SUPPLEMENTAL GUARANTOR INFORMATION

In 2007, FGCO completed a sale and leaseback transaction for its undivided interest in Bruce Mansfield Unit 1. FES has fully, unconditionally and irrevocably guaranteed all of FGCO’s obligations under each of the leases. The related lessor notes and pass through certificates are not guaranteed by FES or FGCO, but the notes are secured by, among other things, each lessor trust’s undivided interest in Unit 1, rights and interests under the applicable lease and rights and interests under other related agreements, including FES’ lease guaranty. This transaction is classified as an operating lease under GAAP for FES and FirstEnergy and as a financing for FGCO.

The Condensed Consolidating Statements of Income and Comprehensive Income for the three months and six months ended June 30, 2012 and 2011, Consolidating Balance Sheets as of June 30, 2012 and December 31, 2011, and Consolidating Statements of Cash Flows for the six months ended June 30, 2012 and 2011, for FES (parent and guarantor), FGCO and NGC (non-guarantor) are presented below. Investments in wholly owned subsidiaries are accounted for by FES using the equity method. Results of operations for FGCO and NGC are, therefore, reflected in FES’ investment accounts and earnings as if operating lease treatment was achieved. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions and the entries required to reflect operating lease treatment associated with the 2007 Bruce Mansfield Unit 1 sale and leaseback transaction.

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited)



For the Three Months Ended June 30, 2012	FES			FGCO			NGC			Eliminations			Consolidated
	(In millions)
STATEMENTS OF INCOME

REVENUES	$	1,430		$	636		$	473		$	(1,083	)	$	1,456
OPERATING EXPENSES:
Fuel	—			336			44			—			380
Purchased power from affiliates	1,156			—			60			(1,083		)	133
Purchased power from non-affiliates	434			—			—			—			434
Other operating expenses	107			100			172			14			393
Provision for depreciation	1			30			39			(1		)	69
General taxes	20			8			4			—			32
Total operating expenses	1,718			474			319			(1,070		)	1,441

OPERATING INCOME (LOSS)	(288		)	162			154			(13		)	15

OTHER INCOME (EXPENSE):
Investment income	—			5			7			(6		)	6
Miscellaneous income, including net income from equity investees	279			19			—			(278		)	20
Interest expense — affiliates	(5		)	(2		)	(1		)	6			(2		)
Interest expense — other	(24		)	(26		)	(14		)	16			(48		)
Capitalized interest	—			1			8			—			9
Total other income (expense)	250			(3		)	—			(262		)	(15		)

INCOME (LOSS) BEFORE INCOME TAXES	(38		)	159			154			(275		)	—

INCOME TAXES (BENEFITS)	(37		)	(7		)	42			3			1

NET INCOME (LOSS)	$	(1	)	$	166		$	112		$	(278	)	$	(1	)

STATEMENTS OF COMPREHENSIVE INCOME

NET INCOME (LOSS)	$	(1	)	$	166		$	112		$	(278	)	$	(1	)

OTHER COMPREHENSIVE INCOME:
Pensions and OPEB prior service costs	8			7			—			(7		)	8
Amortized gain on derivative hedges	1			—			—			—			1
Change in unrealized gain on available for sale securities	3			—			3			(3		)	3
Other comprehensive income	12			7			3			(10		)	12
Income taxes on other comprehensive income	2			3			1			(4		)	2
Other comprehensive income, net of tax	10			4			2			(6		)	10
COMPREHENSIVE INCOME	$	9		$	170		$	114		$	(284	)	$	9

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited)



For the Six Months Ended June 30, 2012	FES			FGCO			NGC			Eliminations			Consolidated
	(In millions)
STATEMENTS OF INCOME

REVENUES	$	2,920		$	1,178		$	867		$	(1,993	)	$	2,972
OPERATING EXPENSES:
Fuel	—			576			99			—			675
Purchased power from affiliates	2,121			—			122			(1,993		)	250
Purchased power from non-affiliates	921			—			—			—			921
Other operating expenses	183			192			288			25			688
Provision for depreciation	2			60			73			(3		)	132
General taxes	40			18			11			—			69
Total operating expenses	3,267			846			593			(1,971		)	2,735

OPERATING INCOME (LOSS)	(347		)	332			274			(22		)	237

OTHER INCOME (EXPENSE):
Investment income	1			9			12			(10		)	12
Miscellaneous income, including net income from equity investees	537			19			—			(532		)	24
Interest expense — affiliates	(9		)	(3		)	(2		)	10			(4		)
Interest expense — other	(47		)	(52		)	(21		)	31			(89		)
Capitalized interest	—			2			16			—			18
Total other income (expense)	482			(25		)	5			(501		)	(39		)

INCOME BEFORE INCOME TAXES	135			307			279			(523		)	198

INCOME TAXES (BENEFITS)	14			(8		)	65			6			77

NET INCOME	$	121		$	315		$	214		$	(529	)	$	121

STATEMENTS OF COMPREHENSIVE INCOME

NET INCOME	$	121		$	315		$	214		$	(529	)	$	121

OTHER COMPREHENSIVE INCOME
Pensions and OPEB prior service costs	3			3			—			(3		)	3
Amortized loss on derivative hedges	(4		)	—			—			—			(4		)
Change in unrealized gain on available for sale securities	13			—			13			(13		)	13
Other comprehensive income	12			3			13			(16		)	12
Income taxes on other comprehensive income	4			1			5			(6		)	4
Other comprehensive income, net of tax	8			2			8			(10		)	8
COMPREHENSIVE INCOME	$	129		$	317		$	222		$	(539	)	$	129

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited)



For the Three Months Ended June 30, 2011	FES			FGCO			NGC			Eliminations			Consolidated
	(In millions)
STATEMENTS OF INCOME

REVENUES	$	1,275		$	535		$	393		$	(911	)	$	1,292
OPERATING EXPENSES:
Fuel	6			266			44			—			316
Purchased power from affiliates	902			9			65			(911		)	65
Purchased power from non-affiliates	332			(3		)	—			—			329
Other operating expenses	159			108			134			12			413
Provision for depreciation	1			32			37			(1		)	69
General taxes	16			8			6			—			30
Impairment of long-lived assets	—			7			—			—			7
Total operating expenses	1,416			427			286			(900		)	1,229

OPERATING INCOME (LOSS)	(141		)	108			107			(11		)	63

OTHER INCOME (EXPENSE):
Investment income	—			1			15			—			16
Miscellaneous income, including net income from equity investees	132			1			—			(129		)	4
Interest expense — affiliates	—			(1		)	(1		)	—			(2		)
Interest expense — other	(24		)	(28		)	(16		)	16			(52		)
Capitalized interest	—			5			5			—			10
Total other income (expense)	108			(22		)	3			(113		)	(24		)

INCOME (LOSS) BEFORE INCOME TAXES	(33		)	86			110			(124		)	39

INCOME TAXES (BENEFITS)	(62		)	28			41			3			10

NET INCOME	$	29		$	58		$	69		$	(127	)	$	29

STATEMENTS OF COMPREHENSIVE INCOME

NET INCOME	$	29		$	58		$	69		$	(127	)	$	29

OTHER COMPREHENSIVE INCOME (LOSS)
Pensions and OPEB prior service costs	(5		)	(4		)	—			4			(5		)
Amortized gain on derivative hedges	14			—			—			—			14
Change in unrealized gain on available for sale securities	8			—			8			(8		)	8
Other comprehensive income (loss)	17			(4		)	8			(4		)	17
Income taxes (benefits) on other comprehensive income (loss)	8			(2		)	3			(1		)	8
Other comprehensive income (loss), net of tax	9			(2		)	5			(3		)	9
COMPREHENSIVE INCOME	$	38		$	56		$	74		$	(130	)	$	38

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited)



For the Six Months Ended June 30, 2011	FES			FGCO			NGC			Eliminations			Consolidated
	(In millions)
STATEMENTS OF INCOME

REVENUES	$	2,642		$	1,278		$	862		$	(2,098	)	$	2,684
OPERATING EXPENSES:
Fuel	7			560			92			—			659
Purchased power from affiliates	2,087			11			134			(2,098		)	134
Purchased power from non-affiliates	629			(3		)	—			—			626
Other operating expenses	321			219			313			25			878
Provision for depreciation	2			63			76			(3		)	138
General taxes	27			19			14			—			60
Impairment of long-lived assets	—			20			—			—			20
Total operating expenses	3,073			889			629			(2,076		)	2,515

OPERATING INCOME (LOSS)	(431		)	389			233			(22		)	169

OTHER INCOME (EXPENSE):
Investment income	1			1			20			—			22
Miscellaneous income, including net income from equity investees	374			2			—			(368		)	8
Interest expense — affiliates	(1		)	(1		)	(1		)	—			(3		)
Interest expense — other	(48		)	(56		)	(33		)	32			(105		)
Capitalized interest	—			10			10			—			20
Total other income (expense)	326			(44		)	(4		)	(336		)	(58		)

INCOME (LOSS) BEFORE INCOME TAXES	(105		)	345			229			(358		)	111

INCOME TAXES (BENEFITS)	(179		)	125			86			5			37

NET INCOME	$	74		$	220		$	143		$	(363	)	$	74

STATEMENTS OF COMPREHENSIVE INCOME

NET INCOME	$	74		$	220		$	143		$	(363	)	$	74

OTHER COMPREHENSIVE INCOME (LOSS)
Pensions and OPEB prior service costs	(9		)	(8		)	—			8			(9		)
Amortized gain on derivative hedges	5			—			—			—			5
Change in unrealized gain on available for sale securities	15			—			15			(15		)	15
Other comprehensive income (loss)	11			(8		)	15			(7		)	11
Income taxes (benefits) on other comprehensive income (loss)	4			(4		)	6			(2		)	4
Other comprehensive income (loss), net of tax	7			(4		)	9			(5		)	7
COMPREHENSIVE INCOME	$	81		$	216		$	152		$	(368	)	$	81

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING BALANCE SHEETS

(Unaudited)



As of June 30, 2012	FES		FGCO		NGC		Eliminations			Consolidated
	(In millions)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	7	$	—	$	—		$	7
Receivables-
Customers	457		—		—		—			457
Affiliated companies	464		482		297		(706		)	537
Other	67		25		4		—			96
Notes receivable from affiliated companies	155		1,653		152		(1,732		)	228
Materials and supplies, at average cost	68		272		208		—			548
Derivatives	265		—		—		—			265
Prepayments and other	3		15		1		—			19
	1,479		2,454		662		(2,438		)	2,157
PROPERTY, PLANT AND EQUIPMENT:
In service	89		5,620		6,051		(385		)	11,375
Less — Accumulated provision for depreciation	30		1,872		2,594		(182		)	4,314
	59		3,748		3,457		(203		)	7,061
Construction work in progress	28		187		704		—			919
	87		3,935		4,161		(203		)	7,980
INVESTMENTS:
Nuclear plant decommissioning trusts	—		—		1,250		—			1,250
Investment in affiliated companies	6,241		—		—		(6,241		)	—
Other	—		7		—		—			7
	6,241		7		1,250		(6,241		)	1,257
DEFERRED CHARGES AND OTHER ASSETS:
Accumulated deferred income tax benefits	—		261		—		(261		)	—
Customer intangibles	118				—		—			118
Goodwill	24				—		—			24
Property taxes	—		20		23		—			43
Unamortized sale and leaseback costs	—		4		—		114			118
Derivatives	110				—		—			110
Other	86		160		1		(110		)	137
	338		445		24		(257		)	550
	$	8,145	$	6,841	$	6,097	$	(9,139	)	$	11,944

LIABILITIES AND CAPITALIZATION
CURRENT LIABILITIES:
Currently payable long-term debt	$	1	$	646	$	518	$	(21	)	$	1,144
Short-term borrowings-
Affiliated companies	1,597		135		—		(1,732		)	—
Accounts payable-
Affiliated companies	739		279		305		(715		)	608
Other	173		133		—		—			306
Accrued taxes	23		20		27		(8		)	62
Derivatives	219		—		—		—			219
Other	68		124		13		37			242
	2,820		1,337		863		(2,439		)	2,581
CAPITALIZATION:
Total equity	3,704		3,413		2,810		(6,223		)	3,704
Long-term debt and other long-term obligations	1,482		1,657		580		(1,219		)	2,500
	5,186		5,070		3,390		(7,442		)	6,204
NONCURRENT LIABILITIES:
Deferred gain on sale and leaseback transaction	—		—		—		909			909
Accumulated deferred income taxes	28		—		572		(164		)	436
Asset retirement obligations	—		29		905		—			934
Retirement benefits	34		145		—		—			179
Lease market valuation liability	—		148		—		—			148
Other	77		112		367		(3		)	553
	139		434		1,844		742			3,159
	$	8,145	$	6,841	$	6,097	$	(9,139	)	$	11,944

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING BALANCE SHEETS

(Unaudited)



As of December 31, 2011	FES		FGCO		NGC		Eliminations			Consolidated
	(In millions)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	7	$	—	$	—		$	7
Receivables-
Customers	424		—		—		—			424
Affiliated companies	476		643		262		(781		)	600
Other	28		20		13		—			61
Notes receivable from affiliated companies	155		1,346		69		(1,187		)	383
Materials and supplies, at average cost	60		232		200		—			492
Derivatives	219		—		—		—			219
Prepayments and other	11		26		1		—			38
	1,373		2,274		545		(1,968		)	2,224
PROPERTY, PLANT AND EQUIPMENT:
In service	84		5,573		5,711		(385		)	10,983
Less — Accumulated provision for depreciation	28		1,813		2,449		(180		)	4,110
	56		3,760		3,262		(205		)	6,873
Construction work in progress	29		195		790		—			1,014
	85		3,955		4,052		(205		)	7,887
INVESTMENTS:
Nuclear plant decommissioning trusts	—		—		1,223		—			1,223
Investment in affiliated companies	5,700		—		—		(5,700		)	—
Other	—		7		—		—			7
	5,700		7		1,223		(5,700		)	1,230
DEFERRED CHARGES AND OTHER ASSETS:
Accumulated deferred income tax benefits	10		307		—		(317		)	—
Customer intangibles	123		—		—		—			123
Goodwill	24		—		—		—			24
Property taxes	—		20		23		—			43
Unamortized sale and leaseback costs	—		5		—		75			80
Derivatives	79		—		—		—			79
Other	89		99		3		(62		)	129
	325		431		26		(304		)	478
	$	7,483	$	6,667	$	5,846	$	(8,177	)	$	11,819

LIABILITIES AND CAPITALIZATION
CURRENT LIABILITIES:
Currently payable long-term debt	$	1	$	411	$	513	$	(20	)	$	905
Short-term borrowings-
Affiliated companies	1,065		89		32		(1,186		)	—
Accounts payable-
Affiliated companies	777		228		211		(780		)	436
Other	99		121		—		—			220
Accrued taxes	84		42		110		(9		)	227
Derivatives	189		—		—		—			189
Other	62		141		16		42			261
	2,277		1,032		882		(1,953		)	2,238
CAPITALIZATION:
Total equity	3,577		3,097		2,587		(5,684		)	3,577
Long-term debt and other long-term obligations	1,483		1,905		641		(1,230		)	2,799
	5,060		5,002		3,228		(6,914		)	6,376
NONCURRENT LIABILITIES:
Deferred gain on sale and leaseback transaction	—		—		—		925			925
Accumulated deferred income taxes	12		—		510		(236		)	286
Asset retirement obligations	—		28		876		—			904
Retirement benefits	56		300		—		—			356
Lease market valuation liability	—		171		—		—			171
Other	78		134		350		1			563
	146		633		1,736		690			3,205
	$	7,483	$	6,667	$	5,846	$	(8,177	)	$	11,819

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(Unaudited)



For the Six Months Ended June 30, 2012	FES			FGCO			NGC			Eliminations			Consolidated
	(In millions)

NET CASH PROVIDED FROM (USED FOR) OPERATING ACTIVITIES	$	(525	)	$	308		$	446		$	(10	)	$	219
CASH FLOWS FROM FINANCING ACTIVITIES:
New Financing-
Long-term debt	—			52			30			—			82
Short-term borrowings, net	532			46			—			(578		)	—
Redemptions and Repayments-
Long-term debt	—			(63		)	(87		)	10			(140		)
Short-term borrowings, net	—			—			(32		)	32			—
Other	(1		)	(4		)	(1		)	—			(6		)
Net cash provided from (used for) financing activities	531			31			(90		)	(536		)	(64		)
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions	(5		)	(44		)	(254		)	—			(303		)
Proceeds from assets sale	—			17			—			—			17
Sales of investment securities held in trusts	—			—			109			—			109
Purchases of investment securities held in trusts	—			—			(127		)	—			(127		)
Loans to affiliated companies, net	1			(308		)	(84		)	546			155
Other	(2		)	(4		)	—			—			(6		)
Net cash provided from (used for) investing activities	(6		)	(339		)	(356		)	546			(155		)
Net change in cash and cash equivalents	—			—			—			—			—
Cash and cash equivalents at beginning of period	—			7			—			—			7
Cash and cash equivalents at end of period	$	—		$	7		$	—		$	—		$	7

FIRSTENERGY SOLUTIONS CORP.

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(Unaudited)



For the Six Months Ended June 30, 2011	FES			FGCO			NGC			Eliminations			Consolidated
	(In millions)

NET CASH PROVIDED FROM (USED FOR) OPERATING ACTIVITIES	$	(329	)	$	321		$	200		$	(10	)	$	182
CASH FLOWS FROM FINANCING ACTIVITIES:
New Financing-
Long-term debt	—			140			107			—			247
Short-term borrowings, net	453			77			—			—			530
Redemptions and Repayments-
Long-term debt	(135		)	(192		)	(155		)	10			(472		)
Other	(9		)	(1		)	(1		)	—			(11		)
Net cash used for financing activities	309			24			(49		)	10			294

CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions	(6		)	(109		)	(219		)	—			(334		)
Sales of investment securities held in trusts	—			—			513			—			513
Purchases of investment securities held in trusts	—			—			(545		)	—			(545		)
Loans to affiliated companies, net	28			(221		)	100			—			(93		)
Other	(2		)	(18		)	—			—			(20		)
Net cash provided from (used for) investing activities	20			(348		)	(151		)	—			(479		)
Net change in cash and cash equivalents	—			(3		)	—			—			(3		)
Cash and cash equivalents at beginning of period	—			9			—			—			9
Cash and cash equivalents at end of period	$	—		$	6		$	—		$	—		$	6