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Segment Information

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

Regulated Distribution and Regulated Transmission are FirstEnergy's reportable segments.

On March 31, 2018, as discussed in Note 3, “Discontinued Operations,” FirstEnergy deconsolidated FES and FENOC and presented FES, FENOC, BSPC and a portion of AE Supply, representing substantially all of FirstEnergy’s operations that previously comprised the CES reportable operating segment, as discontinued operations in FirstEnergy’s consolidated financial statements resulting from actions taken as part of the strategic review to exit commodity-exposed generation. The financial information for all periods has been revised to present the discontinued operations within Reconciling Adjustments. The remaining business activities that previously comprised the CES reportable operating segment were not material and, as such, have been combined into Corporate/Other for reporting purposes.

The Regulated Distribution segment distributes electricity through FirstEnergy’s ten utility operating companies, serving approximately six million customers within 65,000 square miles of Ohio, Pennsylvania, West Virginia, Maryland, New Jersey and New York, and purchases power for its POLR, SOS, SSO and default service requirements in Ohio, Pennsylvania, New Jersey and Maryland. This segment also controls 3,790 MWs of regulated electric generation capacity located primarily in West Virginia, Virginia and New Jersey. The segment's results reflect the costs of securing and delivering electric generation from transmission facilities to customers, including the deferral and amortization of certain related costs. Included within the segment are $882 million of assets classified as held for sale associated with the asset purchase and sale agreement with TMI-2 Solutions to transfer TMI-2 to TMI-2 Solutions, LLC. See Note 15, "Commitments, Guarantees and Contingencies" for additional information.

The Regulated Transmission segment provides transmission infrastructure owned and operated by the Transmission Companies and certain of FirstEnergy's utilities (JCP&L, MP, PE and WP) to transmit electricity from generation sources to distribution facilities. The segment's revenues are primarily derived from forward-looking formula rates at the Transmission Companies as well as stated transmission rates at JCP&L, MP, PE and WP. Effective January 1, 2020, JPC&L's transmission rates became forward-looking formula rates, subject to refund, pending further hearing and settlement proceedings. Both the forward-looking formula and stated rates recover costs that the regulatory agencies determine are permitted to be recovered and provide a return on transmission capital investment. Under forward-looking formula rates, the revenue requirement is updated annually based on a projected rate base and projected costs, which is subject to an annual true-up based on actual costs. The

segment's results also reflect the net transmission expenses related to the delivery of electricity on FirstEnergy's transmission facilities.

Corporate/Other reflects corporate support not charged to FE's subsidiaries, interest expense on FE’s holding company debt and other businesses that do not constitute an operating segment. Reconciling adjustments for the elimination of inter-segment transactions and discontinued operations are shown separately in the following table of Segment Financial Information. As of December 31, 2019, 67 MWs of electric generating capacity, representing AE Supply's OVEC capacity entitlement, was included in continuing operations of Corporate/Other. As of December 31, 2019, Corporate/Other had approximately $7.1 billion of FE holding company debt.

Financial information for each of FirstEnergy’s reportable segments is presented in the tables below:

Segment Financial Information

For the Years Ended						Regulated Distribution						Regulated Transmission						Corporate/ Other						Reconciling Adjustments						FirstEnergy Consolidated
						(In millions)
December 31, 2019
External revenues						$	9,511					$	1,510					$	14					$	—					$	11,035
Internal revenues						187						16						—						(203)						—
Total revenues						9,698						1,526						14						(203)						11,035
Provision for depreciation						863						284						5						68						1,220
Amortization (deferral) of regulatory assets, net						(89)						10						—						—						(79)
Miscellaneous income (expense), net						174						15						80						(26)						243
Interest expense						495						192						372						(26)						1,033
Income taxes (benefits)						271						113						(171)						—						213
Income (loss) from continuing operations						1,076						447						(619)						—						904
Property additions						$	1,473					$	1,090					$	102					$	—					$	2,665
December 31, 2018
External revenues						$	9,900					$	1,335					$	26					$	—					$	11,261
Internal revenues						203						18						8						(229)						—
Total revenues						10,103						1,353						34						(229)						11,261
Provision for depreciation						812						252						3						69						1,136
Amortization (deferral) of regulatory assets, net						(163)						13						—						—						(150)
Miscellaneous income (expense), net						192						14						32						(33)						205
Interest expense						514						167						468						(33)						1,116
Income taxes (benefits)						422						122						(54)						—						490
Income (loss) from continuing operations						1,242						397						(617)						—						1,022
Property additions						$	1,411					$	1,104					$	133					$	27					$	2,675
December 31, 2017
External revenues						$	9,602					$	1,307					$	19					$	—					$	10,928
Internal revenues						158						17						24						(199)						—
Total revenues						9,760						1,324						43						(199)						10,928
Provision for depreciation						724						224						10						69						1,027
Amortization of regulatory assets, net						292						16						—						—						308
Miscellaneous income (expense), net						57						1						39						(44)						53
Interest expense						535						156						358						(44)						1,005
Income taxes						580						205						930						—						1,715
Income (loss) from continuing operations						916						336						(1,541)						—						(289)
Property additions						$	1,191					$	1,030					$	49					$	317					$	2,587
As of December 31, 2019
Total assets						$	29,642					$	11,611					$	1,015					$	33					$	42,301
Total goodwill						$	5,004					$	614					$	—					$	—					$	5,618
As of December 31, 2018
Total assets						$	28,690					$	10,404					$	944					$	25					$	40,063
Total goodwill						$	5,004					$	614					$	—					$	—					$	5,618
As of December 31, 2017
Total assets						$	27,730					$	9,525					$	1,007					$	3,995					$	42,257
Total goodwill						$	5,004					$	614					$	—					$	—					$	5,618

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- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-URI http://asc.fasb.org/topic&trid=2134510

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