FE · 10-Q · 2026Q1 · Full report

Pension Funding and Risks

FIRSTENERGY CORP · 2026-04-28 · Importance 62 · Surprise 50

FirstEnergy discloses pension plan asset allocations (approximately 30% equities, 19% fixed income, 24% private debt/equity and other allocations) and that it does not expect a required pension contribution until 2027, estimated at approximately $250 million based on assumptions including an 8.0% expected return for 2026. The company reports recent quarter losses in plan assets (pension plan assets lost ~1.3% in the three months ended March 31, 2026) and explains it uses a spot rate approach along the full yield curve to estimate benefit cost components; spot rates increased to 5.87% (pension) and 5.68% (OPEB) as of March 31, 2026. FirstEnergy cautions that volatile equity markets and interest rates make the year‑end mark‑to‑market remeasurement difficult to predict and it is unable to meaningfully project the range of potential adjustment as of December 31, 2026.

Key facts

• FirstEnergy does not currently expect to have a required contribution to the pension plan until 2027 and based on assumptions including an expected rate of return on assets of 8.0% for 2026, the expected contribution is approximately $250 million.
• JCP&L is not expected to make a contribution to the pension plan.
• In the three months ended March 31, 2026, FirstEnergy’s pension plan assets lost approximately 1.3% compared to an annual expected return on plan assets of 8%.
• In the three months ended March 31, 2026, FirstEnergy’s qualified OPEB plan assets lost approximately 0.2% compared to an annual expected return on plan assets of 7%.
• As of March 31, 2026, FirstEnergy pension plan assets allocation was approximately 30% equity securities, 19% fixed income securities, 5% alternatives, 9% real estate, 24% private debt/equity, 9% derivatives and 4% cash and short-term securities.
• As of March 31, 2026, FirstEnergy’s OPEB plan assets allocation was approximately 57% equity securities, 39% fixed income securities and 4% cash and short-term securities.

Impact estimates