2. PA Revenue Operations Overview of High Balance Account Strategies Prepared for 2015 EAPA Conference by: Brian E. Lowe

3. 2 PA Introduction Revenue Operations (Rev Ops) was established to provide a consistent approach to the FE –PA collection process. The service we provide for our regional Operating Companies (OP-CO’s - West Penn, Penn Power, Met-Ed and Penelec), includes the exclusive responsibility for developing, implementing, executing, and coordinating strategies which reduce our financial risk by specifically addressing all delinquent accounts, within regulatory guidelines and our company business strategies. This financial accountability is a critical component towards the achievement of our corporate goals that meet our commitment to investors and customers.

4. 3 PA Introduction Our team consists of 48 Employees, and cover over 33,000 Sq. Miles 5 Management employees (Manager, 3 supervisors, and a Senior Analyst) 6 office support employees that review and schedule our field work, coordinate and communicate with field employees that perform “collection functions”, and initiate manual efforts to address problem accounts, where appropriate. 37 Field Employees (dedicated collectors) reporting out of 26 locations Penn Power – 3 field employees @ 2 locations – 1,600 Sq. Miles Met-Ed – 12 field employees @ 5 locations – 4,100 Sq. Miles Penelec – 14 field employees @ 11 locations – 17,200 Sq. Miles West Penn Power – 8 field employees @ 8 locations – 10,400 Sq. Miles

5. Pennsylvania Service territory Waverly, NY

6. 5 FE Residential High Balance Challenge Our strategy involved identifying accounts with balances over $5,000, so we had an idea of the pending volume. Below is an illustration:

7. 6 Next we identified the reasons (“root causes”) for the high balances. As anticipated many were a result of abuses. For example: PCAP dismissals (Failure to make payments and/or recertify) Multiple payment arrangements Multiple PUC disputes and delayed decisions Multiple bankruptcy filings (dismissed) Life Support accounts Access issues Name change games [Move-out – Move-In and subsequent balance transfers] Landlord Tenant Accounts (LL/TN) Protection From Abuse (PFA’s) accounts Employee errors Staffing Reasons for High Balances

8. 7 FE Residential High Balance Challenge We assigned these accounts to our team to review, initiate action (where appropriate), monitor, and document progress. The team was empowered to: Take an aggressive approach on undisputed arrears (both informal and formal disputes), working with other areas (Contact Centers, Compliance, Legal. Etc.). Expedite follow up during the regulatory window. Work closer with other areas of FE (For example: our contact centers, Compliance, Legal, and regional organizations). Their review (2-year history) of 221 high balance accounts indicated: 151 were classified as “low income”. 79 accounts were currently enrolled in CAP, but in default. 65 accounts have been removed from CAP. Dispute Rights were issued 174 times (The average was 4 times). 112 PUC complaints were filed. 90 Med Certs were accepted to avoid termination or for restoration. Note: an account can appear in more than one category.

9. 8 FE High Balance Progress This snapshot illustrates our FE progress addressing balances over $10,000: The number of accounts was reduced by 35% The balances were reduced by 36%

10. 9 FE High Balance Challenge This snapshot illustrates our progress by category, addressing high balances before they reach $10,000. Overall the number over $5k was reduced by 24% and the amounts by 25%.

11. 10 Questions?