AGR 00001

Question: Can you provide details of the PIPP program and the rules for customers switching from SSO to PIPP and back?

Answer: Percentage of Income Payment Plan (PIPP) is an extended payment arrangement that requires electric companies to accept payments based on a percentage of the household income. As a part of the Universal Service Fund program enabled by Ohio Substitute Senate Bill 3, the Deparment of Ohio Development will administer the PIPP for electricity customers. Please see the following link for further details: http://development.ohio.gov/is/is_pipp.htm

If/when a customer would leave the PIPP program, they would be able to become an SSO customer or shop with a Competitive Retail Electric Service (CRES) supplier.

AGR 00002

Question: Who is the PIPP Supplier's counterparty to the Master PIPP Supply Agreement and is there a single contract or three?

Answer: The PIPP Supplier's counterparty to the Master PIPP Supply Agreement is the FirstEnergy Ohio Utilities. There is one contract.

AGR 00003

Question: Are each of The Cleveland Electric Illuminating Company, The Toledo Edison Company, and Ohio Edison Company (hereafter each referred to as an “EDC”) able to separately exercise rights and remedies under the Master PIPP Supply Agreement or are they able to exercise rights and remedies only collectively as the Companies? For example, is there any danger to a PIPP Supplier that a particular EDC will issue an instruction (e.g., regarding margin calls) or make a declaration (e.g., regarding an Event of Default) that is contrary to another EDC under the Master PIPP Supply Agreement or make contrary determinations regarding an SSO Supplier’s creditworthiness for purposes of Article 6 of the Master PIPP Supply Agreement?

Answer: It would not be expected that the electric distribution utilities under the Master PIPP Supply Agreement would render conflicting decisions. Also note that another FAQ states that, "The PIPP Supplier's counterparty to the Master PIPP Supply Agreement is the FirstEnergy Ohio Utilities. There is one contract."

AGR 00004

Question: Are each of The Cleveland Electric Illuminating Company, The Toledo Edison Company, and Ohio Edison Company jointly and severally liable or collectively liable for obligations of the “Companies” under the Master PIPP Supply Agreement? If not, please explain what their respective and collective liability is thereunder. Is a PIPP Supplier entitled to exercise rights and remedies (e.g., termination) against the Companies collectively, for example in the event that any particular Electricity Distribution Company (EDC) defaults and a consequent Event of Default occurs under the Master PIPP Supply Agreement?

Answer: It is the Companies' position that the Companies under the Master PIPP Supply Agreement are severally, but not jointly, liable. Each Company would be responsible for its proportionate share of liability.

AGR 00005

Question: Please confirm that a specified single point of contact will speak for the Companies collectively with respect to notices (other than those required under Article 6) and that a single point of contact will speak for the Companies collectively with respect to notices required under Article 6

Answer: Please see Article 13.1 of the Master PIPP Supply Agreement which provides for notifications to the Company.

AGR 00006

Question: Do the FirstEnergy Ohio Utilities have an overarching parent guaranty from FirstEnergy Corp.?

Answer: No, the FirstEnergy Ohio Utilities do not have an overarching parent guaranty from FirstEnergy Corp.

AGR 00007

Question: As this is a sale for resale, is there a risk that the FirstEnergy Ohio Utilities withhold payment to the PIPP Supplier in the event of PIPP customer non-payment or dispute?

Answer: No. There is no risk that payments to PIPP Suppliers are withheld in the event of PIPP customer non-payment.