PART I ITEM 1. BUSINESS The Companies FE and its subsidiaries are principally involved in the transmission, distribution, and generation of electricity. FirstEnergy’s ten utility operating companies comprise one of the nation’s largest investor-owned electric systems, based on serving over six million customers in the Midwest and Mid-Atlantic regions. FirstEnergy’s transmission operations include over 24,000 miles of transmission lines and two regional transmission operation centers. AGC and MP control 3,580 MWs of total capacity. FirstEnergy’s revenues are primarily derived from electric service provided by the Utilities and Transmission Companies. Regulated Utility Operating Subsidiaries The Utilities’ combined service areas encompass approximately 65,000 square miles in Ohio, Pennsylvania, West Virginia, Maryland, New Jersey, and New York. The areas they serve have a combined population of approximately 14 million. OE owns property and does business as an electric public utility in Ohio. OE engages in the distribution and sale of electric energy to communities in central and northeastern Ohio. The area it serves has a population of approximately 2.4 million. Penn owns property and does business as an electric public utility in Pennsylvania. Penn furnishes electric service to communities in western Pennsylvania. The area it serves has a population of approximately 0.4 million. CEI does business as an electric public utility in Ohio. CEI engages in the distribution and sale of electric energy in northeastern Ohio. The area it serves has a population of approximately 1.7 million. TE does business as an electric public utility in Ohio. TE engages in the distribution and sale of electric energy in northwestern Ohio. The area it serves has a population of approximately 0.7 million. JCP&L owns property and does business as an electric public utility in New Jersey. JCP&L provides transmission and distribution services in northern, western, and east central New Jersey. The area it serves has a population of approximately 2.9 million. ME owns property and does business as an electric public utility in Pennsylvania. ME provides distribution services in eastern and south central Pennsylvania. The area it serves has a population of approximately 1.3 million. PN owns property and does business as an electric public utility in Pennsylvania. PN provides distribution services in western, northern, and south central Pennsylvania. The area PN serves has a population of approximately 1.2 million. Also, PN, as lessee of the property of its subsidiary, the Waverly Electric Light & Power Company, serves approximately 4,000 customers in the Waverly, New York vicinity. PE owns property and does business as an electric public utility in Maryland, Virginia, and West Virginia. PE provides transmission and distribution services in portions of Maryland and West Virginia and provides transmission services in Virginia. The area it serves has a population of approximately 1.0 million. MP owns property and does business as an electric public utility in West Virginia. MP provides generation, transmission, and distribution services in northern West Virginia. The area it serves has a population of approximately 0.8 million. MP is contractually obligated to provide power to PE to meet its load obligations in West Virginia. MP owns or contractually controls 3,580 MWs of generation capacity that is supplied to its electric utility business, including a 16.25% undivided interest in the Bath County pumped-storage hydroelectric generation facility in Virginia (487 MWs) through its wholly owned subsidiary AGC. WP owns property and does business as an electric public utility in Pennsylvania. WP provides transmission and distribution services in southwestern, south-central, and northern Pennsylvania. The area it serves has a population of approximately 1.6 million. FirstEnergy is proceeding with the consolidation of the Pennsylvania Companies into a new, single operating entity. The PA Consolidation will require, among other steps: (a) the transfer of certain Pennsylvania-based transmission assets owned by WP to KATCo, (b) the transfer of Class B equity interests of MAIT currently held by PN and ME to FE (and ultimately transferred to FET as part of the FET Minority Equity Interest Sale), (c) the formation of PA NewCo and (d) the merger of each of the Pennsylvania Companies with and into PA NewCo, with PA NewCo surviving such mergers as the successor-in-interest to all assets and liabilities of the Pennsylvania Companies. Following completion of the PA Consolidation, PA NewCo will be FE’s only regulated utility in Pennsylvania encompassing the operations previously conducted individually by the Pennsylvania Companies. Consummation of the PA Consolidation is contingent upon numerous conditions, including the approval of NYPSC, PPUC and FERC. Subject to receipt of such regulatory approvals, FirstEnergy expects that the PA Consolidation will close by early 2024. 1
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