Firstenergy Corp 8-K, filed Nov 8, 2024
Firstenergy Corp (FE)
8-K
2024-11-08
For: 2024-11-08
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Added on
April 10, 2026
About this 8-K
Firstenergy Corp filed this 8-K on November 8, 2024.
Items reported
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 8, 2024
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 7.01 Regulation FD Disclosure
FirstEnergy Corp. (“FirstEnergy” or the “Company”) senior management will present to investors beginning November 10, 2024, at the 2024 Edison Electric Institute (“EEI”) Financial Conference. The presentation for use at the EEI Financial Conference, which is attached hereto as Exhibit 99.1, is available under the “Investor Relations” section of the Company’s website, located at investors.firstenergycorp.com. Website addresses are included as inactive textual references only. Information on the Company’s website is not, and will not be deemed to be, a part of this Current Report on Form 8-K or incorporated into any other filings the Company may make with the Securities and Exchange Commission. Important information may be disseminated initially or exclusively via the Company’s Investor Relations website; investors should consult the site to access this information.
The information set forth in and incorporated into this Item 7.01 of this Current Report on Form 8-K is being furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any of the Company’s filings under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and regardless of any general incorporation language in such filings, except to the extent expressly set forth by specific reference in such a filing. The furnishing of this Item 7.01 of this Current Report on Form 8-K shall not be deemed an admission as to the materiality of any information herein that is required to be disclosed solely by reason of Regulation FD.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
| Exhibit No. | Description | |||||||
| 99.1 | ||||||||
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document) | |||||||
Forward-Looking Statements: This Form 8-K includes forward-looking statements based on information currently available to management. Such statements are subject to certain risks and uncertainties and readers are cautioned not to place undue reliance on these forward-looking statements. 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,” "forecast," "target," "will," "intend," “believe,” "project," “estimate," "plan" 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, which may include the following: the potential liabilities, increased costs and unanticipated developments resulting from government investigations and agreements, including those associated with compliance with or failure to comply with the Deferred Prosecution Agreement entered into July 21, 2021 with the U.S. Attorney’s Office for the Southern District of Ohio; the risks and uncertainties associated with government investigations and audits regarding Ohio House Bill 6, as passed by Ohio’s 133rd General Assembly (“HB 6”) and related matters, including potential adverse impacts on federal or state regulatory matters, including, but not limited to, matters relating to rates; the risks and uncertainties associated with litigation, arbitration, mediation and similar proceedings, particularly regarding HB 6 related matters; changes in national and regional economic conditions, including recession, volatile interest rates, inflationary pressure, supply chain disruptions, higher fuel costs, and workforce impacts, affecting us and/or our customers and those vendors with which we do business; variations in weather, such as mild seasonal weather variations and severe weather conditions (including events caused, or exacerbated, by climate change, such as wildfires, hurricanes, flooding, droughts, high wind events and extreme heat events) and other natural disasters affecting future operating results and associated regulatory actions or outcomes in response to such conditions; legislative and regulatory developments, including, but not limited to, matters related to rates, energy regulatory policies, compliance and enforcement activity, cyber security, and climate change; the risks associated with physical attacks, such as acts of war, terrorism, sabotage or other acts of violence, and cyber-attacks and other disruptions to our, or our vendors’, information technology system, which may compromise our operations, and data security breaches of sensitive data, intellectual property and proprietary or personally identifiable information; the ability to meet our goals relating to employee, environmental, social and corporate governance opportunities, improvements, and efficiencies, including our greenhouse gas (“GHG”) reduction goals; the ability to accomplish or realize anticipated benefits through establishing a culture of continuous improvement and our other strategic and financial goals, including, but not limited to, overcoming current uncertainties and challenges associated with the ongoing government investigations, executing Energize365, our transmission and distribution investment plan, executing on our rate filing strategy, controlling costs, improving credit metrics, maintaining investment grade ratings and growing earnings; changing market conditions affecting the measurement of certain liabilities and the value of assets held in our pension trusts may negatively impact our forecasted growth rate, results of operations and may also cause us to make contributions to our pension sooner or in amounts that are larger than currently anticipated; mitigating exposure for remedial activities associated with retired and formerly owned electric generation assets, including those sites impacted by the legacy coal combustion residual rules that were finalized during 2024; changes to environmental laws and regulations, including, but not limited to, rules finalized by the Environmental Protection Agency and the Securities and Exchange Commission (“SEC”) related to climate change; changes in customers’ demand for power, including, but not limited to, economic conditions, the impact of climate change, emerging technology, particularly with respect to electrification, energy storage and distributed sources of generation; the ability to access the public securities and other capital and credit markets in accordance with our financial plans, the cost of such capital and overall condition of the capital and credit markets affecting us, including the increasing number of financial institutions evaluating the impact of climate change on their investment decisions; future actions taken by credit rating agencies that could negatively affect either our access to or terms of financing or our financial condition and liquidity; changes in assumptions regarding factors such as economic conditions within our territories, the reliability of our transmission and distribution system, generation resource planning, or the availability of capital or other resources supporting identified transmission and distribution investment opportunities; the potential of non-compliance with debt covenants in our credit facilities; the ability to comply with applicable reliability standards and energy efficiency and peak demand reduction mandates; human capital management challenges, including among other things, attracting and retaining appropriately trained and qualified employees and labor disruptions by our unionized workforce; changes to significant accounting policies; any changes in tax laws or regulations, including, but not limited to, the Inflation Reduction Act of 2022, or adverse tax audit results or rulings; and the risks and other factors discussed from time to time in our SEC filings. Dividends declared from time to time on FirstEnergy Corp.’s common stock during any period may in the aggregate vary from prior periods due to circumstances considered by FirstEnergy Corp.’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. These forward-looking statements are also qualified by, and should be read together with, the risk factors included in FirstEnergy Corp.’s Form 10-K, Form 10-Q and in FirstEnergy's other filings with the SEC. The foregoing review of factors also 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 FirstEnergy Corp.’s 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. FirstEnergy Corp. expressly disclaims any obligation to update or revise, except as required by law, any forward-looking statements contained herein or in the information incorporated by reference as a result of new information, future events or otherwise.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
November 8, 2024
| FIRSTENERGY CORP. | |||||
| Registrant | |||||
| By: | /s/ Jason J. Lisowski | ||||
Jason J. Lisowski Vice President, Controller and Chief Accounting Officer | |||||
Focused on Our Future 2024 EEI Financial Conference Published November 8, 2024
EEI – Published November 8, 20242 FirstEnergy Overview $51B Total Assets 6M+ Total Customers 24K Transmission Miles 65K Square Miles of Service Territory 12K Employees $29B 2024F Rate Base Distribution Segment • OH & PA – Distribution only • ~45% of 2024F EPS Integrated Segment • WV, MD & NJ – Distribution, Transmission & Generation • ~35% of 2024F EPS Stand-Alone Transmission Segment • FET (ATSI, TrAILCo, MAIT) & KATCo – Transmission only • ~20% of 2024F EPS FE at a Glance Our Fully Regulated Businesses Regulated Fossil Generation plants Regulated Renewable Generation plants
Key Messages EEI – Published November 8, 20243 Building a strong regulatory track record Four constructive base rate case outcomes, including PA base rate case settlement, totaling nearly $450M of annual revenue increases which support investments to best serve customers Completed balance sheet transformation Equity proceeds totaling ~$7B since late ’21, equivalent to issuing common equity at $87/sh or 36x LTM P/E Simplified business segments Organized into new segments representing our five major businesses placing leadership, responsibility and decision-making closer to the customer 5 year, $26B Energize365 investment plan Focused on executing our low-risk, T&D investment plan to modernize the grid, improve the customer experience and to support the energy transition; Plan represents a 44% increase vs. previous 5-yr plan Compelling shareholder value proposition Our diversified, low-risk asset mix, coupled with a strong balance sheet and affordability position, provides the opportunity to significantly enhance the customer experience and provide solid risk- adjusted returns to our investors
Brian Tierney President & CEO Wade Smith President, FE Utilities Torrence Hinton President, OH John Hawkins President, PA Doug Mokoid President, NJ Jim Myers VP Operations, WV/MD Mark Mroczynski President, Transmission Amanda Mertens Campbell VP, External Affairs Toby Thomas COO Jon Taylor SVP, CFO & Strategy Abigail Phillips VP, Chief Risk Officer Karen Sagot VP, Investor Relations John Combs SVP, Shared Services Sean Davies VP, Continuous Improvement Karen McClendon SVP, CHRO Hyun Park SVP, CLO Simplified Segments with a New Operating Model 4 Stand-Alone Transmission Distribution Integrated Corp/Other (FE Parent Debt & Other Obligations) PAOH CEIOE TE FE PA WV & MDNJ JCP&L PEMP FET, LLC KATCo Represents leaders who have joined FE since June 2023 $26B Energize365 Investment Plan (2024-2028) Focused on investments to strengthen the grid and support the energy transition Plan drives 9% average annual rate base growth Plan represents a 44% increase over previous 5-yr plan Aligned the organizational structure and personnel to focus on our five regulated businesses allowing for greater transparency into business unit performance Segment Reporting Leadership Structure ~45% ~35% ~20% EEI – Published November 8, 2024 2024F EPS
2024-2028 Investment Plan Summary $26B 2024-2028 ~25% Rate Base Recovery ~75% Formula Rate State Regulated: 55% FERC Regulated: 45% 9% Transmission: Operational Flexibility 7% Transmission: Regulatory Required 12% Transmission: Enhance System Performance 17% Transmission: Upgrade System Condition 6% Clean Energy 11% Grid Modernization 36% Infrastructure Renewal 2% Fossil Generation $1.4 $1.3 $1.5 $1.7 $1.8 $1.7 $1.8 $2.0 $2.2 $2.4 $1.5 $1.5 $1.6 $1.7 $1.9 2024F 2025F 2026F 2027F 2028F Corp/Other Stand-Alone Transmission Integrated Distribution $5.7B $6.2B $4.6B $4.7B $5.2B Our scale and diversity across five states and FERC provides for flexibility in plan as needed Energize365 $26B investment plan (’24-’28) to strengthen the grid and enable the energy transition EEI – Published November 8, 20245
Ohio Regulatory Update Continue working towards constructive outcomes ■ Filed withdrawal of ESP V on 10/29/24 – Subject to PUCO approval for Ohio Companies to revert to ESP IV – Comments due 11/13/24, Replies due 11/20/24 ■ Reverting to ESP IV reduces risk and simplifies base rate case (BRC) – ESP V added significant uncertainty as the order only provided certain key terms for up to 2 years of the 5-year plan with resolution in BRC (see slide 6) – ESP V was inconsistent with Ohio law as rider recovery should be addressed in an ESP, not a BRC ■ Plan to file ESP VI to provide certainty, consistent with Ohio law, through better alignment between ESP VI and BRC outcomes ■ Next steps in ESP VI and BRC – Nov. 2024: Comments due on the request to revert to ESP IV – By Early 2025: File updated BRC and file a new ESP VI – 2025: ESP VI and BRC progress in separate proceedings – By Early 2026: Anticipate effective dates of ESP VI and BRC EEI – Published November 8, 20246 ESP V Process Timeline May 15: PUCO issued Order to approve our ESP V with modifications, with rates effective June 1, 2025 June 14: FE filed Application for Rehearing (AFR) August 27: Ohio Supreme Court decision (Application of Moraine Wind, LLC), stating that PUCO must decide an AFR within 30 days which thus meant FE’s AFR was denied by operation of law Electric Security Plan (ESP) Summary Utilities are required to file applications to establish either an ESP or a Market Rate Offer to provide customers default generation service, also known as a Standard Service Offer ESPs may include provisions regarding Dx infrastructure, grid modernization, economic development and job retention initiatives, and energy efficiency programs FE’s Ohio utilities ESP IV included riders to recover the costs of capital investments through Rider DCR and Rider AMI High-Level Financial Overview: ESP V vs. IV ESP V ESP IV Rider DCR Cap -$51M (cap = $339M) No change (cap = $390M) DCR increase/yr $15-$21M $0-$15M Veg Mgmt Rider + $22M $0
Ohio Regulatory Update ESP VI provides certainty for all stakeholders EEI – Published November 8, 20247 Illustrative Pre-2022 2022 2023 2024 2025 2026 2027 2028 2029 2030+ E S P IV ESP IV Timeline ESP IV DCR1 All accounts Storm Deferral1 Deferral only E S P V O rd er ESP V Timeline ESP V DCR (excl. Accounts 360-374)2 Storm Deferral/Rider Veg Mgmt Rider E S P IV & V I Projected Timeline ESP IV ESP VI DCR (IV incl. Accounts 360-374)2 Opportunity to provide more certainty Storm Deferral/Rider Veg Mgmt Rider Notes – Illustrative Assumptions • ESP V withdrawal and revert to ESP IV effective 1/1/2025 • Base Rate Case and ESP VI go into effect 1/1/2026 • Term of ESP VI is illustrative and subject to change 1 2 3 Recovery to be determined in BRC 1 Subject to PUCO approval 2 Represents non-distribution FERC capital accounts that resulted in a $50M annual revenue reduction in ESP V
Data Center Growth EEI – Published November 8, 20248 380 1,800 1,800 2,000 2,400 2,400 2,400 2,400 2,400 220 150 500 1,500 2,800 4,100 4,700 4,800 600 1,800 1,950 2,500 3,900 5,200 6,500 7,100 7,200 2025F 2026F 2027F 2028F 2029F 2030F 2031F 2032F 2033F Under Agreement Pipeline MW Data center load growth not included in FE '24-28 load forecast Representative of projected data center growth in the pipeline, including projects under agreement Over 7GWs of projected data center demand through 2033, with over 2GWs under agreement Large load studies > 500MW have tripled since 2023 Data represents FE’s filing to PJM for incremental large load adjustments
2024F % of FE Rate Base: 18% % of FE EPS: 16% Torrence Hinton President of Ohio Rate Case Statistics (Update Filing 7/31/24) Dx Rate Base $4.4B Filed ROE 10.8% Filed Debt / Equity ~45%/55% Test Year 2024 Last published TTM ROE (3/31/24) 7.7% Ohio Overview EEI – Published November 8, 20249 1.7% 1.6% 2.0% 1.5% 4.6% 2.8% -0.3% 3.4% -2% 2% 6% 3Q23 4Q23 1Q24 2Q24 Gross State Product (% Growth) Rate Base ($B) Key Regulatory Updates • ESP V: Withdrawal filed 10/29/24 ‒ Withdrawal subject to PUCO order and will result in the reverting to ESP IV until an ESP VI is filed and approved ‒ Expect to file the ESP VI by early next year and align with review of the Ohio base rate case • Base Rate Case Filing: ‒ No procedural schedule; next steps to include discovery and a PUCO Staff report • OH Grid Mod II: ‒ Settlement agreement filed 4/12/24; $421M investments over 4 years ‒ Expect final order by YE 2024 $175 $178 $181 $209 $168 $172 CEI OE TE AEP DPL DUK [state avg $181] FE Rates 3% < peer avg 3.5% 3.6% 3.7% 4.2% 3.5% 3.6% 3.7% 4.2% 0% 5% 3Q23 4Q23 1Q24 2Q24 Unemployment Rate U.S. OH Data Center Activity Economic Indicators Key Formula Investment Programs • OH Grid Mod II ‒ Smart meters, DERMS ‒ Subject to PUCO approval • OH DCR ‒ Allows for recovery of incremental distribution investments, subject to annual revenue caps $3.1B Total Investments (‘24-28) ~+5% Rate Base Growth (Avg Annual) +28% Increase 2028F vs. 2023 Rate Base 2.1M Ohio customers • 2024 Data Center Peak load 160MW+ • 42 large load studies >500MW in 2024 estimated at +30,000MW • Projected data center growth through 2033 of +4,000MW, with +1,100MW under agreement $4.3 $4.5 $4.6 $4.9 $5.1 $5.5 2023A 2024F 2025F 2026F 2027F 2028F Affordability Average Customer Bills, as of 1/1/2024 100% of Investments have the opportunity for rider recovery, subject to rider terms and revenue caps
Pennsylvania Overview EEI – Published November 8, 202410 Rate Base ($B) Key Regulatory Updates Base Rate Case: Settlement filed 9/13/24; ALJ recommended PAPUC approval on 10/15/24; Expect final order in Dec. 2024 • $225M net revenue adjustment, based on YE 2025 projected rate base of $7B and related cost of service • Constructive outcome; difference in revenue requested and settlement primarily relates to proposed expenses • Required stay-out of new rates until 1/1/27 LTIIP III: Filed 7/22/24; ; Expect final order in Dec. 2024 • $1.6B investment plan for 5 years (2025-2029) Economic Indicators Key Formula Investment Programs • LTIIP II (2020-2024) / LTIIP III (2025-2029) ‒ Accelerated replacement of utility poles, underground and overhead lines and fuses ‒ Install new equipment ‒ Reconfiguration of circuits ‒ Automated equipment with ADMS implementation $4.5B Total Investments (‘24-28) ~+6% Rate Base Growth (Avg Annual) +27% 2028F vs. 2023 John Hawkins President of Pennsylvania 29% 71% Base Rates Formula Penn Power West Penn Power Penelec Met-Ed Rate Districts 2024F % of FE Rate Base: 26% % of FE EPS: 29% $181 $189 $209 $198 $173 FE PA Current FE PA Settled* DUQ PECO PPL [state avg $190] Investment Recovery Mechanisms Last Filed Rate Case Statistics 3.5% 3.6% 3.7% 4.2% 3.3% 3.4% 3.4% 3.4% 0.0% 5.0% 3Q23 4Q23 1Q24 2Q24 Unemployment Rate U.S. PA R te Case Statistics (Settlement Filed 9/13/24) Dx Rate Base $7.0B ROE Settled Debt / Equity Settled Test Year Dec 2025 Last published TTM ROE (12/21/23) 9.2% 2.1M PA customers $6.6 $6.7 $7.0 $7.4 $8.1 $8.8 2023A 2024F 2025F 2026F 2027F 2028F Data Center Activity FE Settled Rates remain 2% < peer avg * Effective date of 1/1/25, subject to PAPUC approval +33% Increase 2028F vs. 2023 Rate Base • 2024 Data Center Peak load 160MW+ • 9 large load studies >500MW in 2024 estimated at +8,800MW Affordability Average Customer Bills, as of 1/1/24, except where noted 1.7% 1.6% 2.0% 1.5% 5.6% 3.8% 1.4% 3.2% 0.0% 4.0% 8.0% 3Q23 4Q23 1Q24 2Q24 Gross State Product (% Growth)
Doug Mokoid President of New Jersey 25% 75% Base Rates Formula 34.5kV 115 kV 230 kV 500 kV JCP&L 2024F % of FE Rate Base: 18% % of FE EPS: 19% New Jersey Overview EEI – Published November 8, 202411 Rate Base ($B) Key Regulatory Updates Base Rate Case: Settlement approved 2/14/24 • Net Revenue increase $85M EE&C: Approved 10/30/24 • Program budget $817M over 2.5 years (January 2025- June 2027), recovered over 10 years • ROE 9.6%; Debt/Equity 48%/52% • Includes programs addressing energy efficiency, peak demand reduction, and building decarbonization EnergizeNJ: Settlement negotiations in progress; Expect final order by 1Q25 • Significant capital investments over 5 years (2025- 2029) to enhance reliability and modernize distribution system Economic Indicators Key Formula Investment Programs • Transmission investments • Includes onshore Tx upgrade projects that support renewable energy • AMI: Deploying 1.2M smart meters • EE&C: Programs for energy efficiency, peak demand reduction & building decarbonization • EnergizeNJ: Enhance reliability & modernize Dx system $5.9B Total Investments: 60% Dx / 40% Tx (‘24-28) ~+13% Rate Base Growth (Avg Annual) +46% 2028F vs. 2023 $150 $155 $231 $200 $200 JCP&L JCP&L (6/1/24) ACE PSEG RECO FE Rates 26% < peer avg [state avg $197] Investment Recovery Mechanisms 1.7% 1.6% 2.0% 1.5% 4.8% 3.3% 1.0% 2.4% 0.0% 2.0% 4.0% 6.0% 3Q23 4Q23 1Q24 2Q24 Gross State Product (% Growth) 3.5% 3.6% 3.7% 4.2%4.7% 4.8% 4.8% 4.6% 0.0% 2.0% 4.0% 6.0% 3Q23 4Q23 1Q24 2Q24 Unemployment Rate U.S. NJ 1.2M NJ customers $4.8B Rate Base (2024F) ~52% Allowed Equity Data Center Activity $4.2 $4.8 $5.3 $6.0 $6.9 $7.8 2023A 2024F 2025F 2026F 2027F 2028F Affordability Average Customer Bills, as of 1/1/24, except where noted +86% Increase 2028F vs. 2023 Rate Base • 2024 Data Center Peak load 30MW • 4 large load studies >500MW in 2024 estimated at +2,700MW 9.6% 10.2% Dx Tx Allowed ROEs
2024F (PE & MP) % of FE Rate Base: 19% % of FE EPS: 17% 47% 53% Base Rates Formula EEI – Published November 8, 202412 Rate Base ($B) Key Regulatory Updates WV Base Rate Case: Settlement approved 3/26/24, rates effective 3/27/24 • Net revenue increase of $105M WV ENEC: Received WVPSC approval of settlement with rates effective 3/27/24 to increase ENEC rates, with deferred amounts to be recovered in 2025-2026 MD Base Rate Case: Order issued 10/18/23, New rates effective 10/19/23 • Net revenue increase of $29M MD EmPOWER: Legislation effective 7/1/24 • Reduces the carrying cost on the unamortized balances of EmPOWER costs from the pre-tax ROR to the average cost of outstanding debt Economic Indicators ~+8% Rate Base Growth (Avg Annual) +33% 2028F vs. 2023 WV West Virginia & Maryland Overview WEST VIRGINIA [state avg $158] FE Rates 22% < peer avg $124 $133 $170 $170 MP & PE MP & PE AEP (AP) AEP (WP) $138 $177 $199 $218 PE BGE Delmarva PEPCO MARYLAND [state avg $183] FE Rates 30% < peer avg Investment Recovery Mechanisms 1.7% 1.6% 2.0% 1.5% 3.7% 4.7% 1.1% 2.1% 0.0% 2.0% 4.0% 6.0% 3Q23 4Q23 1Q24 2Q24 WV Gross State Product (% Growth) 1.7% 1.6% 2.0% 1.5% 2.7% 1.3% -0.1% 2.3% -2.0% 0.0% 2.0% 4.0% 6.0% 3Q23 4Q23 1Q24 2Q24 MD Gross State Product (% Growth) U.S. WV/MD Potomac Edison Mon PowerJim Myers VP Operations, WV & MD 553K WV & 289K MD customers $4.7B Rate Base (2024F) Data Center Activity $3.6 $3.8 $4.0 $4.3 $4.6 $4.9 $0.9 $0.9 $1.0 $1.2 $1.5 $1.8 2023A 2024F 2025F 2026F 2027F 2028F WV MD Affordability +49% Increase 2028F vs. 2023 Rate Base • 2024 Data Center Peak load 70MW+ • 22 large load studies >500MW in 2024 estimated at +17,500MW • Projected data center growth through 2033 of +3,000MW, with +1,200MW under agreement MD Average Customer Bills, as of 1/1/24 except where noted (3/27/24) Key Formula Investment Programs • WV ‒ Transmission investments ‒ Utility-scale solar generation investments ‒ ELG environmental compliance investments • MD ‒ Transmission investments ‒ EmPOWER Energy Efficiency Program $4.2B Total Investments: 50% Dx/15% Gx/Tx 35% (‘24-28) 9.8% 9.5%/10.45% WV MD: Dx / TX Allowed ROEs 50% 53%/50% WV MD: Dx / TX Allowed Equity
Transmission Overview EEI – Published November 8, 202413 Total Rate Base ($B) Mark Mroczynski President of Transmission 2024F % of FE Rate Base: 19% % of FE EPS: 21% MAIT TrAILCo 100% FERC-regulated, forward-looking rates 10.3-12.7% Allowed ROEs $8.4B Total Rate Base (2024F) 16.8K Tx Line Miles Brookfield 49.9% Ownership of FET, LLC • FE sold 49.9% equity interest of FET, LLC for $5.9B (19.9% closed in May ‘22, 30% in March ’24) ‒ FET, LLC is the parent of ATSI, MAIT, and TrAILCo Key Updates • Pursuing incremental Tx investments through joint-development agreement (JDA) with AEP and Dominion; the most comprehensive of these solutions totals $3.8B in investment (FE portion $1.3B) ‒ FE also submitted nearly $1B individual projects to PJM and for needs that are outside the JDA ‒ JDA solutions include several new 765-, 500- and 345-kv transmission lines ‒ Project approvals expected to be announced in late February 2025 • Data center and AI’s share of U.S. electricity consumption expected to triple by 2030 • Load study requests of 500MW+ in FE footprint have more than tripled compared to 2023 ‒ While we have transmission capacity to support data center investments, we are taking a thoughtful approach to ensure we appropriately manage risks and that existing customers have adequate protections • Focused on improving grid reliability and resiliency, which are key to enable greater operational flexibility, increased protection against physical asset risks, and better support for increased renewables and distributed energy resources • Enhancing the high-voltage transmission system to make it more resilient, reduce future maintenance costs and increase flexibility to help grid operators respond more swiftly to variable conditions $8.2B Total Investments (‘24-28) 9% Rate Base Growth (Avg Annual) +56% Increase 2028 vs. 2023 Rate Base $3.8 $4.1 $4.3 $4.7 $5.0 $5.4 $1.4 $1.4 $1.4 $1.3 $1.3 $1.3$2.1 $2.4 $2.9 $3.4 $4.0 $4.5 $0.4 $0.5 $0.5 $0.6 $0.7 $0.8 2023A 2024F 2025F 2026F 2027F 2028F ATSI TrAIL MAIT KATCo FE Rate Base (Excl. Brookfield) $5.0B $5.3B $11B $12B $6.4B$6.4B $7.7B $10B$9B$8.4B $5.8B $7.0B 100% FE Owned ATSI KATCo
Our Value Proposition 14 (1) As measured year-over-year off prior midpoint guidance. The amount and timing of items impacting comparability makes a detailed reconciliation of forward-looking non-GAAP financial measures impracticable. Strong Growth Outlook Attractive Risk Profile Compelling Total Shareholder Return 6-8% long-term annual Operating EPS growth(1) Energize365 T&D Investment Plan of $26B through 2024-2028 9% Average Annual Rate Base Growth 2024-2028 Significant infrastructure investment opportunities beyond plan horizon Targeted 14-15% FFO/Debt over plan horizon No incremental equity needs expected through the planning period beyond Employee Benefit programs of up to ~$100M annually Constructive regulatory frameworks with 75% of planned investment in formula rate programs Low-risk diversified T&D asset mix with strong affordability position Attractive total shareholder return of 10-12%+ with potential for upside (6-8% Operating EPS growth and 4%+ dividend yield) Vastly improved earnings quality, driven by core regulated business growth Committed to dividend growth in line with earnings growth, targeting dividend payout ratio of 60-70% Our diversified asset mix, coupled with an improved balance sheet and a strong affordability position, provides the opportunity to significantly enhance the customer experience and provide solid risk-adjusted returns to our investors EEI – Published November 8, 2024
Forward-Looking Statements 15 Forward-Looking Statements: This presentation includes forward-looking statements based on information currently available to management. Such statements are subject to certain risks and uncertainties and readers are cautioned not to place undue reliance on these forward-looking statements. 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,” "forecast," "target," "will," "intend," “believe,” "project," “estimate," "plan" 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, which may include the following: the potential liabilities, increased costs and unanticipated developments resulting from government investigations and agreements, including those associated with compliance with or failure to comply with the Deferred Prosecution Agreement entered into July 21, 2021 with the U.S. Attorney’s Office for the Southern District of Ohio; the risks and uncertainties associated with government investigations and audits regarding Ohio House Bill 6, as passed by Ohio’s 133rd General Assembly (“HB 6”) and related matters, including potential adverse impacts on federal or state regulatory matters, including, but not limited to, matters relating to rates; the risks and uncertainties associated with litigation, arbitration, mediation and similar proceedings, particularly regarding HB 6 related matters; changes in national and regional economic conditions, including recession, volatile interest rates, inflationary pressure, supply chain disruptions, higher fuel costs, and workforce impacts, affecting us and/or our customers and those vendors with which we do business; variations in weather, such as mild seasonal weather variations and severe weather conditions (including events caused, or exacerbated, by climate change, such as wildfires, hurricanes, flooding, droughts, high wind events and extreme heat events) and other natural disasters affecting future operating results and associated regulatory actions or outcomes in response to such conditions; legislative and regulatory developments, including, but not limited to, matters related to rates, energy regulatory policies, compliance and enforcement activity, cyber security, and climate change; the risks associated with physical attacks, such as acts of war, terrorism, sabotage or other acts of violence, and cyber-attacks and other disruptions to our, or our vendors’, information technology system, which may compromise our operations, and data security breaches of sensitive data, intellectual property and proprietary or personally identifiable information; the ability to meet our goals relating to employee, environmental, social and corporate governance opportunities, improvements, and efficiencies, including our greenhouse gas (“GHG”) reduction goals; the ability to accomplish or realize anticipated benefits through establishing a culture of continuous improvement and our other strategic and financial goals, including, but not limited to, overcoming current uncertainties and challenges associated with the ongoing government investigations, executing Energize365, our transmission and distribution investment plan, executing on our rate filing strategy, controlling costs, improving credit metrics, maintaining investment grade ratings, and growing earnings; changing market conditions affecting the measurement of certain liabilities and the value of assets held in our pension trusts may negatively impact our forecasted growth rate, results of operations, and may also cause us to make contributions to our pension sooner or in amounts that are larger than currently anticipated; mitigating exposure for remedial activities associated with retired and formerly owned electric generation assets, including those sites impacted by the legacy coal combustion residual rules that were finalized during 2024; changes to environmental laws and regulations, including, but not limited to, rules finalized by the Environmental Protection Agency and the Securities and Exchange Commission (“SEC”) related to climate change; changes in customers’ demand for power, including, but not limited to, economic conditions, the impact of climate change, emerging technology, particularly with respect to electrification, energy storage and distributed sources of generation; the ability to access the public securities and other capital and credit markets in accordance with our financial plans, the cost of such capital and overall condition of the capital and credit markets affecting us, including the increasing number of financial institutions evaluating the impact of climate change on their investment decisions; future actions taken by credit rating agencies that could negatively affect either our access to or terms of financing or our financial condition and liquidity; changes in assumptions regarding factors such as economic conditions within our territories, the reliability of our transmission and distribution system, generation resource planning, or the availability of capital or other resources supporting identified transmission and distribution investment opportunities; the potential of non-compliance with debt covenants in our credit facilities; the ability to comply with applicable reliability standards and energy efficiency and peak demand reduction mandates; human capital management challenges, including among other things, attracting and retaining appropriately trained and qualified employees and labor disruptions by our unionized workforce; changes to significant accounting policies; any changes in tax laws or regulations, including, but not limited to, the Inflation Reduction Act of 2022, or adverse tax audit results or rulings; and the risks and other factors discussed from time to time in our SEC filings. Dividends declared from time to time on FirstEnergy Corp.’s common stock during any period may in the aggregate vary from prior periods due to circumstances considered by FirstEnergy Corp.’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. These forward-looking statements are also qualified by, and should be read together with, the risk factors included in FirstEnergy Corp.’s Form 10-K, Form 10-Q and in FirstEnergy's other filings with the SEC. The foregoing review of factors also 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 FirstEnergy Corp.’s 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. FirstEnergy Corp. expressly disclaims any obligation to update or revise, except as required by law, any forward-looking statements contained herein or in the information incorporated by reference as a result of new information, future events or otherwise. EEI – Published November 8, 2024