UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2011

OR

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

For the transition period from                      to                     

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
1-2578		OHIO EDISON COMPANY		34-0437786
		(An Ohio Corporation)
		c/o FirstEnergy Corp.
		76 South Main Street
		Akron, OH 44308
		Telephone (800)736-3402
1-2323		THE CLEVELAND ELECTRIC ILLUMINATING COMPANY		34-0150020
		(An Ohio Corporation)
		c/o FirstEnergy Corp.
		76 South Main Street
		Akron, OH 44308
		Telephone (800)736-3402
1-3583		THE TOLEDO EDISON COMPANY		34-4375005
		(An Ohio Corporation)
		c/o FirstEnergy Corp.
		76 South Main Street
		Akron, OH 44308
		Telephone (800)736-3402
1-3141		JERSEY CENTRAL POWER & LIGHT COMPANY		21-0485010
		(A New Jersey Corporation)
		c/o FirstEnergy Corp.
		76 South Main Street
		Akron, OH 44308
		Telephone (800)736-3402
1-446		METROPOLITAN EDISON COMPANY		23-0870160
		(A Pennsylvania Corporation)
		c/o FirstEnergy Corp.
		76 South Main Street
		Akron, OH 44308
		Telephone (800)736-3402
1-3522		PENNSYLVANIA ELECTRIC COMPANY		25-0718085
		(A Pennsylvania Corporation)
		c/o FirstEnergy Corp.
		76 South Main Street
		Akron, OH 44308
		Telephone (800)736-3402

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., 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 JULY 29, 2011
FirstEnergy Corp., $.10 par value			418,216,437
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			740,905
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 a 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.

•

The impact of the regulatory process on the pending matters in the various states in which we do business including, but not limited to, matters related to rates.

•

The status of the PATH project in light of PJM’s direction to suspend work on the project pending review of its planning process, its re-evaluation of the need for the project and the uncertainty of the timing and amounts of any related capital expenditures.

•

Business and regulatory impacts from ATSI’s realignment into PJM Interconnection, L.L.C.

•

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.

•

The continued ability of FirstEnergy’s regulated utilities to collect transition and other costs.

•

Operation and maintenance costs being higher than anticipated.

•

Other legislative and regulatory changes, and revised environmental requirements, including possible GHG emission, water intake and coal combustion residual regulations, the potential impacts of any laws, rules or regulations that ultimately replace CAIR, including the Cross-State Air Pollution Rule (CSAPR), and the effects of the EPA’s recently released MACT proposal to establish certain mercury and other emission standards for electric generating units.

•

The uncertainty of the timing and amounts of the capital expenditures that may arise in connection with any NSR litigation or potential regulatory initiatives or rulemakings (including that such expenditures could result in our decision to shut down or idle certain generating units).

•

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 including as a result of the incident at Japan’s Fukushima Daiichi Nuclear Plant).

•

Adverse legal decisions and outcomes related to Met-Ed’s and Penelec’s ability to recover certain transmission costs through their transmission service charge riders.

•

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

•

Replacement power costs being higher than anticipated or inadequately hedged.

•

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

•

Changes in customers’ demand for power, including but not limited to, changes resulting from the implementation of state and federal energy efficiency mandates.

•

The ability to accomplish or realize anticipated benefits from strategic goals.

•

Efforts and our ability to improve electric commodity margins and the impact of, among other factors, the increased cost of coal and coal transportation on such margins.

•

The ability to experience growth in the distribution business.

•

The changing market conditions that could affect the value of assets held in FirstEnergy’s nuclear decommissioning trusts, pension trusts and other trust funds, and cause us 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, the cost of such capital and overall condition of the capital and credit markets affecting FirstEnergy and its subsidiaries.

•

Changes in general economic conditions affecting FirstEnergy and its subsidiaries.

•

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

•

The continuing uncertainty of the national and regional economy and its impact on FirstEnergy’s and its subsidiaries’ major industrial and commercial customers.

•

Issues concerning the soundness of financial institutions and counterparties with which FirstEnergy and its subsidiaries do business.

•

Issues arising from the recently completed merger of FirstEnergy and Allegheny Energy, Inc. and the ongoing coordination of their combined operations including FirstEnergy’s 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.

Dividends declared from time to time on FirstEnergy’s common stock during any annual period may in aggregate vary from the indicated amount due to circumstances considered by FirstEnergy’s Board of Directors at the time of the actual declarations. A security rating is not a recommendation to buy, or hold securities and is subject to revision or withdrawal at any time by the assigning rating agency. Each rating should be evaluated independently of any other rating.

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. 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
Part I. Financial Information
Glossary of Terms			iii
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 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			27
Item 2. Management’s Discussion and Analysis of Registrant and Subsidiaries			84
Management’s Narrative Analysis of Results of Operations
FirstEnergy Solutions Corp.			131
Ohio Edison Company			134
The Cleveland Electric Illuminating Company			136
The Toledo Edison Company			138
Jersey Central Power & Light Company			140
Metropolitan Edison Company			142
Pennsylvania Electric Company			144
Item 3. Quantitative and Qualitative Disclosures About Market Risk			146
Item 4. Controls and Procedures — FirstEnergy			146
Part II. Other Information
Item 1. Legal Proceedings			147
Item 1A. Risk Factors			147
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			147
Item 5. Other Information			147
Item 6. Exhibits			148
Exhibit 10.1
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:

AE		Allegheny Energy, Inc., a Maryland utility holding company that merged with a subsidiary of FirstEnergy on February 25, 2011
AESC		Allegheny Energy Service Corporation, a subsidiary of AE
AE Supply		Allegheny Energy Supply Company LLC, an unregulated generation subsidiary of AE
AET		Allegheny Energy Transmission, LLC, a parent of TrAIL and PATH
AGC		Allegheny Generating Company, a generation subsidiary of AE
Allegheny		Allegheny Energy, Inc., together with its consolidated subsidiaries
AVE		Allegheny Ventures, Inc.
ATSI		American Transmission Systems, Incorporated, which owns and operates transmission facilities
CEI		The Cleveland Electric Illuminating Company, an Ohio electric utility operating subsidiary
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
FEV		FirstEnergy Ventures Corp., which invests in certain unregulated enterprises and business ventures
FGCO		FirstEnergy Generation Corp., which owns and operates non-nuclear generating facilities
FirstEnergy		FirstEnergy Corp., a public utility holding company
Global Rail		A joint venture between FEV 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, that 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
MP		Monongahela Power Company, a West Virginia electric utility operating subsidiary of AE
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
PATH		Potomac-Appalachian Transmission Highline LLC, a joint venture between Allegheny and a subsidiary of American Electric Power Company, Inc.
PATH-VA		PATH Allegheny Virginia Transmission Corporation
PE		The Potomac Edison Company, a Maryland electric operating subsidiary of AE
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, Penn and WP
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 FEV and WMB Loan Ventures LLC, that owns mining operations near Roundup, Montana
TE		The Toledo Edison Company, an Ohio electric utility operating subsidiary
TrAIL		Trans-Allegheny Interstate Line Company
Utilities		OE, CEI, TE, Penn, JCP&L, Met-Ed, Penelec, MP, PE and WP
Utility Registrants		OE, CEI, TE, JCP&L, Met-Ed and Penelec
WP		West Penn Power Company, a Pennsylvania electric utility operating subsidiary of AE
The following abbreviations and acronyms are used to identify frequently used terms in this report:
ALJ		Administrative Law Judge
AOCL		Accumulated Other Comprehensive Loss
AEP		American Electric Power
AQC		Air Quality Control
ARO		Asset Retirement Obligation
ARR		Auction Revenue Rights
BGS		Basic Generation Service
BMP		Bruce Mansfield Plant
CAA		Clean Air Act
CAIR		Clean Air Interstate Rule
CAMR		Clean Air Mercury Rule
CATR		Clean Air Transport Rule
CBP		Competitive Bid Process

GLOSSARY OF TERMS, Cont’d.

CCB		Coal Combustion By-products
CDWR		California Department of Water Resources
CO2		Carbon Dioxide
CSAPR		Cross-State Air Pollution Rule
CTC		Competitive Transition Charge
CWA		Clean Water Act
CWIP		Construction Work in Progress
DCPD		Deferred Compensation Plan for Outside Directors
DOE		United States Department of Energy
DOJ		United States Department of Justice
DPA		Department of the Public Advocate, Division of Rate Counsel (New Jersey)
DSP		Default Service Plan
EDCP		Executive Deferred Compensation Plan
EE&C		Energy Efficiency and Conservation
EIS		Energy Insurance Services, Inc.
EMP		Energy Master Plan
ENEC		Expanded Net Energy Cost
EPA		United States Environmental Protection Agency
ESOP		Employee Stock Ownership Plan
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
FTRs		Financial Transmission Rights
GAAP		Generally Accepted Accounting Principles in the United States
RGGI		Regional Greenhouse Gas Initiative
GHG		Greenhouse Gases
IRS		Internal Revenue Service
JOA		Joint Operating Agreement
kV		Kilovolt
KWH		Kilowatt-hours
LBR		Little Blue Run
LED		Light-Emitting Diode
LOC		Letter of Credit
LSE		Load Serving Entity
LTIP		Long-Term Incentive Plan
MACT		Maximum Achievable Control Technology
MDE		Maryland Department of the Environment
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
MSHA		Mine Safety and Health Administration
MTEP		MISO Regional Transmission Expansion Plan
MVP		Multi-value Project
MW		Megawatts
MWH		Megawatt-hours
NAAQS		National Ambient Air Quality Standards
NDT		Nuclear Decommissioning Trusts
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
NPDES		National Pollutant Discharge Elimination System
NRC		Nuclear Regulatory Commission

GLOSSARY OF TERMS, Cont’d.

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
OSBA		Office of Small Business Advocate
OVEC		Ohio Valley Electric Corporation
PA DEP		Pennsylvania Department of Environmental Protection
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
PURPA		Public Utility Regulatory Policies Act of 1978
RECs		Renewable Energy Credits
RFP		Request for Proposal
RGGI		Regional Greenhouse Gas Initiative
RPM		Reliability Pricing Model
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
SEC		U.S. Securities and Exchange Commission
SIP		State Implementation Plan(s) Under the Clean Air Act
SMIP		Smart Meter Implementation Plan
SNCR		Selective Non-Catalytic Reduction
SO2		Sulfur Dioxide
SOS		Standard Offer Service
TBC		Transition Bond Charge
TDS		Total Dissolved Solid
TMDL		Total Maximum Daily Load
TMI-2		Three Mile Island Unit 2
TSC		Transmission Service Charge
VIE		Variable Interest Entity
VSCC		Virginia State Corporation Commission
WVDEP		West Virginia Department of Environmental Protection
WVPSC		Public Service Commission of West Virginia

FIRSTENERGY CORP.

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

		Three Months								Six Months
		Ended June 30								Ended June 30
In millions, except per share amounts		2011				2010				2011				2010
REVENUES:
Electric utilities		$	2,590			$	2,373			$	4,925			$	4,916
Unregulated businesses			1,470				766				2,711				1,522
Total revenues*			4,060				3,139				7,636				6,438
EXPENSES:
Fuel			635				350				1,088				684
Purchased power			1,220				1,063				2,406				2,301
Other operating expenses			1,105				673				2,138				1,374
Provision for depreciation			282				190				502				383
Amortization of regulatory assets			90				161				222				373
General taxes			242				176				479				381
Total expenses			3,574				2,613				6,835				5,496
OPERATING INCOME			486				526				801				942
OTHER INCOME (EXPENSE):
Investment income			31				31				52				47
Interest expense			(265	)			(207	)			(496	)			(420	)
Capitalized interest			20				40				38				81
Total other expense			(214	)			(136	)			(406	)			(292	)
INCOME BEFORE INCOME TAXES			272				390				395				650
INCOME TAXES			101				134				179				245
NET INCOME			171				256				216				405
Loss attributable to noncontrolling interest			(10	)			(9	)			(15	)			(15	)
EARNINGS AVAILABLE TO FIRSTENERGY CORP.		$	181			$	265			$	231			$	420
EARNINGS PER SHARE OF COMMON STOCK:
Basic		$	0.43			$	0.87			$	0.61			$	1.38
Diluted		$	0.43			$	0.87			$	0.61			$	1.37
AVERAGE SHARES OUTSTANDING:
Basic			418				304				380				304
Diluted			420				305				382				305
DIVIDENDS DECLARED PER SHARE OF COMMON STOCK			—				—			$	0.55			$	0.55

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								Six Months
		Ended June 30								Ended June 30
(In millions)		2011				2010				2011				2010
NET INCOME		$	171			$	256			$	216			$	405
OTHER COMPREHENSIVE INCOME:
Pension and other postretirement benefits			111				17				130				30
Unrealized gain on derivative hedges			17				6				11				10
Change in unrealized gain on available-for-sale securities			10				6				19				12
Other comprehensive income			138				29				160				52
Income tax expense related to other comprehensive income			53				9				54				16
Other comprehensive income, net of tax			85				20				106				36
COMPREHENSIVE INCOME			256				276				322				441
COMPREHENSIVE LOSS ATTRIBUTABLE
TO NONCONTROLLING INTEREST			(10	)			(9	)			(15	)			(15	)
COMPREHENSIVE INCOME AVAILABLE TO FIRSTENERGY CORP.		$	266			$	285			$	337			$	456

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

FIRSTENERGY CORP.

CONSOLIDATED BALANCE SHEETS
(Unaudited)

		June 30,				December 31,
(In millions)		2011				2010
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	476			$	1,019
Receivables-
Customers, net of allowance for uncollectible accounts of $35 in 2011 and $36 in 2010			1,578				1,392
Other, net of allowance for uncollectible accounts of $8 in 2011 and 2010			256				176
Materials and supplies, at average cost			866				638
Prepaid taxes			474				199
Derivatives			265				182
Other			203				92
			4,118				3,698
PROPERTY, PLANT AND EQUIPMENT:
In service			39,568				29,451
Less — Accumulated provision for depreciation			11,593				11,180
			27,975				18,271
Construction work in progress			1,465				1,517
Property, plant and equipment held for sale, net			502				—
			29,942				19,788
INVESTMENTS:
Nuclear plant decommissioning trusts			2,051				1,973
Investments in lease obligation bonds			414				476
Nuclear fuel disposal trust			212				208
Other			479				345
			3,156				3,002
DEFERRED CHARGES AND OTHER ASSETS:
Goodwill			6,456				5,575
Regulatory assets			2,182				1,826
Intangible assets			973				256
Other			769				660
			10,380				8,317
		$	47,596			$	34,805
LIABILITIES AND CAPITALIZATION
CURRENT LIABILITIES:
Currently payable long-term debt		$	2,058			$	1,486
Short-term borrowings			656				700
Accounts payable			1,122				872
Accrued taxes			399				326
Accrued compensation and benefits			331				315
Derivatives			287				266
Other			691				733
			5,544				4,698
CAPITALIZATION:
Common stockholders’ equity-
Common stock, $0.10 par value, authorized 490,000,000 and 375,000,000 shares, respectively- 418,216,437 and 304,835,407 shares outstanding, respectively			42				31
Other paid-in capital			9,782				5,444
Accumulated other comprehensive loss			(1,433	)			(1,539	)
Retained earnings			4,607				4,609
Total common stockholders’ equity			12,998				8,545
Noncontrolling interest			(48	)			(32	)
Total equity			12,950				8,513
Long-term debt and other long-term obligations			16,491				12,579
			29,441				21,092
NONCURRENT LIABILITIES:
Accumulated deferred income taxes			5,219				2,879
Retirement benefits			2,134				1,868
Asset retirement obligations			1,459				1,407
Deferred gain on sale and leaseback transaction			942				959
Adverse power contract liability			649				466
Other			2,208				1,436
			12,611				9,015
COMMITMENTS, GUARANTEES AND CONTINGENCIES (Note 9)
		$	47,596			$	34,805

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)

		Six Months Ended
		June 30
(In millions)		2011				2010
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income		$	216			$	405
Adjustments to reconcile net income to net cash from operating activities-
Provision for depreciation			502				383
Amortization of regulatory assets			222				373
Nuclear fuel and lease amortization			92				76
Deferred purchased power and other costs			(168	)			(146	)
Deferred income taxes and investment tax credits, net			552				159
Deferred rents and lease market valuation liability			(61	)			(62	)
Accrued compensation and retirement benefits			49				(27	)
Commodity derivative transactions, net			(21	)			(29	)
Pension trust contribution			(262	)			—
Asset impairments			41				21
Cash collateral paid, net			(31	)			(63	)
Interest rate swap transactions			—				43
Decrease (increase) in operating assets-
Receivables			199				(156	)
Materials and supplies			24				(17	)
Prepayments and other current assets			(268	)			(81	)
Increase (decrease) in operating liabilities-
Accounts payable			(28	)			18
Accrued taxes			(66	)			(58	)
Accrued interest			(4	)			10
Other			43				9
Net cash provided from operating activities			1,031				858
CASH FLOWS FROM FINANCING ACTIVITIES:
New Financing-
Long-term debt			503				—
Short-term borrowings, net			—				281
Redemptions and Repayments-
Long-term debt			(1,002	)			(407	)
Short-term borrowings, net			(44	)			—
Common stock dividend payments			(420	)			(335	)
Other			(76	)			(23	)
Net cash used for financing activities			(1,039	)			(484	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions			(1,018	)			(997	)
Proceeds from asset sales			—				116
Sales of investment securities held in trusts			1,703				1,915
Purchases of investment securities held in trusts			(1,807	)			(1,934	)
Customer acquisition costs			(2	)			(105	)
Cash investments			50				59
Cash received in Allegheny merger			590				—
Other			(51	)			(21	)
Net cash used for investing activities			(535	)			(967	)
Net change in cash and cash equivalents			(543	)			(593	)
Cash and cash equivalents at beginning of period			1,019				874
Cash and cash equivalents at end of period		$	476			$	281
SUPPLEMENTAL CASH FLOW INFORMATION:
Non-cash transaction: merger with Allegheny, common stock issued		$	4,354			$	—

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								Six Months Ended
		June 30								June 30
(In millions)		2011				2010				2011				2010
STATEMENTS OF INCOME
REVENUES:
Electric sales to non-affiliates		$	1,052			$	729			$	2,097			$	1,397
Electric sales to affiliates			170				539				431				1,146
Other			70				58				156				171
Total revenues			1,292				1,326				2,684				2,714
EXPENSES:
Fuel			316				343				659				671
Purchased power from affiliates			65				69				134				130
Purchased power from non-affiliates			329				310				626				760
Other operating expenses			429				304				910				608
Provision for depreciation			68				63				136				126
General taxes			30				22				60				49
Impairment of long-lived assets			7				—				20				2
Total expenses			1,244				1,111				2,545				2,346
OPERATING INCOME			48				215				139				368
OTHER INCOME (EXPENSE):
Investment income			16				13				22				14
Miscellaneous income (expense)			4				4				8				7
Interest expense — affiliates			(2	)			(2	)			(3	)			(5	)
Interest expense — other			(52	)			(51	)			(105	)			(101	)
Capitalized interest			10				24				20				44
Total other expense			(24	)			(12	)			(58	)			(41	)
INCOME BEFORE INCOME TAXES			24				203				81				327
INCOME TAXES			4				69				25				113
NET INCOME		$	20			$	134			$	56			$	214
STATEMENTS OF COMPREHENSIVE INCOME
NET INCOME		$	20			$	134			$	56			$	214
OTHER COMPREHENSIVE INCOME:
Pension and other postretirement benefits			1				1				3				(9	)
Unrealized gain on derivative hedges			14				3				5				4
Change in unrealized gain on available-for-sale securities			8				6				15				11
Other comprehensive income			23				10				23				6
Income taxes related to other comprehensive income			10				4				8				2
Other comprehensive income, net of tax			13				6				15				4
COMPREHENSIVE INCOME		$	33			$	140			$	71			$	218

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

FIRSTENERGY SOLUTIONS CORP.

CONSOLIDATED BALANCE SHEETS
(Unaudited)

		June 30,				December 31,
(In millions)		2011				2010
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	6			$	9
Receivables-
Customers, net of allowance for uncollectible accounts of $18 in 2011 and $17 in 2010			450				366
Associated companies			490				478
Other, net of allowances for uncollectible accounts of $3 in 2011 and $7 in 2010			51				90
Notes receivable from associated companies			490				397
Materials and supplies, at average cost			499				545
Derivatives			221				182
Prepayments and other			49				59
			2,256				2,126
PROPERTY, PLANT AND EQUIPMENT:
In service			11,455				11,321
Less — Accumulated provision for depreciation			4,206				4,024
			7,249				7,297
Construction work in progress			694				1,063
Property, plant and equipment held for sale, net			487				—
			8,430				8,360
INVESTMENTS:
Nuclear plant decommissioning trusts			1,184				1,146
Other			10				12
			1,194				1,158
DEFERRED CHARGES AND OTHER ASSETS:
Customer intangibles			129				134
Goodwill			24				24
Property taxes			41				41
Unamortized sale and leaseback costs			76				73
Derivatives			135				98
Other			75				48
			480				418
		$	12,360			$	12,062
LIABILITIES AND CAPITALIZATION
CURRENT LIABILITIES:
Currently payable long-term debt		$	1,088			$	1,132
Short-term borrowings-
Associated companies			541				12
Other			1				—
Accounts payable-
Associated companies			393				467
Other			191				241
Derivatives			242				266
Other			262				322
			2,718				2,440
CAPITALIZATION:
Common stockholder’s equity-
Common stock, without par value, authorized 750 shares- 7 shares outstanding			1,488				1,490
Accumulated other comprehensive loss			(105	)			(120	)
Retained earnings			2,474				2,418
Total common stockholder’s equity			3,857				3,788
Long-term debt and other long-term obligations			3,000				3,181
			6,857				6,969
NONCURRENT LIABILITIES:
Deferred gain on sale and leaseback transaction			942				959
Accumulated deferred income taxes			216				58
Asset retirement obligations			875				892
Retirement benefits			295				285
Lease market valuation liability			194				217
Derivatives			85				81
Other			178				161
			2,785				2,653
COMMITMENTS, GUARANTEES AND CONTINGENCIES (Note 9)
		$	12,360			$	12,062

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

FIRSTENERGY SOLUTIONS CORP.