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FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Dec. 31, 2021

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:


	December 31, 2021								December 31, 2020
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets	(In millions)


Derivative assets FTRs(1)	$	—	$	—	$	9	$	9	$	—	$	—	$	3	$	3

Equity securities	2		—		—		2		2		—		—		2
U.S. state debt securities	—		273		—		273		—		276		—		276
Cash, cash equivalents and restricted cash(2)	1,511		—		—		1,511		1,801		—		—		1,801
Other(3)	—		42		—		42		—		41		—		41
Total assets	$	1,513	$	315	$	9	$	1,837	$	1,803	$	317	$	3	$	2,123

Liabilities

Derivative liabilities FTRs(1)	$	—	$	—	$	(1)	$	(1)	$	—	$	—	$	—	$	—


Total liabilities	$	—	$	—	$	(1)	$	(1)	$	—	$	—	$	—	$	—

Net assets (liabilities)(4)	$	1,513	$	315	$	8	$	1,836	$	1,803	$	317	$	3	$	2,123

(1)Contracts are subject to regulatory accounting treatment and changes in market values do not impact earnings.

(2)Restricted cash of $49 million and $67 million as of December 31, 2021 and 2020 respectively, primarily relates to cash collected from JCP&L, MP, PE and the Ohio Companies' customers that is specifically used to service debt of their respective funding companies.

(3)Primarily consists of short-term investments.

(4)Excludes $1 million as of December 31, 2020, 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 contracts and FTRs that are classified as Level 3 in the fair value hierarchy for the years ended December 31, 2021 and 2020:


	NUG Contracts(1)						FTRs(1)
	Derivative Assets		Derivative Liabilities		Net			Derivative Assets		Derivative Liabilities		Net
	(In millions)
January 1, 2020 Balance	$	—	$	(16)	$	(16)		$	4	$	(1)	$	3

Unrealized gain (loss)	—		(3)		(3)			(3)		—		(3)
Purchases	—		—		—			7		(2)		5


Settlements	—		19		19			(5)		3		(2)

December 31, 2020 Balance	$	—	$	—	$	—		$	3	$	—	$	3

Unrealized gain (loss)	—		—		—			7		—		7
Purchases	—		—		—			5		(2)		3


Settlements	—		—		—			(6)		1		(5)

December 31, 2021 Balance	$	—	$	—	$	—		$	9	$	(1)	$	8

(1)Contracts are subject to regulatory accounting treatment and changes in market values do not impact earnings.

Quantitative information for level 3 valuation

The following table provides quantitative information for FTRs contracts that are classified as Level 3 in the fair value hierarchy for the year ended December 31, 2021:

Fair Value, Net (In millions)

Valuation
Technique

Significant Input

Range

Weighted Average

Units

FTRs

Model

RTO auction clearing prices

$1.10

$4.60

$1.80

Dollars/MWH

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, unrealized losses and fair values of investments held in nuclear fuel disposal trusts as of December 31, 2021 and 2020:


	December 31, 2021(1)								December 31, 2020(2)
	Cost Basis		Unrealized Gains		Unrealized Losses		Fair Value		Cost Basis		Unrealized Gains		Unrealized Losses		Fair Value
	(In millions)

Debt securities	$	280	$	2	$	(9)	$	273	$	275	$	7	$	(6)	$	276

(1)Excludes short-term cash investments of $11 million.

(2)Excludes short-term cash investments of $9 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 debt securities, realized gains and losses on those sales and interest and dividend income for the years ended December 31, 2021, 2020 and 2019, were as follows:


	For the Years Ended December 31,
	2021		2020(1)		2019(1)
	(In millions)
Sale Proceeds	$	48	$	186	$	1,637
Realized Gains	—		12		98
Realized Losses	(3)		(8)		(31)

Interest and Dividend Income	11		22		38

(1) Includes amounts associated with NDTs that were previously held by JCP&L, ME, and PN. See above for additional information.

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, which excludes finance lease obligations and net unamortized debt issuance costs, unamortized fair value adjustments, premiums and discounts as of December 31, 2021 and 2020:


	As of December 31,
	2021		2020
	(In millions)
Carrying Value	$	23,946		$	22,377
Fair Value	27,043			25,465