1, 2014
|
|
$
|
27
|
|
|
$
|
385
|
|
Actual return on plan assets:
|
|
|
|
|
|
|
||
Unrealized gains (losses)
|
|
(2
|
)
|
|
17
|
|
||
Realized gains
|
|
1
|
|
|
14
|
|
||
Transfers in (out)
|
|
(1
|
)
|
|
5
|
|
||
Balance as of December 31, 2014
|
|
$
|
25
|
|
|
$
|
421
|
|
Actual return on plan assets:
|
|
|
|
|
||||
Unrealized gains
|
|
—
|
|
|
42
|
|
||
Realized gains (losses)
|
|
(1
|
)
|
|
16
|
|
||
Transfers in
|
|
—
|
|
|
108
|
|
||
Balance as of December 31, 2015
|
|
$
|
24
|
|
|
$
|
587
|
|
|
|
December 31, 2015
|
|
Asset Allocation
|
|||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
||||||||||
|
|
(In millions)
|
|
|
|||||||||||||||
Cash and short-term securities
|
|
$
|
—
|
|
|
$
|
25
|
|
|
$
|
—
|
|
|
$
|
25
|
|
|
6
|
%
|
Equity investment
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Domestic
|
|
219
|
|
|
—
|
|
|
—
|
|
|
219
|
|
|
50
|
%
|
||||
International
|
|
1
|
|
|
3
|
|
|
—
|
|
|
4
|
|
|
1
|
%
|
||||
Fixed income
|
|
|
|
|
|
|
|
|
|
|
|||||||||
U.S. treasuries
|
|
—
|
|
|
42
|
|
|
—
|
|
|
42
|
|
|
10
|
%
|
||||
Government bonds
|
|
—
|
|
|
114
|
|
|
—
|
|
|
114
|
|
|
26
|
%
|
||||
Corporate bonds
|
|
—
|
|
|
27
|
|
|
—
|
|
|
27
|
|
|
6
|
%
|
||||
High yield debt
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
%
|
||||
Mortgage-backed securities (non-government)
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
|
1
|
%
|
||||
Alternatives
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Hedge funds
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
%
|
||||
Real estate funds
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
%
|
||||
Total
(1)
|
|
$
|
220
|
|
|
$
|
216
|
|
|
$
|
2
|
|
|
$
|
438
|
|
|
100
|
%
|
(1)
|
Excludes
$(7) million
as of
December 31, 2015
of receivables, payables, taxes and accrued income associated with financial instruments reflected within the fair value table.
|
|
|
December 31, 2014
|
|
Asset Allocation
|
|||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
||||||||||
|
|
(In millions)
|
|
|
|||||||||||||||
Cash and short-term securities
|
|
$
|
—
|
|
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
41
|
|
|
9
|
%
|
Equity investment
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Domestic
|
|
230
|
|
|
—
|
|
|
—
|
|
|
230
|
|
|
48
|
%
|
||||
International
|
|
3
|
|
|
3
|
|
|
—
|
|
|
6
|
|
|
1
|
%
|
||||
Fixed income
|
|
|
|
|
|
|
|
|
|
|
|||||||||
U.S. treasuries
|
|
—
|
|
|
41
|
|
|
—
|
|
|
41
|
|
|
9
|
%
|
||||
Government bonds
|
|
—
|
|
|
110
|
|
|
—
|
|
|
110
|
|
|
23
|
%
|
||||
Corporate bonds
|
|
—
|
|
|
32
|
|
|
—
|
|
|
32
|
|
|
7
|
%
|
||||
High yield debt
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
%
|
||||
Mortgage-backed securities (non-government)
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
|
1
|
%
|
||||
Alternatives
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Hedge funds
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|
1
|
%
|
||||
Real estate funds
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
|
1
|
%
|
||||
Total
(1)
|
|
$
|
233
|
|
|
$
|
237
|
|
|
$
|
3
|
|
|
$
|
473
|
|
|
100
|
%
|
(1)
|
Excludes
$(9) million
as of
December 31, 2014
, of receivables, payables, taxes and accrued income associated with financial instruments reflected within the fair value table.
|
|
|
Real Estate Funds
|
||
|
|
|
||
Balance as of January 1, 2014
|
|
$
|
5
|
|
Transfers out
|
|
(2
|
)
|
|
Balance as of December 31, 2014
|
|
$
|
3
|
|
Transfers out
|
|
(1
|
)
|
|
Balance as of December 31, 2015
|
|
$
|
2
|
|
|
|
1-Percentage-Point Increase
|
|
1-Percentage-Point Decrease
|
||||
|
|
(In millions)
|
||||||
Effect on total of service and interest cost
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
Effect on accumulated benefit obligation
|
|
$
|
26
|
|
|
$
|
(23
|
)
|
|
|
|
|
OPEB
|
||||||||
|
|
Pension
|
|
Benefit Payments
|
|
Subsidy Receipts
|
||||||
|
|
(In millions)
|
||||||||||
2016
|
|
$
|
484
|
|
|
$
|
54
|
|
|
$
|
(3
|
)
|
2017
|
|
505
|
|
|
54
|
|
|
(3
|
)
|
|||
2018
|
|
522
|
|
|
54
|
|
|
(3
|
)
|
|||
2019
|
|
533
|
|
|
54
|
|
|
(3
|
)
|
|||
2020
|
|
551
|
|
|
54
|
|
|
(3
|
)
|
|||
Years 2021-2025
|
|
2,946
|
|
|
259
|
|
|
(9
|
)
|
|
|
Pension
|
|
OPEB
|
||||||||||||||||||||
|
|
2015
|
|
2014
|
|
2013
|
|
2015
|
|
2014
|
|
2013
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
Net Periodic Cost (Credit)
|
|
$
|
10
|
|
|
$
|
150
|
|
|
$
|
(30
|
)
|
|
$
|
(22
|
)
|
|
$
|
(24
|
)
|
|
$
|
(40
|
)
|
FirstEnergy
|
|
Years ended December 31,
|
||||||||||
Stock-based Compensation Plan
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
(In millions)
|
||||||||||
Restricted Stock Units
|
|
$
|
46
|
|
|
$
|
26
|
|
|
$
|
36
|
|
Restricted Stock
|
|
2
|
|
|
5
|
|
|
6
|
|
|||
Performance Shares
|
|
—
|
|
|
5
|
|
|
(10
|
)
|
|||
401(k) Savings Plan
|
|
38
|
|
|
25
|
|
|
25
|
|
|||
EDCP & DCPD
|
|
3
|
|
|
8
|
|
|
3
|
|
|||
Total
|
|
$
|
89
|
|
|
$
|
69
|
|
|
$
|
60
|
|
Stock-based compensation costs capitalized
|
|
$
|
32
|
|
|
$
|
23
|
|
|
$
|
20
|
|
FES
|
|
Years ended December 31,
|
||||||||||
Stock-based Compensation Plan
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
(In millions)
|
||||||||||
Restricted Stock Units
|
|
$
|
6
|
|
|
$
|
4
|
|
|
$
|
6
|
|
Performance Shares
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|||
401(k) Savings Plan
|
|
5
|
|
|
4
|
|
|
4
|
|
|||
Total
|
|
$
|
11
|
|
|
$
|
9
|
|
|
$
|
9
|
|
Stock-based compensation costs capitalized
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Restricted Stock Unit Activity
|
|
Shares
|
|
Weighted-Average Grant Date Fair Value
|
|||
Nonvested as of January 1, 2015
|
|
2,069,518
|
|
|
$
|
37.65
|
|
Granted in 2015
|
|
1,157,755
|
|
|
35.27
|
|
|
Forfeited in 2015
|
|
(231,271
|
)
|
|
34.19
|
|
|
Vested in 2015
(1)
|
|
(559,114
|
)
|
|
44.58
|
|
|
Nonvested as of December 31, 2015
|
|
2,436,888
|
|
|
$
|
35.26
|
|
Restricted Stock
|
|
Number of Shares
|
|
Weighted Average Grant-Date Fair Value
|
|||
Nonvested as of January 1, 2015
|
|
342,286
|
|
|
$
|
45.29
|
|
Granted in 2015
|
|
65,434
|
|
|
32.98
|
|
|
Forfeited in 2015
|
|
(26,079
|
)
|
|
57.58
|
|
|
Vested in 2015
(1)
|
|
(190,985
|
)
|
|
43.17
|
|
|
Nonvested as of December 31, 2015
|
|
190,656
|
|
|
$
|
40.65
|
|
|
|
|
|
|
Stock Option Activity
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|||
Balance, January 1, 2015 (1,077,988 options exercisable)
|
|
1,439,145
|
|
|
$
|
44.83
|
|
Options exercised
|
|
(18,551
|
)
|
|
29.53
|
|
|
Options forfeited
|
|
(8,623
|
)
|
|
68.02
|
|
|
Balance, December 31, 2015 (1,211,358 options exercisable)
|
|
1,411,971
|
|
|
$
|
44.89
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In millions)
|
||||||||||
FirstEnergy
|
|
|
|
|
|
||||||
Income from Continuing Operations before income taxes
|
$
|
893
|
|
|
$
|
171
|
|
|
$
|
570
|
|
Federal income tax expense at statutory rate (35%)
|
$
|
313
|
|
|
$
|
60
|
|
|
$
|
199
|
|
Increases (reductions) in taxes resulting from-
|
|
|
|
|
|
||||||
State income taxes, net of federal tax benefit
|
34
|
|
|
12
|
|
|
10
|
|
|||
AFUDC equity and other flow-through
|
(16
|
)
|
|
(13
|
)
|
|
(7
|
)
|
|||
Amortization of investment tax credits
|
(8
|
)
|
|
(10
|
)
|
|
(8
|
)
|
|||
Change in accounting method
|
(8
|
)
|
|
(27
|
)
|
|
—
|
|
|||
ESOP dividend
|
(6
|
)
|
|
(6
|
)
|
|
(9
|
)
|
|||
Tax basis balance sheet adjustments
|
—
|
|
|
(25
|
)
|
|
—
|
|
|||
Uncertain tax positions
|
1
|
|
|
(35
|
)
|
|
(2
|
)
|
|||
Other, net
|
5
|
|
|
2
|
|
|
12
|
|
|||
Total income taxes (benefits)
|
$
|
315
|
|
|
$
|
(42
|
)
|
|
$
|
195
|
|
Effective income tax rate
|
35.3
|
%
|
|
(24.6
|
)%
|
|
34.2
|
%
|
|||
|
|
|
|
|
|
||||||
FES
|
|
|
|
|
|
||||||
Income (loss) from Continuing Operations before income taxes (benefits)
|
$
|
147
|
|
|
$
|
(588
|
)
|
|
$
|
52
|
|
Federal income tax expense (benefit) at statutory rate (35%)
|
$
|
51
|
|
|
$
|
(206
|
)
|
|
$
|
18
|
|
Increases (reductions) in taxes resulting from-
|
|
|
|
|
|
||||||
State income taxes, net of federal tax benefit
|
16
|
|
|
(14
|
)
|
|
(5
|
)
|
|||
Amortization of investment tax credits
|
(2
|
)
|
|
(4
|
)
|
|
(4
|
)
|
|||
ESOP dividend
|
(1
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|||
Uncertain tax positions
|
5
|
|
|
—
|
|
|
—
|
|
|||
Other, net
|
(4
|
)
|
|
(3
|
)
|
|
(1
|
)
|
|||
Total income taxes (benefits)
|
$
|
65
|
|
|
$
|
(228
|
)
|
|
$
|
6
|
|
Effective income tax rate
|
44.2
|
%
|
|
38.8
|
%
|
|
11.5
|
%
|
|
|
2015
|
|
2014
|
||||
|
|
(In millions)
|
||||||
FirstEnergy
|
|
|
|
|
||||
Property basis differences
|
|
$
|
9,920
|
|
|
$
|
9,354
|
|
Deferred sale and leaseback gain
|
|
(360
|
)
|
|
(381
|
)
|
||
Pension and OPEB
|
|
(1,541
|
)
|
|
(1,433
|
)
|
||
Nuclear decommissioning activities
|
|
480
|
|
|
458
|
|
||
Asset retirement obligations
|
|
(731
|
)
|
|
(641
|
)
|
||
Regulatory asset/liability
|
|
763
|
|
|
768
|
|
||
Loss carryforwards and AMT credits
|
|
(1,965
|
)
|
|
(1,932
|
)
|
||
Loss carryforward valuation reserve
|
|
192
|
|
|
174
|
|
||
All other
|
|
15
|
|
|
172
|
|
||
Net deferred income tax liability
|
|
$
|
6,773
|
|
|
$
|
6,539
|
|
|
|
|
|
|
||||
FES
|
|
|
|
|
||||
Property basis differences
|
|
$
|
1,901
|
|
|
$
|
1,749
|
|
Deferred sale and leaseback gain
|
|
(342
|
)
|
|
(356
|
)
|
||
Pension and OPEB
|
|
(393
|
)
|
|
(373
|
)
|
||
Lease market valuation liability
|
|
95
|
|
|
75
|
|
||
Nuclear decommissioning activities
|
|
483
|
|
|
489
|
|
||
Asset retirement obligations
|
|
(509
|
)
|
|
(486
|
)
|
||
Loss carryforwards and AMT credits
|
|
(687
|
)
|
|
(631
|
)
|
||
Loss carryforward valuation reserve
|
|
46
|
|
|
32
|
|
||
All other
|
|
6
|
|
|
(15
|
)
|
||
Net deferred income tax liability
|
|
$
|
600
|
|
|
$
|
484
|
|
Expiration Period
|
|
FirstEnergy
|
|
FES
|
||||||||||||
|
|
(In millions)
|
||||||||||||||
|
|
State
|
|
Local
|
|
State
|
|
Local
|
||||||||
2016-2020
|
|
$
|
403
|
|
|
$
|
2,983
|
|
|
$
|
95
|
|
|
$
|
1,820
|
|
2021-2025
|
|
1,323
|
|
|
—
|
|
|
68
|
|
|
—
|
|
||||
2026-2030
|
|
2,205
|
|
|
—
|
|
|
259
|
|
|
—
|
|
||||
2031-2035
|
|
3,245
|
|
|
—
|
|
|
1,128
|
|
|
—
|
|
||||
|
|
$
|
7,176
|
|
|
$
|
2,983
|
|
|
$
|
1,550
|
|
|
$
|
1,820
|
|
|
|
FirstEnergy
|
|
FES
|
||||
|
|
(In millions)
|
||||||
Balance, January 1, 2013
|
|
$
|
43
|
|
|
$
|
3
|
|
Prior years increases
|
|
10
|
|
|
—
|
|
||
Prior years decreases
|
|
(5
|
)
|
|
—
|
|
||
Balance, December 31, 2013
|
|
$
|
48
|
|
|
$
|
3
|
|
Current year increases
|
|
4
|
|
|
—
|
|
||
Prior years increases
|
|
5
|
|
|
—
|
|
||
Prior years decreases
|
|
(23
|
)
|
|
—
|
|
||
Balance, December 31, 2014
|
|
$
|
34
|
|
|
$
|
3
|
|
Current year increases
|
|
3
|
|
|
—
|
|
||
Prior years increases
|
|
7
|
|
|
5
|
|
||
Prior years decreases
|
|
(10
|
)
|
|
—
|
|
||
Balance, December 31, 2015
|
|
$
|
34
|
|
|
$
|
8
|
|
|
|
Net Interest Expense (Income)
For the Years Ended December 31,
|
|
Net Interest Payable
As of December 31,
|
||||||||||||||||
|
|
2015
|
|
2014
|
|
2013
|
|
2015
|
|
2014
|
||||||||||
|
|
(In millions)
|
|
(In millions)
|
||||||||||||||||
FirstEnergy
|
|
$
|
(1
|
)
|
|
$
|
(6
|
)
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
(In millions)
|
||||||||||
FirstEnergy
|
|
|
|
|
|
|
||||||
KWH excise
|
|
$
|
193
|
|
|
$
|
194
|
|
|
$
|
219
|
|
State gross receipts
|
|
224
|
|
|
226
|
|
|
240
|
|
|||
Real and personal property
|
|
410
|
|
|
393
|
|
|
368
|
|
|||
Social security and unemployment
|
|
119
|
|
|
112
|
|
|
110
|
|
|||
Other
|
|
32
|
|
|
37
|
|
|
41
|
|
|||
Total general taxes
|
|
$
|
978
|
|
|
$
|
962
|
|
|
$
|
978
|
|
|
|
|
|
|
|
|
||||||
FES
|
|
|
|
|
|
|
||||||
State gross receipts
|
|
$
|
44
|
|
|
$
|
69
|
|
|
$
|
77
|
|
Real and personal property
|
|
36
|
|
|
39
|
|
|
40
|
|
|||
Social security and unemployment
|
|
16
|
|
|
17
|
|
|
19
|
|
|||
Other
|
|
2
|
|
|
3
|
|
|
2
|
|
|||
Total general taxes
|
|
$
|
98
|
|
|
$
|
128
|
|
|
$
|
138
|
|
(In millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
|
|
|
|
|
|
||||||
FirstEnergy
|
|
$
|
174
|
|
|
$
|
199
|
|
|
$
|
224
|
|
FES
|
|
$
|
94
|
|
|
$
|
95
|
|
|
$
|
97
|
|
Capital leases
|
|
FirstEnergy
|
|
FES
|
||||
|
|
(In millions)
|
||||||
2016
|
|
$
|
36
|
|
|
$
|
6
|
|
2017
|
|
31
|
|
|
6
|
|
||
2018
|
|
24
|
|
|
2
|
|
||
2019
|
|
18
|
|
|
—
|
|
||
2020
|
|
14
|
|
|
—
|
|
||
Years thereafter
|
|
27
|
|
|
—
|
|
||
Total minimum lease payments
|
|
150
|
|
|
14
|
|
||
Interest portion
|
|
(18
|
)
|
|
(1
|
)
|
||
Present value of net minimum lease payments
|
|
132
|
|
|
13
|
|
||
Less current portion
|
|
32
|
|
|
5
|
|
||
Noncurrent portion
|
|
$
|
100
|
|
|
$
|
8
|
|
|
|
FirstEnergy
|
||||||||||
Operating Leases
|
|
Lease Payments
|
|
PNBV
|
|
Net
|
||||||
|
|
(In millions)
|
||||||||||
2016
|
|
$
|
197
|
|
|
$
|
13
|
|
|
$
|
184
|
|
2017
|
|
122
|
|
|
3
|
|
|
119
|
|
|||
2018
|
|
135
|
|
|
—
|
|
|
135
|
|
|||
2019
|
|
116
|
|
|
—
|
|
|
116
|
|
|||
2020
|
|
91
|
|
|
—
|
|
|
91
|
|
|||
Years thereafter
|
|
1,438
|
|
|
—
|
|
|
1,438
|
|
|||
Total minimum lease payments
|
|
$
|
2,099
|
|
|
$
|
16
|
|
|
$
|
2,083
|
|
Operating Leases
|
|
Lease Payments
|
||
|
|
(In millions)
|
||
2016
|
|
$
|
131
|
|
2017
|
|
82
|
|
|
2018
|
|
101
|
|
|
2019
|
|
97
|
|
|
2020
|
|
68
|
|
|
Years thereafter
|
|
1,315
|
|
|
Total minimum lease payments
|
|
$
|
1,794
|
|
|
|
Intangible Assets
|
|
Amortization Expense
|
||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
Actual
|
|
Estimated
|
||||||||||||||||||||||||||||||
(In millions)
|
|
Gross
|
|
Accumulated Amortization
|
|
Net
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
||||||||||||||||||||
NUG contracts
(1)
|
|
$
|
124
|
|
|
$
|
25
|
|
|
$
|
99
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
$
|
74
|
|
OVEC
|
|
54
|
|
|
9
|
|
|
45
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
35
|
|
||||||||||
Coal contracts
(2)(3)(4)
|
|
556
|
|
|
430
|
|
|
126
|
|
|
116
|
|
|
38
|
|
|
32
|
|
|
17
|
|
|
17
|
|
|
6
|
|
|
—
|
|
||||||||||
FES customer contracts
|
|
148
|
|
|
87
|
|
|
61
|
|
|
17
|
|
|
17
|
|
|
16
|
|
|
14
|
|
|
13
|
|
|
1
|
|
|
—
|
|
||||||||||
|
|
$
|
882
|
|
|
$
|
551
|
|
|
$
|
331
|
|
|
$
|
140
|
|
|
$
|
62
|
|
|
$
|
55
|
|
|
$
|
38
|
|
|
$
|
37
|
|
|
$
|
14
|
|
|
$
|
109
|
|
(1)
|
NUG contracts are subject to regulatory accounting and their amortization does not impact earnings.
|
(2)
|
A gross amount of
$40 million
($
23 million
, net) of the coal contracts is related to FES. The 2015 and estimated 2016 to 2019 amortization expense for FES is
$5.7 million
annually.
|
(3)
|
A gross amount of
$102 million
(
$16 million
, net) of the coal contracts was recorded with a regulatory offset and the amortization does not impact earnings. Accordingly, the amortization expense for these coal contracts is excluded from table above.
|
(4)
|
Amortization expense in 2015, includes a
$67 million
impairment of a coal contract intangible asset associated with the termination of a coal supply contract, which impacted earnings.
|
•
|
PNBV
-
PNBV
,
a business trust established by OE in 1996, issued certain beneficial interests and notes to fund the acquisition of a portion of the bonds issued by certain owner trusts in connection with the sale and leaseback in 1987 of a portion of OE's interest in the Perry Plant and Beaver Valley Unit 2. OE used debt and available funds to purchase the notes issued by PNBV. The beneficial ownership of PNBV includes a 3% interest by unaffiliated third parties.
|
•
|
Ohio Securitization
-
In September 2012, the Ohio Companies created separate, wholly-owned limited liability companies (SPEs) which issued phase-in recovery bonds to securitize the recovery of certain all-electric customer heating discounts, fuel and purchased power regulatory assets. The phase-in recovery bonds are payable only from, and secured by, phase-in recovery property owned by the SPEs. The bondholder has no recourse to the general credit of FirstEnergy or any of the Ohio Companies. Each of the Ohio Companies, as servicer of its respective SPE, manages and administers the phase-in recovery property including the billing, collection and remittance of usage-based charges payable by retail electric customers. In the aggregate, the Ohio Companies are entitled to annual servicing fees of
$445 thousand
that are recoverable through the usage-based charges. As of
December 31, 2015
and December 31, 2014,
$362 million
and
$386 million
of the phase-in recovery bonds were outstanding, respectively.
|
•
|
JCP&L Securitization
-
In June 2002, JCP&L Transition Funding sold transition bonds to securitize the recovery of JCP&L’s bondable stranded costs associated with the previously divested Oyster Creek Nuclear Generating Station. In August 2006, JCP&L Transition Funding II sold transition bonds to securitize the recovery of deferred costs associated with JCP&L’s supply of BGS. JCP&L did not purchase and does not own any of the transition bonds, which are included as long-term debt on FirstEnergy’s and JCP&L’s Consolidated Balance Sheets. The transition bonds are the sole obligations of JCP&L Transition Funding and JCP&L Transition Funding II and are collateralized by each company’s equity and assets, which consist primarily of bondable transition property. As of
December 31, 2015
and December 31, 2014,
$128 million
and
$168 million
of the transition bonds were outstanding, respectively.
|
•
|
MP and PE Environmental Funding Companies
-
The entities issued bonds of which the proceeds were used to construct environmental control facilities. The special purpose limited liability companies own the irrevocable right to collect non-bypassable environmental control charges from all customers who receive electric delivery service in MP's and PE's West Virginia service territories. Principal and interest owed on the environmental control bonds is secured by, and payable solely from, the proceeds of the environmental control charges. Creditors of FirstEnergy, other than the special purpose limited liability companies, have no recourse to any assets or revenues of the special purpose limited liability companies. As of
December 31, 2015
and December 31, 2014,
$429 million
and
$450 million
of the environmental control bonds were outstanding, respectively.
|
•
|
Global Holding
-
FEV holds a
33-1/3%
equity ownership in Global Holding, the holding company for a joint venture in the Signal Peak mining and coal transportation operations with coal sales in U.S. and international markets. FEV is not the primary beneficiary of the joint venture, as it does not have control over the significant activities affecting the joint venture's economic performance. FEV's ownership interest is subject to the equity method of accounting. See Note 1, Organization, Basis of Presentation and Significant Accounting Policies - Investments, for additional information regarding FEV's investment in Global Holding.
|
•
|
PATH WV
-
PATH is a series limited liability company that is comprised of multiple series, each of which has separate rights, powers and duties regarding specified property and the series profits and losses associated with such property. A subsidiary of FE owns
100%
of the Allegheny Series (PATH-Allegheny) and
50%
of the West Virginia Series (PATH-WV), which is a joint venture with a subsidiary of AEP. FirstEnergy is not the primary beneficiary of PATH-WV, as it does not have control over the significant activities affecting the economics of PATH-WV. FirstEnergy's ownership interest in PATH-WV is subject to the equity method of accounting.
|
•
|
Power Purchase Agreements
-
FirstEnergy evaluated its power purchase agreements and determined that certain NUG entities at its Regulated Distribution segment may be VIEs to the extent that they own a plant that sells substantially all of its output to the applicable utilities and the contract price for power is correlated with the plant’s variable costs of production.
|
•
|
Sale and Leaseback Transactions
-
FES and certain of the Ohio Companies have obligations that are not included on their Consolidated Balance Sheets related to the Perry Unit 1, Beaver Valley Unit 2, and 2007 Bruce Mansfield Unit 1 sale and leaseback arrangements, which are satisfied through operating lease payments. FirstEnergy is not the primary beneficiary of these interests as it does not have control over the significant activities affecting the economics of the arrangements.
As of
December 31, 2015
, FirstEnergy's leasehold interest was
3.75%
of Perry Unit 1,
93.83%
of Bruce Mansfield Unit 1 and
2.60%
of Beaver Valley Unit 2.
|
|
Maximum
Exposure
|
|
Discounted Lease
Payments, net
|
|
Net
Exposure
|
||||||
|
(In millions)
|
||||||||||
FirstEnergy
|
$
|
1,225
|
|
|
$
|
950
|
|
|
$
|
275
|
|
FES
|
$
|
1,155
|
|
|
$
|
933
|
|
|
$
|
222
|
|
Level 1
|
-
|
Quoted prices for identical instruments in active market
|
|
|
|
Level 2
|
-
|
Quoted prices for similar instruments in active market
|
|
-
|
Quoted prices for identical or similar instruments in markets that are not active
|
|
-
|
Model-derived valuations for which all significant inputs are observable market data
|
Level 3
|
-
|
Valuation inputs are unobservable and significant to the fair value measurement
|
FirstEnergy
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Recurring Fair Value Measurements
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets
|
(In millions)
|
||||||||||||||||||||||||||||||
Corporate debt securities
|
$
|
—
|
|
|
$
|
1,245
|
|
|
$
|
—
|
|
|
$
|
1,245
|
|
|
$
|
—
|
|
|
$
|
1,221
|
|
|
$
|
—
|
|
|
$
|
1,221
|
|
Derivative assets - commodity contracts
|
4
|
|
|
224
|
|
|
—
|
|
|
228
|
|
|
1
|
|
|
171
|
|
|
—
|
|
|
172
|
|
||||||||
Derivative assets - FTRs
|
—
|
|
|
—
|
|
|
8
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
39
|
|
|
39
|
|
||||||||
Derivative assets - NUG contracts
(1)
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||||||
Equity securities
(2)
|
576
|
|
|
—
|
|
|
—
|
|
|
576
|
|
|
592
|
|
|
—
|
|
|
—
|
|
|
592
|
|
||||||||
Foreign government debt securities
|
—
|
|
|
75
|
|
|
—
|
|
|
75
|
|
|
—
|
|
|
76
|
|
|
—
|
|
|
76
|
|
||||||||
U.S. government debt securities
|
—
|
|
|
180
|
|
|
—
|
|
|
180
|
|
|
—
|
|
|
182
|
|
|
—
|
|
|
182
|
|
||||||||
U.S. state debt securities
|
—
|
|
|
246
|
|
|
—
|
|
|
246
|
|
|
—
|
|
|
237
|
|
|
—
|
|
|
237
|
|
||||||||
Other
(3)
|
105
|
|
|
212
|
|
|
—
|
|
|
317
|
|
|
55
|
|
|
256
|
|
|
—
|
|
|
311
|
|
||||||||
Total assets
|
$
|
685
|
|
|
$
|
2,182
|
|
|
$
|
9
|
|
|
$
|
2,876
|
|
|
$
|
648
|
|
|
$
|
2,143
|
|
|
$
|
41
|
|
|
$
|
2,832
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivative liabilities - commodity contracts
|
$
|
(9
|
)
|
|
$
|
(122
|
)
|
|
$
|
—
|
|
|
$
|
(131
|
)
|
|
$
|
(26
|
)
|
|
$
|
(141
|
)
|
|
$
|
—
|
|
|
$
|
(167
|
)
|
Derivative liabilities - FTRs
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
(13
|
)
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
(14
|
)
|
||||||||
Derivative liabilities - NUG contracts
(1)
|
—
|
|
|
—
|
|
|
(137
|
)
|
|
(137
|
)
|
|
—
|
|
|
—
|
|
|
(153
|
)
|
|
(153
|
)
|
||||||||
Total liabilities
|
$
|
(9
|
)
|
|
$
|
(122
|
)
|
|
$
|
(150
|
)
|
|
$
|
(281
|
)
|
|
$
|
(26
|
)
|
|
$
|
(141
|
)
|
|
$
|
(167
|
)
|
|
$
|
(334
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net assets (liabilities)
(4)
|
$
|
676
|
|
|
$
|
2,060
|
|
|
$
|
(141
|
)
|
|
$
|
2,595
|
|
|
$
|
622
|
|
|
$
|
2,002
|
|
|
$
|
(126
|
)
|
|
$
|
2,498
|
|
(1)
|
NUG contracts are subject to regulatory accounting treatment and do not impact earnings.
|
(2)
|
NDT funds hold equity portfolios whose performance is benchmarked against the Alerian MLP Index or the Wells Fargo Hybrid and Preferred Securities REIT index.
|
(3)
|
Primarily consists of cash and short-term cash investments.
|
(4)
|
Excludes
$7 million
and
$40 million
as of
December 31, 2015
and
December 31, 2014
, respectively, of receivables, payables, taxes and accrued income associated with financial instruments reflected within the fair value table.
|
|
NUG Contracts
(1)
|
|
FTRs
|
||||||||||||||||||||
|
Derivative Assets
|
|
Derivative Liabilities
|
|
Net
|
|
Derivative Assets
|
|
Derivative Liabilities
|
|
Net
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
January 1, 2014 Balance
|
$
|
20
|
|
|
$
|
(222
|
)
|
|
$
|
(202
|
)
|
|
$
|
4
|
|
|
$
|
(12
|
)
|
|
$
|
(8
|
)
|
Unrealized gain (loss)
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
47
|
|
|
(1
|
)
|
|
46
|
|
||||||
Purchases
|
—
|
|
|
—
|
|
|
—
|
|
|
26
|
|
|
(16
|
)
|
|
10
|
|
||||||
Settlements
|
(20
|
)
|
|
71
|
|
|
51
|
|
|
(38
|
)
|
|
15
|
|
|
(23
|
)
|
||||||
December 31, 2014 Balance
|
$
|
2
|
|
|
$
|
(153
|
)
|
|
$
|
(151
|
)
|
|
$
|
39
|
|
|
$
|
(14
|
)
|
|
$
|
25
|
|
Unrealized gain (loss)
|
2
|
|
|
(49
|
)
|
|
(47
|
)
|
|
(5
|
)
|
|
(7
|
)
|
|
(12
|
)
|
||||||
Purchases
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|
(11
|
)
|
|
11
|
|
||||||
Settlements
|
(3
|
)
|
|
65
|
|
|
62
|
|
|
(48
|
)
|
|
19
|
|
|
(29
|
)
|
||||||
December 31, 2015 Balance
|
$
|
1
|
|
|
$
|
(137
|
)
|
|
$
|
(136
|
)
|
|
$
|
8
|
|
|
$
|
(13
|
)
|
|
$
|
(5
|
)
|
(1)
|
NUG contracts are subject to regulatory accounting treatment and do not impact earnings.
|
|
|
Fair Value, Net (In millions)
|
|
Valuation
Technique |
|
Significant Input
|
|
Range
|
|
Weighted Average
|
|
Units
|
||
FTRs
|
|
$
|
(5
|
)
|
|
Model
|
|
RTO auction clearing prices
|
|
($3.90) to $6.90
|
|
$1.00
|
|
Dollars/MWH
|
NUG Contracts
|
|
$
|
(136
|
)
|
|
Model
|
|
Generation
Regional electricity prices |
|
400 to 3,871,000
$38.10 to $45.60
|
|
839,000
$40.20
|
|
MWH
Dollars/MWH |
FES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Recurring Fair Value Measurements
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets
|
(In millions)
|
||||||||||||||||||||||||||||||
Corporate debt securities
|
$
|
—
|
|
|
$
|
678
|
|
|
$
|
—
|
|
|
$
|
678
|
|
|
$
|
—
|
|
|
$
|
655
|
|
|
$
|
—
|
|
|
$
|
655
|
|
Derivative assets - commodity contracts
|
4
|
|
|
224
|
|
|
—
|
|
|
228
|
|
|
1
|
|
|
171
|
|
|
—
|
|
|
172
|
|
||||||||
Derivative assets - FTRs
|
—
|
|
|
—
|
|
|
5
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|
27
|
|
||||||||
Equity securities
(1)
|
378
|
|
|
—
|
|
|
—
|
|
|
378
|
|
|
360
|
|
|
—
|
|
|
—
|
|
|
360
|
|
||||||||
Foreign government debt securities
|
—
|
|
|
59
|
|
|
—
|
|
|
59
|
|
|
—
|
|
|
57
|
|
|
—
|
|
|
57
|
|
||||||||
U.S. government debt securities
|
—
|
|
|
23
|
|
|
—
|
|
|
23
|
|
|
—
|
|
|
46
|
|
|
—
|
|
|
46
|
|
||||||||
U.S. state debt securities
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||||||
Other
(2)
|
—
|
|
|
184
|
|
|
—
|
|
|
184
|
|
|
—
|
|
|
199
|
|
|
—
|
|
|
199
|
|
||||||||
Total assets
|
$
|
382
|
|
|
$
|
1,172
|
|
|
$
|
5
|
|
|
$
|
1,559
|
|
|
$
|
361
|
|
|
$
|
1,132
|
|
|
$
|
27
|
|
|
$
|
1,520
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivative liabilities - commodity contracts
|
$
|
(9
|
)
|
|
$
|
(122
|
)
|
|
$
|
—
|
|
|
$
|
(131
|
)
|
|
$
|
(26
|
)
|
|
$
|
(141
|
)
|
|
$
|
—
|
|
|
$
|
(167
|
)
|
Derivative liabilities - FTRs
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
(11
|
)
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
(13
|
)
|
||||||||
Total liabilities
|
$
|
(9
|
)
|
|
$
|
(122
|
)
|
|
$
|
(11
|
)
|
|
$
|
(142
|
)
|
|
$
|
(26
|
)
|
|
$
|
(141
|
)
|
|
$
|
(13
|
)
|
|
$
|
(180
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net assets (liabilities)
(3)
|
$
|
373
|
|
|
$
|
1,050
|
|
|
$
|
(6
|
)
|
|
$
|
1,417
|
|
|
$
|
335
|
|
|
$
|
991
|
|
|
$
|
14
|
|
|
$
|
1,340
|
|
(1)
|
NDT funds hold equity portfolios whose performance is benchmarked against the Alerian MLP Index or the Wells Fargo Hybrid and Preferred Securities REIT index.
|
(2)
|
Primarily consists of short-term cash investments.
|
(3)
|
Excludes
$1 million
and
$44 million
as of
December 31, 2015
and
December 31, 2014
, respectively, of receivables, payables, taxes and accrued income associated with financial instruments reflected within the fair value table.
|
|
|
Derivative Asset
|
|
Derivative Liability
|
|
Net Asset/(Liability)
|
||||||
|
|
(In millions)
|
||||||||||
January 1, 2014 Balance
|
|
$
|
3
|
|
|
$
|
(11
|
)
|
|
$
|
(8
|
)
|
Unrealized gain (loss)
|
|
34
|
|
|
(1
|
)
|
|
33
|
|
|||
Purchases
|
|
15
|
|
|
(16
|
)
|
|
(1
|
)
|
|||
Settlements
|
|
(25
|
)
|
|
15
|
|
|
(10
|
)
|
|||
December 31, 2014 Balance
|
|
$
|
27
|
|
|
$
|
(13
|
)
|
|
$
|
14
|
|
Unrealized gain (loss)
|
|
2
|
|
|
(5
|
)
|
|
(3
|
)
|
|||
Purchases
|
|
9
|
|
|
(10
|
)
|
|
(1
|
)
|
|||
Settlements
|
|
(33
|
)
|
|
17
|
|
|
(16
|
)
|
|||
December 31, 2015 Balance
|
|
$
|
5
|
|
|
$
|
(11
|
)
|
|
$
|
(6
|
)
|
|
|
Fair Value, Net (In millions)
|
|
Valuation
Technique |
|
Significant Input
|
|
Range
|
|
Weighted Average
|
|
Units
|
||
FTRs
|
|
$
|
(6
|
)
|
|
Model
|
|
RTO auction clearing prices
|
|
($3.90) to $5.70
|
|
$0.70
|
|
Dollars/MWH
|
|
|
December 31, 2015
(1)
|
|
December 31, 2014
(2)
|
||||||||||||||||||||
|
|
Cost Basis
|
|
Unrealized Gains
|
|
Fair Value
|
|
Cost Basis
|
|
Unrealized Gains
|
|
Fair Value
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
Debt securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
FirstEnergy
|
|
$
|
1,778
|
|
|
$
|
16
|
|
|
$
|
1,794
|
|
|
$
|
1,724
|
|
|
$
|
27
|
|
|
$
|
1,751
|
|
FES
|
|
801
|
|
|
9
|
|
|
810
|
|
|
788
|
|
|
13
|
|
|
801
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
FirstEnergy
|
|
$
|
542
|
|
|
$
|
34
|
|
|
$
|
576
|
|
|
$
|
533
|
|
|
$
|
58
|
|
|
$
|
591
|
|
FES
|
|
354
|
|
|
24
|
|
|
378
|
|
|
329
|
|
|
31
|
|
|
360
|
|
(1)
|
Excludes short-term cash investments: FE Consolidated -
$157 million
; FES -
$139 million
.
|
(2)
|
Excludes short-term cash investments: FE Consolidated -
$241 million
; FES -
$204 million
.
|
December 31, 2015
|
|
Sale Proceeds
|
|
Realized Gains
|
|
Realized Losses
|
|
OTTI
|
|
Interest and
Dividend Income
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
FirstEnergy
|
|
$
|
1,534
|
|
|
$
|
209
|
|
|
$
|
(191
|
)
|
|
$
|
(102
|
)
|
|
$
|
101
|
|
FES
|
|
733
|
|
|
158
|
|
|
(134
|
)
|
|
(90
|
)
|
|
57
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2014
|
|
Sale Proceeds
|
|
Realized Gains
|
|
Realized Losses
|
|
OTTI
|
|
Interest and Dividend Income
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
FirstEnergy
|
|
$
|
2,133
|
|
|
$
|
146
|
|
|
$
|
(75
|
)
|
|
$
|
(37
|
)
|
|
$
|
96
|
|
FES
|
|
1,163
|
|
|
113
|
|
|
(54
|
)
|
|
(33
|
)
|
|
56
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2013
|
|
Sale Proceeds
|
|
Realized Gains
|
|
Realized Losses
|
|
OTTI
|
|
Interest and
Dividend Income
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
FirstEnergy
|
|
$
|
2,047
|
|
|
$
|
92
|
|
|
$
|
(46
|
)
|
|
$
|
(90
|
)
|
|
$
|
101
|
|
FES
|
|
940
|
|
|
70
|
|
|
(21
|
)
|
|
(79
|
)
|
|
60
|
|
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||||||||
|
|
Cost Basis
|
|
Unrealized Gains
|
|
Fair Value
|
|
Cost Basis
|
|
Unrealized Gains
|
|
Fair Value
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
Debt Securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
FirstEnergy
|
|
$
|
6
|
|
|
$
|
2
|
|
|
$
|
8
|
|
|
$
|
13
|
|
|
$
|
4
|
|
|
$
|
17
|
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||
|
Carrying
Value
|
|
Fair
Value
|
|
Carrying
Value
|
|
Fair
Value
|
||||||||
|
(In millions)
|
||||||||||||||
FirstEnergy
|
$
|
20,244
|
|
|
$
|
21,519
|
|
|
$
|
19,828
|
|
|
$
|
21,733
|
|
FES
|
3,027
|
|
|
3,121
|
|
|
3,097
|
|
|
3,241
|
|
•
|
Changes in the fair value of derivative instruments that are designated and qualify as cash flow hedges are recorded to AOCI with subsequent reclassification to earnings in the period during which the hedged forecasted transaction affects earnings.
|
•
|
Changes in the fair value of derivative instruments that are designated and qualify as fair value hedges are recorded as an adjustment to the item being hedged. When fair value hedges are discontinued, the adjustment recorded to the item being hedged is amortized into earnings.
|
•
|
Changes in the fair value of derivative instruments that are not designated in a hedging relationship are recorded in earnings on a mark-to-market basis, unless otherwise noted.
|
Derivative Assets
|
|
Derivative Liabilities
|
||||||||||||||
|
Fair Value
|
|
|
Fair Value
|
||||||||||||
|
December 31,
2015 |
|
December 31,
2014 |
|
|
December 31,
2015 |
|
December 31,
2014 |
||||||||
|
(In millions)
|
|
|
(In millions)
|
||||||||||||
Current Assets - Derivatives
|
|
|
|
|
Current Liabilities - Derivatives
|
|
|
|
||||||||
Commodity Contracts
|
$
|
150
|
|
|
$
|
121
|
|
|
Commodity Contracts
|
$
|
(94
|
)
|
|
$
|
(154
|
)
|
FTRs
|
7
|
|
|
38
|
|
|
FTRs
|
(12
|
)
|
|
(13
|
)
|
||||
|
157
|
|
|
159
|
|
|
|
(106
|
)
|
|
(167
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
Noncurrent Liabilities - Adverse Power Contract Liability
|
|
|
|
||||||||
Deferred Charges and Other Assets - Other
|
|
|
|
|
NUGs
(1)
|
(137
|
)
|
|
(153
|
)
|
||||||
Commodity Contracts
|
78
|
|
|
51
|
|
|
Noncurrent Liabilities - Other
|
|
|
|
||||||
FTRs
|
1
|
|
|
1
|
|
|
Commodity Contracts
|
(37
|
)
|
|
(13
|
)
|
||||
NUGs
(1)
|
1
|
|
|
2
|
|
|
FTRs
|
(1
|
)
|
|
(1
|
)
|
||||
|
80
|
|
|
54
|
|
|
|
(175
|
)
|
|
(167
|
)
|
||||
Derivative Assets
|
$
|
237
|
|
|
$
|
213
|
|
|
Derivative Liabilities
|
$
|
(281
|
)
|
|
$
|
(334
|
)
|
(1)
|
NUG contracts are subject to regulatory accounting treatment and do not impact earnings.
|
|
|
|
|
Amounts Not Offset in Consolidated Balance Sheet
|
|
|
||||||||||
December 31, 2015
|
|
Fair Value
|
|
Derivative Instruments
|
|
Cash Collateral (Received)/Pledged
|
|
Net Fair Value
|
||||||||
|
|
(In millions)
|
||||||||||||||
Derivative Assets
|
|
|
|
|
|
|
|
|
||||||||
Commodity contracts
|
|
$
|
228
|
|
|
$
|
(125
|
)
|
|
$
|
—
|
|
|
$
|
103
|
|
FTRs
|
|
8
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
||||
NUG contracts
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
|
|
$
|
237
|
|
|
$
|
(133
|
)
|
|
$
|
—
|
|
|
$
|
104
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Commodity contracts
|
|
$
|
(131
|
)
|
|
$
|
125
|
|
|
$
|
3
|
|
|
$
|
(3
|
)
|
FTRs
|
|
(13
|
)
|
|
8
|
|
|
5
|
|
|
—
|
|
||||
NUG contracts
|
|
(137
|
)
|
|
—
|
|
|
—
|
|
|
(137
|
)
|
||||
|
|
$
|
(281
|
)
|
|
$
|
133
|
|
|
$
|
8
|
|
|
$
|
(140
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts Not Offset in Consolidated Balance Sheet
|
|
|
||||||||||
December 31, 2014
|
|
Fair Value
|
|
Derivative Instruments
|
|
Cash Collateral (Received)/Pledged
|
|
Net Fair Value
|
||||||||
|
|
(In millions)
|
||||||||||||||
Derivative Assets
|
|
|
|
|
|
|
|
|
||||||||
Commodity contracts
|
|
$
|
172
|
|
|
$
|
(126
|
)
|
|
$
|
—
|
|
|
$
|
46
|
|
FTRs
|
|
39
|
|
|
(14
|
)
|
|
—
|
|
|
25
|
|
||||
NUG contracts
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
|
|
$
|
213
|
|
|
$
|
(140
|
)
|
|
$
|
—
|
|
|
$
|
73
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Commodity contracts
|
|
$
|
(167
|
)
|
|
$
|
126
|
|
|
$
|
35
|
|
|
$
|
(6
|
)
|
FTRs
|
|
(14
|
)
|
|
14
|
|
|
—
|
|
|
—
|
|
||||
NUG contracts
|
|
(153
|
)
|
|
—
|
|
|
—
|
|
|
(153
|
)
|
||||
|
|
$
|
(334
|
)
|
|
$
|
140
|
|
|
$
|
35
|
|
|
$
|
(159
|
)
|
|
Purchases
|
|
Sales
|
|
Net
|
|
Units
|
|||
|
(In millions)
|
|||||||||
Power Contracts
|
16
|
|
|
49
|
|
|
(33
|
)
|
|
MWH
|
FTRs
|
29
|
|
|
—
|
|
|
29
|
|
|
MWH
|
NUGs
|
4
|
|
|
—
|
|
|
4
|
|
|
MWH
|
Natural Gas
|
83
|
|
|
—
|
|
|
83
|
|
|
mmBTU
|
|
|
Year Ended December 31,
|
||||||||||
Derivatives Not in a Hedging Relationship with Regulatory Offset
|
|
NUGs
|
|
Regulated FTRs
|
|
Total
|
||||||
|
|
(In millions)
|
||||||||||
Outstanding net asset (liability) as of January 1, 2015
|
|
$
|
(151
|
)
|
|
$
|
11
|
|
|
$
|
(140
|
)
|
Unrealized loss
|
|
(47
|
)
|
|
(9
|
)
|
|
(56
|
)
|
|||
Purchases
|
|
—
|
|
|
12
|
|
|
12
|
|
|||
Settlements
|
|
62
|
|
|
(13
|
)
|
|
49
|
|
|||
Outstanding net asset (liability) as of December 31, 2015
|
|
$
|
(136
|
)
|
|
$
|
1
|
|
|
$
|
(135
|
)
|
|
|
|
|
|
|
|
||||||
Outstanding net liability as of January 1, 2014
|
|
$
|
(202
|
)
|
|
$
|
—
|
|
|
$
|
(202
|
)
|
Unrealized gain (loss)
|
|
(1
|
)
|
|
13
|
|
|
12
|
|
|||
Purchases
|
|
—
|
|
|
11
|
|
|
11
|
|
|||
Settlements
|
|
52
|
|
|
(13
|
)
|
|
39
|
|
|||
Outstanding net asset (liability) as of December 31, 2014
|
|
$
|
(151
|
)
|
|
$
|
11
|
|
|
$
|
(140
|
)
|
|
|
Preferred Stock
|
|
Preference Stock
|
||||||||||
|
|
Shares Authorized
|
|
Par Value
|
|
Shares Authorized
|
|
Par Value
|
||||||
FirstEnergy
|
|
5,000,000
|
|
|
$
|
100
|
|
|
|
|
|
|
|
|
OE
|
|
6,000,000
|
|
|
$
|
100
|
|
|
8,000,000
|
|
|
no par
|
|
|
OE
|
|
8,000,000
|
|
|
$
|
25
|
|
|
|
|
|
|
|
|
Penn
|
|
1,200,000
|
|
|
$
|
100
|
|
|
|
|
|
|
|
|
CEI
|
|
4,000,000
|
|
|
no par
|
|
|
3,000,000
|
|
|
no par
|
|
||
TE
|
|
3,000,000
|
|
|
$
|
100
|
|
|
5,000,000
|
|
|
$
|
25
|
|
TE
|
|
12,000,000
|
|
|
$
|
25
|
|
|
|
|
|
|||
JCP&L
|
|
15,600,000
|
|
|
no par
|
|
|
|
|
|
||||
ME
|
|
10,000,000
|
|
|
no par
|
|
|
|
|
|
||||
PN
|
|
11,435,000
|
|
|
no par
|
|
|
|
|
|
||||
MP
|
|
940,000
|
|
|
$
|
100
|
|
|
|
|
|
|||
PE
|
|
10,000,000
|
|
|
$
|
0.01
|
|
|
|
|
|
|||
WP
|
|
32,000,000
|
|
|
no par
|
|
|
|
|
|
|
|
As of December 31, 2015
|
|
As of December 31
|
||||||||
(Dollar amounts in millions)
|
|
Maturity Date
|
|
Interest Rate
|
|
2015
|
|
2014
|
||||
FirstEnergy:
|
|
|
|
|
|
|
|
|
||||
FMBs
|
|
2016 - 2045
|
|
3.340% - 9.740%
|
|
$
|
3,269
|
|
|
$
|
3,190
|
|
Secured notes - fixed rate
|
|
2016 - 2037
|
|
0.679% - 12.000%
|
|
2,096
|
|
|
2,247
|
|
||
Secured notes - variable rate
|
|
2017 - 2017
|
|
3.500% - 3.500%
|
|
2
|
|
|
—
|
|
||
Total secured notes
|
|
|
|
|
|
2,098
|
|
|
2,247
|
|
||
Unsecured notes - fixed rate
|
|
2016 - 2045
|
|
2.150% - 7.700%
|
|
13,580
|
|
|
13,078
|
|
||
Unsecured notes - variable rate
|
|
2017 - 2020
|
|
0.010% - 2.180%
|
|
1,292
|
|
|
1,292
|
|
||
Total unsecured notes
|
|
|
|
|
|
14,872
|
|
|
14,370
|
|
||
Capital lease obligations
|
|
|
|
|
|
132
|
|
|
160
|
|
||
Unamortized debt discounts
|
|
|
|
|
|
(18
|
)
|
|
(8
|
)
|
||
Unamortized fair value adjustments
|
|
|
|
|
|
5
|
|
|
21
|
|
||
Currently payable long-term debt
|
|
|
|
|
|
(1,166
|
)
|
|
(804
|
)
|
||
Total long-term debt and other long-term obligations
|
|
|
|
|
|
$
|
19,192
|
|
|
$
|
19,176
|
|
|
|
|
|
|
|
|
|
|
||||
FES:
|
|
|
|
|
|
|
|
|
||||
Secured notes - fixed rate
|
|
2016 - 2018
|
|
5.625% - 12.000%
|
|
$
|
340
|
|
|
$
|
437
|
|
Secured notes - variable rate
|
|
2017 - 2017
|
|
3.500% - 3.500%
|
|
2
|
|
|
—
|
|
||
Total secured notes
|
|
|
|
|
|
342
|
|
|
437
|
|
||
Unsecured notes - fixed rate
|
|
2016 - 2039
|
|
2.150% - 6.800%
|
|
2,593
|
|
|
2,568
|
|
||
Unsecured notes - variable rate
|
|
2017 - 2017
|
|
0.010% - 0.010%
|
|
92
|
|
|
92
|
|
||
Total unsecured notes
|
|
|
|
|
|
2,685
|
|
|
2,660
|
|
||
Capital lease obligations
|
|
|
|
|
|
13
|
|
|
18
|
|
||
Unamortized debt discounts
|
|
|
|
|
|
(1
|
)
|
|
(1
|
)
|
||
Currently payable long-term debt
|
|
|
|
|
|
(512
|
)
|
|
(506
|
)
|
||
Total long-term debt and other long-term obligations
|
|
|
|
|
|
$
|
2,527
|
|
|
$
|
2,608
|
|
|
|
|
|
|
|
|
|
|
Year
|
|
FirstEnergy
|
|
FES
|
||||
|
|
(In millions)
|
||||||
2016
|
|
$
|
1,039
|
|
|
$
|
414
|
|
2017
|
|
1,733
|
|
|
257
|
|
||
2018
|
|
1,702
|
|
|
516
|
|
||
2019
|
|
2,268
|
|
|
322
|
|
||
2020
|
|
1,231
|
|
|
667
|
|
Year
|
|
FirstEnergy
|
|
FES
|
||||
|
|
(In millions)
|
||||||
2016
|
|
$
|
391
|
|
|
$
|
391
|
|
2017
|
|
222
|
|
|
222
|
|
||
2018
|
|
375
|
|
|
375
|
|
||
2019
|
|
232
|
|
|
232
|
|
||
2020
|
|
490
|
|
|
490
|
|
|
|
Aggregate LOC Amount
(1)
|
|
Annual Fees
|
|
||
|
|
(In millions)
|
|
|
|
||
FirstEnergy
|
|
$
|
93
|
|
|
1.25%
|
|
FES
|
|
93
|
|
|
1.25%
|
|
(1)
|
Includes approximately
$1 million
of applicable interest
|
Borrower(s)
|
|
Type
|
|
Maturity
|
|
Commitment
|
|
Available Liquidity
|
||||
|
|
|
|
|
|
(In millions)
|
||||||
FirstEnergy
(1)
|
|
Revolving
|
|
March 2019
|
|
$
|
3,500
|
|
|
$
|
1,595
|
|
FES / AE Supply
|
|
Revolving
|
|
March 2019
|
|
1,500
|
|
|
1,442
|
|
||
FET
(2)
|
|
Revolving
|
|
March 2019
|
|
1,000
|
|
|
1,000
|
|
||
|
|
|
|
Subtotal
|
|
$
|
6,000
|
|
|
$
|
4,037
|
|
|
|
|
|
Cash
|
|
—
|
|
|
63
|
|
||
|
|
|
|
Total
|
|
$
|
6,000
|
|
|
$
|
4,100
|
|
(1)
|
FE and the Utilities
|
(2)
|
Includes FET, ATSI and TrAIL as subsidiary borrowers
|
Borrower
|
|
Revolving Credit Facility Sub-Limits
|
|
Regulatory and Other Short-Term Debt Limitations
|
|
||||||
|
|
(In millions)
|
|
||||||||
FE
|
|
|
$
|
3,500
|
|
|
|
$
|
—
|
|
(1)
|
FES
|
|
|
1,500
|
|
|
|
—
|
|
(2)
|
||
AE Supply
|
|
|
1,000
|
|
|
|
—
|
|
(2)
|
||
FET
|
|
|
1,000
|
|
|
|
—
|
|
(1)
|
||
OE
|
|
|
500
|
|
|
|
500
|
|
(3)
|
||
CEI
|
|
|
500
|
|
|
|
500
|
|
(3)
|
||
TE
|
|
|
500
|
|
|
|
500
|
|
(3)
|
||
JCP&L
|
|
|
600
|
|
|
|
500
|
|
(3)
|
||
ME
|
|
|
300
|
|
|
|
500
|
|
(3)
|
||
PN
|
|
|
300
|
|
|
|
300
|
|
(3)
|
||
WP
|
|
|
200
|
|
|
|
200
|
|
(3)
|
||
MP
|
|
|
500
|
|
|
|
500
|
|
(3)
|
||
PE
|
|
|
150
|
|
|
|
150
|
|
(3)
|
||
ATSI
|
|
|
500
|
|
|
|
500
|
|
(3)
|
||
Penn
|
|
|
50
|
|
|
|
100
|
|
(3)
|
||
TrAIL
|
|
|
400
|
|
|
|
400
|
|
(3)
|
(1)
|
No limitations.
|
(2)
|
No limitation based upon blanket financing authorization from the FERC under existing market-based rate tariffs.
|
(3)
|
Excluding amounts which may be borrowed under the regulated companies' money pool.
|
|
|
2015
|
|
2014
|
||
FirstEnergy
|
|
2.16
|
%
|
|
1.96
|
%
|
FES
|
|
—
|
%
|
|
3.34
|
%
|
|
|
2015
|
|
2014
|
||||
|
|
(In millions)
|
||||||
FirstEnergy
|
|
$
|
2,282
|
|
|
$
|
2,341
|
|
FES
|
|
$
|
1,327
|
|
|
$
|
1,365
|
|
ARO Reconciliation
|
|
FirstEnergy
|
|
FES
|
||||
|
|
(In millions)
|
||||||
Balance, January 1, 2014
|
|
$
|
1,678
|
|
|
$
|
1,015
|
|
Liabilities settled
|
|
(9
|
)
|
|
(7
|
)
|
||
Accretion
|
|
113
|
|
|
66
|
|
||
Revisions in estimated cash flows
|
|
(395
|
)
|
|
(233
|
)
|
||
Balance, December 31, 2014
|
|
$
|
1,387
|
|
|
$
|
841
|
|
Liabilities settled
|
|
(13
|
)
|
|
(8
|
)
|
||
Accretion
|
|
92
|
|
|
55
|
|
||
Revisions in estimated cash flows
|
|
(56
|
)
|
|
(57
|
)
|
||
Balance, December 31, 2015
|
|
$
|
1,410
|
|
|
$
|
831
|
|
•
|
A base distribution rate freeze through May 31, 2016;
|
•
|
Collection of lost distribution revenues associated with energy efficiency and peak demand reduction programs;
|
•
|
Economic development and assistance to low-income customers for the
two
-year plan period at levels established in the prior ESP;
|
•
|
A
6%
generation rate discount to certain low income customers provided by the Ohio Companies through a bilateral wholesale contract with FES (FES is one of the wholesale suppliers to the Ohio Companies);
|
•
|
A requirement to provide power to non-shopping customers at a market-based price set through an auction process;
|
•
|
Rider DCR that allows continued investment in the distribution system for the benefit of customers;
|
•
|
A commitment not to recover from retail customers certain costs related to transmission cost allocations for the longer of the five-year period from June 1, 2011 through May 31, 2016 or when the amount of costs avoided by customers for certain types of products totals $360 million, subject to the outcome of certain FERC proceedings;
|
•
|
Securing generation supply for a longer period of time by conducting an auction for a
three
-year period rather than a
one
-year period, in each of October 2012 and January 2013, to mitigate any potential price spikes for the Ohio Companies' utility customers who do not switch to a competitive generation supplier; and
|
•
|
Extending the recovery period for costs associated with purchasing RECs mandated by SB221, Ohio's renewable energy and energy efficiency standard, through the end of the new ESP 3 period. This is expected to initially reduce the monthly renewable energy charge for all non-shopping utility customers of the Ohio Companies by spreading out the costs over the entire ESP period.
|
•
|
An
eight
-year term (June 1, 2016 - May 31, 2024);
|
•
|
Contemplates continuing a base distribution rate freeze through May 31, 2024;
|
•
|
An Economic Stability Program that flows through charges or credits through Rider RRS representing the net result of the price paid to FES through a proposed
eight
-year FERC-jurisdictional PPA for the output of the Sammis and Davis-Besse plants and FES’ share of OVEC against the revenues received from selling such output into the PJM markets over the same period, subject to the PUCO’s termination of Rider RRS charges/credits associated with any plants or units that may be sold or transferred;
|
•
|
Continuing to provide power to non-shopping customers at a market-based price set through an auction process;
|
•
|
Continuing Rider DCR with increased revenue caps of approximately
$30 million
per year from June 1, 2016 through May 31, 2019;
$20 million
per year from June 1, 2019 through May 31, 2022; and
$15 million
per year from June 1, 2022 through May 31, 2024 that supports continued investment related to the distribution system for the benefit of customers;
|
•
|
Collection of lost distribution revenues associated with energy efficiency and peak demand reduction programs;
|
•
|
A risk-sharing mechanism that would provide guaranteed credits under Rider RRS in years five through eight to customers as follows: $10 million in year five, $20 million in year six, $30 million in year seven and $40 million in year eight;
|
•
|
A continuing commitment not to recover from retail customers certain costs related to transmission cost allocations for the longer of the five-year period from June 1, 2011 through May 31, 2016 or when the amount of such costs avoided by customers for certain types of products totals $360 million, including such costs from MISO along with such costs from PJM, subject to the outcome of certain FERC proceedings;
|
•
|
Potential procurement of
100
MW of new Ohio wind or solar resources subject to a demonstrated need to procure new renewable energy resources as part of a strategy to further diversify Ohio's energy portfolio;
|
•
|
An agreement to file a case with the PUCO by April 3, 2017, seeking to transition to decoupled base rates for residential customers;
|
•
|
An agreement to file by February 29, 2016, a Grid Modernization Business Plan for PUCO consideration and approval;
|
•
|
A contribution of $3 million per year ($24 million over the eight year term) to fund energy conservation programs, economic development and job retention in the Ohio Companies service territory;
|
•
|
Contributions of $2.4 million per year ($19 million over the eight year term) to fund a fuel-fund in each of the Ohio Companies service territories to assist low-income customers; and
|
•
|
A contribution of $1 million per year ($8 million over the eight year term) to establish a Customary Advisory Council to ensure preservation and growth of the competitive market in Ohio.
|
|
2016 - 2017
|
|
2017 - 2018
|
|
2018 - 2019*
|
||||||||||||||||||
|
Legacy Obligation
|
|
Capacity Performance
|
|
Legacy Obligation
|
|
Capacity Performance
|
|
Base Generation
|
|
Capacity Performance
|
||||||||||||
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
|
(MW)
|
|
($/MWD)
|
ATSI
|
2,765
|
|
$114.23
|
|
4,210
|
|
$134.00
|
|
375
|
|
$120.00
|
|
6,245
|
|
$151.50
|
|
—
|
|
$149.98
|
|
6,245
|
|
$164.77
|
RTO
|
875
|
|
$59.37
|
|
3,675
|
|
$134.00
|
|
985
|
|
$120.00
|
|
3,565
|
|
$151.50
|
|
240
|
|
$149.98
|
|
3,930
|
|
$164.77
|
All Other Zones
|
135
|
|
$119.13
|
|
—
|
|
$134.00
|
|
150
|
|
$120.00
|
|
—
|
|
$151.50
|
|
35
|
|
**
|
|
20
|
|
**
|
|
3,775
|
|
|
|
7,885
|
|
|
|
1,510
|
|
|
|
9,810
|
|
|
|
275
|
|
|
|
10,195
|
|
|
Collateral Provisions
|
|
FES
|
|
AE Supply
|
|
Utilities
|
|
Total
|
||||||||
|
|
(In millions)
|
||||||||||||||
Split Rating (One rating agency's rating below investment grade)
|
|
$
|
198
|
|
|
$
|
6
|
|
|
$
|
41
|
|
|
$
|
245
|
|
BB+/Ba1 Credit Ratings
|
|
$
|
231
|
|
|
$
|
6
|
|
|
$
|
41
|
|
|
$
|
278
|
|
Full impact of credit contingent contractual obligations
|
|
$
|
363
|
|
|
$
|
16
|
|
|
$
|
41
|
|
|
$
|
420
|
|
FES
|
|
2015
|
|
2014
|
|
2013
|
|
||||||
|
|
(In millions)
|
|||||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||
Electric sales to affiliates
|
|
$
|
664
|
|
|
$
|
861
|
|
|
$
|
652
|
|
|
Other
|
|
6
|
|
|
6
|
|
|
6
|
|
|
|||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|||
Purchased power from affiliates
|
|
353
|
|
|
271
|
|
|
486
|
|
|
|||
Fuel
|
|
1
|
|
|
1
|
|
|
—
|
|
|
|||
Support services
|
|
705
|
|
|
619
|
|
|
619
|
|
|
|||
Investment Income:
|
|
|
|
|
|
|
|
|
|
|
|||
Interest income from FE
|
|
2
|
|
|
3
|
|
|
2
|
|
|
|||
Interest Expense:
|
|
|
|
|
|
|
|
|
|
|
|||
Interest expense to affiliates
|
|
4
|
|
|
3
|
|
|
4
|
|
|
|||
Interest expense to FE
|
|
3
|
|
|
4
|
|
|
6
|
|
|
For the Year Ended December 31, 2015
|
|
FES
|
|
FG
|
|
NG
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
STATEMENTS OF INCOME
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
REVENUES
|
|
$
|
4,824
|
|
|
$
|
1,801
|
|
|
$
|
2,138
|
|
|
$
|
(3,758
|
)
|
|
$
|
5,005
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Fuel
|
|
—
|
|
|
679
|
|
|
192
|
|
|
—
|
|
|
871
|
|
|||||
Purchased power from affiliates
|
|
3,826
|
|
|
—
|
|
|
285
|
|
|
(3,758
|
)
|
|
353
|
|
|||||
Purchased power from non-affiliates
|
|
1,684
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,684
|
|
|||||
Other operating expenses
|
|
399
|
|
|
275
|
|
|
618
|
|
|
49
|
|
|
1,341
|
|
|||||
Pension and OPEB mark-to-market adjustment
|
|
(8
|
)
|
|
10
|
|
|
55
|
|
|
—
|
|
|
57
|
|
|||||
Provision for depreciation
|
|
12
|
|
|
124
|
|
|
191
|
|
|
(3
|
)
|
|
324
|
|
|||||
General taxes
|
|
45
|
|
|
26
|
|
|
27
|
|
|
—
|
|
|
98
|
|
|||||
Total operating expenses
|
|
5,958
|
|
|
1,114
|
|
|
1,368
|
|
|
(3,712
|
)
|
|
4,728
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OPERATING INCOME (LOSS)
|
|
(1,134
|
)
|
|
687
|
|
|
770
|
|
|
(46
|
)
|
|
277
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Investment income (loss), including net income from equity investees
|
|
844
|
|
|
17
|
|
|
(5
|
)
|
|
(870
|
)
|
|
(14
|
)
|
|||||
Miscellaneous income
|
|
1
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Interest expense — affiliates
|
|
(29
|
)
|
|
(8
|
)
|
|
(4
|
)
|
|
34
|
|
|
(7
|
)
|
|||||
Interest expense — other
|
|
(52
|
)
|
|
(104
|
)
|
|
(49
|
)
|
|
58
|
|
|
(147
|
)
|
|||||
Capitalized interest
|
|
—
|
|
|
6
|
|
|
29
|
|
|
—
|
|
|
35
|
|
|||||
Total other income (expense)
|
|
764
|
|
|
(87
|
)
|
|
(29
|
)
|
|
(778
|
)
|
|
(130
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME (LOSS) BEFORE INCOME TAXES (BENEFITS)
|
|
(370
|
)
|
|
600
|
|
|
741
|
|
|
(824
|
)
|
|
147
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME TAXES (BENEFITS)
|
|
(452
|
)
|
|
224
|
|
|
278
|
|
|
15
|
|
|
65
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NET INCOME
|
|
$
|
82
|
|
|
$
|
376
|
|
|
$
|
463
|
|
|
$
|
(839
|
)
|
|
$
|
82
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
STATEMENTS OF COMPREHENSIVE INCOME
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NET INCOME
|
|
$
|
82
|
|
|
$
|
376
|
|
|
$
|
463
|
|
|
$
|
(839
|
)
|
|
$
|
82
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER COMPREHENSIVE LOSS:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Pension and OPEB prior service costs
|
|
(6
|
)
|
|
(5
|
)
|
|
—
|
|
|
5
|
|
|
(6
|
)
|
|||||
Amortized gain on derivative hedges
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||
Change in unrealized gain on available-for-sale securities
|
|
(9
|
)
|
|
—
|
|
|
(8
|
)
|
|
8
|
|
|
(9
|
)
|
|||||
Other comprehensive loss
|
|
(18
|
)
|
|
(5
|
)
|
|
(8
|
)
|
|
13
|
|
|
(18
|
)
|
|||||
Income tax benefits on other comprehensive loss
|
|
(7
|
)
|
|
(2
|
)
|
|
(3
|
)
|
|
5
|
|
|
(7
|
)
|
|||||
Other comprehensive loss, net of tax
|
|
(11
|
)
|
|
(3
|
)
|
|
(5
|
)
|
|
8
|
|
|
(11
|
)
|
|||||
COMPREHENSIVE INCOME
|
|
$
|
71
|
|
|
$
|
373
|
|
|
$
|
458
|
|
|
$
|
(831
|
)
|
|
$
|
71
|
|
For the Year Ended December 31, 2014
|
|
FES
|
|
FG
|
|
NG
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
STATEMENTS OF INCOME (LOSS)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
REVENUES
|
|
$
|
5,990
|
|
|
$
|
1,902
|
|
|
$
|
2,172
|
|
|
$
|
(3,920
|
)
|
|
$
|
6,144
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Fuel
|
|
—
|
|
|
1,055
|
|
|
198
|
|
|
—
|
|
|
1,253
|
|
|||||
Purchased power from affiliates
|
|
3,920
|
|
|
—
|
|
|
271
|
|
|
(3,920
|
)
|
|
271
|
|
|||||
Purchased power from non-affiliates
|
|
2,767
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
2,771
|
|
|||||
Other operating expenses
|
|
790
|
|
|
269
|
|
|
527
|
|
|
49
|
|
|
1,635
|
|
|||||
Pension and OPEB mark-to-market adjustment
|
|
19
|
|
|
90
|
|
|
188
|
|
|
—
|
|
|
297
|
|
|||||
Provision for depreciation
|
|
10
|
|
|
119
|
|
|
193
|
|
|
(3
|
)
|
|
319
|
|
|||||
General taxes
|
|
72
|
|
|
31
|
|
|
25
|
|
|
—
|
|
|
128
|
|
|||||
Total operating expenses
|
|
7,578
|
|
|
1,568
|
|
|
1,402
|
|
|
(3,874
|
)
|
|
6,674
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OPERATING INCOME (LOSS)
|
|
(1,588
|
)
|
|
334
|
|
|
770
|
|
|
(46
|
)
|
|
(530
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Loss on debt redemptions
|
|
(3
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|
—
|
|
|
(6
|
)
|
|||||
Investment income, including net income from equity investees
|
|
791
|
|
|
8
|
|
|
61
|
|
|
(799
|
)
|
|
61
|
|
|||||
Miscellaneous income
|
|
2
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||
Interest expense — affiliates
|
|
(12
|
)
|
|
(6
|
)
|
|
(4
|
)
|
|
15
|
|
|
(7
|
)
|
|||||
Interest expense — other
|
|
(53
|
)
|
|
(101
|
)
|
|
(52
|
)
|
|
60
|
|
|
(146
|
)
|
|||||
Capitalized interest
|
|
—
|
|
|
4
|
|
|
30
|
|
|
—
|
|
|
34
|
|
|||||
Total other income (expense)
|
|
725
|
|
|
(92
|
)
|
|
33
|
|
|
(724
|
)
|
|
(58
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (BENEFITS)
|
|
(863
|
)
|
|
242
|
|
|
803
|
|
|
(770
|
)
|
|
(588
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME TAXES (BENEFITS)
|
|
(619
|
)
|
|
87
|
|
|
298
|
|
|
6
|
|
|
(228
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS
|
|
(244
|
)
|
|
155
|
|
|
505
|
|
|
(776
|
)
|
|
(360
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Discontinued operations (net of income taxes of $70)
|
|
—
|
|
|
116
|
|
|
—
|
|
|
—
|
|
|
116
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NET INCOME (LOSS)
|
|
$
|
(244
|
)
|
|
$
|
271
|
|
|
$
|
505
|
|
|
$
|
(776
|
)
|
|
$
|
(244
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NET INCOME (LOSS)
|
|
$
|
(244
|
)
|
|
$
|
271
|
|
|
$
|
505
|
|
|
$
|
(776
|
)
|
|
$
|
(244
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER COMPREHENSIVE INCOME (LOSS):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Pension and OPEB prior service costs
|
|
(6
|
)
|
|
(5
|
)
|
|
—
|
|
|
5
|
|
|
(6
|
)
|
|||||
Amortized gain on derivative hedges
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|||||
Change in unrealized gain on available-for-sale securities
|
|
21
|
|
|
—
|
|
|
21
|
|
|
(21
|
)
|
|
21
|
|
|||||
Other comprehensive income (loss)
|
|
5
|
|
|
(5
|
)
|
|
21
|
|
|
(16
|
)
|
|
5
|
|
|||||
Income taxes (benefits) on other comprehensive income (loss)
|
|
2
|
|
|
(2
|
)
|
|
8
|
|
|
(6
|
)
|
|
2
|
|
|||||
Other comprehensive income (loss), net of tax
|
|
3
|
|
|
(3
|
)
|
|
13
|
|
|
(10
|
)
|
|
3
|
|
|||||
COMPREHENSIVE INCOME (LOSS)
|
|
$
|
(241
|
)
|
|
$
|
268
|
|
|
$
|
518
|
|
|
$
|
(786
|
)
|
|
$
|
(241
|
)
|
For the Year Ended December 31, 2015
|
|
FES
|
|
FG
|
|
NG
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NET CASH PROVIDED FROM (USED FOR) OPERATING ACTIVITIES
|
|
$
|
(637
|
)
|
|
$
|
551
|
|
|
$
|
1,261
|
|
|
$
|
(24
|
)
|
|
$
|
1,151
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
New Financing-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Long-term debt
|
|
—
|
|
|
45
|
|
|
296
|
|
|
—
|
|
|
341
|
|
|||||
Short-term borrowings, net
|
|
796
|
|
|
67
|
|
|
—
|
|
|
(863
|
)
|
|
—
|
|
|||||
Redemptions and Repayments-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Long-term debt
|
|
(17
|
)
|
|
(70
|
)
|
|
(348
|
)
|
|
24
|
|
|
(411
|
)
|
|||||
Short-term borrowings, net
|
|
—
|
|
|
—
|
|
|
(28
|
)
|
|
(98
|
)
|
|
(126
|
)
|
|||||
Common stock dividend payment
|
|
(70
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(70
|
)
|
|||||
Other
|
|
—
|
|
|
(5
|
)
|
|
(1
|
)
|
|
—
|
|
|
(6
|
)
|
|||||
Net cash provided from (used for) financing activities
|
|
709
|
|
|
37
|
|
|
(81
|
)
|
|
(937
|
)
|
|
(272
|
)
|
|||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Property additions
|
|
(5
|
)
|
|
(223
|
)
|
|
(399
|
)
|
|
—
|
|
|
(627
|
)
|
|||||
Nuclear fuel
|
|
—
|
|
|
—
|
|
|
(190
|
)
|
|
—
|
|
|
(190
|
)
|
|||||
Proceeds from asset sales
|
|
10
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|||||
Sales of investment securities held in trusts
|
|
—
|
|
|
—
|
|
|
733
|
|
|
—
|
|
|
733
|
|
|||||
Purchases of investment securities held in trusts
|
|
—
|
|
|
—
|
|
|
(791
|
)
|
|
—
|
|
|
(791
|
)
|
|||||
Cash Investments
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|||||
Loans to affiliated companies, net
|
|
(67
|
)
|
|
(372
|
)
|
|
(533
|
)
|
|
961
|
|
|
(11
|
)
|
|||||
Other
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Net cash used for investing activities
|
|
(72
|
)
|
|
(588
|
)
|
|
(1,180
|
)
|
|
961
|
|
|
(879
|
)
|
|||||
Net change in cash and cash equivalents
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Cash and cash equivalents at beginning of period
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Cash and cash equivalents at end of period
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
For the Year Ended December 31, 2013
|
|
FES
|
|
FG
|
|
NG
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
NET CASH PROVIDED FROM (USED FOR) OPERATING ACTIVITIES
|
|
$
|
(1,429
|
)
|
|
$
|
753
|
|
|
$
|
776
|
|
|
$
|
(22
|
)
|
|
$
|
78
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
New Financing-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Short-term borrowings, net
|
|
864
|
|
|
371
|
|
|
150
|
|
|
(954
|
)
|
|
431
|
|
|||||
Equity contribution from parent
|
|
1,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,500
|
|
|||||
Redemptions and Repayments-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Long-term debt
|
|
(770
|
)
|
|
(364
|
)
|
|
(90
|
)
|
|
22
|
|
|
(1,202
|
)
|
|||||
Short-term borrowings, net
|
|
(244
|
)
|
|
(505
|
)
|
|
—
|
|
|
749
|
|
|
—
|
|
|||||
Tender premiums
|
|
(67
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(67
|
)
|
|||||
Other
|
|
(4
|
)
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|||||
Net cash provided from (used for) financing activities
|
|
1,279
|
|
|
(503
|
)
|
|
60
|
|
|
(183
|
)
|
|
653
|
|
|||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Property additions
|
|
(12
|
)
|
|
(256
|
)
|
|
(449
|
)
|
|
—
|
|
|
(717
|
)
|
|||||
Nuclear fuel
|
|
—
|
|
|
—
|
|
|
(250
|
)
|
|
—
|
|
|
(250
|
)
|
|||||
Proceeds from asset sales
|
|
—
|
|
|
21
|
|
|
—
|
|
|
—
|
|
|
21
|
|
|||||
Sales of investment securities held in trusts
|
|
—
|
|
|
—
|
|
|
940
|
|
|
—
|
|
|
940
|
|
|||||
Purchases of investment securities held in trusts
|
|
—
|
|
|
—
|
|
|
(1,000
|
)
|
|
—
|
|
|
(1,000
|
)
|
|||||
Loans to affiliated companies, net
|
|
163
|
|
|
(15
|
)
|
|
(77
|
)
|
|
205
|
|
|
276
|
|
|||||
Other
|
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||||
Net cash provided from (used for) investing activities
|
|
150
|
|
|
(251
|
)
|
|
(836
|
)
|
|
205
|
|
|
(732
|
)
|
|||||
Net change in cash and cash equivalents
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Cash and cash equivalents at end of period
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
For the Years Ended December 31,
|
|
Regulated Distribution
|
|
Regulated Transmission
|
|
Competitive Energy Services
|
|
Corporate/ Other
|
|
Reconciling Adjustments
|
|
Consolidated
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
External revenues
|
|
$
|
9,625
|
|
|
$
|
1,011
|
|
|
$
|
4,698
|
|
|
$
|
(168
|
)
|
|
$
|
(140
|
)
|
|
$
|
15,026
|
|
Internal revenues
|
|
—
|
|
|
—
|
|
|
686
|
|
|
—
|
|
|
(686
|
)
|
|
—
|
|
||||||
Total revenues
|
|
9,625
|
|
|
1,011
|
|
|
5,384
|
|
|
(168
|
)
|
|
(826
|
)
|
|
15,026
|
|
||||||
Depreciation
|
|
672
|
|
|
156
|
|
|
394
|
|
|
60
|
|
|
—
|
|
|
1,282
|
|
||||||
Amortization of regulatory assets, net
|
|
261
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
268
|
|
||||||
Impairment of long-lived assets
|
|
8
|
|
|
—
|
|
|
34
|
|
|
—
|
|
|
—
|
|
|
42
|
|
||||||
Investment income (loss)
|
|
42
|
|
|
—
|
|
|
(16
|
)
|
|
(9
|
)
|
|
(39
|
)
|
|
(22
|
)
|
||||||
Impairment of equity method investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
362
|
|
|
—
|
|
|
362
|
|
||||||
Interest expense
|
|
586
|
|
|
161
|
|
|
192
|
|
|
193
|
|
|
—
|
|
|
1,132
|
|
||||||
Income taxes (benefits)
|
|
342
|
|
|
174
|
|
|
50
|
|
|
(262
|
)
|
|
11
|
|
|
315
|
|
||||||
Income (loss) from continuing operations
|
|
618
|
|
|
298
|
|
|
89
|
|
|
(427
|
)
|
|
—
|
|
|
578
|
|
||||||
Discontinued operations, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net income (loss)
|
|
618
|
|
|
298
|
|
|
89
|
|
|
(427
|
)
|
|
—
|
|
|
578
|
|
||||||
Total assets
|
|
27,876
|
|
|
7,439
|
|
|
16,365
|
|
|
507
|
|
|
—
|
|
|
52,187
|
|
||||||
Total goodwill
|
|
5,092
|
|
|
526
|
|
|
800
|
|
|
—
|
|
|
—
|
|
|
6,418
|
|
||||||
Property additions
|
|
1,108
|
|
|
952
|
|
|
588
|
|
|
56
|
|
|
—
|
|
|
2,704
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
External revenues
|
|
$
|
9,102
|
|
|
$
|
769
|
|
|
$
|
5,470
|
|
|
$
|
(146
|
)
|
|
$
|
(146
|
)
|
|
$
|
15,049
|
|
Internal revenues
|
|
—
|
|
|
—
|
|
|
819
|
|
|
—
|
|
|
(819
|
)
|
|
—
|
|
||||||
Total revenues
|
|
9,102
|
|
|
769
|
|
|
6,289
|
|
|
(146
|
)
|
|
(965
|
)
|
|
15,049
|
|
||||||
Depreciation
|
|
658
|
|
|
127
|
|
|
387
|
|
|
48
|
|
|
—
|
|
|
1,220
|
|
||||||
Amortization of regulatory assets, net
|
|
1
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12
|
|
||||||
Impairment of long-lived assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Investment income (loss)
|
|
56
|
|
|
—
|
|
|
54
|
|
|
2
|
|
|
(40
|
)
|
|
72
|
|
||||||
Impairment of equity method investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest expense
|
|
589
|
|
|
131
|
|
|
189
|
|
|
168
|
|
|
(4
|
)
|
|
1,073
|
|
||||||
Income taxes (benefits)
|
|
227
|
|
|
121
|
|
|
(223
|
)
|
|
(178
|
)
|
|
11
|
|
|
(42
|
)
|
||||||
Income (loss) from continuing operations
|
|
465
|
|
|
223
|
|
|
(417
|
)
|
|
(58
|
)
|
|
—
|
|
|
213
|
|
||||||
Discontinued operations, net of tax
|
|
—
|
|
|
—
|
|
|
86
|
|
|
—
|
|
|
—
|
|
|
86
|
|
||||||
Net income (loss)
|
|
465
|
|
|
223
|
|
|
(331
|
)
|
|
(58
|
)
|
|
—
|
|
|
299
|
|
||||||
Total assets
|
|
28,085
|
|
|
6,252
|
|
|
16,518
|
|
|
793
|
|
|
—
|
|
|
51,648
|
|
||||||
Total goodwill
|
|
5,092
|
|
|
526
|
|
|
800
|
|
|
—
|
|
|
—
|
|
|
6,418
|
|
||||||
Property additions
|
|
972
|
|
|
1,329
|
|
|
939
|
|
|
72
|
|
|
—
|
|
|
3,312
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
External revenues
|
|
$
|
8,720
|
|
|
$
|
731
|
|
|
$
|
5,728
|
|
|
$
|
(121
|
)
|
|
$
|
(166
|
)
|
|
$
|
14,892
|
|
Internal revenues
|
|
—
|
|
|
—
|
|
|
770
|
|
|
—
|
|
|
(770
|
)
|
|
—
|
|
||||||
Total revenues
|
|
8,720
|
|
|
731
|
|
|
6,498
|
|
|
(121
|
)
|
|
(936
|
)
|
|
14,892
|
|
||||||
Depreciation
|
|
606
|
|
|
114
|
|
|
439
|
|
|
43
|
|
|
—
|
|
|
1,202
|
|
||||||
Amortization of regulatory assets, net
|
|
529
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
539
|
|
||||||
Impairment of long-lived assets
|
|
322
|
|
|
—
|
|
|
473
|
|
|
—
|
|
|
—
|
|
|
795
|
|
||||||
Investment income (loss)
|
|
57
|
|
|
—
|
|
|
14
|
|
|
6
|
|
|
(44
|
)
|
|
33
|
|
||||||
Impairment of equity method investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest expense
|
|
543
|
|
|
93
|
|
|
222
|
|
|
148
|
|
|
10
|
|
|
1,016
|
|
||||||
Income taxes (benefits)
|
|
301
|
|
|
129
|
|
|
(140
|
)
|
|
(105
|
)
|
|
10
|
|
|
195
|
|
||||||
Income (loss) from continuing operations
|
|
501
|
|
|
214
|
|
|
(235
|
)
|
|
(105
|
)
|
|
—
|
|
|
375
|
|
||||||
Discontinued operations, net of tax
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
17
|
|
||||||
Net income (loss)
|
|
501
|
|
|
214
|
|
|
(218
|
)
|
|
(105
|
)
|
|
—
|
|
|
392
|
|
||||||
Total assets
|
|
27,683
|
|
|
5,247
|
|
|
16,782
|
|
|
712
|
|
|
—
|
|
|
50,424
|
|
||||||
Total goodwill
|
|
5,092
|
|
|
526
|
|
|
800
|
|
|
—
|
|
|
—
|
|
|
6,418
|
|
||||||
Property additions
|
|
1,272
|
|
|
461
|
|
|
827
|
|
|
78
|
|
|
—
|
|
|
2,638
|
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
|
|
Audit Fees
(1)
|
|
Audit-Related Fees
(2)
|
||||||||||||
Company
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In thousands)
|
||||||||||||||
FES
|
|
$
|
1,810
|
|
|
$
|
1,700
|
|
|
$
|
—
|
|
|
$
|
—
|
|
FE and other subsidiaries
|
|
5,812
|
|
|
6,001
|
|
|
150
|
|
|
117
|
|
||||
Total FirstEnergy
|
|
$
|
7,622
|
|
|
$
|
7,701
|
|
|
$
|
150
|
|
|
$
|
117
|
|
(1)
|
Professional services rendered for the audits of the registrants' annual financial statements and reviews of unaudited financial statements included in the registrants' Quarterly Reports on Form 10-Q and for services in connection with statutory and regulatory filings or engagements, including comfort letters, agreed upon procedures and consents for financings and filings made with the SEC.
|
(2)
|
Professional services rendered in
2015
and
2014
related to SEC Regulation AB. Also, in 2014, professional services rendered related to additional agreed upon procedures for the audit of compliance with certain DOE grants, risk assurance and the audit of PE's cost allocation manual.
|
ITEM 15.
|
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
|
|
||
Exhibit
Number |
|
|
|
|
|
|
|
|
(B) 10-12
|
|
FirstEnergy Corp. Executive Deferred Compensation Plan, Amended and Restated as of January 1, 2014 (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-12 File No. 333-21011)
|
|
|
|
(B) 10-13
|
|
Retirement Plan for Outside Directors of GPU, Inc. as amended and restated as of August 8, 2000 (incorporated by reference to GPU, Inc. Form 10-K filed March 21, 2001, Exhibit 10-N, File No. 001-06047).
|
|
|
|
10-14
|
|
Consent Decree dated March 18, 2005. (incorporated by reference to FE’s Form 8-K filed March 18, 2005, Exhibit 10-1, File No. 333-21011).
|
|
|
|
(B) 10-15
|
|
Form of 2010-2012 Performance Share Award Agreement effective January 1, 2010 (incorporated by reference to FE’s Form 10-K filed February 19, 2010, Exhibit 10-48, File No. 333-21011).
|
|
|
|
(B) 10-16
|
|
Form of Performance-Adjusted Restricted Stock Unit Award Agreement as of March 8, 2010 (incorporated by reference to FE’s Form 10-K filed February 19, 2010, Exhibit 10-49, File No. 333-21011).
|
|
|
|
(B) 10-17
|
|
Form of Director Indemnification Agreement (incorporated by reference to FE’s 10-Q filed May 7, 2009, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-18
|
|
Form of Management Director Indemnification Agreement (incorporated by reference to FE’s 10-Q filed May 7, 2009, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-19
|
|
FirstEnergy Corp. Change in Control Severance Plan (incorporated by reference to FE's Form 10-Q filed May 3, 2011, Exhibit 10.9, File No. 333-21011).
|
|
|
|
(B) 10-20
|
|
Allegheny Energy, Inc. 1998 Long-Term Incentive Plan (incorporated by reference to FirstEnergy's Form 8-K filed February 25, 2011, Exhibit 10.2, File No. 21011).
|
|
|
|
(B) 10-21
|
|
Amendment No. 1 to Allegheny Energy, Inc. 1998 Long-Term Incentive Plan (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-25 File No. 333-21011).
|
|
|
|
(B) 10-22
|
|
Allegheny Energy, Inc. 2008 Long-Term Incentive Plan (incorporated by reference to FirstEnergy's Form 8-K filed February 25, 2011, Exhibit 10.3, File No. 21011).
|
|
|
|
(B) 10-23
|
|
Amendment No. 1 to Allegheny Energy, Inc. 2008 Long-Term Incentive Plan (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-27 File No. 333-21011).
|
|
|
|
(B) 10-24
|
|
Allegheny Energy, Inc. Non-Employee Director Stock Plan (incorporated by reference to FirstEnergy's Form 8-K filed February 25, 2011, Exhibit 10.4, File No. 21011).
|
|
|
|
(B) 10-25
|
|
Allegheny Energy, Inc. Amended and Restated Revised Plan for Deferral of Compensation of Directors (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-29 File No. 333-21011).
|
|
|
|
(B) 10-26
|
|
Amendment No. 1 to Allegheny Energy, Inc. Amended and Restated Revised Plan for Deferral of Compensation of Directors (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-30 File No. 333-21011).
|
|
|
|
10-27
|
|
Credit Agreement, dated as of June 17, 2011, among FirstEnergy Corp., The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, American Transmission Systems, Incorporated, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein. (incorporated by reference to FE's Form 10-Q filed August 2, 2011, Exhibit 10.1, File No. 333-21011).
|
|
|
|
10-28
|
|
Amendment, dated as of May 8, 2012, to the Credit Agreement, dated as of June 17, 2011, among FirstEnergy Corp., The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, American Transmission Systems, Incorporated, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FE's Form 8-K filed May 11, 2012, Exhibit 10.2, File No. 333-21011).
|
|
|
|
10-29
|
|
Amendment, dated as of May 8, 2013, to the Credit Agreement, dated as of June 17, 2011, as amended as of May 8, 2012, among FirstEnergy, The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FE’ s Form 8-K filed May 13, 2013, Exhibit 10.1, File No. 333-21011).
|
|
||
Exhibit
Number |
|
|
|
|
|
|
|
|
10-30
|
|
Amendment, dated as of October 31, 2013, to the Credit Agreement, dated as of June 17, 2011, as amended as of May 8, 2012, among FirstEnergy, The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FE’ s Form 10-Q filed November 5, 2013, Exhibit 10.1(a), File No. 333-21011).
|
|
|
|
10-31
|
|
Amendment, dated as of March 31, 2014, to the Credit Agreement, dated as of June 17, 2011, as amended as of May 8, 2012, May 8, 2013 and October 31, 2013, among FirstEnergy, The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FE’ s Form 8-K filed April 4, 2014, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-32
|
|
Employment Agreement between FirstEnergy Corp. and Anthony J. Alexander, dated March 20, 2012. (incorporated by reference to FE's Form 10-Q filed March 31, 2012, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-33
|
|
Form of Officer Indemnification Agreement (incorporated by reference to FirstEnergy's Form 8-K filed July 23, 2012, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-34
|
|
Amendment No.1 to the FirstEnergy Corp. Change in Control Severance Plan, amended and restated as of September 18, 2012 (incorporated by reference to FE's Form 10-Q filed November 8, 2012, Exhibit 10.1, File No. 333-21011).
|
|
|
|
10-35
|
|
U.S. $1,000,000,000 Credit Agreement, dated as of May 8, 2012, among FirstEnergy Transmission, LLC, American Transmission Systems, Incorporated and Trans-Allegheny Interstate Line Company, as borrowers, PNC Bank, National Association, as administrative agent, and the lending banks and fronting banks identified therein (incorporated by reference to FE's Form 8-K filed May 11, 2012, Exhibit 10.3, File No. 333-21011).
|
|
|
|
10-36
|
|
Amendment, dated as of May 8, 2013, to the Credit Agreement, dated as of May 8, 2012, among FirstEnergy Transmission, LLC, American Transmission Systems, Incorporated and Trans-Allegheny Interstate Line Company, as borrowers, and PNC Bank, National Association, as administrative agent, and the lending banks and fronting banks identified therein (incorporated by reference to FE’s Form 8-K filed May 13, 2013, Exhibit 10.3, File No. 333-21011).
|
|
|
|
10-37
|
|
Amendment, dated as of March 31, 2014 to the Credit Agreement, dated as of May 8, 2012, and as amended as of May 8, 2013, among FirstEnergy Transmission, LLC, American Transmission Systems, Incorporated and Trans-Allegheny Interstate Line Company, as borrowers, and PNC Bank, National Association, as administrative agent, and the lending banks and fronting banks identified therein (incorporated by reference to FE’s Form 8-K filed April 4, 2014, Exhibit 10.3, File No. 333-21011).
|
|
|
|
10-38
|
|
Term Loan Credit Agreement, dated as of March 31, 2014, among FE, as borrower, the banks named therein and The Royal Bank of Scotland, plc, as administrative agent (incorporated by reference to FE's Form 8-K filed April 4, 2014, Exhibit 10.4, File No. 333-21011).
|
|
|
|
10-39
|
|
Guarantee, dated as of September 16, 2013 by FirstEnergy Corp. in favor of participants under the FirstEnergy Corp. Executive Deferred Compensation Plan (incorporated by reference to FE’s Form 10-Q filed November 5, 2013, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-40
|
|
Executive Severance Benefits Plan (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-44 File No. 333-21011).
|
|
|
|
(B) 10-41
|
|
Amendment No. 2 to the FirstEnergy Corp. Change in Control Severance Plan (incorporated by reference to FE's Form 10-K filed February 17, 2015, Exhibit 10-44, File No. 333-21011).
|
|
|
|
(B) 10-42
|
|
Amendment No. 1 to the FirstEnergy Corp. Executive Deferred Compensation Plan, dated as of January 23, 2014 (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-45, File No. 333-21011)
.
|
|
|
|
(B) 10-43
|
|
Executive Short-Term Incentive Program (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-46, File No. 333-21011)
.
|
|
|
|
(B) 10-44
|
|
Form of 2015-2017 Cash-Based Performance-Adjusted Restricted Stock Unit Award Agreement (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-47, File No. 333-21011)
.
|
|
|
|
(B) 10-45
|
|
Form of 2015-2017 Stock-Based Performance-Adjusted Restricted Stock Unit Award Agreement (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-48, File No. 333-21011)
.
|
|
|
|
|
||
Exhibit
Number |
|
|
|
|
|
(B) 10-46
|
|
Form of Restricted Stock Agreement (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-49, File No. 333-21011)
.
|
|
|
|
(B) 10-47
|
|
FirstEnergy Corp. Amended and Restated Executive Deferred Compensation Plan, dated July 20, 2015, and effective as of November 1, 2015 (incorporated by reference to FE's Form 8-K filed July 24, 2015, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-48
|
|
Performance-Earned Restricted Stock Award Agreement, effective August 10, 2015, by and between FirstEnergy Corp. and James F. Pearson (incorporated by reference to FE's Form 8-K filed August 7, 2015, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-49
|
|
Performance-Earned Cash Award Agreement, effective August 10, 2015, by and between FirstEnergy Corp. and James H. Lash (incorporated by reference to FE's Form 8-K filed August 7, 2015, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-50
|
|
FirstEnergy Corp. 2017 Change in Control Severance Plan, dated as of September 15, 2015, and effective as of January 1, 2017 (incorporated by reference to FE's Form 8-K filed September 18, 2015, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-51
|
|
Waiver of Participation in the FirstEnergy Corp. Change in Control Severance Plan, entered into by Charles E. Jones dated as of September 15, 2015 (incorporated by reference to FE's Form 8-K filed September 18, 2015, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-52
|
|
Non-Competition and Non-Disparagement Agreement, dated as of September 15, 2015 (incorporated by reference to FE's Form 8-K filed September 18, 2015, Exhibit 10.3, File No. 333-21011).
|
|
|
|
(B) 10-53
|
|
2015-2017 Cash-Based Performance-Adjusted Restricted Stock Unit Award Agreement between FirstEnergy Corp. and Anthony J. Alexander, effective March 2, 2015 (incorporated by reference to FE's Form 10-Q filed May 1, 2015, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-54
|
|
2015-2017 Stock-Based Performance-Adjusted Restricted Stock Unit Award Agreement between FirstEnergy Corp. and Anthony J. Alexander, effective March 2, 2015 (incorporated by reference to FE's Form 10-Q filed May 1, 2015, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-55
|
|
FirstEnergy Corp. 2015 Incentive Compensation Plan (incorporated by reference to FirstEnergy's Definitive Proxy Statement filed April 1, 2015, Appendix A, File No. 333-21011)
.
|
|
|
|
(A)(B) 10-56
|
|
Executive Short-Term Incentive Program, effective February 16, 2016.
|
|
|
|
(A)(B) 10-57
|
|
Form of 2016-2018 Cash-Based Performance-Adjusted Restricted Stock Unit Award Agreement.
|
|
|
|
(A)(B) 10-58
|
|
Form of 2016-2018 Stock-Based Performance-Adjusted Restricted Stock Unit Award Agreement.
|
|
|
|
(A)(B) 10-59
|
|
Form of 2016 Restricted Stock Award Agreement
|
|
|
|
(A) 12
|
|
Consolidated ratios of earnings to fixed charges.
|
|
|
|
(A) 21
|
|
List of Subsidiaries of the Registrant at December 31, 2015.
|
|
|
|
(A) 23
|
|
Consent of Independent Registered Public Accounting Firm.
|
|
|
|
(A) 31-1
|
|
Certification of chief executive officer, as adopted pursuant to Rule 13a-15(e)/15d-15(e).
|
|
|
|
(A) 31-2
|
|
Certification of chief financial officer, as adopted pursuant to Rule 13a-15(e)/15d-15(e).
|
|
|
|
(A) 32
|
|
Certification of chief executive officer and chief financial officer, pursuant to 18 U.S.C. §1350.
|
|
|
|
101
|
|
The following materials from the Annual Report on Form 10-K for FirstEnergy Corp. for the period ended December 31, 2015, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, (iv) related notes to these financial statements and (v) document and entity information.
|
|
|
|
†
|
|
Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Registrant will furnish the omitted schedules to the Securities and Exchange Commission upon request by the Commission.
|
(A)
|
|
Provided herein in electronic format as an exhibit.
|
(B)
|
|
Management contract or compensatory plan contract or arrangement filed pursuant to Item 601 of Regulation S-K.
|
3. Exhibits — FES
|
|||
Exhibit
Number |
|
||
|
|
|
|
3-1
|
|
|
Articles of Incorporation of FirstEnergy Solutions Corp., as amended August 31, 2001. (incorporated by reference to FES’ Form S-4 filed August 6, 2007, Exhibit 3.2, File No. 333-145140-01).
|
|
|
|
|
3-2
|
|
|
Amended and Restated Code of Regulations of FirstEnergy Solutions Corp. effective as of August 26, 2009 (incorporated by reference to FES’ Form 8-K filed August 27, 2009, Exhibit 3.1, File No. 000-53742).
|
|
|
|
|
4-1
|
|
|
Open-End Mortgage, General Mortgage Indenture and Deed of Trust, dated as of June 19, 2008, of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) to The Bank of New York Mellon Trust Company, N.A., as Trustee (incorporated by reference to FES’ 10-Q filed May 7, 2009, Exhibit 4.1, File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(a)
|
First Supplemental Indenture dated as of June 25, 2008 (including Form of First Mortgage Bonds, Guarantee Series A of 2008 due 2009 and Form of First Mortgage Bonds, Guarantee Series B of 2008 due 2009). (incorporated by reference to FES’ 10-Q filed May 7, 2009, Exhibit 4.1(a), File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(b)
|
Second Supplemental Indenture dated as of March 1, 2009 (including Form of First Mortgage Bonds, Guarantee Series A of 2009 due 2014 and Form of First Mortgage Bonds, Guarantee Series B of 2009 due 2023). (incorporated by reference to FES’ 10-Q filed May 7, 2009, Exhibit 4.1(b), File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(c)
|
Third Supplemental Indenture dated as of March 31, 2009 (including Form of First Mortgage Bonds, Collateral Series A of 2009 due 2011). (incorporated by reference to FES’ 10-Q filed May 7, 2009, Exhibit 4.1(c), File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(d)
|
Fourth Supplemental Indenture, dated as of June 15, 2009 (including Form of First Mortgage Bonds, Guarantee Series C of 2009 due 2018, Form of First Mortgage Bonds, Guarantee Series D of 2009 due 2029, Form of First Mortgage Bonds, Guarantee Series E of 2009 due 2029, Form of First Mortgage Bonds, Collateral Series B of 2009 due 2011 and Form of First Mortgage Bonds, Collateral Series C of 2009 due 2011). (incorporated by reference to FES’ Form 8-K filed June 19, 2009, Exhibit 4.3, File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(e)
|
Fifth Supplemental Indenture, dated as of June 30, 2009 (including Form of First Mortgage Bonds, Guarantee Series F of 2009 due 2047, Form of First Mortgage Bonds, Guarantee Series G of 2009 due 2018 and Form of First Mortgage Bonds, Guarantee Series H of 2009 due 2018). (incorporated by reference to FES’ Form 8-K filed July 6, 2009, Exhibit 4.2, File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(f)
|
Sixth Supplemental Indenture, dated as of December 1, 2009 (including Form of First Mortgage Bonds, Collateral Series D of 2009 due 2012) (incorporated by reference to FES’ Form 8-K filed December 4, 2009, Exhibit 4.2, File No. 000-53742).
|
|
|
|
|
4-1
|
|
(g)
|
Seventh Supplemental Indenture dated as of February 14, 2012 (including Form of First Mortgage Bonds, Collateral Series D of 2009 due 2012) (incorporated by reference to FES' Form 10-Q filed May 1, 2012, Exhibit 4.1(g), File No. 000-53742).
|
|
|
|
|
4-2
|
|
|
Open-End Mortgage, General Mortgage Indenture and Deed of Trust, dated as of June 1, 2009, by and between FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to FES’ Form 8-K filed June 19, 2009, Exhibit 4.1, File No. 333-145140-01).
|
|
|
|
|
4-2
|
|
(a)
|
First Supplemental Indenture, dated as of June 15, 2009 (including Form of First Mortgage Bonds, Guarantee Series A of 2009 due 2033, Form of First Mortgage Bonds, Guarantee Series B of 2009 due 2011, Form of First Mortgage Bonds, Collateral Series A of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series B of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series C of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series D of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series E of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series F of 2009 due 2011 and Form of First Mortgage Bonds, Collateral Series G of 2009 due 2011). (incorporated by reference to FES’ Form 8-K filed June 19, 2009, Exhibit 4.2(i), File No. 333-145140-01).
|
|
|
|
|
4-2
|
|
(b)
|
Second Supplemental Indenture, dated as of June 30, 2009 (including Form of First Mortgage Bonds, Guarantee Series C of 2009 due 2033, Form of First Mortgage Bonds, Guarantee Series D of 2009 due 2033, Form of First Mortgage Bonds, Guarantee Series E of 2009 due 2033, Form of First Mortgage Bonds, Collateral Series H of 2009 due 2011, Form of First Mortgage Bonds, Collateral Series I of 2009 due 2011 and Form of First Mortgage Bonds, Collateral Series J of 2009 due 2010). (incorporated by reference to FES’ Form 8-K filed July 6, 2009, Exhibit 4.1, File No. 333-145140-01).
|
|
|
|
|
4-2
|
|
(c)
|
Third Supplemental Indenture, dated as of December 1, 2009 (including Form of First Mortgage Bonds, Collateral Series K of 2009 due 2012). (incorporated by reference to FES’ Form 8-K filed December 4, 2009, Exhibit 4.1, File No. 000-53742).
|
|
|
|
|
|
|||
Exhibit
Number |
|
||
|
|
|
|
4-2
|
|
(d)
|
Fourth Supplemental Indenture, dated as of February 14, 2012 (including Form of First Mortgage Bonds, Collateral Series K of 2009 due 2012). (incorporated by reference to FES' Form 10-Q filed May 1, 2012, Exhibit 4.2(d), File No. 000-53742).
|
|
|
|
|
4-3
|
|
|
Indenture, dated as of August 1, 2009, between FirstEnergy Solutions Corp. and The Bank of New York Mellon Trust Company, N.A. (incorporated by reference to FES’ Form 8-K filed August 7, 2009, Exhibit 4.1, File No. 000-53742).
|
|
|
|
|
4-3
|
|
(a)
|
First Supplemental Indenture, dated as of August 1, 2009 (including Form of 4.80% Senior Notes due 2015, Form of 6.05% Senior Notes due 2021 and Form of 6.80% Senior Notes due 2039). (incorporated by reference to FES’ Form 8-K filed August 7, 2009, Exhibit 4.2, File No. 000-53742).
|
|
|
|
|
10-1
|
|
|
Form of 6.85% Exchange Certificate due 2034. (incorporated by reference to FES’ Form S-4 filed August 6, 2007, Exhibit 4.1, File No. 333-145140-01).
|
|
|
|
|
10-2
|
|
|
Guaranty of FirstEnergy Solutions Corp., dated as of July 1, 2007. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-9, File No. 333-21011).
|
|
|
|
|
10-3
|
|
|
Indenture of Trust, Open-End Mortgage and Security Agreement, dated as of July 1, 2007, between the applicable Lessor and The Bank of New York Trust Company, N.A., as Indenture Trustee. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-3, File No. 333-21011).
|
|
|
|
|
10-4
|
|
|
6.85% Lessor Note due 2034. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-3, File No. 333-21011).
|
|
|
|
|
10-5
|
|
|
Participation Agreement, dated as of June 26, 2007, among FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.), as Lessee, FirstEnergy Solutions Corp., as Guarantor, the applicable Lessor, U.S. Bank Trust National Association, as Trust Company, the applicable Owner Participant, The Bank of New York Trust Company, N.A., as Indenture Trustee, and The Bank of New York Trust Company, N.A., as Pass Through Trustee. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-1, File No. 333-21011).
|
|
|
|
|
10-6
|
|
|
Trust Agreement, dated as of June 26, 2007, between the applicable Owner Participant and U.S. Bank Trust National Association, as Owner Trustee. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-2, File No. 333-21011).
|
|
|
|
|
10-7
|
|
|
Pass Through Trust Agreement, dated as of June 26, 2007, among FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.), FirstEnergy Solutions Corp., and The Bank of New York Trust Company, N.A., as Pass Through Trustee. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-12, File No. 333-21011).
|
|
|
|
|
10-8
|
|
|
Bill of Sale and Transfer, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-5, File No. 333-21011).
|
|
|
|
|
10-9
|
|
|
Facility Lease Agreement, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-6, File No. 333-21011).
|
|
|
|
|
10-10
|
|
|
Site Lease, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-7, File No. 333-21011).
|
|
|
|
|
10-11
|
|
|
Site Sublease, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-8, File No. 333-21011).
|
|
|
|
|
10-12
|
|
|
Support Agreement, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-10, File No. 333-21011).
|
|
|
|
|
10-13
|
|
|
Second Amendment to the Bruce Mansfield Units 1, 2, and 3 Operating Agreement, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.), The Cleveland Electric Illuminating Company and The Toledo Edison Company. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-11, File No. 333-21011).
|
|
|
|
|
10-14
|
|
|
Guaranty, dated as of March 26, 2007, by FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) on behalf of FirstEnergy Solutions Corp. (incorporated by reference to FES’ Form S-4/A filed August 20, 2007, Exhibit 10.39, File No. 333-145140-01).
|
|
|
|
|
|
|||
Exhibit
Number |
|
||
|
|
|
|
10-15
|
|
|
Guaranty, dated as of March 26, 2007, by FirstEnergy Solutions Corp. on behalf of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) (incorporated by reference to FES’ Form S-4/A filed August 20, 2007, Exhibit 10.40, File No. 333-145140-01).
|
|
|
|
|
10-16
|
|
|
Guaranty, dated as of March 26, 2007, by FirstEnergy Solutions Corp. on behalf of FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) (incorporated by reference to FES’ Form S-4/A filed August 20, 2007, Exhibit 10.41, File No. 333-145140-01).
|
|
|
|
|
10-17
|
|
|
Guaranty, dated as of March 26, 2007, by FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) on behalf of FirstEnergy Solutions Corp. (incorporated by reference to FES’ Form S-4/A filed August 20, 2007, Exhibit 10.42, File No. 333-145140-01).
|
|
|
|
|
(B) 10-18
|
|
|
Form of Trust Indenture dated as of December 1, 2005 between Ohio Water Development Authority and JP Morgan Trust Company, as Trustee, related to issuance of FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) pollution control revenue refunding bonds. (incorporated by reference to FE’s Form 10-K filed March 2, 2006, Exhibit 10-59, File No. 333-21011).
|
|
|
|
|
(B) 10-19
|
|
|
Form of Waste Water Facilities and Solid Waste Facilities Loan Agreement between Ohio Water Development Authority and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.), dated as of December 1, 2005. (incorporated by reference to FE’s Form 10-K filed March 2, 2006, Exhibit 10-63, File No. 333-21011).
|
|
|
|
|
(C) 10-20
|
|
|
Form of Trust Indenture dated as of April 1, 2006 between the Ohio Water Development Authority and The Bank of New York Trust Company, N.A. as Trustee securing pollution control revenue refunding bonds issued on behalf of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) (incorporated by reference to FE’s Form 10-Q filed May 9, 2006, Exhibit 10-3, File No. 333-21011).
|
|
|
|
|
(C) 10-21
|
|
|
Form of Waste Water Facilities Loan Agreement between the Ohio Water Development Authority and FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) dated as of April 1, 2006. (incorporated by reference to FE’s Form 10-Q filed May 9, 2006, Exhibit 10-4, File No. 333-21011).
|
|
|
|
|
(D) 10-22
|
|
|
Form of Trust Indenture dated as of December 1, 2006 between the Ohio Water Development Authority and The Bank of New York Trust Company, N.A. as Trustee securing State of Ohio Pollution Control Revenue Refunding Bonds (FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.)) (FirstEnergy Nuclear Generation Project). (incorporated by reference to FE’s Form 10-K filed February 28, 2007, Exhibit 10-77, File No. 333-21011).
|
|
|
|
|
(D) 10-23
|
|
|
Form of Waste Water Facilities and Solid Waste Facilities Loan Agreement between the Ohio Water Development Authority and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) dated as of December 1, 2006. (incorporated by reference to FE’s Form 10-K filed February 28, 2007, Exhibit 10-80, File No. 333-21011).
|
|
|
|
|
(B) 10-24
|
|
|
First Amendment to Loan Agreement, dated as of February 14, 2012, between the Ohio Water Development Authority, as issuer, and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Generation Corp.). (incorporated by reference to FES' Form 10-Q filed May 1, 2012, Exhibit 10.1, File No. 000-53742).
|
|
|
|
|
(B) 10-25
|
|
|
First Amendment to Loan Agreement, dated as of February 14, 2012, between the Ohio Air Quality Development Authority, as issuer, and FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.). (incorporated by reference to FES' Form 10-Q filed May 1, 2012, Exhibit 10.2, File No. 000-53742).
|
|
|
|
|
10-26
|
|
|
First Supplemental Trust Indenture, dated April 2, 2012, supplementing and amending that certain Trust Indenture dated as of April 1, 2006 between the Ohio Water Development Authority and The Bank of New York Mellon Trust Company, N.A. as Trustee securing pollution control revenue refunding bonds issued on behalf of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) (FirstEnergy Generation Project), which trust indenture, as amended, is substantially similar to various other PCRB trust indentures of FirstEnergy Generation, LLC (incorporated by reference to FES’ Form 10-Q filed August 7, 2012, Exhibit 10.1, File No. 000-53742).
|
|
|
|
|
10-27
|
|
|
First Amendment to Loan Agreement dated April 2, 2012, amending the Waste Water Facilities Loan Agreement between the Ohio Water Development Authority and FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.), dated as of April 1, 2006, which loan agreement, as amended, is substantially similar to various other PCRB loan agreements of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) (incorporated by reference to FES' Form 10-Q filed August 7, 2012, Exhibit 10.2, File No. 000-53742).
|
|
|
|
|
10-28
|
|
|
First Supplemental Trust Indenture, dated April 2, 2012, supplementing and amending that certain Trust Indenture dated as of December 1, 2006 between the Ohio Water Development Authority and The Bank of New York Mellon Trust Company, N.A., as Trustee securing State of Ohio Pollution Control Revenue Refunding Bonds (FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.)) (FirstEnergy Nuclear Generation Project), which trust indenture, as amended, is substantially similar to various other PCRB trust indentures of FirstEnergy Nuclear Generation, LLC (incorporated by reference to FES' Form 10-Q filed August 7, 2012, Exhibit 10.3, File No. 000-53742).
|
|
|
|
|
|
|||
Exhibit
Number |
|
||
|
|
|
|
10-29
|
|
|
First Amendment to Loan Agreement dated April 2, 2012, amending the Waste Water Facilities and Solid Waste Facilities Loan Agreement between the Ohio Water Development Authority and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.), dated as of December 1, 2006, which loan agreement, as amended, is substantially similar to various other PCRB loan agreements of FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) (incorporated by reference to FES' Form 10-Q filed August 7, 2012, Exhibit 10.4, File No. 000-53742).
|
|
|
|
|
10-30
|
|
|
Credit Agreement, dated as of June 17, 2011, among FirstEnergy Solutions Corp., and Allegheny Energy Supply Company, LLC, as borrowers, JPMorgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein. (incorporated by reference to FES' Form 10-Q filed August 2, 2011, Exhibit 10.1, File No. 000-53742).
|
|
|
|
|
10-31
|
|
|
Amendment, dated as of May 8, 2012, to the Credit Agreement, dated as of June 17, 2011, among FirstEnergy Solutions Corp., and Allegheny Energy Supply Company, LLC, as borrowers, JP Morgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FES' Form 8-K filed May 11, 2012, Exhibit 10.3, File No. 000-53742).
|
|
|
|
|
10-32
|
|
|
Amendment, dated as of May 8, 2013, to the Credit Agreement, dated as of June 17, 2011, as amended as of October 3, 2011 and May 8, 2012, among FirstEnergy Solutions Corp. and Allegheny Energy Supply Company, LLC, as borrowers, and JPMorgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FES' Form 8-K filed May 13, 2013, Exhibit 10.2, File No. 000-53742).
|
|
|
|
|
10-33
|
|
|
Amendment, dated as of October 31, 2013, to the Credit Agreement, dated as of June 17, 2011, as amended as of October 3, 2011 and May 8, 2012 and May 8, 2013, among FirstEnergy Solutions Corp. and Allegheny Energy Supply Company, LLC, as borrowers, and JPMorgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FES' Form 10-Q filed November 5, 2013, Exhibit 10.1(b), File No. 000-53742).
|
|
|
|
|
10-34
|
|
|
Amendment, dated as of March 31, 2014, to the Credit Agreement, dated as of June 17, 2011, as amended as of October 3, 2011, May 8, 2012 and May 8, 2013 and October 31, 2013, among FirstEnergy Solutions Corp. and Allegheny Energy Supply Company, LLC, as borrowers, and JPMorgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FES’ Form 8-K filed April 4, 2014, Exhibit 10.2, File No. 000-53742).
|
|
|
|
|
(A) 31-1
|
|
|
Certification of chief executive officer, as adopted pursuant to Rule 13a-15(e)/15d-15(e).
|
|
|
|
|
(A) 31-2
|
|
|
Certification of chief financial officer, as adopted pursuant to Rule 13a-15(e)/15d-15(e).
|
|
|
|
|
(A) 32
|
|
|
Certification of chief executive officer and chief financial officer, pursuant to 18 U.S.C. §1350.
|
|
|
|
|
101
|
|
|
The following materials from the Annual Report on Form 10-K for FirstEnergy Solutions Corp. for the period ended December 31, 2015, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, (iv) related notes to these financial statements and (v) document and entity information.
|
|
|
|
|
(A)
|
|
|
Provided herein in electronic format as an exhibit.
|
|
|
|
|
(B)
|
|
|
Four substantially similar agreements, each dated as of the same date, were executed and delivered by the registrant and its affiliates with respect to four other series of pollution control revenue refunding bonds issued by the Ohio Water Development Authority, the Ohio Air Quality Authority and Beaver County Industrial Development Authority, Pennsylvania, relating to pollution control notes of FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.).
|
|
|
|
|
(C)
|
|
|
Three substantially similar agreements, each dated as of the same date, were executed and delivered by the registrant and its affiliates with respect to three other series of pollution control revenue refunding bonds issued by the Ohio Water Development Authority and the Beaver County Industrial Development Authority relating to pollution control notes of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.).
|
|
|
|
|
(D)
|
|
|
Seven substantially similar agreements, each dated as of the same date, were executed and delivered by the registrant and its affiliates with respect to one other series of pollution control revenue refunding bonds issued by the Ohio Water Development Authority, three other series of pollution control bonds issued by the Ohio Air Quality Development Authority and the three other series of pollution control bonds issued by the Beaver County Industrial Development Authority, relating to pollution control notes of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.).
|
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
|
Beginning Balance
|
|
Charged to Income
|
|
Charged to Other Accounts
|
(1)
|
Deductions
|
(2)
|
Ending Balance
|
||||||||||
|
|
(In thousands)
|
||||||||||||||||||
Year Ended December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accumulated provision for uncollectible accounts — customers
|
|
$
|
59,266
|
|
|
$
|
114,249
|
|
|
$
|
54,199
|
|
|
$
|
158,939
|
|
|
$
|
68,775
|
|
— other
|
|
$
|
5,197
|
|
|
$
|
899
|
|
|
$
|
4,189
|
|
|
$
|
5,054
|
|
|
$
|
5,231
|
|
Loss carryforward tax valuation reserve
|
|
$
|
174,004
|
|
|
$
|
18,393
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
192,397
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended December 31, 2014:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accumulated provision for uncollectible accounts — customers
|
|
$
|
51,630
|
|
|
$
|
90,144
|
|
|
$
|
36,373
|
|
|
$
|
118,881
|
|
|
$
|
59,266
|
|
— other
|
|
$
|
2,976
|
|
|
$
|
3,469
|
|
|
$
|
8,264
|
|
|
$
|
9,512
|
|
|
$
|
5,197
|
|
Loss carryforward tax valuation reserve
|
|
$
|
125,360
|
|
|
$
|
48,644
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
174,004
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended December 31, 2013:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accumulated provision for uncollectible accounts — customers
|
|
$
|
40,354
|
|
|
$
|
68,733
|
|
|
$
|
39,775
|
|
|
$
|
97,232
|
|
|
$
|
51,630
|
|
— other
|
|
$
|
4,013
|
|
|
$
|
(1,464
|
)
|
|
$
|
5,208
|
|
|
$
|
4,781
|
|
|
$
|
2,976
|
|
Loss carryforward tax valuation reserve
|
|
$
|
101,697
|
|
|
$
|
23,663
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
125,360
|
|
(1)
|
Represents recoveries and reinstatements of accounts previously written off.
|
(2)
|
Represents the write-off of accounts considered to be uncollectible.
|
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
|
Beginning Balance
|
|
Charged to Income
|
|
Charged to Other Accounts
|
(1)
|
Deductions
|
(2)
|
Ending Balance
|
||||||||||
|
|
(In thousands)
|
||||||||||||||||||
Year Ended December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accumulated provision for uncollectible accounts — customers
|
|
$
|
17,862
|
|
|
$
|
7,411
|
|
|
$
|
—
|
|
|
$
|
16,807
|
|
|
$
|
8,466
|
|
— other
|
|
$
|
2,500
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,500
|
|
Loss carryforward tax valuation reserve
|
|
$
|
32,126
|
|
|
$
|
13,682
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
45,808
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended December 31, 2014:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accumulated provision for uncollectible accounts — customers
|
|
$
|
11,073
|
|
|
$
|
21,942
|
|
|
$
|
—
|
|
|
$
|
15,153
|
|
|
$
|
17,862
|
|
— other
|
|
$
|
2,523
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
32
|
|
|
$
|
2,500
|
|
Loss carryforward tax valuation reserve
|
|
$
|
26,875
|
|
|
$
|
5,251
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
32,126
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended December 31, 2013:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accumulated provision for uncollectible accounts — customers
|
|
$
|
16,188
|
|
|
$
|
14,294
|
|
|
$
|
—
|
|
|
$
|
19,409
|
|
|
$
|
11,073
|
|
— other
|
|
$
|
2,500
|
|
|
$
|
28
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
2,523
|
|
Loss carryforward tax valuation reserve
|
|
$
|
15,810
|
|
|
$
|
11,065
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
26,875
|
|
(1)
|
Represents recoveries and reinstatements of accounts previously written off.
|
(2)
|
Represents the write-off of accounts considered to be uncollectible.
|
|
FIRSTENERGY CORP.
|
|
|
|
BY:
|
/s/ Charles E. Jones
|
|
|
|
Charles E. Jones
|
|
|
|
President and Chief Executive Officer
|
|
/s/ Charles E. Jones
|
|
|
|
Charles E. Jones
|
|
|
|
President and Chief Executive Officer and Director
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ George M. Smart
|
|
|
|
George M. Smart
|
|
|
|
Director
|
|
|
|
(Non-Executive Chairman of Board)
|
|
|
|
|
|
|
|
/s/ James F. Pearson
|
|
/s/ K. Jon Taylor
|
|
James F. Pearson
|
|
K. Jon Taylor
|
|
Executive Vice President and Chief Financial Officer
|
|
Vice President, Controller and Chief Accounting Officer
|
|
(Principal Financial Officer)
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
/s/ Paul T. Addison
|
|
/s/ Donald T. Misheff
|
|
Paul T. Addison
|
|
Donald T. Misheff
|
|
Director
|
|
Director
|
|
|
|
|
|
/s/ Michael J. Anderson
|
|
/s/ Thomas N. Mitchell
|
|
Michael J. Anderson
|
|
Thomas N. Mitchell
|
|
Director
|
|
Director
|
|
|
|
|
|
/s/ William T. Cottle
|
|
/s/ Ernest J. Novak, Jr.
|
|
William T. Cottle
|
|
Ernest J. Novak, Jr.
|
|
Director
|
|
Director
|
|
|
|
|
|
/s/ Robert B. Heisler, Jr.
|
|
/s/ Christopher D. Pappas
|
|
Robert B. Heisler, Jr.
|
|
Christopher D. Pappas
|
|
Director
|
|
Director
|
|
|
|
|
|
/s/ Julia L. Johnson
|
|
/s/ Luis A. Reyes
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Julia L. Johnson
|
|
Luis A. Reyes
|
|
Director
|
|
Director
|
|
|
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|
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/s/ Ted J. Kleisner
|
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/s/ Jerry Sue Thornton
|
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Ted J. Kleisner
|
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Jerry Sue Thornton
|
|
Director
|
|
Director
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|
|
FIRSTENERGY SOLUTIONS CORP.
|
|
|
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BY:
|
/s/ Donald R. Schneider
|
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Donald R. Schneider
|
|
|
|
President
|
|
/s/ Donald R. Schneider
|
|
/s/ James F. Pearson
|
|
Donald R. Schneider
|
|
James F. Pearson
|
|
President
|
|
Executive Vice President and Chief Financial Officer, Director
|
|
(Principal Executive Officer)
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|
(Principal Financial Officer)
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/s/ Charles E. Jones
|
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/s/ K. Jon Taylor
|
|
Charles E. Jones
|
|
K. Jon Taylor
|
|
Director
|
|
Vice President and Controller
|
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(Principal Accounting Officer)
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/s/ James H. Lash
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James H. Lash
|
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|
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Director
|
|
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(B) 10-11
|
|
FirstEnergy Corp. Cash Balance Restoration Plan, effective January 1, 2014 (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-11 File No. 333-21011).
|
|
|
|
(B) 10-12
|
|
FirstEnergy Corp. Executive Deferred Compensation Plan, Amended and Restated as of January 1, 2014 (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-12 File No. 333-21011)
|
|
|
|
(B) 10-13
|
|
Retirement Plan for Outside Directors of GPU, Inc. as amended and restated as of August 8, 2000 (incorporated by reference to GPU, Inc. Form 10-K filed March 21, 2001, Exhibit 10-N, File No. 001-06047).
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10-14
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Consent Decree dated March 18, 2005. (incorporated by reference to FE’s Form 8-K filed March 18, 2005, Exhibit 10-1, File No. 333-21011).
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(B) 10-15
|
|
Form of 2010-2012 Performance Share Award Agreement effective January 1, 2010 (incorporated by reference to FE’s Form 10-K filed February 19, 2010, Exhibit 10-48, File No. 333-21011).
|
|
|
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(B) 10-16
|
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Form of Performance-Adjusted Restricted Stock Unit Award Agreement as of March 8, 2010 (incorporated by reference to FE’s Form 10-K filed February 19, 2010, Exhibit 10-49, File No. 333-21011).
|
|
|
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(B) 10-17
|
|
Form of Director Indemnification Agreement (incorporated by reference to FE’s 10-Q filed May 7, 2009, Exhibit 10.1, File No. 333-21011).
|
|
|
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(B) 10-18
|
|
Form of Management Director Indemnification Agreement (incorporated by reference to FE’s 10-Q filed May 7, 2009, Exhibit 10.2, File No. 333-21011).
|
|
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(B) 10-19
|
|
FirstEnergy Corp. Change in Control Severance Plan (incorporated by reference to FE's Form 10-Q filed May 3, 2011, Exhibit 10.9, File No. 333-21011).
|
|
|
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(B) 10-20
|
|
Allegheny Energy, Inc. 1998 Long-Term Incentive Plan (incorporated by reference to FirstEnergy's Form 8-K filed February 25, 2011, Exhibit 10.2, File No. 21011).
|
|
|
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(B) 10-21
|
|
Amendment No. 1 to Allegheny Energy, Inc. 1998 Long-Term Incentive Plan (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-25 File No. 333-21011).
|
|
|
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(B) 10-22
|
|
Allegheny Energy, Inc. 2008 Long-Term Incentive Plan (incorporated by reference to FirstEnergy's Form 8-K filed February 25, 2011, Exhibit 10.3, File No. 21011).
|
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(B) 10-23
|
|
Amendment No. 1 to Allegheny Energy, Inc. 2008 Long-Term Incentive Plan (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-27 File No. 333-21011).
|
|
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(B) 10-24
|
|
Allegheny Energy, Inc. Non-Employee Director Stock Plan (incorporated by reference to FirstEnergy's Form 8-K filed February 25, 2011, Exhibit 10.4, File No. 21011).
|
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(B) 10-25
|
|
Allegheny Energy, Inc. Amended and Restated Revised Plan for Deferral of Compensation of Directors (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-29 File No. 333-21011).
|
|
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|
(B) 10-26
|
|
Amendment No. 1 to Allegheny Energy, Inc. Amended and Restated Revised Plan for Deferral of Compensation of Directors (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-30 File No. 333-21011).
|
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10-27
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Credit Agreement, dated as of June 17, 2011, among FirstEnergy Corp., The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, American Transmission Systems, Incorporated, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein. (incorporated by reference to FE's Form 10-Q filed August 2, 2011, Exhibit 10.1, File No. 333-21011).
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|
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10-28
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|
Amendment, dated as of May 8, 2012, to the Credit Agreement, dated as of June 17, 2011, among FirstEnergy Corp., The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, American Transmission Systems, Incorporated, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FE's Form 8-K filed May 11, 2012, Exhibit 10.2, File No. 333-21011).
|
|
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10-29
|
|
Amendment, dated as of May 8, 2013, to the Credit Agreement, dated as of June 17, 2011, as amended as of May 8, 2012, among FirstEnergy, The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FE’ s Form 8-K filed May 13, 2013, Exhibit 10.1, File No. 333-21011).
|
|
|
|
10-30
|
|
Amendment, dated as of October 31, 2013, to the Credit Agreement, dated as of June 17, 2011, as amended as of May 8, 2012, among FirstEnergy, The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FE’ s Form 10-Q filed November 5, 2013, Exhibit 10.1(a), File No. 333-21011).
|
|
|
|
10-31
|
|
Amendment, dated as of March 31, 2014, to the Credit Agreement, dated as of June 17, 2011, as amended as of May 8, 2012, May 8, 2013 and October 31, 2013, among FirstEnergy, The Cleveland Electric Illuminating Company, Metropolitan Edison Company, Ohio Edison Company, Pennsylvania Power Company, The Toledo Edison Company, Jersey Central Power & Light Company, Monongahela Power Company, Pennsylvania Electric Company, the Potomac Edison Company and West Penn Power Company, as borrowers, The Royal Bank of Scotland plc, as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FE’ s Form 8-K filed April 4, 2014, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-32
|
|
Employment Agreement between FirstEnergy Corp. and Anthony J. Alexander, dated March 20, 2012. (incorporated by reference to FE's Form 10-Q filed March 31, 2012, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-33
|
|
Form of Officer Indemnification Agreement (incorporated by reference to FirstEnergy's Form 8-K filed July 23, 2012, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-34
|
|
Amendment No.1 to the FirstEnergy Corp. Change in Control Severance Plan, amended and restated as of September 18, 2012 (incorporated by reference to FE's Form 10-Q filed November 8, 2012, Exhibit 10.1, File No. 333-21011).
|
|
|
|
10-35
|
|
U.S. $1,000,000,000 Credit Agreement, dated as of May 8, 2012, among FirstEnergy Transmission, LLC, American Transmission Systems, Incorporated and Trans-Allegheny Interstate Line Company, as borrowers, PNC Bank, National Association, as administrative agent, and the lending banks and fronting banks identified therein (incorporated by reference to FE's Form 8-K filed May 11, 2012, Exhibit 10.3, File No. 333-21011).
|
|
|
|
10-36
|
|
Amendment, dated as of May 8, 2013, to the Credit Agreement, dated as of May 8, 2012, among FirstEnergy Transmission, LLC, American Transmission Systems, Incorporated and Trans-Allegheny Interstate Line Company, as borrowers, and PNC Bank, National Association, as administrative agent, and the lending banks and fronting banks identified therein (incorporated by reference to FE’s Form 8-K filed May 13, 2013, Exhibit 10.3, File No. 333-21011).
|
|
|
|
10-37
|
|
Amendment, dated as of March 31, 2014 to the Credit Agreement, dated as of May 8, 2012, and as amended as of May 8, 2013, among FirstEnergy Transmission, LLC, American Transmission Systems, Incorporated and Trans-Allegheny Interstate Line Company, as borrowers, and PNC Bank, National Association, as administrative agent, and the lending banks and fronting banks identified therein (incorporated by reference to FE’s Form 8-K filed April 4, 2014, Exhibit 10.3, File No. 333-21011).
|
|
|
|
10-38
|
|
Term Loan Credit Agreement, dated as of March 31, 2014, among FE, as borrower, the banks named therein and The Royal Bank of Scotland, plc, as administrative agent (incorporated by reference to FE's Form 8-K filed April 4, 2014, Exhibit 10.4, File No. 333-21011).
|
|
|
|
10-39
|
|
Guarantee, dated as of September 16, 2013 by FirstEnergy Corp. in favor of participants under the FirstEnergy Corp. Executive Deferred Compensation Plan (incorporated by reference to FE’s Form 10-Q filed November 5, 2013, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-40
|
|
Executive Severance Benefits Plan (incorporated by reference to FE's Form 10-K filed February 27, 2014, Exhibit 10-44 File No. 333-21011).
|
|
|
|
(B) 10-41
|
|
Amendment No. 2 to the FirstEnergy Corp. Change in Control Severance Plan (incorporated by reference to FE's Form 10-K filed February 17, 2015, Exhibit 10-44, File No. 333-21011).
|
|
|
|
(B) 10-42
|
|
Amendment No. 1 to the FirstEnergy Corp. Executive Deferred Compensation Plan, dated as of January 23, 2014 (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-45, File No. 333-21011)
.
|
|
|
|
(B) 10-43
|
|
Executive Short-Term Incentive Program (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-46, File No. 333-21011)
.
|
|
|
|
(B) 10-44
|
|
Form of 2015-2017 Cash-Based Performance-Adjusted Restricted Stock Unit Award Agreement (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-47, File No. 333-21011)
.
|
|
|
|
(B) 10-45
|
|
Form of 2015-2017 Stock-Based Performance-Adjusted Restricted Stock Unit Award Agreement (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-48, File No. 333-21011)
.
|
|
|
|
(B) 10-46
|
|
Form of Restricted Stock Agreement (incorporated by reference to FE’s Form 10-K filed February 17, 2015, Exhibit 10-49, File No. 333-21011)
.
|
|
|
|
(B) 10-47
|
|
FirstEnergy Corp. Amended and Restated Executive Deferred Compensation Plan, dated July 20, 2015, and effective as of November 1, 2015 (incorporated by reference to FE's Form 8-K filed July 24, 2015, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-48
|
|
Performance-Earned Restricted Stock Award Agreement, effective August 10, 2015, by and between FirstEnergy Corp. and James F. Pearson (incorporated by reference to FE's Form 8-K filed August 7, 2015, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-49
|
|
Performance-Earned Cash Award Agreement, effective August 10, 2015, by and between FirstEnergy Corp. and James H. Lash (incorporated by reference to FE's Form 8-K filed August 7, 2015, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-50
|
|
FirstEnergy Corp. 2017 Change in Control Severance Plan, dated as of September 15, 2015, and effective as of January 1, 2017 (incorporated by reference to FE's Form 8-K filed September 18, 2015, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-51
|
|
Waiver of Participation in the FirstEnergy Corp. Change in Control Severance Plan, entered into by Charles E. Jones dated as of September 15, 2015 (incorporated by reference to FE's Form 8-K filed September 18, 2015, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-52
|
|
Non-Competition and Non-Disparagement Agreement, dated as of September 15, 2015 (incorporated by reference to FE's Form 8-K filed September 18, 2015, Exhibit 10.3, File No. 333-21011).
|
|
|
|
(B) 10-53
|
|
2015-2017 Cash-Based Performance-Adjusted Restricted Stock Unit Award Agreement between FirstEnergy Corp. and Anthony J. Alexander, effective March 2, 2015 (incorporated by reference to FE's Form 10-Q filed May 1, 2015, Exhibit 10.1, File No. 333-21011).
|
|
|
|
(B) 10-54
|
|
2015-2017 Stock-Based Performance-Adjusted Restricted Stock Unit Award Agreement between FirstEnergy Corp. and Anthony J. Alexander, effective March 2, 2015 (incorporated by reference to FE's Form 10-Q filed May 1, 2015, Exhibit 10.2, File No. 333-21011).
|
|
|
|
(B) 10-55
|
|
FirstEnergy Corp. 2015 Incentive Compensation Plan (incorporated by reference to FirstEnergy's Definitive Proxy Statement filed April 1, 2015, Appendix A, File No. 333-21011)
.
|
|
|
|
(A)(B) 10-56
|
|
Executive Short-Term Incentive Program, effective February 16, 2016.
|
|
|
|
(A)(B) 10-57
|
|
Form of 2016-2018 Cash-Based Performance-Adjusted Restricted Stock Unit Award Agreement.
|
|
|
|
(A)(B) 10-58
|
|
Form of 2016-2018 Stock-Based Performance-Adjusted Restricted Stock Unit Award Agreement.
|
|
|
|
(A)(B) 10-59
|
|
Form of 2016 Restricted Stock Award Agreement
|
|
|
|
(A) 12
|
|
Consolidated ratios of earnings to fixed charges.
|
|
|
|
(A) 21
|
|
List of Subsidiaries of the Registrant at December 31, 2015.
|
|
|
|
(A) 23
|
|
Consent of Independent Registered Public Accounting Firm.
|
|
|
|
(A) 31-1
|
|
Certification of chief executive officer, as adopted pursuant to Rule 13a-15(e)/15d-15(e).
|
|
|
|
(A) 31-2
|
|
Certification of chief financial officer, as adopted pursuant to Rule 13a-15(e)/15d-15(e).
|
|
|
|
(A) 32
|
|
Certification of chief executive officer and chief financial officer, pursuant to 18 U.S.C. §1350.
|
|
|
|
101
|
|
The following materials from the Annual Report on Form 10-K for FirstEnergy Corp. for the period ended December 31, 2015, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, (iv) related notes to these financial statements and (v) document and entity information.
|
|
|
|
†
|
|
Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Registrant will furnish the omitted schedules to the Securities and Exchange Commission upon request by the Commission.
|
(A)
|
|
Provided herein in electronic format as an exhibit.
|
(B)
|
|
Management contract or compensatory plan contract or arrangement filed pursuant to Item 601 of Regulation S-K.
|
Exhibit
Number |
|
||
|
|
|
|
3-1
|
|
|
Articles of Incorporation of FirstEnergy Solutions Corp., as amended August 31, 2001. (incorporated by reference to FES’ Form S-4 filed August 6, 2007, Exhibit 3.2, File No. 333-145140-01).
|
|
|
|
|
3-2
|
|
|
Amended and Restated Code of Regulations of FirstEnergy Solutions Corp. effective as of August 26, 2009 (incorporated by reference to FES’ Form 8-K filed August 27, 2009, Exhibit 3.1, File No. 000-53742).
|
|
|
|
|
4-1
|
|
|
Open-End Mortgage, General Mortgage Indenture and Deed of Trust, dated as of June 19, 2008, of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) to The Bank of New York Mellon Trust Company, N.A., as Trustee (incorporated by reference to FES’ 10-Q filed May 7, 2009, Exhibit 4.1, File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(a)
|
First Supplemental Indenture dated as of June 25, 2008 (including Form of First Mortgage Bonds, Guarantee Series A of 2008 due 2009 and Form of First Mortgage Bonds, Guarantee Series B of 2008 due 2009). (incorporated by reference to FES’ 10-Q filed May 7, 2009, Exhibit 4.1(a), File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(b)
|
Second Supplemental Indenture dated as of March 1, 2009 (including Form of First Mortgage Bonds, Guarantee Series A of 2009 due 2014 and Form of First Mortgage Bonds, Guarantee Series B of 2009 due 2023). (incorporated by reference to FES’ 10-Q filed May 7, 2009, Exhibit 4.1(b), File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(c)
|
Third Supplemental Indenture dated as of March 31, 2009 (including Form of First Mortgage Bonds, Collateral Series A of 2009 due 2011). (incorporated by reference to FES’ 10-Q filed May 7, 2009, Exhibit 4.1(c), File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(d)
|
Fourth Supplemental Indenture, dated as of June 15, 2009 (including Form of First Mortgage Bonds, Guarantee Series C of 2009 due 2018, Form of First Mortgage Bonds, Guarantee Series D of 2009 due 2029, Form of First Mortgage Bonds, Guarantee Series E of 2009 due 2029, Form of First Mortgage Bonds, Collateral Series B of 2009 due 2011 and Form of First Mortgage Bonds, Collateral Series C of 2009 due 2011). (incorporated by reference to FES’ Form 8-K filed June 19, 2009, Exhibit 4.3, File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(e)
|
Fifth Supplemental Indenture, dated as of June 30, 2009 (including Form of First Mortgage Bonds, Guarantee Series F of 2009 due 2047, Form of First Mortgage Bonds, Guarantee Series G of 2009 due 2018 and Form of First Mortgage Bonds, Guarantee Series H of 2009 due 2018). (incorporated by reference to FES’ Form 8-K filed July 6, 2009, Exhibit 4.2, File No. 333-145140-01).
|
|
|
|
|
4-1
|
|
(f)
|
Sixth Supplemental Indenture, dated as of December 1, 2009 (including Form of First Mortgage Bonds, Collateral Series D of 2009 due 2012) (incorporated by reference to FES’ Form 8-K filed December 4, 2009, Exhibit 4.2, File No. 000-53742).
|
|
|
|
|
4-1
|
|
(g)
|
Seventh Supplemental Indenture dated as of February 14, 2012 (including Form of First Mortgage Bonds, Collateral Series D of 2009 due 2012) (incorporated by reference to FES' Form 10-Q filed May 1, 2012, Exhibit 4.1(g), File No. 000-53742).
|
|
|
|
|
4-2
|
|
|
Open-End Mortgage, General Mortgage Indenture and Deed of Trust, dated as of June 1, 2009, by and between FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to FES’ Form 8-K filed June 19, 2009, Exhibit 4.1, File No. 333-145140-01).
|
|
|
|
|
4-2
|
|
(a)
|
First Supplemental Indenture, dated as of June 15, 2009 (including Form of First Mortgage Bonds, Guarantee Series A of 2009 due 2033, Form of First Mortgage Bonds, Guarantee Series B of 2009 due 2011, Form of First Mortgage Bonds, Collateral Series A of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series B of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series C of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series D of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series E of 2009 due 2010, Form of First Mortgage Bonds, Collateral Series F of 2009 due 2011 and Form of First Mortgage Bonds, Collateral Series G of 2009 due 2011). (incorporated by reference to FES’ Form 8-K filed June 19, 2009, Exhibit 4.2(i), File No. 333-145140-01).
|
|
|
|
|
4-2
|
|
(b)
|
Second Supplemental Indenture, dated as of June 30, 2009 (including Form of First Mortgage Bonds, Guarantee Series C of 2009 due 2033, Form of First Mortgage Bonds, Guarantee Series D of 2009 due 2033, Form of First Mortgage Bonds, Guarantee Series E of 2009 due 2033, Form of First Mortgage Bonds, Collateral Series H of 2009 due 2011, Form of First Mortgage Bonds, Collateral Series I of 2009 due 2011 and Form of First Mortgage Bonds, Collateral Series J of 2009 due 2010). (incorporated by reference to FES’ Form 8-K filed July 6, 2009, Exhibit 4.1, File No. 333-145140-01).
|
|
|
|
|
4-2
|
|
(c)
|
Third Supplemental Indenture, dated as of December 1, 2009 (including Form of First Mortgage Bonds, Collateral Series K of 2009 due 2012). (incorporated by reference to FES’ Form 8-K filed December 4, 2009, Exhibit 4.1, File No. 000-53742).
|
|
|
|
|
4-2
|
|
(d)
|
Fourth Supplemental Indenture, dated as of February 14, 2012 (including Form of First Mortgage Bonds, Collateral Series K of 2009 due 2012). (incorporated by reference to FES' Form 10-Q filed May 1, 2012, Exhibit 4.2(d), File No. 000-53742).
|
|
|
|
|
4-3
|
|
|
Indenture, dated as of August 1, 2009, between FirstEnergy Solutions Corp. and The Bank of New York Mellon Trust Company, N.A. (incorporated by reference to FES’ Form 8-K filed August 7, 2009, Exhibit 4.1, File No. 000-53742).
|
|
|
|
|
4-3
|
|
(a)
|
First Supplemental Indenture, dated as of August 1, 2009 (including Form of 4.80% Senior Notes due 2015, Form of 6.05% Senior Notes due 2021 and Form of 6.80% Senior Notes due 2039). (incorporated by reference to FES’ Form 8-K filed August 7, 2009, Exhibit 4.2, File No. 000-53742).
|
|
|
|
|
10-1
|
|
|
Form of 6.85% Exchange Certificate due 2034. (incorporated by reference to FES’ Form S-4 filed August 6, 2007, Exhibit 4.1, File No. 333-145140-01).
|
|
|
|
|
10-2
|
|
|
Guaranty of FirstEnergy Solutions Corp., dated as of July 1, 2007. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-9, File No. 333-21011).
|
|
|
|
|
10-3
|
|
|
Indenture of Trust, Open-End Mortgage and Security Agreement, dated as of July 1, 2007, between the applicable Lessor and The Bank of New York Trust Company, N.A., as Indenture Trustee. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-3, File No. 333-21011).
|
|
|
|
|
10-4
|
|
|
6.85% Lessor Note due 2034. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-3, File No. 333-21011).
|
|
|
|
|
10-5
|
|
|
Participation Agreement, dated as of June 26, 2007, among FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.), as Lessee, FirstEnergy Solutions Corp., as Guarantor, the applicable Lessor, U.S. Bank Trust National Association, as Trust Company, the applicable Owner Participant, The Bank of New York Trust Company, N.A., as Indenture Trustee, and The Bank of New York Trust Company, N.A., as Pass Through Trustee. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-1, File No. 333-21011).
|
|
|
|
|
10-6
|
|
|
Trust Agreement, dated as of June 26, 2007, between the applicable Owner Participant and U.S. Bank Trust National Association, as Owner Trustee. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-2, File No. 333-21011).
|
|
|
|
|
10-7
|
|
|
Pass Through Trust Agreement, dated as of June 26, 2007, among FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.), FirstEnergy Solutions Corp., and The Bank of New York Trust Company, N.A., as Pass Through Trustee. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-12, File No. 333-21011).
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10-8
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Bill of Sale and Transfer, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-5, File No. 333-21011).
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10-9
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Facility Lease Agreement, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-6, File No. 333-21011).
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10-10
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Site Lease, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-7, File No. 333-21011).
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10-11
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Site Sublease, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-8, File No. 333-21011).
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10-12
|
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Support Agreement, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and the applicable Lessor. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-10, File No. 333-21011).
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10-13
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Second Amendment to the Bruce Mansfield Units 1, 2, and 3 Operating Agreement, dated as of July 1, 2007, between FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.), The Cleveland Electric Illuminating Company and The Toledo Edison Company. (incorporated by reference to FE’s Form 8-K/A filed August 2, 2007, Exhibit 10-11, File No. 333-21011).
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10-14
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Guaranty, dated as of March 26, 2007, by FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) on behalf of FirstEnergy Solutions Corp. (incorporated by reference to FES’ Form S-4/A filed August 20, 2007, Exhibit 10.39, File No. 333-145140-01).
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10-15
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Guaranty, dated as of March 26, 2007, by FirstEnergy Solutions Corp. on behalf of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) (incorporated by reference to FES’ Form S-4/A filed August 20, 2007, Exhibit 10.40, File No. 333-145140-01).
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10-16
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Guaranty, dated as of March 26, 2007, by FirstEnergy Solutions Corp. on behalf of FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) (incorporated by reference to FES’ Form S-4/A filed August 20, 2007, Exhibit 10.41, File No. 333-145140-01).
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10-17
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Guaranty, dated as of March 26, 2007, by FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) on behalf of FirstEnergy Solutions Corp. (incorporated by reference to FES’ Form S-4/A filed August 20, 2007, Exhibit 10.42, File No. 333-145140-01).
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(B) 10-18
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Form of Trust Indenture dated as of December 1, 2005 between Ohio Water Development Authority and JP Morgan Trust Company, as Trustee, related to issuance of FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) pollution control revenue refunding bonds. (incorporated by reference to FE’s Form 10-K filed March 2, 2006, Exhibit 10-59, File No. 333-21011).
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(B) 10-19
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Form of Waste Water Facilities and Solid Waste Facilities Loan Agreement between Ohio Water Development Authority and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.), dated as of December 1, 2005. (incorporated by reference to FE’s Form 10-K filed March 2, 2006, Exhibit 10-63, File No. 333-21011).
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|
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(C) 10-20
|
|
|
Form of Trust Indenture dated as of April 1, 2006 between the Ohio Water Development Authority and The Bank of New York Trust Company, N.A. as Trustee securing pollution control revenue refunding bonds issued on behalf of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) (incorporated by reference to FE’s Form 10-Q filed May 9, 2006, Exhibit 10-3, File No. 333-21011).
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(C) 10-21
|
|
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Form of Waste Water Facilities Loan Agreement between the Ohio Water Development Authority and FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) dated as of April 1, 2006. (incorporated by reference to FE’s Form 10-Q filed May 9, 2006, Exhibit 10-4, File No. 333-21011).
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(D) 10-22
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Form of Trust Indenture dated as of December 1, 2006 between the Ohio Water Development Authority and The Bank of New York Trust Company, N.A. as Trustee securing State of Ohio Pollution Control Revenue Refunding Bonds (FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.)) (FirstEnergy Nuclear Generation Project). (incorporated by reference to FE’s Form 10-K filed February 28, 2007, Exhibit 10-77, File No. 333-21011).
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(D) 10-23
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Form of Waste Water Facilities and Solid Waste Facilities Loan Agreement between the Ohio Water Development Authority and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) dated as of December 1, 2006. (incorporated by reference to FE’s Form 10-K filed February 28, 2007, Exhibit 10-80, File No. 333-21011).
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(B) 10-24
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First Amendment to Loan Agreement, dated as of February 14, 2012, between the Ohio Water Development Authority, as issuer, and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Generation Corp.). (incorporated by reference to FES' Form 10-Q filed May 1, 2012, Exhibit 10.1, File No. 000-53742).
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(B) 10-25
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First Amendment to Loan Agreement, dated as of February 14, 2012, between the Ohio Air Quality Development Authority, as issuer, and FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.). (incorporated by reference to FES' Form 10-Q filed May 1, 2012, Exhibit 10.2, File No. 000-53742).
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10-26
|
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First Supplemental Trust Indenture, dated April 2, 2012, supplementing and amending that certain Trust Indenture dated as of April 1, 2006 between the Ohio Water Development Authority and The Bank of New York Mellon Trust Company, N.A. as Trustee securing pollution control revenue refunding bonds issued on behalf of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) (FirstEnergy Generation Project), which trust indenture, as amended, is substantially similar to various other PCRB trust indentures of FirstEnergy Generation, LLC (incorporated by reference to FES’ Form 10-Q filed August 7, 2012, Exhibit 10.1, File No. 000-53742).
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10-27
|
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First Amendment to Loan Agreement dated April 2, 2012, amending the Waste Water Facilities Loan Agreement between the Ohio Water Development Authority and FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.), dated as of April 1, 2006, which loan agreement, as amended, is substantially similar to various other PCRB loan agreements of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) (incorporated by reference to FES' Form 10-Q filed August 7, 2012, Exhibit 10.2, File No. 000-53742).
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10-28
|
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|
First Supplemental Trust Indenture, dated April 2, 2012, supplementing and amending that certain Trust Indenture dated as of December 1, 2006 between the Ohio Water Development Authority and The Bank of New York Mellon Trust Company, N.A., as Trustee securing State of Ohio Pollution Control Revenue Refunding Bonds (FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.)) (FirstEnergy Nuclear Generation Project), which trust indenture, as amended, is substantially similar to various other PCRB trust indentures of FirstEnergy Nuclear Generation, LLC (incorporated by reference to FES' Form 10-Q filed August 7, 2012, Exhibit 10.3, File No. 000-53742).
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10-29
|
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|
First Amendment to Loan Agreement dated April 2, 2012, amending the Waste Water Facilities and Solid Waste Facilities Loan Agreement between the Ohio Water Development Authority and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.), dated as of December 1, 2006, which loan agreement, as amended, is substantially similar to various other PCRB loan agreements of FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.) (incorporated by reference to FES' Form 10-Q filed August 7, 2012, Exhibit 10.4, File No. 000-53742).
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10-30
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Credit Agreement, dated as of June 17, 2011, among FirstEnergy Solutions Corp., and Allegheny Energy Supply Company, LLC, as borrowers, JPMorgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein. (incorporated by reference to FES' Form 10-Q filed August 2, 2011, Exhibit 10.1, File No. 000-53742).
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10-31
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Amendment, dated as of May 8, 2012, to the Credit Agreement, dated as of June 17, 2011, among FirstEnergy Solutions Corp., and Allegheny Energy Supply Company, LLC, as borrowers, JP Morgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FES' Form 8-K filed May 11, 2012, Exhibit 10.3, File No. 000-53742).
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10-32
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Amendment, dated as of May 8, 2013, to the Credit Agreement, dated as of June 17, 2011, as amended as of October 3, 2011 and May 8, 2012, among FirstEnergy Solutions Corp. and Allegheny Energy Supply Company, LLC, as borrowers, and JPMorgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FES' Form 8-K filed May 13, 2013, Exhibit 10.2, File No. 000-53742).
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10-33
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Amendment, dated as of October 31, 2013, to the Credit Agreement, dated as of June 17, 2011, as amended as of October 3, 2011 and May 8, 2012 and May 8, 2013, among FirstEnergy Solutions Corp. and Allegheny Energy Supply Company, LLC, as borrowers, and JPMorgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FES' Form 10-Q filed November 5, 2013, Exhibit 10.1(b), File No. 000-53742).
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10-34
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Amendment, dated as of March 31, 2014, to the Credit Agreement, dated as of June 17, 2011, as amended as of October 3, 2011, May 8, 2012 and May 8, 2013 and October 31, 2013, among FirstEnergy Solutions Corp. and Allegheny Energy Supply Company, LLC, as borrowers, and JPMorgan Chase Bank, N.A., as administrative agent, and the lending banks, fronting banks and swing line lenders identified therein (incorporated by reference to FES’ Form 8-K filed April 4, 2014, Exhibit 10.2, File No. 000-53742).
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(A) 31-1
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Certification of chief executive officer, as adopted pursuant to Rule 13a-15(e)/15d-15(e).
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(A) 31-2
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Certification of chief financial officer, as adopted pursuant to Rule 13a-15(e)/15d-15(e).
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(A) 32
|
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Certification of chief executive officer and chief financial officer, pursuant to 18 U.S.C. §1350.
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101
|
|
|
The following materials from the Annual Report on Form 10-K for FirstEnergy Solutions Corp. for the period ended December 31, 2015, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, (iv) related notes to these financial statements and (v) document and entity information.
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(A)
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Provided herein in electronic format as an exhibit.
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(B)
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|
Four substantially similar agreements, each dated as of the same date, were executed and delivered by the registrant and its affiliates with respect to four other series of pollution control revenue refunding bonds issued by the Ohio Water Development Authority, the Ohio Air Quality Authority and Beaver County Industrial Development Authority, Pennsylvania, relating to pollution control notes of FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.).
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(C)
|
|
|
Three substantially similar agreements, each dated as of the same date, were executed and delivered by the registrant and its affiliates with respect to three other series of pollution control revenue refunding bonds issued by the Ohio Water Development Authority and the Beaver County Industrial Development Authority relating to pollution control notes of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.).
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(D)
|
|
|
Seven substantially similar agreements, each dated as of the same date, were executed and delivered by the registrant and its affiliates with respect to one other series of pollution control revenue refunding bonds issued by the Ohio Water Development Authority, three other series of pollution control bonds issued by the Ohio Air Quality Development Authority and the three other series of pollution control bonds issued by the Beaver County Industrial Development Authority, relating to pollution control notes of FirstEnergy Generation, LLC (f/k/a FirstEnergy Generation Corp.) and FirstEnergy Nuclear Generation, LLC (f/k/a FirstEnergy Nuclear Generation Corp.).
|
[Form of Cash-Based]
|
|
Exhibit 10-57
|
(a)
|
Vesting
. Except as otherwise provided in Sections 6 and 7 below, if and to the extent the performance goals set forth on
Exhibit A
attached to this Agreement (the “Performance Goals”) are achieved during the performance period set forth on
Exhibit A
(the “Performance Period”), the RSUs will vest on March 1, 2019 (the “Vesting Date”), as long as the Grantee remains continuously employed by the Company or a Subsidiary until such Vesting Date. The number of RSUs that shall vest will range from 0% to 200% of the Target Number, as determined by the extent to which the Performance Goals are achieved. The Grantee will have no rights to any payment with respect to the RSUs until the RSUs have vested (each RSU that vests pursuant to this Section 4 or Sections 6 and 7 below, a “Vested RSU”). Prior to settlement, each RSU (whether or not a Vested RSU) represents an unfunded and unsecured obligation of the Company.
|
(b)
|
Settlement
. Except as otherwise provided in Sections 6, 7 and 10 below, the Company shall settle each Vested RSU by making a cash payment equal to the Fair Market Value of one Share per Vested RSU to the Grantee as soon as administratively practicable (and no later than 60 days) after the RSU’s Vesting Date. With respect to any Vested RSU, the Fair Market Value of one Share shall be determined as of the RSU’s Vesting Date, except as provided in Section 6. Notwithstanding the foregoing or any provision in Sections 6 or 7 to the contrary, if the Grantee elects to defer the settlement of the RSUs pursuant to the Company’s Executive Deferred Compensation Plan (or any other non-qualified deferred compensation plan providing for the ability to defer settlement of the RSUs), then the time, form and medium of payment with respect to any deferred RSUs shall be made pursuant to the terms and conditions of the Executive Deferred Compensation Plan (or similar non-qualified deferred compensation plan).
|
(a)
|
Death
. If, at least one month after the Grant date but prior to the Vesting Date, the Grantee dies, a prorated number of RSUs shall become Vested RSUs. For purposes of
|
(b)
|
Disability
. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated due to the Grantee’s Disability, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(b) by paying the Grantee a cash amount equal to the Fair Market Value of one Share for each Vested RSU as soon as administratively practicable after the last day of the Performance Period, but in any event, by March 15th of the year following the year in which the Performance Period ends. For purposes of this Section 6(b), the Fair Market Value shall be determined as of the last day of the Performance Period.
|
(c)
|
Termination without Cause
. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated by the Company or a Subsidiary without Cause, then a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(c) by paying the Grantee a cash amount equal to the Fair Market Value of one Share for each Vested RSU as soon as administratively practicable after the last day of the Performance Period, but in any event, by March 15th of the year following the year in which the Performance Period ends. For purposes of this Section 6(c), the Fair Market Value shall be determined as of the last day of the Performance Period.
|
(d)
|
Retirement
. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated due to the Grantee’s Retirement, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(d) by paying the Grantee a cash amount equal to the Fair Market Value of one Share for each Vested RSU as soon as administratively practicable after the last day of the Performance Period, but in any event, by March 15th of the year following the year in which the Performance Period ends. For purposes of this Section 6(d), the Fair Market Value shall be determined as of the last day of the Performance Period.
|
(e)
|
Change in Position
. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee is transferred to a position with the Company or a Subsidiary that is not an executive position, a Prorated Number of RSUs shall become Vested RSUs (as
|
(f)
|
Prorated Vesting
. If a Prorated Number of RSUs are to become Vested RSUs pursuant to Sections 6(b), (c), (d) or (e) above, then the number of shares that become Vested Shares (the “Prorated Number”) shall be determined as follows:
|
(g)
|
Release Requirement
. Notwithstanding any provision herein to the contrary, except as otherwise determined by the Company, in order for the Grantee to receive payment pursuant to the settlement of Vested RSUs under Sections 6(a), (b), (c), (d) or (e) above, the Grantee (or the administrator of his or her estate) must execute and deliver to the Company a general release and waiver of claims against the Company, its Subsidiaries and their directors, officers, employees, shareholders and other affiliates in a form that is satisfactory to the Company (the “Release”). The Release must become effective and irrevocable under applicable law no later than 60 days following the date of the Grantee’s death, termination of employment or transfer of position, as applicable.
|
(i)
|
in any case permitted by the terms of the Plan or this Agreement;
|
(ii)
|
except with respect to an adjustment made pursuant to the last paragraph of this Section 14(h), with the written consent of the Grantee; or
|
(iii)
|
without the consent of the Grantee if the amendment is either not materially adverse to the interests of the Grantee or is necessary or appropriate in the view of the Compensation Committee to conform with, or to take into account, applicable law, including either exemption from or compliance with any applicable tax law.
|
|
|
|
|
|
|
|
(Signature of the Grantee)
|
(Date)
|
|
|
|
|
|
|
|
[Form of Stock-Based]
|
|
Exhibit 10-58
|
4.
|
Vesting and Settlement of RSUs
.
|
(a)
|
Vesting
. Except as otherwise provided in Sections 6 and 7 below, if and to the extent the performance goals set forth on
Exhibit A
attached to this Agreement (the “Performance Goals”) are achieved during the performance period set forth on
Exhibit A
(the “Performance Period”), the RSUs will vest on March 1, 2019 (the “Vesting Date”), as long as the Grantee remains continuously employed by the Company or a Subsidiary until such Vesting Date. The number of RSUs that shall vest will range from 0% to 200% of the Target Number, as determined by the extent to which the Performance Goals are achieved. The Grantee will have no rights to the Shares underlying the RSUs until the RSUs have vested (each RSU that vests pursuant to this Section 4 or Sections 6 and 7 below, a “Vested RSU”). Prior to settlement, each RSU (whether or not a Vested RSU) represents an unfunded and unsecured obligation of the Company.
|
(b)
|
Settlement
. Except as otherwise provided in Sections 6, 7 and 11 below, the Company shall settle each Vested RSU by delivering one Share per Vested RSU to the Grantee as soon as administratively practicable (and no later than 60 days) after the RSU’s Vesting Date. Notwithstanding the foregoing or any provision in Sections 6 or 7 to the contrary, if the Grantee elects to defer the settlement of the RSUs pursuant to the Company’s Executive Deferred Compensation Plan (or any other non-qualified deferred compensation plan providing for the ability to defer settlement of the RSUs), then the time, form and medium of payment with respect to any deferred RSUs shall be made pursuant to the terms and conditions of the Executive Deferred Compensation Plan (or similar non-qualified deferred compensation plan). Fractional RSUs, if any, will be settled in cash.
|
(a)
|
Death
. If, at least one month after the Grant date but prior to the Vesting Date, the Grantee dies, a prorated number of RSUs shall become Vested RSUs. For purposes of this Section 6(a), the number of RSUs that shall become Vested RSUs due to the Grantee’s death shall be equal to (i) the Target Number of RSUs
multiplied by
(ii) a fraction, where the
|
(b)
|
Disability
. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated due to the Grantee’s Disability, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(b) by delivering to the Grantee one Share for each Vested RSU as soon as administratively practicable after the last day of the Performance Period, but in any event, by March 15th of the year following the year in which the Performance Period ends.
|
(c)
|
Termination without Cause
. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated by the Company or a Subsidiary without Cause, then a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(c) by delivering to the Grantee one Share for each Vested RSU as soon as administratively practicable after the last day of the Performance Period, but in any event, by March 15th of the year following the year in which the Performance Period ends.
|
(d)
|
Retirement
. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee’s employment is terminated due to the Grantee’s Retirement, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(d) by delivering to the Grantee one Share for each Vested RSU as soon as administratively practicable after the last day of the Performance Period, but in any event, by March 15th of the year following the year in which the Performance Period ends.
|
(e)
|
Change in Position
. If, at least one month after the Grant Date but prior to the Vesting Date, the Grantee is transferred to a position with the Company or a Subsidiary that is not an executive position, a Prorated Number of RSUs shall become Vested RSUs (as determined in Section 6(f) below). The Company shall settle any RSUs that become Vested RSUs under this Section 6(e) by delivering to the Grantee one Share for each Vested RSU as soon as administratively practicable after the last day of the Performance Period, but in any event, by March 15th of the year following the year in which the Performance Period ends.
|
(f)
|
Prorated Vesting
. If a Prorated Number of RSUs are to become Vested RSUs pursuant to Sections 6(b), (c), (d) or (e) above, then the number of shares that become Vested Shares (the “Prorated Number”) shall be determined as follows:
|
(g)
|
Release Requirement
. Notwithstanding any provision herein to the contrary, except as otherwise determined by the Company, in order for the Grantee to receive Shares pursuant to the settlement of Vested RSUs under Sections 6(a), (b), (c), (d) or (e) above, the Grantee (or the administrator of his or her estate) must execute and deliver to the Company a general release and waiver of claims against the Company, its Subsidiaries and their directors, officers, employees, shareholders and other affiliates in a form that is satisfactory to the Company (the “Release”). The Release must become effective and irrevocable under applicable law no later than 60 days following the date of the Grantee’s death, termination of employment or transfer of position, as applicable.
|
(i)
|
in any case permitted by the terms of the Plan or this Agreement;
|
(ii)
|
except with respect to an adjustment made pursuant to the last paragraph of this Section 15(h), with the written consent of the Grantee; or
|
(iii)
|
without the consent of the Grantee if the amendment is either not materially adverse to the interests of the Grantee or is necessary or appropriate in the view of the Compensation Committee to conform with, or to take into account, applicable law, including either exemption from or compliance with any applicable tax law.
|
|
|
|
|
|
|
|
(Signature of the Grantee)
|
(Date)
|
|
|
|
|
|
|
|
[Form of RS Award Agreement]
|
|
Exhibit 10-59
|
16.
|
Miscellaneous Provisions
.
|
(i)
|
in any case permitted by the terms of the Plan or this Agreement;
|
(ii)
|
with the written consent of the Grantee; or
|
(iii)
|
without the consent of the Grantee if the amendment is either not materially adverse to the interests of the Grantee or is necessary or appropriate in the view of the Compensation Committee to conform with, or to take into account, applicable law, including either exemption from or compliance with any applicable tax law.
|
|
|
|
|
|
|
|
(Signature of the Grantee)
|
(Date)
|
|
|
|
|
|
|
|
(1)
|
Includes the interest element of rentals where determinable plus 1/3 of rental expense where no readily defined interest element can be determined.
|
FIRSTENERGY CORP.
|
||||||
LIST OF SUBSIDIARIES OF THE REGISTRANT
|
||||||
AT DECEMBER 31, 2015
|
||||||
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FirstEnergy Nuclear Operating Company - Incorporated in Ohio
|
||||||
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FirstEnergy Service Company - Incorporated in Ohio
|
||||||
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FirstEnergy Solutions Corp. - Incorporated in Ohio
|
||||||
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FirstEnergy Transmission, LLC - Organized in Delaware
|
||||||
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FirstEnergy Ventures Corp. - Incorporated in Ohio
|
||||||
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Jersey Central Power & Light Company - Incorporated in New Jersey
|
||||||
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Metropolitan Edison Company - Incorporated in Pennsylvania
|
||||||
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Monongahela Power Company - Incorporated in Ohio
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Ohio Edison Company - Incorporated in Ohio
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Pennsylvania Electric Company - Incorporated in Pennsylvania
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The Cleveland Electric Illuminating Company - Incorporated in Ohio
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The Potomac Edison Company - Incorporated in Maryland
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The Toledo Edison Company - Incorporated in Ohio
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West Penn Power Company - Incorporated in Pennsylvania
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1.
|
I have reviewed this report on Form 10-K of FirstEnergy Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Charles E. Jones
|
|
|
Charles E. Jones
|
|
|
President and Chief Executive Officer
|
|
1.
|
I have reviewed this report on Form 10-K of FirstEnergy Solutions Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Donald R. Schneider
|
|
|
Donald R. Schneider
|
|
|
President
|
|
1.
|
I have reviewed this report on Form 10-K of FirstEnergy Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ James F. Pearson
|
|
|
James F. Pearson
|
|
|
Executive Vice President and Chief Financial Officer
|
|
1.
|
I have reviewed this report on Form 10-K of FirstEnergy Solutions Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ James F. Pearson
|
|
|
James F. Pearson
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
/s/ Charles E. Jones
|
|
|
Charles E. Jones
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
/s/ James F. Pearson
|
|
|
James F. Pearson
|
|
|
Chief Financial Officer
|
|
|
/s/ Donald R. Schneider
|
|
|
Donald R. Schneider
|
|
|
President
|
|
|
(Chief Executive Officer)
|
|
|
|
|
|
/s/ James F. Pearson
|
|
|
James F. Pearson
|
|
|
Chief Financial Officer
|
|