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Fair Value Measurements (Tables)
 9 Months Ended
Sep. 30, 2013
Fair Value of Financial Instruments [Line Items]  
Assets and liabilities measured on recurring basis
The following tables set forth the recurring assets and liabilities that are accounted for at fair value by level within the fair value hierarchy:

FirstEnergy
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Recurring Fair Value Measurements
September 30, 2013
 
December 31, 2012
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets
(In millions)
Corporate debt securities
$
—

 
$
1,299

 
$
—

 
$
1,299

 
$
—

 
$
1,259

 
$
—

 
$
1,259

Derivative assets - commodity contracts
4

 
197

 
—

 
201

 
—

 
252

 
—

 
252

Derivative assets - FTRs
—

 
—

 
3

 
3

 
—

 
—

 
8

 
8

Derivative assets - NUG contracts(1)
—

 
—

 
23

 
23

 
—

 
—

 
36

 
36

Equity securities(2)
461

 
—

 
—

 
461

 
310

 
—

 
—

 
310

Foreign government debt securities
—

 
101

 
—

 
101

 
—

 
126

 
—

 
126

U.S. government debt securities
—

 
171

 
—

 
171

 
—

 
179

 
—

 
179

U.S. state debt securities
—

 
226

 
—

 
226

 
—

 
299

 
—

 
299

Other(3)
160

 
157

 
—

 
317

 
126

 
227

 
—

 
353

Total assets
$
625

 
$
2,151

 
$
26

 
$
2,802

 
$
436

 
$
2,342

 
$
44

 
$
2,822

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities - commodity contracts
$
(5
)
 
$
(107
)
 
$
—

 
$
(112
)
 
$
(3
)
 
$
(151
)
 
$
—

 
$
(154
)
Derivative liabilities - FTRs
—

 
—

 
(14
)
 
(14
)
 
—

 
—

 
(9
)
 
(9
)
Derivative liabilities - NUG contracts(1)
—

 
—

 
(233
)
 
(233
)
 
—

 
—

 
(290
)
 
(290
)
Derivative liabilities - LCAPP contracts(1)
—

 
—

 
(166
)
 
(166
)
 
—

 
—

 
(144
)
 
(144
)
Total liabilities
$
(5
)
 
$
(107
)
 
$
(413
)
 
$
(525
)
 
$
(3
)
 
$
(151
)
 
$
(443
)
 
$
(597
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net assets (liabilities)(4)
$
620

 
$
2,044

 
$
(387
)
 
$
2,277

 
$
433

 
$
2,191

 
$
(399
)
 
$
2,225


(1) 
NUG and LCAPP contracts are generally subject to regulatory accounting treatment and do not impact earnings.
(2) 
NDT funds hold equity portfolios whose performance is benchmarked against the Alerian MLP Index or the Wells Fargo Hybrid and Preferred Securities REIT index.
(3) 
Primarily consists of short-term cash investments.
(4) 
Excludes $13 million and $110 million as of September 30, 2013 and December 31, 2012, respectively, of receivables, payables, taxes and accrued income associated with financial instruments reflected within the fair value table.
Reconciliation of changes in the fair value roll forward of level 3 measurements of NUG contracts
The following table provides a reconciliation of changes in the fair value of NUG and LCAPP contracts and FTRs that are classified as Level 3 in the fair value hierarchy for the periods ended September 30, 2013 and December 31, 2012:

 
NUG Contracts(1)
 
LCAPP Contracts(1)
 
FTRs
 
Derivative Assets
 
Derivative Liabilities
 
Net
 
Derivative Assets
 
Derivative Liabilities
 
Net
 
Derivative Assets
 
Derivative Liabilities
 
Net
 
(In millions)
January 1, 2012 Balance
$
57

 
$
(349
)
 
$
(292
)
 
$
—

 
$
—

 
$
—

 
$
1

 
$
(23
)
 
$
(22
)
Unrealized gain (loss)
(20
)
 
(180
)
 
(200
)
 
—

 
1

 
1

 
6

 
(6
)
 
—

Purchases
—

 
—

 
—

 
—

 
(145
)
 
(145
)
 
13

 
(10
)
 
3

Settlements
(1
)
 
239

 
238

 
—

 
—

 
—

 
(12
)
 
30

 
18

December 31, 2012 Balance
$
36

 
$
(290
)
 
$
(254
)
 
$
—

 
$
(144
)
 
$
(144
)
 
$
8

 
$
(9
)
 
$
(1
)
Unrealized gain (loss)
(6
)
 
(6
)
 
(12
)
 
—

 
(22
)
 
(22
)
 
1

 
2

 
3

Purchases
—

 
—

 
—

 
—

 
—

 
—

 
5

 
(15
)
 
(10
)
Settlements
(7
)
 
63

 
56

 
—

 
—

 
—

 
(11
)
 
8

 
(3
)
September 30, 2013 Balance
$
23

 
$
(233
)
 
$
(210
)
 
$
—


$
(166
)
 
$
(166
)
 
$
3

 
$
(14
)
 
$
(11
)

(1) 
Changes in the fair value of NUG and LCAPP contracts are generally subject to regulatory accounting treatment and do not impact earnings.
Quantitative information for level 3 valuation
The following table provides quantitative information for FTRs, NUG contracts and LCAPP contracts that are classified as Level 3 in the fair value hierarchy for the period ended September 30, 2013:
 
 
 
Fair Value, Net (In millions)
 
Valuation
Technique
 
Significant Input
 
Range
 
Weighted Average
 
Units
FTRs
 
$
(11
)
 
Model
 
RTO auction clearing prices
 
($5.60) to $5.40
 
$0.62
 
Dollars/MWH
NUG Contracts
 
$
(210
)
 
Model
 
Generation
Electricity regional prices
 
600 to 5,864,000
$41.40 to $57.30
 
1,421,000
$49.40
 
MWH
Dollars/MWH
LCAPP Contracts
 
$
(166
)
 
Model
 
Regional capacity prices
 
$158.60 to $187.60
 
$171.20
 
Dollars/MW-Day
Amortized cost basis, unrealized gains and losses and fair values of investments in available-for-sale securities
The following table summarizes the amortized cost basis, unrealized gains (there were no unrealized losses) and fair values of investments held in NDT, nuclear fuel disposal and NUG trusts as of September 30, 2013 and December 31, 2012:

 
 
September 30, 2013(1)
 
December 31, 2012(2)
 
 
Cost Basis
 
Unrealized Gains
 
Fair Value
 
Cost Basis
 
Unrealized Gains
 
Fair Value
 
 
(In millions)
Debt securities
 
 
 
 
 
 
 
 
 
 
 
 
FirstEnergy
 
$
1,825

 
$
21

 
$
1,846

 
$
1,827

 
$
34


$
1,861

FES
 
868

 
9

 
877

 
778

 
14

 
792

 
 
 
 
 
 
 
 
 
 
 
 
 
Equity securities
 
 
 
 
 
 
 
 
 
 
 
 
FirstEnergy
 
$
433

 
$
28

 
$
461

 
$
293

 
$
16

 
$
309

FES
 
317

 
21

 
338

 
281

 
13

 
294


(1) 
Excludes short-term cash investments: FE Consolidated - $106 million; FES - $55 million.
(2) 
Excludes short-term cash investments: FE Consolidated - $326 million; FES - $196 million.
Proceeds from the sale of investments in available-for-sale securities, realized gains and losses on those sales, and interest and dividend income
Proceeds from the sale of investments in AFS securities, realized gains and losses on those sales, OTTI and interest and dividend income for the three months and nine months ended September 30, 2013 and 2012 were as follows:

Three Months Ended
September 30, 2013
 
Sale Proceeds
 
Realized Gains
 
Realized Losses
 
OTTI
 
Interest and
Dividend Income
 
 
(In millions)
FirstEnergy
 
$
368

 
$
9

 
$
(15
)
 
$
(21
)
 
$
26

FES
 
164

 
5

 
(3
)
 
(21
)
 
16

September 30, 2012
 
Sale Proceeds
 
Realized Gains
 
Realized Losses
 
OTTI
 
Interest and Dividend Income
 
 
(In millions)
FirstEnergy
 
$
1,751

 
$
81

 
$
(30
)
 
$
(2
)
 
$
18

FES
 
1,059

 
60

 
(21
)
 
(2
)
 
10



Nine Months Ended
September 30, 2013
 
Sale Proceeds
 
Realized Gains
 
Realized Losses
 
OTTI
 
Interest and
Dividend Income
 
 
(In millions)
FirstEnergy
 
$
1,545

 
$
49

 
$
(31
)
 
$
(74
)
 
$
74

FES
 
650

 
38

 
(14
)
 
(66
)
 
44

September 30, 2012
 
Sale Proceeds
 
Realized Gains
 
Realized Losses
 
OTTI
 
Interest and Dividend Income
 
 
(In millions)
FirstEnergy
 
$
2,133

 
$
118

 
$
(58
)
 
$
(9
)
 
$
51

FES
 
1,167

 
85

 
(40
)
 
(8
)
 
27
Amortized cost basis, unrealized gains and losses, and approximate fair values of investments in held-to-maturity securities
The following table provides the amortized cost basis, unrealized gains (there were no unrealized losses) and approximate fair values of investments in held-to-maturity securities as of September 30, 2013 and December 31, 2012:

 
 
September 30, 2013
 
December 31, 2012
 
 
Cost Basis
 
Unrealized Gains
 
Fair Value
 
Cost Basis
 
Unrealized Gains
 
Fair Value
 
 
(In millions)
Debt Securities
 
 
 
 
 
 
 
 
 
 
 
 
FirstEnergy
 
$
46

 
$
1

 
$
47

 
$
54

 
$
30

 
$
84
Fair value and related carrying amounts of long-term debt and other long-term obligations
The following table provides the approximate fair value and related carrying amounts of long-term debt and other long-term obligations, excluding capital lease obligations and net unamortized premiums and discounts:
 
September 30, 2013
 
December 31, 2012
 
Carrying
Value
 
Fair
Value
 
Carrying
Value
 
Fair
Value
 
(In millions)
FirstEnergy
$
17,007

 
$
17,721

 
$
16,957

 
$
19,460

FES
3,015

 
3,082

 
4,194

 
4,524
FES
  
Fair Value of Financial Instruments [Line Items]  
Assets and liabilities measured on recurring basis
FES
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Recurring Fair Value Measurements
September 30, 2013
 
December 31, 2012
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets
(In millions)
Corporate debt securities
$
—

 
$
742

 
$
—

 
$
742

 
$
—

 
$
703

 
$
—

 
$
703

Derivative assets - commodity contracts
4

 
197

 
—

 
201

 
—

 
252

 
—

 
252

Derivative assets - FTRs
—

 
—

 
2

 
2

 
—

 
—

 
6

 
6

Equity securities(1)
338

 
—

 
—

 
338

 
294

 
—

 
—

 
294

Foreign government debt securities
—

 
58

 
—

 
58

 
—

 
61

 
—

 
61

U.S. government debt securities
—

 
26

 
—

 
26

 
—

 
27

 
—

 
27

Other(2)
—

 
94

 
—

 
94

 
—

 
104

 
—

 
104

Total assets
$
342

 
$
1,117

 
$
2

 
$
1,461

 
$
294

 
$
1,147

 
$
6

 
$
1,447

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities - commodity contracts
$
(5
)
 
$
(107
)
 
$
—

 
$
(112
)
 
$
(3
)
 
$
(151
)
 
$
—

 
$
(154
)
Derivative liabilities - FTRs
—

 
—

 
(13
)
 
(13
)
 
—

 
—

 
(6
)
 
(6
)
Total liabilities
$
(5
)
 
$
(107
)
 
$
(13
)
 
$
(125
)
 
$
(3
)
 
$
(151
)
 
$
(6
)
 
$
(160
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net assets (liabilities)(3)
$
337

 
$
1,010

 
$
(11
)
 
$
1,336

 
$
291

 
$
996

 
$
—

 
$
1,287


(1) 
NDT funds hold equity portfolios whose performance is benchmarked against the Alerian MLP Index or the Wells Fargo Hybrid and Preferred Securities REIT index.
(2) 
Primarily consists of short-term cash investments.
(3) 
Excludes $12 million and $94 million as of September 30, 2013 and December 31, 2012, respectively, of receivables, payables, taxes and accrued income associated with the financial instruments reflected within the fair value table.
Reconciliation of changes in the fair value roll forward of level 3 measurements of NUG contracts
The following table provides a reconciliation of changes in the fair value of FTRs held by FES and classified as Level 3 in the fair value hierarchy for the periods ended September 30, 2013 and December 31, 2012:

 
 
Derivative Asset FTRs
 
Derivative Liability FTRs
 
Net FTRs
 
 
(In millions)
January 1, 2012 Balance
 
$
1

 
$
(7
)
 
$
(6
)
Unrealized gain (loss)
 
4

 
(4
)
 
—

Purchases
 
9

 
(7
)
 
2

Settlements
 
(8
)
 
12

 
4

December 31, 2012 Balance
 
$
6

 
$
(6
)
 
$
—

Unrealized loss
 
(1
)
 
(1
)
 
(2
)
Purchases
 
4

 
(12
)
 
(8
)
Settlements
 
(7
)
 
6

 
(1
)
September 30, 2013 Balance
 
$
2

 
$
(13
)
 
$
(11
)
Quantitative information for level 3 valuation
The following table provides quantitative information for FTRs held by FES that are classified as Level 3 in the fair value hierarchy for the period ended September 30, 2013:
 
 
 
Fair Value, Net (In millions)
 
Valuation
Technique
 
Significant Input
 
Range
 
Weighted Average
 
Units
FTRs
 
$
(11
)
 
Model
 
RTO auction clearing prices
 
($5.60) to $5.40
 
$0.40
 
Dollars/MWH