The Registrants perform qualitative analyses to determine whether a variable interest qualifies them as the primary beneficiary (a controlling financial interest) of a VIE. An enterprise has a controlling financial interest if it has both: (i) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance; and (ii) the obligation to absorb losses of the entity that could potentially be significant to the VIE or the right to receive benefits from the entity that could potentially be significant to the VIE. The Registrants consolidate a VIE when it is determined that it is the primary beneficiary.

In order to evaluate contracts for consolidation treatment and entities for which FirstEnergy has an interest, FirstEnergy aggregates variable interests into categories based on similar risk characteristics and significance.

Total assets on the FirstEnergy consolidated balance sheets include approximately $12 billion of consolidated VIE assets, as of March 31, 2025, and December 31, 2024, that can only be used to settle the liabilities of the applicable VIE. Total liabilities include approximately $9 billion as of March 31, 2025, and December 31, 2024, of consolidated VIE liabilities for which the VIE's creditors do not have recourse to FirstEnergy. JCP&L does not have any consolidated VIE’s.

•Ohio Securitization Companies - In June 2013, the SPEs formed by the Ohio Companies issued approximately $445 million of pass-through trust certificates supported by 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. The SPEs are considered VIEs and each one is consolidated into its applicable electric company. As of March 31, 2025, and December 31, 2024, $167 million and $175 million of the phase-in recovery bonds were outstanding, respectively.

•MP and PE Environmental Funding Companies - The consolidated financial statements of FirstEnergy include environmental control bonds issued by two bankruptcy remote, special purpose limited liability companies that are indirect subsidiaries of MP and PE. Proceeds from the bonds were used to construct environmental control facilities. 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 limited liability company SPEs, have no recourse to any assets or revenues of the special purpose limited liability companies. As of March 31, 2025, and December 31, 2024, $172 million and $188 million of environmental control bonds were outstanding, respectively.

Cash of $27 million and $40 million, respectively, as of March 31, 2025 and December 31, 2024 collected from MP, PE and the Ohio Companies' customers that is specifically used to service debt of their respective funding companies is included in “Restricted cash” on the FirstEnergy Consolidated Balance Sheets.

FET is a holding company that owns equity interests in ATSI, MAIT, TrAIL and PATH. As of March 31, 2025, FE’s equity ownership in FET is 50.1% and Brookfield’s is 49.9%. FirstEnergy has concluded that FET is a VIE and that FE is the primary beneficiary because FE has exposure to the economics of FET and the power to direct significant activities of FET through the FESC services agreement, which represents a separate variable interest.

Although Brookfield was granted incremental consent rights upon the closing of the FET Equity Interest Sale, Brookfield will not have unilateral control over any activities that most significantly impact FET’s economic performance. However, FE will continue to retain power over the activities that most significantly impact FET’s economic performance through its incremental decision-making rights under the existing FESC services agreement, through which executive management and workforce services are provided to FET. As a result, FE is the primary beneficiary of FET, which will continue to be consolidated in FirstEnergy’s financial statements.

The following shows the carrying amounts and classification of the FET assets and liabilities included in FirstEnergy’s consolidated financial statements as of March 31, 2025, and December 31, 2024. Amounts exclude intercompany balances which were eliminated in consolidation. The assets of FET can only be used to settle its obligations, and creditors of FET do not have recourse to the general credit of FE.


Assets	As of March 31, 2025		As of December 31, 2024
	(In millions)
Cash and cash equivalents	$	7	$	8
Receivables	97		94
Materials and supplies, at average cost	1		1
Prepaid taxes and other current assets	20		21
Total current assets	125		124
Property, plant and equipment, net	11,422		11,217
Goodwill	224		224
Investments	19		19
Regulatory assets	24		18
Other noncurrent assets	257		334
Total noncurrent assets	11,946		11,812
TOTAL ASSETS	$	12,071	$	11,936


Liabilities	As of March 31, 2025		As of December 31, 2024
	(In millions)

Currently payable long-term debt	$	625	$	625
Short-term borrowings	385		300

Accrued interest	70		68
Accrued taxes	314		306
Other current liabilities	15		15
Total current liabilities	1,409		1,314
Long-term debt and other long-term obligations	5,240		5,239
Accumulated deferred income taxes	1,436		1,412
Regulatory liabilities	463		442
Other noncurrent liabilities	150		299
Total noncurrent liabilities	7,289		7,392
TOTAL LIABILITIES	$	8,698	$	8,706

The Registrants evaluated their PPAs and determined that certain Non-Utility Generation entities 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. As of March 31, 2025, FirstEnergy maintains four, one at JCP&L, long-term PPAs with Non-Utility Generation entities that were entered into pursuant to the Public Utility Regulatory Policies Act of 1978. The Registrants were not involved in the creation of, and have no equity or debt invested in, any of these entities. The Registrants have determined that they do not have a variable interest, or the entities do not meet the criteria to be considered a VIE.