SUPPLEMENTAL GUARANTOR INFORMATION

In 2007, FG, a 100% owned subsidiary of FES, completed a sale and leaseback transaction for a 93.83% undivided interest in Bruce Mansfield Unit 1. FG's parent company, FES, has fully and unconditionally and irrevocably guaranteed all of FG's obligations under each of the leases. The related lessor notes and pass through certificates are not guaranteed by FG or its parent company, but the notes are secured by, among other things, each lessor trust's undivided interest in Unit 1, rights and interests under the applicable lease and rights and interests under other related agreements, including FES' lease guaranty. This transaction is classified as an operating lease for FES and FirstEnergy and as a financing lease for FG.

The Condensed Consolidating Statements of Income (Loss) and Comprehensive Income (Loss) for the three and nine months ended September 30, 2017 and 2016, Condensed Consolidating Balance Sheets as of September 30, 2017 and December 31, 2016, and Condensed Consolidating Statements of Cash Flows for the nine months ended September 30, 2017 and 2016, for the parent and guarantor and non-guarantor subsidiaries are presented below. These statements are provided as FG's parent company fully and unconditionally guarantees outstanding registered securities of FG as well as FG's obligations under the facility lease for the Bruce Mansfield sale and leaseback that underlie outstanding registered pass-through trust certificates. Investments in wholly owned subsidiaries are accounted for by the parent company using the equity method. Results of operations for FG and NG are, therefore, reflected in their parent company's investment accounts and earnings as if operating lease treatment was achieved. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions and the entries required to reflect operating lease treatment associated with the 2007 Bruce Mansfield Unit 1 sale and leaseback transaction.



FIRSTENERGY SOLUTIONS CORP.
CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


For the Three Months Ended September 30, 2017	FES			FG			NG			Eliminations			Consolidated
	(In millions)
STATEMENTS OF INCOME

REVENUES	$	741		$	231		$	292		$	(521	)	$	743

OPERATING EXPENSES:
Fuel	—			108			57			—			165
Purchased power from affiliates	520			—			1			(521		)	—
Purchased power from non-affiliates	152			—			—			—			152
Other operating expenses	70			62			147			12			291
Provision for depreciation	3			8			18			(1		)	28
General taxes	4			3			(2		)	—			5
Total operating expenses	749			181			221			(510		)	641

OPERATING INCOME (LOSS)	(8		)	50			71			(11		)	102

OTHER INCOME (EXPENSE):
Investment income (loss), including net income from equity investees	106			11			43			(121		)	39
Miscellaneous income	1			—			—			—			1
Interest expense — affiliates	(20		)	(3		)	1			16			(6		)
Interest expense — other	(12		)	(25		)	(11		)	14			(34		)
Capitalized interest	—			—			6			—			6
Total other income (expense)	75			(17		)	39			(91		)	6

INCOME BEFORE INCOME TAXES (BENEFITS)	67			33			110			(102		)	108

INCOME TAXES (BENEFITS)	(9		)	6			34			1			32

NET INCOME	$	76		$	27		$	76		$	(103	)	$	76

STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

NET INCOME	$	76		$	27		$	76		$	(103	)	$	76

OTHER COMPREHENSIVE INCOME (LOSS):
Pension and OPEB prior service costs	(3		)	(3		)	—			3			(3		)
Amortized gains on derivative hedges	1			—			—			—			1
Change in unrealized gains on available-for-sale securities	(6		)	—			(6		)	6			(6		)
Other comprehensive loss	(8		)	(3		)	(6		)	9			(8		)
Income tax benefits on other comprehensive loss	(3		)	(1		)	(2		)	3			(3		)
Other comprehensive loss, net of tax	(5		)	(2		)	(4		)	6			(5		)
COMPREHENSIVE INCOME	$	71		$	25		$	72		$	(97	)	$	71



FIRSTENERGY SOLUTIONS CORP.
CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


For the Nine Months Ended September 30, 2017	FES			FG			NG			Eliminations			Consolidated
	(In millions)
STATEMENTS OF INCOME

REVENUES	$	2,338		$	941		$	988		$	(1,869	)	$	2,398

OPERATING EXPENSES:
Fuel	—			312			151			—			463
Purchased power from affiliates	1,994			—			77			(1,869		)	202
Purchased power from non-affiliates	468			—			—			—			468
Other operating expenses	247			345			467			36			1,095
Provision for depreciation	9			24			49			(2		)	80
General taxes	15			16			13			—			44
Total operating expenses	2,733			697			757			(1,835		)	2,352

OPERATING INCOME (LOSS)	(395		)	244			231			(34		)	46

OTHER INCOME (EXPENSE):
Investment income (loss), including net income (loss) from equity investees	335			31			91			(383		)	74
Miscellaneous income	1			—			5			—			6
Interest expense — affiliates	(58		)	(9		)	(1		)	55			(13		)
Interest expense — other	(35		)	(78		)	(33		)	42			(104		)
Capitalized interest	—			1			19			—			20
Total other income (expense)	243			(55		)	81			(286		)	(17		)

INCOME (LOSS) BEFORE INCOME TAXES (BENEFITS)	(152		)	189			312			(320		)	29

INCOME TAXES (BENEFITS)	(167		)	66			112			3			14

NET INCOME	$	15		$	123		$	200		$	(323	)	$	15

STATEMENTS OF COMPREHENSIVE INCOME

NET INCOME	$	15		$	123		$	200		$	(323	)	$	15

OTHER COMPREHENSIVE INCOME (LOSS):
Pension and OPEB prior service costs	(10		)	(10		)	—			10			(10		)
Amortized gains on derivative hedges	1			—			—			—			1
Change in unrealized gains on available-for-sale securities	16			—			16			(16		)	16
Other comprehensive income (loss)	7			(10		)	16			(6		)	7
Income taxes (benefits) on other comprehensive income (loss)	2			(4		)	6			(2		)	2
Other comprehensive income (loss), net of tax	5			(6		)	10			(4		)	5
COMPREHENSIVE INCOME	$	20		$	117		$	210		$	(327	)	$	20



FIRSTENERGY SOLUTIONS CORP.
CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


For the Three Months Ended September 30, 2016	FES			FG			NG			Eliminations			Consolidated
	(In millions)
STATEMENTS OF INCOME

REVENUES	$	1,065		$	494		$	400		$	(859	)	$	1,100

OPERATING EXPENSES:
Fuel	—			149			53			—			202
Purchased power from affiliates	1,011			—			39			(859		)	191
Purchased power from non-affiliates	186			—			—			—			186
Other operating expenses	95			61			149			11			316
Provision for depreciation	4			28			51			—			83
General taxes	8			7			6			—			21
Total operating expenses	1,304			245			298			(848		)	999

OPERATING INCOME (LOSS)	(239		)	249			102			(11		)	101

OTHER INCOME (EXPENSE):
Investment income, including net income from equity investees	224			8			28			(236		)	24
Miscellaneous income	—			1			—			—			1
Interest expense — affiliates	(13		)	(3		)	(2		)	15			(3		)
Interest expense — other	(14		)	(27		)	(9		)	14			(36		)
Capitalized interest	—			3			6			—			9
Total other income (expense)	197			(18		)	23			(207		)	(5		)

INCOME (LOSS) BEFORE INCOME TAXES (BENEFITS)	(42		)	231			125			(218		)	96

INCOME TAXES (BENEFITS)	(82		)	87			49			2			56

NET INCOME	$	40		$	144		$	76		$	(220	)	$	40

STATEMENTS OF COMPREHENSIVE INCOME

NET INCOME	$	40		$	144		$	76		$	(220	)	$	40

OTHER COMPREHENSIVE INCOME (LOSS):
Pension and OPEB prior service costs	(3		)	(3		)	—			3			(3		)
Amortized gains on derivative hedges	1			—			—			—			1
Change in unrealized gains on available for sale securities	5			—			5			(5		)	5
Other comprehensive income (loss)	3			(3		)	5			(2		)	3
Income taxes (benefits) on other comprehensive income (loss)	1			(1		)	2			(1		)	1
Other comprehensive income (loss), net of tax	2			(2		)	3			(1		)	2
COMPREHENSIVE INCOME	$	42		$	142		$	79		$	(221	)	$	42



FIRSTENERGY SOLUTIONS CORP.
CONDENSED CONSOLIDATING STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)


For the Nine Months Ended September 30, 2016	FES			FG			NG			Eliminations			Consolidated
	(In millions)
STATEMENTS OF INCOME (LOSS)

REVENUES	$	3,281		$	1,309		$	1,404		$	(2,593	)	$	3,401

OPERATING EXPENSES:
Fuel	—			449			146			—			595
Purchased power from affiliates	2,888			—			145			(2,593		)	440
Purchased power from non-affiliates	829			—			—			—			829
Other operating expenses	218			220			450			37			925
Provision for depreciation	10			91			151			(2		)	250
General taxes	23			23			20			—			66
Impairment of assets	23			517			—			—			540
Total operating expenses	3,991			1,300			912			(2,558		)	3,645

OPERATING INCOME (LOSS)	(710		)	9			492			(35		)	(244		)

OTHER INCOME (EXPENSE):
Investment income, including net income (loss) from equity investees	310			21			67			(342		)	56
Miscellaneous income	3			1			—			—			4
Interest expense — affiliates	(34		)	(7		)	(4		)	39			(6		)
Interest expense — other	(40		)	(79		)	(33		)	43			(109		)
Capitalized interest	—			7			20			—			27
Total other income (expense)	239			(57		)	50			(260		)	(28		)

INCOME (LOSS) BEFORE INCOME TAXES (BENEFITS)	(471		)	(48		)	542			(295		)	(272		)

INCOME TAXES (BENEFITS)	(204		)	(1		)	196			4			(5		)

NET INCOME (LOSS)	$	(267	)	$	(47	)	$	346		$	(299	)	$	(267	)

STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

NET INCOME (LOSS)	$	(267	)	$	(47	)	$	346		$	(299	)	$	(267	)

OTHER COMPREHENSIVE INCOME (LOSS)
Pension and OPEB prior service costs	(10		)	(10		)	—			10			(10		)
Amortized gains on derivative hedges	—			—			—			—			—
Change in unrealized gains on available-for-sale securities	61			—			60			(60		)	61
Other comprehensive income (loss)	51			(10		)	60			(50		)	51
Income taxes (benefits) on other comprehensive income (loss)	20			(4		)	23			(19		)	20
Other comprehensive income (loss), net of tax	31			(6		)	37			(31		)	31
COMPREHENSIVE INCOME (LOSS)	$	(236	)	$	(53	)	$	383		$	(330	)	$	(236	)

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING BALANCE SHEETS



As of September 30, 2017	FES		FG		NG		Eliminations			Consolidated
	(In millions)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	2	$	—	$	—		$	2
Receivables-
Customers	171		—		—		—			171
Affiliated companies	194		175		193		(235		)	327
Other	9		4		—		—			13
Notes receivable from affiliated companies	364		1,765		1,481		(3,610		)	—
Materials and supplies	34		147		82		—			263
Derivatives	31		—		—		—			31
Collateral	101		25		—		—			126
Prepaid taxes and other	12		16		1		—			29
	916		2,134		1,757		(3,845		)	962
PROPERTY, PLANT AND EQUIPMENT:
In service	121		2,587		5,016		(281		)	7,443
Less — Accumulated provision for depreciation	61		1,942		4,309		(189		)	6,123
	60		645		707		(92		)	1,320
Construction work in progress	2		45		241		—			288
	62		690		948		(92		)	1,608
INVESTMENTS:
Nuclear plant decommissioning trusts	—		—		1,823		—			1,823
Investment in affiliated companies	3,347		—		—		(3,347		)	—
Other	—		9		—		—			9
	3,347		9		1,823		(3,347		)	1,832

DEFERRED CHARGES AND OTHER ASSETS:
Property taxes	—		2		4		—			6
Accumulated deferred income tax benefits	428		1,212		690		(273		)	2,057
Derivatives	5		—		—		—			5
Other	31		328		—		10			369
	464		1,542		694		(263		)	2,437
	$	4,789	$	4,375	$	5,222	$	(7,547	)	$	6,839

LIABILITIES AND CAPITALIZATION
CURRENT LIABILITIES:
Currently payable long-term debt	$	—	$	180	$	114	$	(27	)	$	267
Short-term borrowings - affiliated companies	3,299		497		—		(3,610		)	186
Accounts payable-
Affiliated companies	329		87		143		(329		)	230
Other	11		87		—		—			98
Accrued taxes	16		12		19		(15		)	32
Derivatives	10		2		—		—			12
Other	28		92		14		33			167
	3,693		957		290		(3,948		)	992
CAPITALIZATION:
Total equity	328		946		2,301		(3,247		)	328
Long-term debt and other long-term obligations	691		1,941		1,006		(1,079		)	2,559
	1,019		2,887		3,307		(4,326		)	2,887
NONCURRENT LIABILITIES:
Deferred gain on sale and leaseback transaction	—		—		—		732			732
Accumulated deferred income taxes	5		—		—		(5		)	—
Retirement benefits	26		181		—		—			207
Asset retirement obligations	—		187		801		—			988
Other	46		163		824		—			1,033
	77		531		1,625		727			2,960
	$	4,789	$	4,375	$	5,222	$	(7,547	)	$	6,839

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING BALANCE SHEETS



As of December 31, 2016	FES		FG		NG		Eliminations			Consolidated
	(In millions)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	2	$	—	$	—		$	2
Receivables-
Customers	213		—		—		—			213
Affiliated companies	332		315		417		(612		)	452
Other	17		2		8		—			27
Notes receivable from affiliated companies	501		1,585		1,294		(3,351		)	29
Materials and supplies	45		142		80		—			267
Derivatives	137		—		—		—			137
Collateral	157		—		—		—			157
Prepaid taxes and other	38		24		1		—			63
	1,440		2,070		1,800		(3,963		)	1,347
PROPERTY, PLANT AND EQUIPMENT:
In service	120		2,524		4,703		(290		)	7,057
Less — Accumulated provision for depreciation	52		1,920		4,144		(187		)	5,929
	68		604		559		(103		)	1,128
Construction work in progress	2		67		358		—			427
	70		671		917		(103		)	1,555
INVESTMENTS:
Nuclear plant decommissioning trusts	—		—		1,552		—			1,552
Investment in affiliated companies	2,923		—		—		(2,923		)	—
Other	—		9		1		—			10
	2,923		9		1,553		(2,923		)	1,562

DEFERRED CHARGES AND OTHER ASSETS:
Property taxes	—		12		28		—			40
Accumulated deferred income tax benefits	395		1,271		883		(270		)	2,279
Derivatives	77		—		—		—			77
Other	33		327		—		21			381
	505		1,610		911		(249		)	2,777
	$	4,938	$	4,360	$	5,181	$	(7,238	)	$	7,241

LIABILITIES AND CAPITALIZATION
CURRENT LIABILITIES:
Currently payable long-term debt	$	—	$	200	$	5	$	(26	)	$	179
Short-term borrowings - affiliated companies	2,969		483		—		(3,351		)	101
Accounts payable-
Affiliated companies	743		107		406		(706		)	550
Other	17		93		—		—			110
Accrued taxes	50		48		61		(16		)	143
Derivatives	71		6		—		—			77
Other	56		54		10		36			156
	3,906		991		482		(4,063		)	1,316
CAPITALIZATION:
Total equity	218		828		2,006		(2,834		)	218
Long-term debt and other long-term obligations	691		2,093		1,120		(1,091		)	2,813
	909		2,921		3,126		(3,925		)	3,031
NONCURRENT LIABILITIES:
Deferred gain on sale and leaseback transaction	—		—		—		757			757
Accumulated deferred income taxes	4		3		—		(7		)	—
Retirement benefits	25		172		—		—			197
Asset retirement obligations	—		188		713		—			901
Other	94		85		860		—			1,039
	123		448		1,573		750			2,894
	$	4,938	$	4,360	$	5,181	$	(7,238	)	$	7,241

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS



For the Nine Months Ended September 30, 2017	FES			FG			NG			Eliminations			Consolidated
	(In millions)

NET CASH (USED FOR) PROVIDED FROM OPERATING ACTIVITIES	$	(463	)	$	387		$	547		$	(13	)	$	458
CASH FLOWS FROM FINANCING ACTIVITIES:
New Financing-
Short-term borrowings, net	330			14			—			(259		)	85
Redemptions and Repayments-
Long-term debt	—			(171		)	(5		)	13			(163		)
Other	—			(5		)	—			—			(5		)
Net cash (used for) provided from financing activities	330			(162		)	(5		)	(246		)	(83		)
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions	(1		)	(46		)	(154		)	—			(201		)
Nuclear fuel	—			—			(156		)	—			(156		)
Sales of investment securities held in trusts	—			—			834			—			834
Purchases of investment securities held in trusts	—			—			(878		)	—			(878		)
Loans to affiliated companies, net	137			(179		)	(188		)	259			29
Other	(3		)	—			—			—			(3		)
Net cash (used for) provided from investing activities	133			(225		)	(542		)	259			(375		)
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

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS



For the Nine Months Ended September 30, 2016	FES			FG			NG			Eliminations			Consolidated
	(In millions)

NET CASH (USED FOR) PROVIDED FROM OPERATING ACTIVITIES	$	(605	)	$	402		$	820		$	(12	)	$	605
CASH FLOWS FROM FINANCING ACTIVITIES:
New Financing-
Long-term debt	—			186			285			—			471
Short-term borrowings, net	701			92			—			(692		)	101
Redemptions and Repayments-
Long-term debt	—			(211		)	(304		)	12			(503		)
Other	—			(6		)	(2		)	—			(8		)
Net cash (used for) provided from financing activities	701			61			(21		)	(680		)	61

CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions	(28		)	(171		)	(233		)	—			(432		)
Nuclear fuel	—			—			(195		)	—			(195		)
Sales of investment securities held in trusts	—			—			576			—			576
Purchases of investment securities held in trusts	—			—			(619		)	—			(619		)
Loans to affiliated companies, net	(87		)	(292		)	(328		)	692			(15		)
Other	19			—			—			—			19
Net cash (used for) provided from investing activities	(96		)	(463		)	(799		)	692			(666		)
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