FirstEnergy To Exit Competitive Operations By Mid-2018

FirstEnergy said in reporting earnings that it has reached a decision to exit "competitive operations" by mid-2018

In a 10-K, FirstEnergy said that although it is targeting mid-2018 to exit from competitive operations, the options to exit are still uncertain, but could include one or more of the following:

• Legislative or regulatory solutions for generation assets that recognize their environmental or energy security benefits,

• Additional asset sales and/or plant deactivations,

• Restructuring FirstEnergy Solutions debt with its creditors, and/or

• Seeking protection under U.S. bankruptcy laws for FES and possibly FirstEnergy Nuclear Operating Company.

In the fourth quarter of 2016, FirstEnergy recognized pre-tax impairment charges of $9.218 billion, or $13.54 per share, resulting from its intention to exit competitive operations by mid-2018, significantly before the end of generation assets' useful lives, and the anticipated cash flows over this shortened period. The impairment charges reduced the carrying value of the majority of the company's competitive generating assets, nuclear fuel and other assets to their estimated fair value.

Previously, during the second quarter of 2016, FirstEnergy recorded pre-tax asset impairment and plant exit costs associated with the decision to deactivate Bay Shore Unit 1, W.H. Sammis Units 1-4, and the impairment of goodwill at the company's competitive business