UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission		Registrant; State of Incorporation;		I.R.S. Employer
File Number		Address; and Telephone Number		Identification No.
333-21011		FIRSTENERGY CORP. (An Ohio Corporation) 76 South Main Street Akron, OH 44308 Telephone (800)736-3402		34-1843785
000-53742		FIRSTENERGY SOLUTIONS CORP. (An Ohio Corporation) c/o FirstEnergy Corp. 76 South Main Street Akron, OH 44308 Telephone (800)736-3402		31-1560186
1-2578		OHIO EDISON COMPANY (An Ohio Corporation) c/o FirstEnergy Corp. 76 South Main Street Akron, OH 44308 Telephone (800)736-3402		34-0437786
1-2323		THE CLEVELAND ELECTRIC ILLUMINATING COMPANY (An Ohio Corporation) c/o FirstEnergy Corp. 76 South Main Street Akron, OH 44308 Telephone (800)736-3402		34-0150020
1-3583		THE TOLEDO EDISON COMPANY (An Ohio Corporation) c/o FirstEnergy Corp. 76 South Main Street Akron, OH 44308 Telephone (800)736-3402		34-4375005
1-3141		JERSEY CENTRAL POWER & LIGHT COMPANY (A New Jersey Corporation) c/o FirstEnergy Corp. 76 South Main Street Akron, OH 44308 Telephone (800)736-3402		21-0485010
1-446		METROPOLITAN EDISON COMPANY (A Pennsylvania Corporation) c/o FirstEnergy Corp. 76 South Main Street Akron, OH 44308 Telephone (800)736-3402		23-0870160
1-3522		PENNSYLVANIA ELECTRIC COMPANY (A Pennsylvania Corporation) c/o FirstEnergy Corp. 76 South Main Street Akron, OH 44308 Telephone (800)736-3402		25-0718085

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ No o		FirstEnergy Corp., FirstEnergy Solutions Corp., Ohio Edison Company, The Cleveland Electric Illuminating Company, The Toledo Edison Company, Jersey Central Power & Light Company, Metropolitan Edison Company and Pennsylvania Electric Company

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes þ No o		FirstEnergy Corp.
Yes o No o		FirstEnergy Solutions Corp., Ohio Edison Company, The Cleveland Electric Illuminating Company, The Toledo Edison Company, Jersey Central Power & Light Company, Metropolitan Edison Company, and Pennsylvania Electric Company

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

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., Ohio Edison Company, The Cleveland Electric Illuminating Company, The Toledo Edison Company, Jersey Central Power & Light Company, Metropolitan Edison Company and Pennsylvania Electric Company
Smaller Reporting Company o		N/A

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes o No þ		FirstEnergy Corp., FirstEnergy Solutions Corp., Ohio Edison Company, The Cleveland Electric Illuminating Company, The Toledo Edison Company, Jersey Central Power & Light Company, Metropolitan Edison Company and Pennsylvania Electric Company

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

		OUTSTANDING
CLASS		AS OF OCTOBER 22, 2010
FirstEnergy Corp., $10 par value			304,835,407
FirstEnergy Solutions Corp., no par value			7
Ohio Edison Company, no par value			60
The Cleveland Electric Illuminating Company, no par value			67,930,743
The Toledo Edison Company, $5 par value			29,402,054
Jersey Central Power & Light Company, $10 par value			13,628,447
Metropolitan Edison Company, no par value			859,500
Pennsylvania Electric Company, $20 par value			4,427,577

FirstEnergy Corp. is the sole holder of FirstEnergy Solutions Corp., Ohio Edison Company, The Cleveland Electric Illuminating Company, The Toledo Edison Company, Jersey Central Power & Light Company, Metropolitan Edison Company and Pennsylvania Electric Company common stock.

 

 

This combined Form 10-Q is separately filed by FirstEnergy Corp., FirstEnergy Solutions Corp., Ohio Edison Company, The Cleveland Electric Illuminating Company, The Toledo Edison Company, Jersey Central Power & Light Company, Metropolitan Edison Company and Pennsylvania Electric Company. Information contained herein relating to any individual registrant is filed by such registrant on its own behalf. No registrant makes any representation as to information relating to any other registrant, except that information relating to any of the FirstEnergy subsidiary registrants is also attributed to FirstEnergy Corp.

FirstEnergy Web Site

Each of the registrants’ Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed with or furnished to the SEC pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are also made available free of charge on or through FirstEnergy’s Internet web site at www.firstenergycorp.com.

These reports are posted on the web site as soon as reasonably practicable after they are electronically filed with the SEC. Additionally, the registrants routinely post important information on FirstEnergy’s Internet web site and recognize FirstEnergy’s Internet web site as channel of distribution to reach public investors and as a means of disclosing material non-public information for complying with disclosure obligations under SEC Regulation FD. Information contained on FirstEnergy’s Internet web site shall not be deemed incorporated into, or to be part of, this report.

OMISSION OF CERTAIN INFORMATION

FirstEnergy Solutions Corp., Ohio Edison Company, The Cleveland Electric Illuminating Company, The Toledo Edison Company, Jersey Central Power & Light Company, Metropolitan Edison Company and Pennsylvania Electric Company meet the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and are therefore filing this Form 10-Q with the reduced disclosure format specified in General Instruction H(2) to Form 10-Q.

Forward-Looking Statements: This Form 10-Q includes forward-looking statements based on information currently available to management. Such statements are subject to certain risks and uncertainties. These statements include declarations regarding management’s intents, beliefs and current expectations. These statements typically contain, but are not limited to, the terms “anticipate,” “potential,” “expect,” “believe,” “estimate” and similar words. Forward-looking statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

Actual results may differ materially due to:

•

The speed and nature of increased competition in the electric utility industry and legislative and regulatory changes affecting how generation rates will be determined following the expiration of existing rate plans in Pennsylvania.

•

The impact of the regulatory process on the pending matters in Ohio, Pennsylvania and New Jersey.

•

Business and regulatory impacts from ATSI’s realignment into PJM.

•

Economic or weather conditions affecting future sales and margins.

•

Changes in markets for energy services.

•

Changing energy and commodity market prices and availability.

•

Financial derivative reforms that could increase our liquidity needs and collateral costs.

•

Replacement power costs being higher than anticipated or inadequately hedged.

•

The continued ability of FirstEnergy’s regulated utilities to recover regulatory assets or increased costs.

•

Operation and maintenance costs being higher than anticipated.

•

Other legislative and regulatory changes, and revised environmental requirements, including possible GHG emission and coal combustion residual regulations.

•

The potential impacts of the proposed rules promulgated by the EPA on July 6, 2010, in response to the U.S. Court of Appeals’ July 11, 2008 decision requiring revisions to the CAIR rules or any final laws, rules or regulations that may ultimately replace CAIR.

•

The uncertainty of the timing and amounts of the capital expenditures needed to, among other things, implement the Air Quality Compliance Plan (including that such amounts could be higher than anticipated or that certain generating units may need to be shut down) or levels of emission reductions related to the Consent Decree resolving the NSR litigation or other potential similar regulatory initiatives or actions.

•

Adverse regulatory or legal decisions and outcomes (including, but not limited to, the revocation of necessary licenses or operating permits and oversight) by the NRC.

•

Ultimate resolution of Met-Ed’s and Penelec’s TSC filings with the PPUC.

•

The continuing availability of generating units and their ability to operate at or near full capacity.

•

The ability to comply with applicable state and federal reliability standards and energy efficiency mandates.

•

The ability to accomplish or realize anticipated benefits from strategic goals (including employee workforce initiatives).

•

The ability to improve electric commodity margins and to experience growth in the distribution business.

•

The changing market conditions that could affect the value of assets held in the registrants’ nuclear decommissioning trusts, pension trusts and other trust funds, and cause FirstEnergy to make additional contributions sooner, or in amounts that are larger than currently anticipated.

•

The ability to access the public securities and other capital and credit markets in accordance with FirstEnergy’s financing plan and the cost of such capital.

•

Changes in general economic conditions affecting the registrants.

•

The state of the capital and credit markets affecting the registrants.

•

Interest rates and any actions taken by credit rating agencies that could negatively affect the registrants’ access to financing or their costs and increase requirements to post additional collateral to support outstanding commodity positions, LOCs and other financial guarantees.

•

The state of the national and regional economies and associated impacts on the registrants’ major industrial and commercial customers.

•

Issues concerning the soundness of financial institutions and counterparties with which the registrants do business.

•

The expected timing and likelihood of completion of the proposed merger with Allegheny Energy, Inc., including the timing, receipt and terms and conditions of any required governmental and regulatory approvals of the proposed merger that could reduce anticipated benefits or cause the parties to abandon the merger, the diversion of management’s time and attention from FirstEnergy’s ongoing business during this time period, the ability to maintain relationships with customers, employees or suppliers as well as the ability to successfully integrate the businesses and realize cost savings and any other synergies and the risk that the credit ratings of the combined company or its subsidiaries may be different from what the companies expect.

•

The risks and other factors discussed from time to time in the registrants’ SEC filings, and other similar factors.

The foregoing review of factors should not be construed as exhaustive. New factors emerge from time to time, and it is not possible for management to predict all such factors, nor assess the impact of any such factor on the registrants’ business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statements. A security rating is not a recommendation to buy, sell or hold securities that may be subject to revision or withdrawal at any time by the assigning rating organization. Each rating should be evaluated independently of any other rating. The registrants expressly disclaim any current intention to update any forward-looking statements contained herein as a result of new information, future events or otherwise.

TABLE OF CONTENTS

		Page
Glossary of Terms			iii-v
Item 1. Financial Statements
FirstEnergy Corp.
Consolidated Statements of Income			1
Consolidated Statements of Comprehensive Income			2
Consolidated Balance Sheets			3
Consolidated Statements of Cash Flows			4
FirstEnergy Solutions Corp.
Consolidated Statements of Income and Comprehensive Income			5
Consolidated Balance Sheets			6
Consolidated Statements of Cash Flows			7
Ohio Edison Company
Consolidated Statements of Income and Comprehensive Income			8
Consolidated Balance Sheets			9
Consolidated Statements of Cash Flows			10
The Cleveland Electric Illuminating Company
Consolidated Statements of Income (Loss) and Comprehensive Income			11
Consolidated Balance Sheets			12
Consolidated Statements of Cash Flows			13
The Toledo Edison Company
Consolidated Statements of Income and Comprehensive Income			14
Consolidated Balance Sheets			15
Consolidated Statements of Cash Flows			16
Jersey Central Power & Light Company
Consolidated Statements of Income and Comprehensive Income			17
Consolidated Balance Sheets			18
Consolidated Statements of Cash Flows			19
Metropolitan Edison Company
Consolidated Statements of Income and Comprehensive Income			20
Consolidated Balance Sheets			21
Consolidated Statements of Cash Flows			22
Pennsylvania Electric Company
Consolidated Statements of Income and Comprehensive Income			23
Consolidated Balance Sheets			24
Consolidated Statements of Cash Flows			25

TABLE OF CONTENTS (Cont’d)

		Page
Combined Notes To Consolidated Financial Statements			26
Item 2. Management’s Discussion and Analysis of Registrant and Subsidiaries			63
Management’s Narrative Analysis of Results of Operations
FirstEnergy Solutions Corp.			99
Ohio Edison Company			102
The Cleveland Electric Illuminating Company			104
The Toledo Edison Company			106
Jersey Central Power & Light Company			108
Metropolitan Edison Company			110
Pennsylvania Electric Company			112
Item 3. Quantitative and Qualitative Disclosures About Market Risk			114
Item 4. Controls and Procedures — FirstEnergy			114
Item 4T. Controls and Procedures — FES, OE, CEI, TE, JCP&L, Met-Ed and Penelec			114
Part II. Other Information
Item 1. Legal Proceedings			114
Item 1A. Risk Factors			114
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			114
Item 5. Other Information			114
Item 6. Exhibits			115
Exhibit 10.1
Exhibit 10.2
Exhibit 10.3
Exhibit 12
Exhibit 31.1
Exhibit 31.2
Exhibit 32
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT

GLOSSARY OF TERMS

The following abbreviations and acronyms are used in this report to identify FirstEnergy Corp. and its current and former subsidiaries:

ATSI		American Transmission Systems, Incorporated, owns and operates transmission facilities
CEI		The Cleveland Electric Illuminating Company, an Ohio electric utility operating subsidiary
FENOC		FirstEnergy Nuclear Operating Company, operates nuclear generating facilities
FES		FirstEnergy Solutions Corp., provides energy-related products and services
FESC		FirstEnergy Service Company, provides legal, financial and other corporate support services
FEV		FirstEnergy Ventures Corp., invests in certain unregulated enterprises and business ventures
FGCO		FirstEnergy Generation Corp., owns and operates non-nuclear generating facilities
FirstEnergy		FirstEnergy Corp., a public utility holding company
Global Rail		A joint venture between FirstEnergy Ventures Corp. and WMB Loan Ventures II LLC, that owns coal transportation operations near Roundup, Montana
GPU		GPU, Inc., former parent of JCP&L, Met-Ed and Penelec, which merged with FirstEnergy on November 7, 2001
JCP&L		Jersey Central Power & Light Company, a New Jersey electric utility operating subsidiary
Met-Ed		Metropolitan Edison Company, a Pennsylvania electric utility operating subsidiary
NGC		FirstEnergy Nuclear Generation Corp., owns nuclear generating facilities
OE		Ohio Edison Company, an Ohio electric utility operating subsidiary
Ohio Companies		CEI, OE and TE
Penelec		Pennsylvania Electric Company, a Pennsylvania electric utility operating subsidiary
Penn		Pennsylvania Power Company, a Pennsylvania electric utility operating subsidiary of OE
Pennsylvania Companies		Met-Ed, Penelec and Penn
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		A joint venture between FirstEnergy Ventures Corp. and WMB Loan Ventures LLC, that owns mining operations near Roundup, Montana
TE		The Toledo Edison Company, an Ohio electric utility operating subsidiary
Utilities		OE, CEI, TE, Penn, JCP&L, Met-Ed and Penelec

The following abbreviations and acronyms are used to identify frequently used terms in this report:

ALJ		Administrative Law Judge
AOCL		Accumulated Other Comprehensive Loss
AQC		Air Quality Control
ARO		Asset Retirement Obligation
BGS		Basic Generation Service
CAA		Clean Air Act
CAIR		Clean Air Interstate Rule
CAMR		Clean Air Mercury Rule
CATR		Clean Air Transport Rule
CBP		Competitive Bid Process
CO2		Carbon Dioxide
CTC		Competitive Transition Charge
DOE		United States Department of Energy
DOJ		United States Department of Justice
DPA		Department of the Public Advocate, Division of Rate Counsel (New Jersey)
EE&C		Energy Efficiency and Conservation
EMP		Energy Master Plan
EPA		United States Environmental Protection Agency

GLOSSARY OF TERMS, Cont’d.

ESP		Electric Security Plan
FASB		Financial Accounting Standards Board
FERC		Federal Energy Regulatory Commission
FMB		First Mortgage Bond
FPA		Federal Power Act
FRR		Fixed Resource Requirement
GAAP		Generally Accepted Accounting Principles in the United States
GHG		Greenhouse Gases
IRS		Internal Revenue Service
JOA		Joint Operating Agreement
kV		Kilovolt
KWH		Kilowatt-hours
LED		Light-Emitting Diode
LOC		Letter of Credit
MACT		Maximum Achievable Control Technology
MDPSC		Maryland Public Service Commission
MEIUG		Met-Ed Industrial users Group
MISO		Midwest Independent Transmission System Operator, Inc.
Moody’s		Moody’s Investors Service, Inc.
MRO		Market Rate Offer
MTEP		MISO Regional Transmission Expansion Plan
MW		Megawatts
MWH		Megawatt-hours
NAAQS		National Ambient Air Quality Standards
NERC		North American Electric Reliability Corporation
NJBPU		New Jersey Board of Public Utilities
NNSR		Non-Attainment New Source Review
NOAC		Northwest Ohio Aggregation Coalition
NOPEC		Northeast Ohio Public Energy Council
NOV		Notice of Violation
NOX		Nitrogen Oxide
NRC		Nuclear Regulatory Commission
NSR		New Source Review
NUG		Non-Utility Generation
NUGC		Non-Utility Generation Charge
NYSEG		New York State Electric and Gas
OCC		Ohio Consumers’ Counsel
OCI		Other Comprehensive Income
OPEB		Other Post-Employment Benefits
OVEC		Ohio Valley Electric Corporation
PCRB		Pollution Control Revenue Bond
PICA		Pennsylvania Intergovernmental Cooperation Authority
PJM		PJM Interconnection L. L. C.
POLR		Provider of Last Resort; an electric utility’s obligation to provide generation service to customers whose alternative supplier fails to deliver service
PPUC		Pennsylvania Public Utility Commission
PSCWV		Public Service Commission of West Virginia
PSA		Power Supply Agreement
PSD		Prevention of Significant Deterioration
PUCO		Public Utilities Commission of Ohio
RECs		Renewable Energy Credits
RFP		Request for Proposal
RTEP		Regional Transmission Expansion Plan
RTC		Regulatory Transition Charge
RTO		Regional Transmission Organization
S&P		Standard & Poor’s Ratings Service
SB221		Amended Substitute Senate Bill 221
SBC		Societal Benefits Charge

GLOSSARY OF TERMS, Cont’d.

SEC		U.S. Securities and Exchange Commission
SIP		State Implementation Plan(s) Under the Clean Air Act
SNCR		Selective Non-Catalytic Reduction
SO2		Sulfur Dioxide
TBC		Transition Bond Charge
TMI-2		Three Mile Island Unit 2
TSC		Transmission Service Charge
VIE		Variable Interest Entity
VSCC		Virginia State Corporation Commission

FIRSTENERGY CORP.

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

		Three Months								Nine Months
		Ended September 30								Ended September 30
		2010				2009				2010				2009
		(In millions, except per share amounts)
REVENUES:
Electric utilities		$	2,757			$	2,940			$	7,673			$	8,751
Unregulated businesses			936				468				2,449				1,262
Total revenues*			3,693				3,408				10,122				10,013
EXPENSES:
Fuel			400				302				1,084				890
Purchased power			1,284				1,313				3,574				3,480
Other operating expenses			738				665				2,112				2,103
Provision for depreciation			182				188				565				550
Amortization of regulatory assets			176				261				549				903
Deferral of new regulatory assets			—				—				—				(136	)
General taxes			206				192				587				587
Impairment of long-lived assets			292				—				294				—
Total expenses			3,278				2,921				8,765				8,377
OPERATING INCOME			415				487				1,357				1,636
OTHER INCOME (EXPENSE):
Investment income			46				191				93				207
Interest expense			(208	)			(355	)			(628	)			(755	)
Capitalized interest			41				35				122				96
Total other expense			(121	)			(129	)			(413	)			(452	)
INCOME BEFORE INCOME TAXES			294				358				944				1,184
INCOME TAXES			119				128				364				430
NET INCOME			175				230				580				754
Loss attributable to noncontrolling interest			(4	)			(4	)			(19	)			(14	)
EARNINGS AVAILABLE TO FIRSTENERGY CORP.		$	179			$	234			$	599			$	768
BASIC EARNINGS PER SHARE OF COMMON STOCK		$	0.59			$	0.77			$	1.97			$	2.52
WEIGHTED AVERAGE NUMBER OF BASIC SHARES OUTSTANDING			304				304				304				304
DILUTED EARNINGS PER SHARE OF COMMON STOCK		$	0.59			$	0.77			$	1.96			$	2.51
WEIGHTED AVERAGE NUMBER OF DILUTED SHARES OUTSTANDING			305				306				305				306
DIVIDENDS DECLARED PER SHARE OF COMMON STOCK		$	1.10			$	1.10			$	1.65			$	1.65

The accompanying Combined Notes to the Consolidated Financial Statements are an integral part of these financial statements.

FIRSTENERGY CORP.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)

		Three Months								Nine Months
		Ended September 30								Ended September 30
		2010				2009				2010				2009
		(In millions)
NET INCOME		$	175			$	230			$	580			$	754
OTHER COMPREHENSIVE INCOME (LOSS):
Pension and other postretirement benefits			17				(480	)			47				24
Unrealized gain on derivative hedges			6				19				16				57
Change in unrealized gain on available-for-sale securities			20				(108	)			32				(76	)
Other comprehensive income (loss)			43				(569	)			95				5
Income tax expense (benefit) related to other comprehensive income			14				(216	)			30				26
Other comprehensive income (loss), net of tax			29				(353	)			65				(21	)
COMPREHENSIVE INCOME (LOSS)			204				(123	)			645				733
COMPREHENSIVE LOSS ATTRIBUTABLE TO NONCONTROLLING INTEREST			(4	)			(4	)			(19	)			(14	)
COMPREHENSIVE INCOME (LOSS) AVAILABLE TO FIRSTENERGY CORP.		$	208			$	(119	)		$	664			$	747

The accompanying Combined Notes to the Consolidated Financial Statements are an integral part of these financial statements.

FIRSTENERGY CORP.

CONSOLIDATED BALANCE SHEETS
(Unaudited)

		September 30,				December 31,
		2010				2009
		(In millions)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	632			$	874
Receivables-
Customers (less allowances of $39 million in 2010 and $33 million in 2009)			1,414				1,244
Other (less allowances of $7 million in 2010 and 2009)			150				153
Materials and supplies, at average cost			652				647
Prepaid taxes			291				248
Other			252				154
			3,391				3,320
PROPERTY, PLANT AND EQUIPMENT:
In service			27,590				27,826
Less — Accumulated provision for depreciation			11,206				11,397
			16,384				16,429
Construction work in progress			3,154				2,735
			19,538				19,164
INVESTMENTS:
Nuclear plant decommissioning trusts			1,965				1,859
Investments in lease obligation bonds			486				543
Other			564				621
			3,015				3,023
DEFERRED CHARGES AND OTHER ASSETS:
Goodwill			5,575				5,575
Regulatory assets			2,246				2,356
Power purchase contract asset			116				200
Other			826				666
			8,763				8,797
		$	34,707			$	34,304
LIABILITIES AND CAPITALIZATION
CURRENT LIABILITIES:
Currently payable long-term debt		$	1,590			$	1,834
Short-term borrowings			1,000				1,181
Accounts payable			813				829
Accrued taxes			230				314
Other			1,339				1,130
			4,972				5,288
CAPITALIZATION:
Common stockholders’ equity-
Common stock, $0.10 par value, authorized 375,000,000 shares- 304,835,407 shares outstanding			31				31
Other paid-in capital			5,445				5,448
Accumulated other comprehensive loss			(1,350	)			(1,415	)
Retained earnings			4,591				4,495
Total common stockholders’ equity			8,717				8,559
Noncontrolling interest			(26	)			(2	)
Total equity			8,691				8,557
Long-term debt and other long-term obligations			12,104				11,908
			20,795				20,465
NONCURRENT LIABILITIES:
Accumulated deferred income taxes			2,824				2,468
Retirement benefits			1,541				1,534
Asset retirement obligations			1,394				1,425
Deferred gain on sale and leaseback transaction			968				993
Power purchase contract liability			756				643
Lease market valuation liability			228				262
Other			1,229				1,226
			8,940				8,551
COMMITMENTS, GUARANTEES AND CONTINGENCIES (Note 9)
		$	34,707			$	34,304

The accompanying Combined Notes to the Consolidated Financial Statements are an integral part of these financial statements.

FIRSTENERGY CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

		Nine Months Ended
		September 30
		2010				2009
		(In millions)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income		$	580			$	754
Adjustments to reconcile net income to net cash from operating activities-
Provision for depreciation			565				550
Amortization of regulatory assets			549				903
Deferral of new regulatory assets			—				(136	)
Nuclear fuel and lease amortization			123				92
Deferred purchased power and other costs			(192	)			(235	)
Deferred income taxes and investment tax credits, net			259				421
Impairment of long-lived assets			294				—
Investment impairment			21				39
Gain on investment securities held in trusts			(39	)			(172	)
Loss on debt redemption			—				142
Deferred rents and lease market valuation liability			(21	)			(20	)
Accrued compensation and retirement benefits			48				20
Interest rate swap transactions			129				—
Commodity derivative transactions, net			(40	)			26
Cash collateral paid, net			(54	)			(85	)
Pension trust contribution			—				(500	)
Decrease (increase) in operating assets-
Receivables			(172	)			78
Materials and supplies			(6	)			30
Prepayments and other current assets			(4	)			(349	)
Increase (decrease) in operating liabilities-
Accounts payable			(16	)			(103	)
Accrued taxes			(18	)			(97	)
Accrued interest			63				121
Other			4				(15	)
Net cash provided from operating activities			2,073				1,464
CASH FLOWS FROM FINANCING ACTIVITIES:
New Financing-
Long-term debt			251				4,151
Redemptions and Repayments-
Long-term debt			(422	)			(2,213	)
Short-term borrowings, net			(171	)			(764	)
Common stock dividend payments			(503	)			(503	)
Other			(25	)			(54	)
Net cash provided from (used for) financing activities			(870	)			617
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions			(1,467	)			(1,575	)
Proceeds from asset sales			117				19
Sales of investment securities held in trusts			2,577				3,039
Purchases of investment securities held in trusts			(2,610	)			(3,101	)
Customer acquisition costs			(110	)			—
Cash investments			56				(4	)
Restricted funds for debt redemption			—				(150	)
Other			(8	)			(16	)
Net cash used for investing activities			(1,445	)			(1,788	)
Net change in cash and cash equivalents			(242	)			293
Cash and cash equivalents at beginning of period			874				545
Cash and cash equivalents at end of period		$	632			$	838

The accompanying Combined Notes to the Consolidated Financial Statements are an integral part of these financial statements.

FIRSTENERGY SOLUTIONS CORP.

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(Unaudited)

		Three Months Ended								Nine Months Ended
		September 30								September 30
		2010				2009				2010				2009
		(In thousands)
REVENUES:
Electric sales to affiliates		$	599,695			$	616,300			$	1,745,542			$	2,348,741
Electric sales to non-affiliates			904,752				443,819				2,302,240				928,944
Other			49,230				44,453				208,662				394,145
Total revenues			1,553,677				1,104,572				4,256,444				3,671,830
EXPENSES:
Fuel			391,087				294,693				1,061,719				871,160
Purchased power from affiliates			116,381				35,290				246,232				149,746
Purchased power from non-affiliates			411,084				205,200				1,160,119				551,155
Other operating expenses			309,793				305,935				916,366				891,555
Provision for depreciation			59,298				66,041				185,535				192,962
General taxes			21,804				21,700				70,822				66,361
Impairment of long-lived assets			291,934				—				293,767				—
Total expenses			1,601,381				928,859				3,934,560				2,722,939
OPERATING INCOME (LOSS)			(47,704	)			175,713				321,884				948,891
OTHER INCOME (EXPENSE):
Investment income			29,895				158,857				43,978				135,723
Miscellaneous income			4,765				2,804				10,468				12,840
Interest expense — affiliates			(2,497	)			(2,209	)			(7,362	)			(8,503	)
Interest expense — other			(49,544	)			(42,187	)			(150,560	)			(90,985	)
Capitalized interest			22,955				17,869				66,550				41,975
Total other income (expense)			5,574				135,134				(36,926	)			91,050
INCOME (LOSS) BEFORE INCOME TAXES			(42,130	)			310,847				284,958				1,039,941
INCOME TAXES			(5,404	)			111,164				107,833				372,175
NET INCOME (LOSS)			(36,726	)			199,683				177,125				667,766
OTHER COMPREHENSIVE INCOME (LOSS):
Pension and other postretirement benefits			886				(61,085	)			(8,063	)			13,604
Unrealized gain on derivative hedges			2,818				790				7,109				26,847
Change in unrealized gain on available-for-sale securities			17,445				(89,401	)			28,533				(51,374	)
Other comprehensive income (loss)			21,149				(149,696	)			27,579				(10,923	)
Income taxes related to other comprehensive income (loss)			7,694				(58,883	)			9,898				(3,549	)
Other comprehensive income (loss), net of tax			13,455				(90,813	)			17,681				(7,374	)
TOTAL COMPREHENSIVE INCOME (LOSS)		$	(23,271	)		$	108,870			$	194,806			$	660,392

The accompanying Combined Notes to the Consolidated Financial Statements are an integral part of these financial statements.

FIRSTENERGY SOLUTIONS CORP.

CONSOLIDATED BALANCE SHEETS
(Unaudited)

		September 30,				December 31,
		2010				2009
		(In thousands)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	10			$	12
Receivables-
Customers (less accumulated provisions of $16,277,000 and $12,041,000, respectively, for uncollectible accounts)			325,265				195,107
Associated companies			269,986				318,561
Other (less accumulated provisions of $6,702,000 for uncollectible accounts)			57,407				51,872
Notes receivable from associated companies			501,648				805,103
Materials and supplies, at average cost			554,043				539,541
Prepayments and other			204,065				107,782
			1,912,424				2,017,978
PROPERTY, PLANT AND EQUIPMENT:
In service			9,663,264				10,357,632
Less — Accumulated provision for depreciation			4,114,381				4,531,158
			5,548,883				5,826,474
Construction work in progress			2,736,635				2,423,446
			8,285,518				8,249,920
INVESTMENTS:
Nuclear plant decommissioning trusts			1,158,376				1,088,641
Other			7,400				22,466
			1,165,776				1,111,107
DEFERRED CHARGES AND OTHER ASSETS:
Accumulated deferred income tax benefits			3,357				86,626
Customer intangibles			127,420				16,566
Goodwill			24,248				24,248
Property taxes			50,125				50,125
Unamortized sale and leaseback costs			61,934				72,553
Other			164,332				121,665
			431,416				371,783
		$	11,795,134			$	11,750,788
LIABILITIES AND CAPITALIZATION
CURRENT LIABILITIES:
Currently payable long-term debt		$	1,396,792			$	1,550,927
Short-term borrowings-
Associated companies			9,642				9,237
Other			100,000				100,000
Accounts payable-
Associated companies			472,018				466,078
Other			204,928				245,363
Accrued taxes			59,422				83,158
Other			430,824				359,057
			2,673,626				2,813,820
CAPITALIZATION:
Common stockholders’ equity-
Common stock, without par value, authorized 750 shares, 7 shares outstanding			1,490,010				1,468,423
Accumulated other comprehensive loss			(85,320	)			(103,001	)
Retained earnings			2,326,274				2,149,149
Total common stockholders’ equity			3,730,964				3,514,571
Long-term debt and other long-term obligations			2,819,150				2,711,652
			6,550,114				6,226,223
NONCURRENT LIABILITIES:
Deferred gain on sale and leaseback transaction			967,583				992,869
Accumulated deferred investment tax credits			55,267				58,396
Asset retirement obligations			877,522				921,448
Retirement benefits			228,779				204,035
Property taxes			50,125				50,125
Lease market valuation liability			228,119				262,200
Other			163,999				221,672
			2,571,394				2,710,745
COMMITMENTS, GUARANTEES AND CONTINGENCIES (Note 9)
		$	11,795,134			$	11,750,788

The accompanying Combined Notes to the Consolidated Financial Statements are an integral part of these financial statements.

FIRSTENERGY SOLUTIONS CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

		Nine Months Ended
		September 30
		2010				2009
		(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income		$	177,125			$	667,766
Adjustments to reconcile net income to net cash from operating activities-
Provision for depreciation			185,535				192,962
Nuclear fuel and lease amortization			126,071				94,244
Deferred rents and lease market valuation liability			(41,493	)			(40,143	)
Deferred income taxes and investment tax credits, net			96,152				268,812
Impairment of long-lived assets			293,767				—
Investment impairment			21,089				36,169
Accrued compensation and retirement benefits			15,887				5,860
Commodity derivative transactions, net			(40,048	)			25,794
Gain on asset sales			(2,213	)			(9,832	)
Gain on investment securities held in trusts			(34,292	)			(154,723	)
Cash collateral, net			(53,900	)			(92,618	)
Decrease (increase) in operating assets-
Receivables			(91,134	)			(55,774	)
Materials and supplies			(15,324	)			38,543
Prepayments and other current assets			36,004				(35,315	)
Increase (decrease) in operating liabilities-
Accounts payable			(50,114	)			(72,181	)
Accrued taxes			(8,404	)			23,846
Accrued interest			(14,130	)			31,770
Other			23,349				(43,369	)
Net cash provided from operating activities			623,927				881,811
CASH FLOWS FROM FINANCING ACTIVITIES:
New Financing-
Long-term debt			249,520				2,356,762
Short-term borrowings, net			405				—
Redemptions and Repayments-
Long-term debt			(296,339	)			(618,213	)
Short-term borrowings, net			—				(1,164,823	)
Other			(798	)			(20,006	)
Net cash provided from (used for) financing activities			(47,212	)			553,720
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions			(801,238	)			(842,600	)
Proceeds from asset sales			117,213				16,129
Sales of investment securities held in trusts			1,478,086				2,152,717
Purchases of investment securities held in trusts			(1,511,273	)			(2,175,135	)
Loans from (to) associated companies, net			303,455				(298,841	)
Customer acquisition costs			(110,073	)			—
Leasehold improvement payments to associated companies			(51,204	)			—
Other			(1,683	)			(20,882	)
Net cash used for investing activities			(576,717	)			(1,168,612	)
Net change in cash and cash equivalents			(2	)			266,919
Cash and cash equivalents at beginning of period			12				39
Cash and cash equivalents at end of period		$	10			$	266,958