UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

October 30, 2015

Date of Report (Date of earliest event reported)

 

 

 

Commission File Number		Exact Name of Registrant as Specified in Its Charter; State of Incorporation; Address of Principal Executive Offices; and Telephone Number		IRS Employer Identification Number
1-16169		EXELON CORPORATION (a Pennsylvania corporation) 10 South Dearborn Street P.O. Box 805379 Chicago, Illinois 60680-5379 (800) 483-3220		23-2990190
333-85496		EXELON GENERATION COMPANY, LLC (a Pennsylvania limited liability company) 300 Exelon Way Kennett Square, Pennsylvania 19348-2473 (610) 765-5959		23-3064219
1-1839		COMMONWEALTH EDISON COMPANY (an Illinois corporation) 440 South LaSalle Street Chicago, Illinois 60605-1028 (312) 394-4321		36-0938600
000-16844		PECO ENERGY COMPANY (a Pennsylvania corporation) P.O. Box 8699 2301 Market Street Philadelphia, Pennsylvania 19101-8699 (215) 841-4000		23-0970240
1-1910		BALTIMORE GAS AND ELECTRIC COMPANY (a Maryland corporation) 2 Center Plaza 110 West Fayette Street Baltimore, Maryland 21201 (410) 234-5000		52-0280210

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Section 2 – Financial Information

Item 2.02. Results of Operations and Financial Condition.

Section 7 – Regulation FD

Item 7.01. Regulation FD Disclosure.

On October 30, 2015, Exelon Corporation (Exelon) announced via press release its results for the third quarter ended September 30, 2015. A copy of the press release and related attachments is attached hereto as Exhibit 99.1. Also attached as Exhibit 99.2 to this Current Report on Form 8-K are the presentation slides to be used at the third quarter 2015 earnings conference call. This Form 8-K and the attached exhibits are provided under Items 2.02, 7.01 and 9.01 of Form 8-K and are furnished to, but not filed with, the Securities and Exchange Commission.

Exelon has scheduled the conference call for 11:00 AM ET (10:00 AM CT) on October 30, 2015. The call-in number in the U.S. and Canada is 800-690-3108, and the international call-in number is 973-935-8753. If requested, the conference ID number is 32485457. Media representatives are invited to participate on a listen-only basis. The call will be web-cast and archived on Exelon’s Web site: www.exeloncorp.com. (Please select the Investors page.)

Telephone replays will be available until November 13, 2015. The U.S. and Canada call-in number for replays is 855-859-2056, and the international call-in number is 404-537-3406. The conference ID number is 32485457.

Section 9 – Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits.

 

(d)

Exhibits.

 

Exhibit No.		Description
99.1		Press release and earnings release attachments
99.2		Earnings conference call presentation slides

* * * * *

This combined Form 8-K is being furnished separately by Exelon, Exelon Generation Company, LLC, Commonwealth Edison Company, PECO Energy Company, and Baltimore Gas and Electric Company (Registrants). Information contained herein relating to any individual Registrant has been furnished by such Registrant on its own behalf. No Registrant makes any representation as to information relating to any other Registrant.

This report contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. The factors that could cause actual results to differ materially from the forward-looking statements made by Exelon Corporation, Commonwealth Edison Company, PECO Energy Company, Baltimore Gas and Electric Company and Exelon Generation Company, LLC (Registrants) include those factors discussed herein, as well as the items discussed in (1) Exelon’s 2014 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note 22; (2) Exelon’s Third Quarter 2015 Quarterly Report on Form 10-Q (to be filed on October 30, 2015) in (a) Part II, Other Information, ITEM 1A. Risk Factors; (b) Part 1, Financial Information, ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) Part I, Financial Information, ITEM 1. Financial Statements: Note 19; and (3) other factors discussed in filings with the SEC by the Registrants. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this report. None of the Registrants undertakes any obligation to publicly release any revision to its forward-looking statements to reflect events or circumstances after the date of this report.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, each Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

October 30, 2015

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EXHIBIT INDEX

 

Exhibit No.		Description
99.1		Press release and earnings release attachments
99.2		Earnings conference call presentation slides

Exhibit 99.1

 

 

Contact:		Francis Idehen Investor Relations 312-394-3967   Paul Adams Corporate Communications 410-470-4167

EXELON ANNOUNCES THIRD QUARTER 2015 RESULTS

CHICAGO (Oct. 30, 2015) — Exelon Corporation (NYSE: EXC) announced third quarter 2015 consolidated earnings as follows:

 

		Third Quarter
		2015				2014
Adjusted (non-GAAP) Operating Results:
Net Income ($ millions)		$	757			$	676
Diluted Earnings per Share		$	0.83			$	0.78
GAAP Results:
Net Income ($ millions)		$	629			$	993
Diluted Earnings per Share		$	0.69			$	1.15

“Our focus on operational performance and strategic investments to grow our business continues to deliver results across all of our businesses,” said Christopher M. Crane, Exelon president and CEO. “Exelon achieved earnings above our guidance range, led by gains at Constellation due to our generation to load matching strategy and improved results at each of our utilities, while also delivering top quartile performance for our customers and communities. Based on our results through September and our outlook for the fourth quarter, we are raising our full-year operating earnings guidance range to $2.40 to $2.60 per share.”

 

1

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Third Quarter Operating Results

As shown in the table above, Exelon’s Adjusted (non-GAAP) Operating Earnings increased to $0.83 per share in the third quarter of 2015 from $0.78 per share in the third quarter of 2014. Earnings in the third quarter of 2015 primarily reflected the following favorable factors:

 

•

Higher revenue net of purchased power and fuel at Generation as a result of lower cost-to-serve load, the benefit from the Integrys acquisition and increased load served;

 

•

Favorable weather at ComEd and PECO;

 

•

Higher distribution earnings at ComEd and BGE; and

 

•

Lower storm costs at BGE.

These factors were partially offset by:

 

•

Higher contracting costs at Generation primarily due to growth development projects;

 

•

Realized NDT fund losses in 2015 as compared to gains in 2014; and

 

•

Higher interest expense due to higher outstanding debt at Generation and Corporate.

Adjusted (non-GAAP) Operating Earnings for the third quarter of 2015 do not include the following items (after tax) that were included in reported GAAP Net Income:

 

		(in millions)				(per diluted share)
Exelon Adjusted (non-GAAP) Operating Earnings		$	757			$	0.83
Mark-to-Market Impact of Economic Hedging Activities			(85	)			(0.09	)
Unrealized Losses Related to NDT Fund Investments			(133	)			(0.15	)
Amortization of Commodity Contract Intangibles			(2	)			—
Merger and Integration Costs			(12	)			(0.02	)
Asset Retirement Obligation			6				0.01
Tax Settlements			52				0.06
CENG Non-Controlling Interest			46				0.05
Exelon GAAP Net Income		$	629			$	0.69

 

2

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Adjusted (non-GAAP) Operating Earnings for the third quarter of 2014 do not include the following items (after tax) that were included in reported GAAP Net Income:

 

		(in millions)				(per diluted share)
Exelon Adjusted (non-GAAP) Operating Earnings		$	676			$	0.78
Mark-to-Market Impact of Economic Hedging Activities			158				0.18
Unrealized Losses Related to NDT Fund Investments			(22	)			(0.03	)
Amortization of Commodity Contract Intangibles			12				0.01
Merger and Integration Costs			(58	)			(0.06	)
Asset Retirement Obligation			13				0.02
Tax Settlement			66				0.08
Long-Lived Asset Impairments			(30	)			(0.03	)
Plant Retirement and Divestitures			197				0.23
Mark-to-Market Impact of PHI Merger Related Interest Rate Swaps			(6	)			(0.01	)
CENG Non-Controlling Interest			(13	)			(0.02	)
Exelon GAAP Net Income		$	993			$	1.15

Third Quarter and Recent Highlights

 

•

Pepco Holdings, Inc. (PHI) Merger: On August 12, 2015, the presiding judge in the Circuit Court of Queen Anne’s County issued an order denying the motions to stay the Maryland Public Service Commission’s order approving the merger. On August 27, 2015, the District of Columbia Public Service Commission (DCPSC) issued an opinion and order denying approval of the merger, asserting that the merger was not in the public’s interest. Exelon and PHI filed an Application for Reconsideration with the DCPSC on September 28, 2015. On October 6, 2015, Exelon, PHI, the District of Columbia Government, the Office of People’s Counsel, the District of Columbia Water and Sewer Authority, the National Consumer Law Center, National Housing Trust, and the Apartment and Office Building Association of Metropolitan Washington entered into a Nonunanimous Full Settlement Agreement and Stipulation with respect to the merger. Exelon and PHI subsequently filed a motion of joint applicants requesting the DCPSC to reopen the approval application to allow for consideration of the Settlement Agreement and granting additional requested relief. On October 28, 2015, the DCPSC at a public meeting agreed to reopen the approval application to allow for consideration of the Settlement Agreement and set a procedural schedule which would allow for completion of the merger in the first quarter of 2016.

 

3

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•

Deferment of Early Plant Retirements: Exelon and Generation continue to evaluate the current and expected economic value of each of Generation’s nuclear plants. On September 10, 2015, after considering the results of the recent PJM capacity auction, Exelon and Generation decided to defer for one year any decisions about the future operations of its Quad Cities and Byron nuclear plants and will offer both plants in the 2019/2020 auction in May 2016. As a result of clearing the other PJM capacity auction in September 2015 for the 2017/2018 transitional capacity auction, Exelon and Generation will continue to operate its Quad Cities nuclear power plant through at least May 2018. The Byron plant is already obligated to operate through May 2019. In addition, on October 29, 2015, Exelon and Generation decided to defer any decision about the future operations of its Clinton nuclear plant for one year and plan to bid the plant into the MISO capacity auction for the 2016/2017 planning year in March 2016. MISO’s announcement on October 27, 2015 acknowledging the need for market design changes in southern Illinois was a key factor in Exelon’s and Generation’s decision to defer for an additional year, among other factors such as positive results from the Illinois Power Agency’s capacity procurement for 2016 and the long-term impact of the EPA’s Clean Power Plan. The Clinton plant is currently obligated to operate through May 2016. Exelon and Generation have not made any decision regarding potential nuclear plant closures at other sites at this time.

 

•

PECO Electric Distribution Rate Case: On September 10, 2015, PECO filed a Joint Petition for Settlement with the Pennsylvania Public Utilities Commission (PAPUC). The terms of the settlement include an increase of $127 million in annual distribution service revenue. On October 28, 2015, the Administrative Law Judge issued a recommended decision to the PAPUC that the joint settlement be approved. A final ruling from the PAPUC is expected by December 2015, and if approved, the rates will go into effect on January 1, 2016.

 

•

Nuclear Operations: Generation’s nuclear fleet, including its owned output from the Salem Generating Station and 100 percent of the CENG units, produced 45,180 gigawatt-hours (GWh) in the third quarter of 2015, compared with 45,263 GWh in the third quarter of 2014. Excluding Salem, the Exelon-operated nuclear plants at ownership achieved a 95.5 percent capacity factor for the third quarter of 2015, compared with 96.5 percent for the third quarter of 2014. The number of planned refueling outage days totaled 27 in the third quarter of 2015, compared with 18 in the third quarter of 2014. There were 11 non-refueling outage days in the third quarter of 2015, compared with 20 days in the third quarter of 2014.

 

•

Fossil and Renewable Operations: The Dispatch Match rate for Generation’s gas and hydro fleet was 99.0 percent in the third quarter of 2015, compared with 98.8 percent in the third quarter of 2014. Energy Capture for the wind and solar fleet was 94.8 percent in the third quarter of 2015, compared with 94.9 percent in the third quarter of 2014.

 

•

Financing Activities: On October 5, 2015, PECO issued $350 million in aggregate principal amount of its First and Refunding Mortgage Bonds, 3.150% Series due October 15, 2025. The net proceeds from the sale of the bonds will be used for general corporate purposes.

 

4

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•

Hedging Update: Exelon’s hedging program involves the hedging of commodity risk for Exelon’s expected generation, typically on a ratable basis over a three-year period. Expected generation is the volume of energy that best represents our commodity position in energy markets from owned or contracted for capacity based upon a simulated dispatch model that makes assumptions regarding future market conditions, which are calibrated to market quotes for power, fuel, load following products, and options. The proportion of expected generation hedged as of September 30, 2015, was 97 percent to 100 percent for 2015, 81 percent to 84 percent for 2016, and 51 percent to 54 percent for 2017. The primary objective of Exelon’s hedging program is to manage market risks and protect the value of its generation and its investment-grade balance sheet, while preserving its ability to participate in improving long-term market fundamentals.

Operating Company Results

Generation consists of the generation, physical delivery and marketing of power across multiple geographical regions through its customer-facing business, Constellation, which sells electricity and natural gas to both wholesale and retail customers. Generation also sells renewable energy and other energy-related products and services, and engages in natural gas and oil exploration and production activities (Upstream).

Generation’s third quarter 2015 GAAP Net Income was $377 million, compared with net income of $771 million in the third quarter of 2014. Adjusted (non-GAAP) Operating Earnings for the third quarter of 2015 and 2014 do not include various items (after tax) that were included in reported GAAP Net Income:

 

($ millions)		3Q15				3Q14
Generation Adjusted (non-GAAP) Operating Earnings		$	499			$	433
Mark-to-Market Impact of Economic Hedging Activities			(85	)			161
Unrealized (Losses) Related to NDT Fund Investments			(133	)			(22	)
Amortization of Commodity Contract Intangibles			(2	)			12
Merger and Integration Costs			(6	)			(47	)
Plant Retirement and Divestitures			—				198
Long Lived Asset Impairment			—				(30	)
Asset Retirement Obligation			6				13
Tax Settlements			52				66
CENG Non-Controlling Interest			46				(13	)
Generation GAAP Net Income		$	377			$	771

Generation’s Adjusted (non-GAAP) Operating Earnings in the third quarter of 2015 increased $66 million compared with the same quarter in 2014. This increase primarily reflected higher revenue net of purchased power and fuel as a result of lower cost-to-serve load, and the benefit from the Integrys acquisition. These increases were partially offset by increased contracting expenses due to growth development opportunities and realized NDT fund losses in 2015 as compared to gains in 2014.

 

5

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ComEd consists of electricity transmission and distribution operations in Northern Illinois.

ComEd’s third quarter 2015 GAAP Net Income was $149 million, compared with net income of $126 million in the third quarter of 2014. Adjusted (non-GAAP) Operating Earnings for the third quarter of 2015 do not include merger and integration costs that were included in reported GAAP Net Income:

 

($ millions)		3Q15				3Q14
ComEd Adjusted (non-GAAP) Operating Earnings		$	151			$	126
Merger and Integration Costs			(2	)			—
ComEd GAAP Net Income		$	149			$	126

ComEd’s Adjusted (non-GAAP) Operating Earnings in the third quarter of 2015 increased $25 million from the same quarter in 2014 primarily as a result of favorable weather and increased electric distribution earnings reflecting the impacts of increased capital investment, which was offset by lower allowed electric distribution return on common equity due to a decrease in treasury rates.

For the third quarter of 2015, heating degree-days in the ComEd service territory were down 50.5 percent relative to the same period in 2014 and were 53.8 percent below normal. Cooling degree days were up 18.1 percent from prior year and 3.4 percent above normal. Total retail electric deliveries increased 3.4 percent in the third quarter of 2015 compared with the same period in 2014.

Weather-normalized retail electric deliveries decreased 0.5 percent in the third quarter of 2015 compared with the same period in 2014.

PECO consists of electricity transmission and distribution operations and retail natural gas distribution operations in Southeastern Pennsylvania.

PECO’s third quarter 2015 GAAP Net Income was $90 million, compared with net income of $81 million in the third quarter of 2014. Adjusted (non-GAAP) Operating Earnings for the third quarter of 2015 do not include merger and integration costs that were included in reported GAAP Net Income:

 

($ millions)		3Q15				3Q14
PECO Adjusted (non-GAAP) Operating Earnings		$	91			$	81
Merger and Integration Costs			(1	)			—
PECO GAAP Net Income		$	90			$	81

PECO’s Adjusted (non-GAAP) Operating Earnings in the third quarter of 2015 increased $10 million from the same quarter in 2014 primarily due to favorable weather.

For the third quarter of 2015, there were no heating degree-days in the PECO service territory representing a decrease of 14 days and 38 days relative to the same period in 2014 and normal, respectively. Cooling degree days were up 30.2 percent from the prior year and 27.7 percent above normal. Total retail electric deliveries were up 6.4 percent compared with the third quarter of 2014. Natural gas deliveries (including both retail and transportation components) in the third quarter of 2015 were up 15.1 percent compared with the same period in 2014.

 

6

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Weather-normalized retail electric and gas deliveries decreased 0.5 percent and increased 9.3 percent, respectively, in the third quarter of 2015 compared with the same period in 2014. The increase in retail gas deliveries was driven primarily by growth in the transportation component during the third quarter of 2015.

BGE consists of electricity transmission and distribution operations and retail natural gas distribution operations in Central Maryland.

BGE’s third quarter 2015 GAAP Net Income was $51 million, compared with net income of $46 million in the third quarter of 2014. Adjusted (non-GAAP) Operating Earnings for the third quarter of 2015 do not include merger and integration costs that were included in reported GAAP Net Income:

 

($ millions)		3Q15				3Q14
BGE Adjusted (non-GAAP) Operating Earnings		$	52			$	46
Merger and Integration Costs			(1	)			—
BGE GAAP Net Income		$	51			$	46

BGE’s Adjusted (non-GAAP) Operating Earnings in the third quarter of 2015 increased $6 million from the same quarter in 2014, primarily due to increased distribution revenues pursuant to increased rates effective in December 2014 and decreased storm costs. Due to decoupling, BGE’s distribution revenues are not affected by actual weather.

Adjusted (non-GAAP) Operating Earnings

Adjusted (non-GAAP) operating earnings, which generally exclude significant one-time charges or credits that are not normally associated with ongoing operations, mark-to-market adjustments from economic hedging activities and unrealized gains and losses from NDT fund investments, are provided as a supplement to results reported in accordance with GAAP. Management uses such adjusted (non-GAAP) operating earnings measures internally to evaluate the company’s performance and manage its operations. Reconciliation of GAAP Net Income to adjusted (non-GAAP) operating earnings for historical periods is attached. Additional earnings release attachments, which include the reconciliation on page 8, are posted on Exelon’s Web site: www.exeloncorp.com and have been furnished to the Securities and Exchange Commission on Form 8-K on October 30, 2015.

Cautionary Statements Regarding Forward-Looking Information

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. The factors that could cause actual results to differ materially from the forward-looking statements made by Exelon Corporation, Commonwealth Edison Company, PECO Energy Company, Baltimore Gas and Electric Company and Exelon

 

7

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Generation Company, LLC (Registrants) include those factors discussed herein, as well as the items discussed in (1) Exelon’s 2014 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note 22; (2) Exelon’s Third Quarter 2015 Quarterly Report on Form 10-Q (to be filed on October 30, 2015) in (a) Part II, Other Information, ITEM 1A. Risk Factors; (b) Part 1, Financial Information, ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) Part I, Financial Information, ITEM 1. Financial Statements: Note 19; and (3) other factors discussed in filings with the SEC by the Registrants. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this press release. None of the Registrants undertakes any obligation to publicly release any revision to its forward-looking statements to reflect events or circumstances after the date of this press release.

# # #

Exelon Corporation (NYSE: EXC) is the nation’s leading competitive energy provider, with 2014 revenues of approximately $27.4 billion. Headquartered in Chicago, Exelon does business in 48 states, the District of Columbia and Canada. Exelon is one of the largest competitive U.S. power generators, with more than 32,000 megawatts of owned capacity comprising one of the nation’s cleanest and lowest-cost power generation fleets. The company’s Constellation business unit provides energy products and services to more than 2.5 million residential, public sector and business customers, including more than two-thirds of the Fortune 100. Exelon’s utilities deliver electricity and natural gas to more than 7.8 million customers in central Maryland (BGE), northern Illinois (ComEd) and southeastern Pennsylvania (PECO). Follow Exelon on Twitter @Exelon.

 

8

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Earnings Release Attachments

Table of Contents

 

Consolidating Statements of Operations - Nine Months Ended September 30, 2015 and 2014			2
Business Segment Comparative Statements of Operations - Generation and ComEd - Three and Nine months ended September 30, 2015 and 2014			3
Business Segment Comparative Statements of Operations - PECO and BGE - Three and Nine months ended September 30, 2015 and 2014			4
Business Segment Comparative Statements of Operations - Other - Three and Nine months ended September 30, 2015 and 2014			5
Consolidated Balance Sheets - September 30, 2015 and December 31, 2014			6
Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2015 and 2014			7
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - Exelon - Three Months Ended September 30, 2015 and 2014			8
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - Exelon - Nine Months Ended September 30, 2015 and 2014			10
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Earnings By Business Segment - Three Months Ended September 30, 2015 and 2014			12
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Earnings By Business Segment - Nine Months Ended September 30, 2015 and 2014			14
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - Generation - Three and Nine months ended September 30, 2015 and 2014			16
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - ComEd - Three and Nine months ended September 30, 2015 and 2014			18
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - PECO - Three and Nine months ended September 30, 2015 and 2014			19
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - BGE - Three and Nine months ended September 30, 2015 and 2014			20
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - Other - Three and Nine months ended September 30, 2015 and 2014			21
Exelon Generation Statistics - Three Months Ended September 30, 2015, June 30, 2015, December 31, 2014, September 30, 2014 and September 30, 2014			22
Exelon Generation Statistics - Nine Months Ended September 30, 2015 and 2014			23
ComEd Statistics - Three and Nine months ended September 30, 2015 and 2014			24
PECO Statistics - Three and Nine months ended September 30, 2015 and 2014			25
BGE Statistics - Three and Nine months ended September 30, 2015 and 2014			27

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EXELON CORPORATION

Consolidating Statements of Operations

(unaudited)

(in millions)

 

		Three Months Ended September 30, 2015
																						Exelon
		Generation				ComEd				PECO				BGE				Other (a)				Consolidated
Operating revenues		$	4,768			$	1,376			$	740			$	725			$	(208	)		$	7,401
Operating expenses
Purchased power and fuel			2,519				390				278				311				(207	)			3,291
Operating and maintenance			1,241				404				196				169				(14	)			1,996
Depreciation and amortization			264				176				68				79				19				606
Taxes other than income			123				79				44				57				7				310
Total operating expenses			4,147				1,049				586				616				(195	)			6,203
Gain on sale of assets			1				—				—				1				—				2
Operating income (loss)			622				327				154				110				(13	)			1,200
Other income and (deductions)
Interest expense, net			(68	)			(83	)			(28	)			(25	)			(49	)			(253	)
Other, net			(257	)			4				1				4				4				(244	)
Total other income and (deductions)			(325	)			(79	)			(27	)			(21	)			(45	)			(497	)
Income (loss) before income taxes			297				248				127				89				(58	)			703
Income taxes			(36	)			99				37				35				(20	)			115
Equity in losses of unconsolidated affiliates			(1	)			—				—				—				—				(1	)
Net income (loss)			332				149				90				54				(38	)			587
Net income (loss) attributable to noncontrolling interests and preference stock dividends			(45	)			—				—				3				—				(42	)
Net income (loss) attributable to common shareholders		$	377			$	149			$	90			$	51			$	(38	)		$	629
		Three Months Ended September 30, 2014
																						Exelon
		Generation				ComEd				PECO				BGE				Other (a)				Consolidated
Operating revenues		$	4,412			$	1,222			$	693			$	697			$	(112	)		$	6,912
Operating expenses
Purchased power and fuel			1,880				326				255				297				(110	)			2,648
Operating and maintenance			1,266				359				204				165				(12	)			1,982
Depreciation and amortization			253				174				59				78				13				577
Taxes other than income			127				76				42				55				6				306
Total operating expenses			3,526				935				560				595				(103	)			5,513
Equity in earnings (losses) of unconsolidated affiliates			1				—				—				—				(1	)			—
Gain on sale of assets			338				—				—				—				1				339
Operating income (loss)			1,225				287				133				102				(9	)			1,738
Other income and (deductions)
Interest expense, net			(89	)			(81	)			(29	)			(26	)			(33	)			(258	)
Other, net			4				4				2				4				2				16
Total other income and (deductions)			(85	)			(77	)			(27	)			(22	)			(31	)			(242	)
Income (loss) before income taxes			1,140				210				106				80				(40	)			1,496
Income taxes			291				84				25				31				(9	)			422
Net income (loss)			849				126				81				49				(31	)			1,074
Net income attributable to noncontrolling interests and preference stock dividends			78				—				—				3				—				81
Net income (loss) attributable to common shareholders		$	771			$	126			$	81			$	46			$	(31	)		$	993

 

(a)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

 

1

---

EXELON CORPORATION

Consolidating Statements of Operations

(unaudited)

(in millions)

 

		Nine Months Ended September 30, 2015 (a)
		Generation				ComEd				PECO				BGE				Other (b)				Exelon Consolidated
Operating revenues		$	14,841			$	3,709			$	2,386			$	2,388			$	(578	)		$	22,746
Operating expenses
Purchased power and fuel			7,800				991				953				1,037				(571	)			10,210
Operating and maintenance			3,860				1,166				609				499				(15	)			6,119
Depreciation and amortization			774				528				198				271				47				1,818
Taxes other than income			369				225				125				169				20				908
Total operating expenses			12,803				2,910				1,885				1,976				(519	)			19,055
Gain on sales of assets			7				—				1				1				1				10
Operating income (loss)			2,045				799				502				413				(58	)			3,701
Other income and (deductions)
Interest expense, net			(269	)			(248	)			(84	)			(73	)			(81	)			(755	)
Other, net			(193	)			14				3				13				(16	)			(179	)
Total other income and (deductions)			(462	)			(234	)			(81	)			(60	)			(97	)			(934	)
Income (loss) before income taxes			1,583				565				421				353				(155	)			2,767
Income taxes			371				226				122				141				(55	)			805
Equity in earnings (losses) of unconsolidated affiliates			(4	)			—				—				—				1				(3	)
Net income (loss)			1,208				339				299				212				(99	)			1,959
Net income (loss) attributable to noncontrolling interests and preference stock dividends			(10	)			—				—				10				—				—
Net income (loss) attributable to common shareholders		$	1,218			$	339			$	299			$	202			$	(99	)		$	1,959
		Nine Months Ended September 30, 2014 (a)
		Generation				ComEd				PECO				BGE				Other (b)				Exelon Consolidated
Operating revenues		$	12,591			$	3,484			$	2,343			$	2,404			$	(649	)		$	20,173
Operating expenses
Purchased power and fuel			7,071				915				960				1,094				(641	)			9,399
Operating and maintenance			3,765				1,040				668				541				(9	)			6,005
Depreciation and amortization			719				521				176				275				41				1,732
Taxes other than income			350				225				122				168				22				887
Total operating expenses			11,905				2,701				1,926				2,078				(587	)			18,023
Equity in losses of unconsolidated affiliates			(20	)			—				—				—				—				(20	)
Gain on sales of assets			355				—				—				—				1				356
Gain on consolidation and acquisition of businesses			261				—				—				—				—				261
Operating income (loss)			1,282				783				417				326				(61	)			2,747
Other income and (deductions)
Interest expense, net			(261	)			(241	)			(85	)			(81	)			(54	)			(722	)
Other, net			306				14				5				14				7				346
Total other income and (deductions)			45				(227	)			(80	)			(67	)			(47	)			(376	)
Income (loss) before income taxes			1,327				556				337				259				(108	)			2,371
Income taxes			290				221				82				103				(50	)			646
Net income (loss)			1,037				335				255				156				(58	)			1,725
Net income attributable to noncontrolling interests and preference stock dividends			111				—				—				10				—				121
Net income (loss) attributable to common shareholders		$	926			$	335			$	255			$	146			$	(58	)		$	1,604

 

(a)	In 2014, includes the results of operations of Constellation Energy Nuclear Group, LLC (CENG) beginning April 1, 2014, the date the nuclear operating services agreement was executed. In 2015, includes the results of operations of CENG on a fully consolidated basis.

(b)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

 

2

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EXELON CORPORATION

Business Segment Comparative Statements of Operations

(unaudited)

(in millions)

 

		Generation
		Three Months Ended September 30,												Nine Months Ended September 30,
		2015 (a)				2014 (a)				Variance				2015 (a)				2014 (a)				Variance
Operating revenues		$	4,768			$	4,412			$	356			$	14,841			$	12,591			$	2,250
Operating expenses
Purchased power and fuel			2,519				1,880				639				7,800				7,071				729
Operating and maintenance			1,241				1,266				(25	)			3,860				3,765				95
Depreciation and amortization			264				253				11				774				719				55
Taxes other than income			123				127				(4	)			369				350				19
Total operating expenses			4,147				3,526				621				12,803				11,905				898
Equity in earnings (losses) of unconsolidated affiliates			—				1				(1	)			—				(20	)			20
Gain on sales of assets			1				338				(337	)			7				355				(348	)
Gain on consolidation and acquisition of businesses			—				—				—				—				261				(261	)
Operating income			622				1,225				(603	)			2,045				1,282				763
Other income and (deductions)
Interest expense			(68	)			(89	)			21				(269	)			(261	)			(8	)
Other, net			(257	)			4				(261	)			(193	)			306				(499	)
Total other income and (deductions)			(325	)			(85	)			(240	)			(462	)			45				(507	)
Income before income taxes			297				1,140				(843	)			1,583				1,327				256
Income taxes			(36	)			291				(327	)			371				290				81
Equity in losses of unconsolidated affiliates			(1	)			—				(1	)			(4	)			—				(4	)
Net income			332				849				(517	)			1,208				1,037				171
Net (loss) income attributable to noncontrolling interests			(45	)			78				(123	)			(10	)			111				(121	)
Net income attributable to membership interest		$	377			$	771			$	(394	)		$	1,218			$	926			$	292
		ComEd
		Three Months Ended September 30,												Nine Months Ended September 30,
		2015				2014				Variance				2015				2014				Variance
Operating revenues		$	1,376			$	1,222			$	154			$	3,709			$	3,484			$	225
Operating expenses
Purchased power			390				326				64				991				915				76
Operating and maintenance			404				359				45				1,166				1,040				126
Depreciation and amortization			176				174				2				528				521				7
Taxes other than income			79				76				3				225				225				—
Total operating expenses			1,049				935				114				2,910				2,701				209
Operating income			327				287				40				799				783				16
Other income and (deductions)
Interest expense, net			(83	)			(81	)			(2	)			(248	)			(241	)			(7	)
Other, net			4				4				—				14				14				—
Total other income and (deductions)			(79	)			(77	)			(2	)			(234	)			(227	)			(7	)
Income before income taxes			248				210				38				565				556				9
Income taxes			99				84				15				226				221				5
Net income		$	149			$	126			$	23			$	339			$	335			$	4

 

(a)	Includes the results of operations of CENG beginning April 1, 2014, the date the nuclear operating services agreement was executed.

 

3

---

EXELON CORPORATION

Business Segment Comparative Statements of Operations

(unaudited)

(in millions)

 

		PECO
		Three Months Ended September 30,												Nine Months Ended September 30,
		2015				2014				Variance				2015				2014				Variance
Operating revenues		$	740			$	693			$	47			$	2,386			$	2,343			$	43
Operating expenses
Purchased power and fuel			278				255				23				953				960				(7	)
Operating and maintenance			196				204				(8	)			609				668				(59	)
Depreciation and amortization			68				59				9				198				176				22
Taxes other than income			44				42				2				125				122				3
Total operating expenses			586				560				26				1,885				1,926				(41	)
Gain on sales of assets			—				—				—				1				—				1
Operating income			154				133				21				502				417				85
Other income and (deductions)
Interest expense, net			(28	)			(29	)			1				(84	)			(85	)			1
Other, net			1				2				(1	)			3				5				(2	)
Total other income and (deductions)			(27	)			(27	)			—				(81	)			(80	)			(1	)
Income before income taxes			127				106				21				421				337				84
Income taxes			37				25				12				122				82				40
Net income attributable to common shareholder		$	90			$	81			$	9			$	299			$	255			$	44
		BGE
		Three Months Ended September 30,												Nine Months Ended September 30,
		2015				2014				Variance				2015				2014				Variance
Operating revenues		$	725			$	697			$	28			$	2,388			$	2,404			$	(16	)
Operating expenses
Purchased power and fuel			311				297				14				1,037				1,094				(57	)
Operating and maintenance			169				165				4				499				541				(42	)
Depreciation and amortization			79				78				1				271				275				(4	)
Taxes other than income			57				55				2				169				168				1
Total operating expenses			616				595				21				1,976				2,078				(102	)
Gain on sales of assets			1				—				1				1				—				1
Operating income			110				102				8				413				326				87
Other income and (deductions)
Interest expense, net			(25	)			(26	)			1				(73	)			(81	)			8
Other, net			4				4				—				13				14				(1	)
Total other income and (deductions)			(21	)			(22	)			1				(60	)			(67	)			7
Income before income taxes			89				80				9				353				259				94
Income taxes			35				31				4				141				103				38
Net income			54				49				5				212				156				56
Preference stock dividends			3				3				—				10				10				—
Net income attributable to common shareholders		$	51			$	46			$	5			$	202			$	146			$	56

 

4

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EXELON CORPORATION

Business Segment Comparative Statements of Operations

(unaudited)

(in millions)

 

		Other (a)
		Three Months Ended September 30,												Nine Months Ended September 30,
		2015				2014				Variance				2015				2014				Variance
Operating revenues		$	(208	)		$	(112	)		$	(96	)		$	(578	)		$	(649	)		$	71
Operating expenses
Purchased power and fuel			(207	)			(110	)			(97	)			(571	)			(641	)			70
Operating and maintenance			(14	)			(12	)			(2	)			(15	)			(9	)			(6	)
Depreciation and amortization			19				13				6				47				41				6
Taxes other than income			7				6				1				20				22				(2	)
Total operating expenses			(195	)			(103	)			(92	)			(519	)			(587	)			68
Equity in earnings of unconsolidated affiliates			—				(1	)			1				—				—				—
Gain on sales of assets			—				1				(1	)			1				1				—
Operating loss			(13	)			(9	)			(4	)			(58	)			(61	)			3
Other income and (deductions)
Interest expense			(49	)			(33	)			(16	)			(81	)			(54	)			(27	)
Other, net			4				2				2				(16	)			7				(23	)
Total other income and (deductions)			(45	)			(31	)			(14	)			(97	)			(47	)			(50	)
Net loss before income taxes			(58	)			(40	)			(18	)			(155	)			(108	)			(47	)
Income taxes			(20	)			(9	)			(11	)			(55	)			(50	)			(5	)
Equity in earnings of unconsolidated affiliates			—				—				—				1				—				1
Net loss attributable to common shareholders		$	(38	)		$	(31	)		$	(7	)		$	(99	)		$	(58	)		$	(41	)

 

(a)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

 

5

---

EXELON CORPORATION

Consolidated Balance Sheets

(in millions)

 

		September 30, 2015				December 31, 2014
		(unaudited)
Assets
Current assets
Cash and cash equivalents		$	7,265			$	1,878
Restricted cash and cash equivalents			341				271
Accounts receivable, net
Customer			3,215				3,482
Other			1,107				1,227
Mark-to-market derivative assets			1,116				1,279
Unamortized energy contract assets			135				254
Inventories, net
Fossil fuel and emission allowances			442				579
Materials and supplies			1,074				1,024
Deferred income taxes			211				244
Regulatory assets			779				847
Assets held for sale			4				147
Other			1,178				865
Total current assets			16,867				12,097
Property, plant and equipment, net			55,814				52,087
Deferred debits and other assets
Regulatory assets			6,000				6,076
Nuclear decommissioning trust funds			10,103				10,537
Investments			620				544
Goodwill			2,672				2,672
Mark-to-market derivative assets			801				773
Deferred income taxes			2				—
Unamortized energy contracts assets			513				549
Pledged assets for Zion Station decommissioning			237				319
Other			1,499				1,160
Total deferred debits and other assets			22,447				22,630
Total assets		$	95,128			$	86,814
Liabilities and shareholders’ equity
Current liabilities
Short-term borrowings		$	675			$	460
Long-term debt due within one year			897				1,802
Accounts payable			2,987				3,048
Accrued expenses			1,576				1,539
Payables to affiliates			8				8
Regulatory liabilities			365				310
Mark-to-market derivative liabilities			204				234
Unamortized energy contract liabilities			118				238
Other			1,017				1,123
Total current liabilities			7,847				8,762
Long-term debt			24,541				19,362
Long-term debt to financing trusts			648				648
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits			13,480				13,019
Asset retirement obligations			8,405				7,295
Pension obligations			3,014				3,366
Non-pension postretirement benefit obligations			1,877				1,742
Spent nuclear fuel obligation			1,021				1,021
Regulatory liabilities			4,180				4,550
Mark-to-market derivative liabilities			360				403
Unamortized energy contract liabilities			136				211
Payable for Zion Station decommissioning			99				155
Other			2,231				2,147
Total deferred credits and other liabilities			34,803				33,909
Total liabilities			67,839				62,681
Commitments and contingencies
Shareholders’ equity
Common stock			18,647				16,709
Treasury stock, at cost			(2,327	)			(2,327	)
Retained earnings			12,046				10,910
Accumulated other comprehensive loss, net			(2,596	)			(2,684	)
Total shareholders’ equity			25,770				22,608
BGE preference stock not subject to mandatory redemption			193				193
Noncontrolling interest			1,326				1,332
Total equity			27,289				24,133
Total liabilities and shareholders’ equity		$	95,128			$	86,814

 

6

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EXELON CORPORATION

Consolidated Statements of Cash Flows

(unaudited)

(in millions)

 

		Nine Months Ended September 30,
		2015				2014
Cash flows from operating activities
Net income		$	1,959			$	1,725
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation, amortization, depletion and accretion, including nuclear fuel and energy contract amortization			2,930				2,856
Impairment of long-lived assets			25				162
Gain on consolidation and acquisition of businesses			—				(268	)
Gain on sales of assets			(10	)			(356	)
Deferred income taxes and amortization of investment tax credits			241				459
Net fair value changes related to derivatives			(363	)			522
Net realized and unrealized (gains) losses on nuclear decommissioning trust fund investments			221				(141	)
Other non-cash operating activities			856				698
Changes in assets and liabilities:
Accounts receivable			175				198
Inventories			65				(316	)
Accounts payable, accrued expenses and other current liabilities			(147	)			(322	)
Option premiums received, net			27				21
Counterparty collateral received (posted), net			305				(615	)
Income taxes			300				72
Pension and non-pension postretirement benefit contributions			(430	)			(516	)
Other assets and liabilities			(480	)			(536	)
Net cash flows provided by operating activities			5,674				3,643
Cash flows from investing activities
Capital expenditures			(5,443	)			(4,114	)
Proceeds from nuclear decommissioning trust fund sales			4,551				5,464
Investment in nuclear decommissioning trust funds			(4,737	)			(5,550	)
Acquisition of businesses			(28	)			(67	)
Proceeds from sale of long-lived assets			145				660
Proceeds from termination of direct financing lease investment			—				335
Proceeds from sales of investments			—				7
Cash and restricted cash acquired from consolidations and acquisitions			—				129
Change in restricted cash			(70	)			(151	)
Other investing activities			(107	)			(89	)
Net cash flows used in investing activities			(5,689	)			(3,376	)
Cash flows from financing activities
Changes in short-term borrowings			230				236
Issuance of long-term debt			5,909				3,212
Retirement of long-term debt			(1,745	)			(1,214	)
Issuance of common stock			1,868				—
Distributions to noncontrolling interest of consolidated VIE			—				(415	)
Dividends paid on common stock			(819	)			(799	)
Proceeds from employee stock plans			24				25
Other financing activities			(65	)			(158	)
Net cash flows provided by financing activities			5,402				887
Increase in cash and cash equivalents			5,387				1,154
Cash and cash equivalents at beginning of period			1,878				1,609
Cash and cash equivalents at end of period		$	7,265			$	2,763

 

7

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EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions, except per share data)

 

		Three Months Ended September 30, 2015												Three Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	7,401			$	11	(b),(c)		$	7,412			$	6,912			$	(248	)(b),(c)		$	6,664
Operating expenses
Purchased power and fuel			3,291				(132	)(b),(c)			3,159				2,648				33	(b),(c)			2,681
Operating and maintenance			1,996				(13	)(d),(e)			1,983				1,982				(99	(d),(e),(i),  )(j)			1,883
Depreciation and amortization			606				—				606				577				—				577
Taxes other than income			310				—				310				306				—				306
Total operating expenses			6,203				(145	)			6,058				5,513				(66	)			5,447
Equity in earnings of unconsolidated affiliates			—				—				—				—				—				—
Gain on sale of assets			2				—				2				339				(329	)(j)			10
Gain on consolidation and acquisition of businesses			—				—				—				—				—				—
Operating income			1,200				156				1,356				1,738				(511	)			1,227
Other income and (deductions)
Interest expense			(253	)			(12	)(f)			(265	)			(258	)			24	(b),(k)			(234	)
Other, net			(244	)			279	(g)			35				16				54	(f),(g)			70
Total other income and (deductions)			(497	)			267				(230	)			(242	)			78				(164	)
Income before income taxes			703				423				1,126				1,496				(433	)			1,063
Income taxes			115				249	(b),(c),(d),  (e),(f),(g)			364				422				(103	(b),(c),(d),   (e),(f),(g),  )(i),(j),(k)			319
Equity in losses of unconsolidated affiliates			(1	)			—				(1	)			—				—				—
Net income			587				174				761				1,074				(330	)			744
Net income (loss) attributable to noncontrolling interests and preference stock dividends			(42	)			46	(h)			4				81				(13	)(h)			68
Net income attributable to common shareholders		$	629			$	128			$	757			$	993			$	(317	)		$	676
Effective tax rate			16.4	%							32.3	%			28.2	%							30.0	%
Earnings per average common share
Basic		$	0.69			$	0.14			$	0.83			$	1.15			$	(0.37	)		$	0.78
Diluted		$	0.69			$	0.14			$	0.83			$	1.15			$	(0.37	)		$	0.78
Average common shares outstanding
Basic			913								913				861								861
Diluted			915								915				863								863
Effect of adjustments on earnings per average diluted common share recorded in accordance with GAAP:
Mark-to-market impact of economic hedging activities (b)						$	0.09											$	(0.18	)
Amortization of commodity contract intangibles (c)							—												(0.01	)
Merger and integration costs (d)							0.02												0.06
Asset retirement obligation (e)							(0.01	)											(0.02	)
Tax settlements (f)							(0.06	)											(0.08	)
Unrealized losses related to NDT fund investments (g)							0.15												0.03
CENG Non-controlling interest (h)							(0.05	)											0.02
Long-lived asset impairment (i)							—												0.03
Plant retirements and divestitures (j)							—												(0.23	)
Mark-to-market impact of PHI merger related interest rate swaps (k)							—												0.01
Total adjustments						$	0.14											$	(0.37	)

 

(a)	Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b)	Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(c)	Adjustment to exclude the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value, if and when applicable, related to the Constellation merger, the CENG integration and the Integrys acquisition.

(d)

Adjustment to exclude certain costs associated with the Constellation merger, pending PHI acquisition, the CENG integration and Integrys acquisition, including, if and when applicable, professional fees, employee-related expenses, integration activities, upfront credit facilities fees, merger commitments, and certain pre-acquisition contingencies.

(e)	Adjustment to exclude a non-cash benefit pursuant to the annual update of the Generation nuclear decommissioning obligation related to the non-regulatory units.

(f)	Adjustment to exclude favorable settlements of certain income tax positions on Constellation’s pre-acquisition tax returns.

(g)	Adjustment to exclude the unrealized gains and losses on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

 

8

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(h)

Adjustment to account for Generation’s non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity in 2015, and in 2014 the impact of unrealized gains and losses on NDT fund investments, certain merger and acquisition costs, non-cash amortization of intangible assets, net, related to commodity contracts and changes in asset retirement obligations.

(i)	Adjustment to exclude a 2014 charge to earnings related to the impairment of certain generating assets held for sale.

(j)	Adjustment to exclude the impacts associated with the sale of Generation’s ownership interest in generating stations, primarily the gain from the sale of Generation’s equity interest in Safe Harbor Water Power Corporation.

(k)	Adjustment to exclude the mark-to-market impact of Exelon Corporate’s forward-starting interest rate swaps related to financing for the pending PHI acquisition.

 

9

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EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions, except per share data)

 

		Nine Months Ended September 30, 2015												Nine Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	22,746			$	(190	)(b),(c)		$	22,556			$	20,173			$	772	(b),(c),(d)		$	20,945
Operating expenses
Purchased power and fuel			10,210				88	(b),(c)			10,298				9,399				220	(b),(c)			9,619
Operating and maintenance			6,119				(66	(d),  )(e),(f),(g)			6,053				6,005				(250	)(d),(e),(g),(l)			5,755
Depreciation and amortization			1,818				—				1,818				1,732				—				1,732
Taxes other than income			908				—				908				887				—				887
Total operating expenses			19,055				22				19,077				18,023				(30	)			17,993
Equity in losses of unconsolidated affiliates			—				—				—				(20	)			12	(c),(d)			(8	)
Gain on sales of assets			10				—				10				356				(329	)(l)			27
Gain on consolidation of CENG			—				—				—				261				(261	)(m)			—
Operating income			3,701				(212	)			3,489				2,747				224				2,971
Other income and (deductions)
Interest expense, net			(755	)			(27	)(h),(j)			(782	)			(722	)			32	(b),(h)			(690	)
Other, net			(179	)			357	(i)			178				346				(151	)(i),(j)			195
Total other income and (deductions)			(934	)			330				(604	)			(376	)			(119	)			(495	)
Income before income taxes			2,767				118				2,885				2,371				105				2,476
Income taxes			805				145	(b),(c),(d),   (e),(f),(g),  (h),(i),(j)			950				646				99	(b),(c),(d),   (e),(g),(h),  (i),(j),(l),(m)			745
Equity in losses of unconsolidated affiliates			(3	)			—				(3	)			—				—				—
Net income			1,959				(27	)			1,932				1,725				6				1,731
Net income attributable to noncontrolling interests and preference stock dividends			—				52	(k)			52				121				(36	)(k)			85
Net income attributable to common shareholders		$	1,959			$	(79	)		$	1,880			$	1,604			$	42			$	1,646
Effective tax rate			29.1	%							32.9	%			27.2	%							30.1	%
Earnings per average common share
Basic		$	2.23			$	(0.09	)		$	2.14			$	1.87			$	0.05			$	1.92
Diluted		$	2.22			$	(0.09	)		$	2.13			$	1.86			$	0.05			$	1.91
Average common shares outstanding
Basic			879								879				860								860
Diluted			883								883				863								863
Effect of adjustments on earnings per average diluted common share recorded in accordance with GAAP:
Mark-to-market impact of economic hedging activities (b)						$	(0.18	)										$	0.34
Amortization of commodity contract intangibles (c)							(0.01	)											0.06
Merger and integration costs (d)							0.06												0.11
Long-lived asset impairment (e)							0.02												0.11
Midwest Generation bankruptcy recoveries (f)							(0.01	)											—
Asset retirement obligation (g)							—												(0.02	)
Mark-to-market impact of PHI merger related interest rate swaps (h)							(0.03	)											0.01
Unrealized gains related to NDT fund investments (i)							0.19												(0.07	)
Tax settlement (j)							(0.06	)											(0.12	)
CENG Non-controlling interest (k)							(0.06	)											0.04
Plant retirements and divestitures (l)							(0.01	)											(0.23	)
Gain on CENG integration (m)							—												(0.18	)
Total adjustments						$	(0.09	)										$	0.05

Note: For the nine months ended September 30, 2014, includes the results of operations of CENG beginning April 1, 2014, the date the nuclear operating services agreement was executed.

 

(a)	Results reported in accordance with GAAP.

(b)	Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(c)	Adjustment to exclude the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value, if and when applicable, related to the Constellation merger, the CENG integration and the Integrys acquisition.

(d)

Adjustment to exclude certain costs associated with the Constellation merger, pending PHI acquisition, the CENG integration and Integrys acquisition, including, if and when applicable, professional fees, employee-related expenses, integration activities, upfront credit facilities fees, merger commitments, and certain pre-acquisition contingencies.

 

10

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(e)	Adjustment to exclude a 2015 and 2014 charge to earnings related to the impairment of investments in long-term leases and a 2014 charge to earnings related to the impairment of certain wind generating assets and certain generating assets held for sale.

(f)	Adjustment to reflect a benefit related to the favorable settlement of a long-term railcar lease agreement pursuant to the Midwest Generation bankruptcy.

(g)	Adjustment to exclude a non-cash benefit pursuant to the annual update of the Generation nuclear decommissioning obligation related to the non-regulatory units.

(h)	Adjustment to exclude the mark-to-market impact of Exelon Corporate’s forward-starting interest rate swaps related to financing for the pending PHI acquisition.

(i)	Adjustment to exclude the unrealized gains on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(j)	Adjustment exclude benefits related to favorable settlements of certain income tax positions on Constellation’s pre-acquisition tax returns.

(k)

Adjustment to account for Generation’s non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity in 2015, and in 2014 the impact of unrealized gains and losses on NDT fund investments, certain merger and acquisition costs, non-cash amortization of intangible assets, net, related to commodity contracts and changes in asset retirement obligations.

(l)	Adjustment to exclude the impacts associated with the sale of Generation’s ownership interest in generating stations, primarily the gain from the sale of Generation’s equity interest in Safe Harbor Water Power Corporation.

(m)	Adjustment to exclude the gain recorded upon consolidation of CENG resulting from the difference in the fair value of CENG’s net assets and the equity method investment previously recorded on Generation’s and Exelon’s books and the settlement of pre-existing commitments between Generation and CENG.

 

11

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EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating

Earnings to GAAP Earnings (in millions)

Three Months Ended September 30, 2015 and 2014

(unaudited)

 

		Exelon Earnings per Diluted Share				Generation				ComEd				PECO				BGE				Other (a)				Exelon
2014 GAAP Earnings (Loss)		$	1.15			$	771			$	126			$	81			$	46			$	(31	)		$	993
2014 Adjusted (non-GAAP) Operating (Earnings) Loss Adjustments:
Mark-to-Market Impact of Economic Hedging Activities			(0.18	)			(161	)			—				—				—				3				(158	)
Unrealized Losses Related to NDT Fund Investments (1)			0.03				22				—				—				—				—				22
Merger and Integration Costs (2)			0.06				47				—				—				—				11				58
Amortization of Commodity Contract Intangibles (3)			(0.01	)			(12	)			—				—				—				—				(12	)
Plant Retirement and Divestitures (4)			(0.23	)			(198	)			—				—				—				1				(197	)
Long-Lived Asset Impairment (5)			0.03				30				—				—				—				—				30
Asset Retirement Obligation (6)			(0.02	)			(13	)			—				—				—				—				(13	)
Tax Settlements (7)			(0.08	)			(66	)			—				—				—				—				(66	)
Mark-to-Market Impact of PHI Merger Related Interest Rate Swaps (8)			0.01				—				—				—				—				6				6
CENG Non-Controlling Interest (9)			0.02				13				—				—								—				13
2014 Adjusted (non-GAAP) Operating Earnings (Loss)			0.78				433				126				81				46				(10	)			676
Generation Energy Margins, Excluding Mark-to-Market:
Nuclear Volume			—				(1	)			—				—				—				—				(1	)
Nuclear Fuel Cost			—				1				—				—				—				—				1
Capacity Pricing (10)			—				(2	)			—				—				—				—				(2	)
Market and Portfolio Conditions (11)			0.10				88				—				—				—				—				88
ComEd, PECO and BGE Margins:
Weather			0.03				—				10				19				—	(b)			—				29
Load			—				—				(1	)			(1	)			—	(b)			—				(2	)
Other Energy Delivery (12)			0.05				—				45	(c)			(4	)(c)			8	(c)			—				49
Operating and Maintenance Expense:
Labor, Contracting and Materials (13)			(0.03	)			(28	)			(1	)			1				(2	)			—				(30	)
Planned Nuclear Refueling Outages			—				—				—				—				—				—				—
Pension and Non-Pension Postretirement Benefits (14)			(0.01	)			(4	)			(5	)			(1	)			—				(2	)			(12	)
Other Operating and Maintenance (15)			(0.02	)			(8	)			(19	)			5				1				(1	)			(22	)
Depreciation and Amortization Expense			(0.02	)			(7	)			(1	)			(5	)			(1	)			(2	)			(16	)
Interest Expense, Net (16)			(0.03	)			(4	)			(1	)			1				1				(21	)			(24	)
Income Taxes (17)			—				5				—				(3	)			—				2				4
Equity in Earnings of Unconsolidated Affiliates			—				(1	)			—				—				—				—				(1	)
CENG Non-Controlling Interest (18)			0.04				39				—				—				—				—				39
Other (19)			(0.02	)			(12	)			(2	)			(2	)			(1	)			(2	)			(19	)
Share Differential (20)			(0.04	)			—				—				—				—				—				—
2015 Adjusted (non-GAAP) Operating Earnings (Loss)			0.83				499				151				91				52				(36	)			757
2015 Adjusted (non-GAAP) Operating Earnings (Loss) Adjustments:
Mark-to-Market Impact of Economic Hedging Activities			(0.09	)			(85	)			—				—				—								(85	)
Unrealized Losses Related to NDT Fund Investments (1)			(0.15	)			(133	)			—				—				—				—				(133	)
Merger and Integration Costs (2)			(0.02	)			(6	)			(2	)			(1	)			(1	)			(2	)			(12	)
Amortization of Commodity Contract Intangibles (3)			—				(2	)			—				—				—				—				(2	)
Asset Retirement Obligation (6)			0.01				6				—				—				—				—				6
Tax Settlements (7)			0.06				52				—				—				—				—				52
CENG Non-Controlling Interest (9)			0.05				46				—				—				—				—				46
2015 GAAP Earnings		$	0.69			$	377			$	149			$	90			$	51			$	(38	)		$	629

Notes:

(a)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

(b)	As approved by the Maryland PSC, BGE records a monthly adjustment to rates for residential and the majority of its commercial and industrial customers to eliminate the effect of abnormal weather and usage patterns per customer on distribution volumes.

(c)

For regulatory recovery mechanisms, including ComEd’s distribution formula rate, ComEd and BGE’s transmission formula rates, and riders across all utilities, revenues increase and decrease i) as fully recoverable costs fluctuate (with no impact on net earnings), and ii) pursuant to changes in rate base, capital structure and ROE (which impact net earnings).

(1)	Reflects the impact of unrealized gains and losses on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(2)

Reflects certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, upfront credit facilities fees, merger commitments, and certain pre-acquisition contingencies related to the Constellation merger, CENG integration and the Integrys and pending PHI acquisitions.

 

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(3)	Represents the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value, if and when applicable, related to the Constellation merger, the CENG integration and the Integrys acquisition.

(4)	Reflects the 2014 impacts associated with the sale of Generation’s ownership interest in generating stations, primarily the gain from sale of Generation’s equity interest in Safe Harbor Water Power Corporation.

(5)	Primarily reflects the impairment of certain generating assets held for sale in 2014.

(6)	Primarily reflects a non-cash benefit pursuant to the annual update of the Generation nuclear decommissioning obligation related to the non-regulatory units.

(7)	Reflects benefits related to the favorable settlements in 2014 and 2015 of certain income tax positions on Constellation’s pre-acquisition tax returns.

(8)	Reflects the impact of mark-to-market activity on forward-starting interest rate swaps held at Exelon Corporate related to financing for the pending PHI acquisition, which were terminated on June 8, 2015.

(9)

Represents Generation’s non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity in 2015, and in 2014 the impact of unrealized gains and losses on NDT fund investments, mark-to-market activity, certain merger and acquisition costs, non-cash amortization of intangible assets, net, related to commodity contracts, and changes in asset retirement obligations.

(10)	Primarily reflects decreased capacity prices in the New York market and the reduction of capacity credits resulting from the sale of generating assets in 2014, substantially offset by an increase in capacity prices in the Mid-Atlantic region.

(11)	Primarily reflects the benefit of lower cost to serve load in the Mid-Atlantic, Midwest, and New England regions, the benefit from the Integrys acquisition and increased load served, partially offset by lower margins resulting from the sale of generating assets in 2014.

(12)

For ComEd, primarily reflects increased electric distribution and transmission formula rate revenues (due to increased capital investments, partially offset by lower electric distribution ROE due to a decrease in treasury rates), and an increase in fully recoverable costs. For BGE, primarily reflects increased distribution revenue pursuant to increased rates effective December 2014 and an increase in fully recoverable costs.

(13)	Primarily reflects increased contracting costs at Generation primarily due to growth development projects and increased inflation across all operating companies.

(14)	Primarily reflects the unfavorable impact in 2015 of lower assumed pension and OPEB discount rates and an increase in the life expectancy assumption for plan participants.

(15)	Primarily reflects increased materials and supplies related costs at Generation, increased fully recoverable energy efficiency program costs at ComEd and decreased storm costs at PECO and BGE.

(16)	Primarily reflects increased interest expense due to higher outstanding debt at Generation and Corporate, partially offset by the net impact of favorable settlements of certain income tax positions on Constellation’s pre-acquisition tax returns at Generation.

(17)	At Generation, primarily reflects an increase in the domestic production activities deduction.

(18)	Reflects Generation’s non-controlling interest related to the net impact of CENG’s operating revenue and expenses.

(19)	For Generation, reflects realized NDT fund losses in 2015 as compared to gains in 2014.

(20)	Reflects the impact on earnings per share due to the increase in Exelon’s average diluted common shares outstanding as a result of the July 2015 common stock issuance.

 

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EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating

Earnings to GAAP Earnings (in millions)

Nine Months Ended September 30, 2015 and 2014

(unaudited)

 

		Exelon Earnings per Diluted Share				Generation				ComEd				PECO				BGE				Other (a)				Exelon
2014 GAAP Earnings (Loss)		$	1.86			$	926			$	335			$	255			$	146			$	(58	)		$	1,604
2014 Adjusted (non-GAAP) Operating (Earnings) Loss Adjustments:
Mark-to-Market Impact of Economic Hedging Activities			0.34				294				—				—				—				(1	)			293
Unrealized Gains Related to NDT Fund Investments (1)			(0.07	)			(62	)			—				—				—				—				(62	)
Amortization of Commodity Contract Intangibles (2)			0.06				42				—				—				—				—				42
Merger and Integration Costs (3)			0.11				76				—				—				—				23				99
Tax Settlements (4)			(0.12	)			(101	)			—				—				—				—				(101	)
Long-Lived Asset Impairment (5)			0.11				83				—				—				—				15				98
Plant Retirements and Divestitures (6)			(0.23	)			(198	)			—				—				—				1				(197	)
Gain on CENG Integration (7)			(0.18	)			(159	)			—				—				—				—				(159	)
Mark-to-Market Impact of PHI Merger Related Interest Rate Swaps (8)			0.01				—				—				—				—				6				6
Asset Retirement Obligation (9)			(0.02	)			(13	)			—				—				—				—				(13	)
CENG Non-Controlling Interest (10)			0.04				36				—				—				—				—				36
2014 Adjusted (non-GAAP) Operating Earnings (Loss)			1.91				924				335				255				146				(14	)			1,646
Year Over Year Effects on Earnings:
Generation Energy Margins, Excluding Mark-to-Market:
Nuclear Volume (12)			0.31				265				—				—				—				—				265
Nuclear Fuel Cost (13)			—				1				—				—				—				—				1
Capacity Pricing (14)			0.02				21				—				—				—				—				21
Market and Portfolio Conditions (15)			0.16				138				—				—				—				—				138
ComEd, PECO and BGE Margins:
Weather			0.03				—				(1	)			31				—	(b)			—				30
Load			—				—				(8	)			5				—	(b)			—				(3	)
Other Energy Delivery (16)			0.14				—				99	(c)			(6	)(c)			24	(c)			1				118
Operating and Maintenance Expense:
Labor, Contracting and Materials (17)			(0.17	)			(124	)			(23	)			1				—				—				(146	)
Planned Nuclear Refueling Outages (18)			(0.02	)			(18	)			—				—				—				—				(18	)
Pension and Non-Pension Postretirement Benefits (19)			(0.02	)			(6	)			(5	)			(1	)			1				(5	)			(16	)
Other Operating and Maintenance (20)			—				(30	)			(43	)			37				27				7				(2	)
Depreciation and Amortization Expense (21)			(0.06	)			(34	)			(4	)			(13	)			2				(3	)			(52	)
Interest Expense, Net (22)			(0.08	)			(32	)			(5	)			—				3				(34	)			(68	)
Income Taxes (23)			(0.05	)			(20	)			(1	)			(7	)			—				(12	)			(40	)
Equity in Earnings of Unconsolidated Affiliates			—				2				—				—				—				—				2
CENG Non-Controlling Interest (24)			0.02				20				—				—				—				—				20
Other (25)			(0.02	)			4				—				(1	)			1				(20	)			(16	)
Share Differential (26)			(0.04	)			—				—				—				—				—				—
2015 Adjusted (non-GAAP) Operating Earnings (Loss)			2.13				1,111				344				301				204				(80	)			1,880
2015 Adjusted (non-GAAP) Operating Earnings (Loss) Adjustments:
Mark-to-Market Impact of Economic Hedging Activities			0.18				160				—				—				—				(2	)			158
Unrealized Losses Related to NDT Fund Investments (1)			(0.19	)			(164	)			—				—				—				—				(164	)
Amortization of Commodity Contract Intangibles (2)			0.01				13				—				—				—				—				13
Merger and Integration Costs (3)			(0.06	)			(18	)			(5	)			(2	)			(2	)			(23	)			(50	)
Tax Settlements (4)			0.06				52				—				—				—				—				52
Long-Lived Asset Impairment (5)			(0.02	)			—				—				—				—				(15	)			(15	)
Mark-to-Market Impact of PHI Merger Related Interest Rate Swaps (8)			0.03				—				—				—				—				21				21
Asset Retirement Obligation (9)			0.01				6								—				—				—				6
Midwest Generation Bankruptcy Recoveries (11)			0.01				6				—				—				—				—				6
CENG Non-Controlling Interest (10)			0.06				52				—				—				—				—				52
2015 GAAP Earnings (Loss)		$	2.22			$	1,218			$	339			$	299			$	202			$	(99	)		$	1,959

Note:

•

In 2015, each line item above includes 100% of CENG’s results of operations, however during the first quarter of 2014, CENG’s net results were included in equity in earnings (loss) on unconsolidated affiliates. Therefore, the results of operations from 2015 and 2014 for each line item above are not comparable for Generation and Exelon. The explanations below identify any other significant or unusual items affecting the results of operations.

(a)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

 

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(b)	As approved by the Maryland PSC, BGE records a monthly adjustment to rates for residential and the majority of its commercial and industrial customers to eliminate the effect of abnormal weather and usage patterns per customer on distribution volumes.

(c)

For regulatory recovery mechanisms, including ComEd’s distribution formula rate, ComEd and BGE’s transmission formula rates, and riders across all utilities, revenues increase and decrease i) as fully recoverable costs fluctuate (with no impact on net earnings), and ii) pursuant to changes in rate base, capital structure and ROE (which impact net earnings).

(1)	Reflects the impact of unrealized gains and losses on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(2)	Represents the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value, if and when applicable, related to the Constellation merger, CENG integration, and the Integrys acquisition.

(3)

Reflects certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, upfront credit facilities fees, merger commitments, and certain pre-acquisition contingencies related to the Constellation merger, CENG integration and the Integrys and pending PHI acquisitions.

(4)	Reflects benefits related to the favorable settlements in 2014 and 2015 of certain income tax positions on Constellation’s pre-acquisition tax returns.

(5)	Reflects a 2014 charge primarily related to the impairment of certain wind generating assets and certain generating assets held for sale, and charges in 2014 and 2015 related to the impairment of investment in long-term leases.

(6)	Reflects the 2014 impacts associated with the sale of Generation’s ownership interest in generating stations, primarily the gain from sale of Generation’s equity interest in Safe Harbor Water Power Corporation.

(7)

Represents the gain recorded upon consolidation of CENG resulting from the difference in the fair value of CENG’s net assets as of April 1, 2014, and the equity method investment previously recorded on Generation’s and Exelon’s books and the settlement of pre-existing transactions between Generation and CENG.

(8)	Reflects the impact of mark-to-market activity on forward-starting interest rate swaps held at Exelon Corporate related to financing for the pending PHI acquisition, which were terminated on June 8, 2015.

(9)	Primarily reflects a non-cash benefit pursuant to the annual update of the Generation nuclear decommissioning obligation related to the non-regulatory units.

(10)

Represents Generation’s non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity in 2015, and in 2014 the impact of unrealized gains and losses on NDT fund investments, certain merger and acquisition costs, non-cash amortization of intangible assets, net, related to commodity contracts, and changes in asset retirement obligations.

(11)	Primarily reflects a benefit for the favorable settlement of a long-term railcar lease agreement pursuant to the Midwest Generation bankruptcy.

(12)	Primarily reflects the inclusion of CENG’s results for the first quarter of 2015 and a reduction in the number of nuclear generating outage days in 2015.

(13)	Primarily reflects the cancellation of the DOE spent nuclear disposal fee, substantially offset by the inclusion of CENG’s results in 2015 and an increase in fuel cost due to increased generation.

(14)	Primarily reflects the inclusion of CENG’s capacity credits and increased capacity prices for the Midwest market, partially offset by a decrease in capacity prices for the Mid-Atlantic market and the reduction of capacity credits resulting from the sale of generating assets in 2014.

(15)

Primarily reflects the benefit of lower cost to serve load (including the absence of higher procurement costs for replacement power in 2014) in the Mid-Atlantic, Midwest, and New England regions, the benefit from the Integrys acquisition, favorability from portfolio management optimization activities in the Mid-Atlantic and Midwest regions, and increased load served, partially offset by lower margins resulting from the sale of generating assets in 2014, lower realized energy prices, and the absence of the 2014 fuel optimization opportunities in the South due to extreme cold weather.

(16)

For ComEd, primarily reflects increased electric distribution and transmission formula rate revenues (due to increased capital investments, partially offset by lower electric distribution ROE due to a decrease in treasury rates), and an increase in fully recoverable costs. For PECO, reflects the impact of lower wholesale transmission revenue resulting from the previous year’s peak demand. For BGE, primarily reflects increased distribution revenue pursuant to increased rates effective in December 2014.

(17)

Primarily reflects the inclusion of CENG’s results for the first quarter of 2015 and increased contracting costs primarily due to growth development projects at Generation, increased contracting costs related to preventative maintenance and other projects at ComEd, and inflation across all operating companies.

(18)	Primarily reflects the impact of increased refueling outage costs at CENG plants in 2015.

(19)	Primarily reflects the unfavorable impact of lower assumed pension and OPEB discount rates for 2015 and an increase in the life expectancy assumption for plan participants in 2015, partially offset by cost savings from plan design changes for certain OPEB plans effective April 2014 and forward.

(20)

For Generation, primarily reflects the inclusion of CENG’s results for the first quarter of 2015 and increased materials and supplies related costs, partially offset by a reduction in the number of nuclear refueling outage days at Salem. For ComEd, primarily relates to increased fully recoverable costs associated with uncollectible accounts. For PECO, reflects decreased storm costs, primarily as a result of the February 5, 2014 ice storm. For BGE, primarily reflects decreased storm costs and a decrease in uncollectible accounts expense.

(21)	Primarily reflects the inclusion of CENG’s results for the first quarter of 2015 at Generation and ongoing capital expenditures at PECO.

(22)

At Generation, primarily reflects increased interest expense due to higher outstanding debt in 2015, partially offset by the inclusion of CENG’s results for the first quarter of 2015. At Corporate, reflects increased interest expense due to higher outstanding debt in 2015 and payments related to the mandatory convertible securities issued for the pending PHI acquisition.

(23)	At Generation, primarily reflects benefits in 2014 for favorable settlements of certain income tax positions partially offset by an increase the domestic production activities deduction. At PECO, primarily reflects a decrease in electric tax repairs deduction taken in 2015.

(24)	Reflects Generation’s non-controlling interest related to the net impact of CENG’s operating revenue and expenses.

(25)	For Corporate, primarily reflects a loss on the termination of forward-starting interest rate swaps in the first quarter of 2015.

(26)	Reflects the impact on earnings per share due to the increase in Exelon’s average diluted common shares outstanding as a result of the July 2015 common stock issuance.

 

15

---

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited) (in millions)

 

		Generation
		Three Months Ended September 30, 2015												Three Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	4,768			$	11	(b),(c)		$	4,779			$	4,412			$	(248	)(b),(c)		$	4,164
Operating expenses
Purchased power and fuel			2,519				(132	)(b),(c)			2,387				1,880				33	(b),(c)			1,913
Operating and maintenance			1,241				(2	)(d),(e)			1,239				1,266				(90	(d),(e),(j),  )(k)			1,176
Depreciation and amortization			264				—				264				253				—				253
Taxes other than income			123				—				123				127				—				127
Total operating expenses			4,147				(134	)			4,013				3,526				(57	)			3,469
Equity in income of unconsolidated affiliates			—				—				—				1				—				1
Gain on sale of assets			1				—				1				338				(329	)(k)			9
Operating income			622				145				767				1,225				(520	)			705
Other income and (deductions)
Interest expense			(68	)			(12	)(f)			(80	)			(89	)			3	(b)			(86	)
Other, net			(257	)			279	(g)			22				4				54	(g),(f)			58
Total other income and (deductions)			(325	)			267				(58	)			(85	)			57				(28	)
Income before income taxes			297				412				709				1,140				(463	)			677
Income taxes			(36	)			244	(b),(c),(d),  (e),(f),(g)			208				291				(112	(b),(c),(d),   (e),(f)(g),  )(j),(k)			179
Equity in losses of unconsolidated affiliates			(1	)			—				(1	)			—				—				—
Net income			332				168				500				849				(351	)			498
Net income (loss) attributable to noncontrolling interests			(45	)			46	(h)			1				78				(13	)(h)			65
Net income attributable to membership interest		$	377			$	122			$	499			$	771			$	(338	)		$	433
		Nine Months Ended September 30, 2015												Nine Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	14,841			$	(190	)(b),(c)		$	14,651			$	12,591			$	772	(b),(c),(d)		$	13,363
Operating expenses
Purchased power and fuel			7,800				88	(b),(c)			7,888				7,071				220	(b),(c)			7,291
Operating and maintenance			3,860				(9	)(d),(e),(i)			3,851				3,765				(207	(d),(e),(j),  )(k)			3,558
Depreciation and amortization			774				—				774				719				—				719
Taxes other than income			369				—				369				350				—				350
Total operating expenses			12,803				79				12,882				11,905				13				11,918
Equity in losses of unconsolidated affiliates			—				—				—				(20	)			12	(c),(d)			(8	)
Gain on sale of assets			7				—				7				355				(329	)(k)			26
Gain on consolidation and acquisition of businesses			—				—				—				261				(261	)(l)			—
Operating income			2,045				(269	)			1,776				1,282				181				1,463
Other income and (deductions)
Interest expense			(269	)			(12	)(f)			(281	)			(261	)			3	(b)			(258	)
Other, net			(193	)			357	(g)			164				306				(151	)(g),(f)			155
Total other income and (deductions)			(462	)			345				(117	)			45				(148	)			(103	)
Income before income taxes			1,583				76				1,659				1,327				33				1,360
Income taxes			371				131	(b),(c),(d),  (e),(f),(g),  (i)			502				290				71	(b),(c),(d),  (e),(f),(g),  (j),(k),(l)			361
Equity in loss of unconsolidated affiliates			(4	)			—				(4	)			—				—				—
Net income			1,208				(55	)			1,153				1,037				(38	)			999
Net income (losses) attributable to noncontrolling interests			(10	)			52	(h)			42				111				(36	)(h)			75
Net income attributable to membership interest		$	1,218			$	(107	)		$	1,111			$	926			$	(2	)		$	924

Note: For the nine months ended September 30, 2014, includes the results of operations of CENG beginning April 1, 2014, the date the nuclear operating services agreement was executed.

 

(a)	Results reported in accordance with GAAP.

 

16

---

(b)	Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(c)	Adjustment to exclude the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value, if and when applicable, related to the Constellation merger, the CENG integration and the Integrys acquisition.

(d)

Adjustment to exclude certain costs associated with the Constellation merger, pending PHI acquisition, the CENG integration and Integrys acquisition, including, if and when applicable, professional fees, employee-related expenses, integration activities, upfront credit facilities fees, merger commitments, and certain pre-acquisition contingencies.

(e)	Adjustment to exclude a non-cash benefit pursuant to the annual update of the Generation nuclear decommissioning obligation related to the non-regulatory units.

(f)	Adjustment to exclude benefits related to favorable settlements of certain income tax positions on Constellation’s pre-acquisition tax returns.

(g)	Adjustment to exclude the unrealized gains on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(h)

Adjustment to account for Generation’s non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark to market activity in 2015, and in 2014 the impact of unrealized gains and losses on NDT fund investments, certain merger and acquisition costs, non-cash amortization of intangible assets, net, related to commodity contracts and changes in asset retirement obligation.

(i)	Adjustment to reflect a benefit related to the favorable settlement of a long-term railcar lease agreement pursuant to the Midwest Generation bankruptcy.

(j)	Adjustment to exclude a 2014 charge to earnings related to the impairment of certain wind generating assets and certain generating assets held for sale.

(k)	Adjustment to exclude the impacts associated with the sale of Generation’s ownership interest in generating stations, primarily the gain from the sale of Generation’s equity interest in Safe Harbor Water Power Corporation.

(l)	Adjustment to exclude the gain recorded upon consolidation of CENG resulting from the difference in the fair value of CENG’s net assets and the equity method investment previously recorded on Generation’s and Exelon’s books and the settlement of pre-existing commitments between Generation and CENG.

 

17

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EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions)

 

		ComEd
		Three Months Ended September 30, 2015												Three Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	1,376			$	—			$	1,376			$	1,222			$	—			$	1,222
Operating expenses
Purchased power			390				—				390				326				—				326
Operating and maintenance			404				(3	)(b)			401				359				—				359
Depreciation and amortization			176				—				176				174				—				174
Taxes other than income			79				—				79				76				—				76
Total operating expenses			1,049				(3	)			1,046				935				—				935
Operating income			327				3				330				287				—				287
Other income and (deductions)
Interest expense			(83	)			—				(83	)			(81	)			—				(81	)
Other, net			4				—				4				4				—				4
Total other income and (deductions)			(79	)			—				(79	)			(77	)			—				(77	)
Income before income taxes			248				3				251				210				—				210
Income taxes			99				1	(b)			100				84				—				84
Net income		$	149			$	2			$	151			$	126			$	—			$	126
		Nine Months Ended September 30, 2015												Nine Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	3,709			$	—			$	3,709			$	3,484			$	—			$	3,484
Operating expenses
Purchased power			991				—				991				915				—				915
Operating and maintenance			1,166				(8	)(b)			1,158				1,040				—				1,040
Depreciation and amortization			528				—				528				521				—				521
Taxes other than income			225				—				225				225				—				225
Total operating expenses			2,910				(8	)			2,902				2,701				—				2,701
Operating income			799				8				807				783				—				783
Other income and (deductions)
Interest expense, net			(248	)			—				(248	)			(241	)			—				(241	)
Other, net			14				—				14				14				—				14
Total other income and (deductions)			(234	)			—				(234	)			(227	)			—				(227	)
Income before income taxes			565				8				573				556				—				556
Income taxes			226				3	(b)			229				221				—				221
Net income		$	339			$	5			$	344			$	335			$	—			$	335

 

(a)	Results reported in accordance with GAAP.

(b)	Adjustment to exclude certain integration costs associated with the pending PHI acquisition.

 

18

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EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions)

 

		PECO
		Three Months Ended September 30, 2015												Three Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	740			$	—			$	740			$	693			$	—			$	693
Operating expenses
Purchased power and fuel			278				—				278				255				—				255
Operating and maintenance			196				(1	)(b)			195				204				—				204
Depreciation and amortization			68				—				68				59				—				59
Taxes other than income			44				—				44				42				—				42
Total operating expenses			586				(1	)			585				560				—				560
Operating income			154				1				155				133				—				133
Other income and (deductions)
Interest expense			(28	)			—				(28	)			(29	)			—				(29	)
Other, net			1				—				1				2				—				2
Total other income and (deductions)			(27	)			—				(27	)			(27	)			—				(27	)
Income before income taxes			127				1				128				106				—				106
Income taxes			37				—				37				25				—				25
Net income attributable to common shareholder		$	90			$	1			$	91			$	81			$	—			$	81
		Nine Months Ended September 30, 2015												Nine Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	2,386			$	—			$	2,386			$	2,343			$	—			$	2,343
Operating expenses
Purchased power and fuel			953				—				953				960				—				960
Operating and maintenance			609				(4	)(b)			605				668				—				668
Depreciation and amortization			198				—				198				176				—				176
Taxes other than income			125				—				125				122				—				122
Total operating expenses			1,885				(4	)			1,881				1,926				—				1,926
Gain on sales of assets			1				—				1				—				—				—
Operating income			502				4				506				417				—				417
Other income and (deductions)
Interest expense, net			(84	)			—				(84	)			(85	)			—				(85	)
Other, net			3				—				3				5				—				5
Total other income and (deductions)			(81	)			—				(81	)			(80	)			—				(80	)
Income before income taxes			421				4				425				337				—				337
Income taxes			122				2	(b)			124				82				—				82
Net income attributable to common shareholder		$	299			$	2			$	301			$	255			$	—			$	255

 

(a)	Results reported in accordance with GAAP.

(b)	Adjustment to exclude certain integration costs associated with the pending PHI acquisition.

 

19

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EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions)

 

		BGE
		Three Months Ended September 30, 2015												Three Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	725			$	—			$	725			$	697			$	—			$	697
Operating expenses
Purchased power and fuel			311				—				311				297				—				297
Operating and maintenance			169				(2	)(b)			167				165				—				165
Depreciation and amortization			79				—				79				78				—				78
Taxes other than income			57				—				57				55				—				55
Total operating expenses			616				(2	)			614				595				—				595
Gain on sales of assets			1				—				1				—				—				—
Operating income			110				2				112				102				—				102
Other income and (deductions)
Interest expense			(25	)			—				(25	)			(26	)			—				(26	)
Other, net			4				—				4				4				—				4
Total other income and (deductions)			(21	)			—				(21	)			(22	)			—				(22	)
Income before income taxes			89				2				91				80				—				80
Income taxes			35				1	(b)			36				31				—				31
Net income			54				1				55				49				—				49
Preference stock dividends			3				—				3				3				—				3
Net income attributable to common shareholders		$	51			$	1			$	52			$	46			$	—			$	46
		Nine Months Ended September 30, 2015												Nine Months Ended September 30, 2014
		GAAP (a)				Adjustments				Adjusted Non-GAAP				GAAP (a)				Adjustments				Adjusted Non-GAAP
Operating revenues		$	2,388			$	—			$	2,388			$	2,404			$	—			$	2,404
Operating expenses
Purchased power and fuel			1,037				—				1,037				1,094				—				1,094
Operating and maintenance			499				(4	)(b)			495				541				—				541
Depreciation and amortization			271				—				271				275				—				275
Taxes other than income			169				—				169				168				—				168
Total operating expenses			1,976				(4	)			1,972				2,078				—				2,078
Gain on sales of assets			1				—				1				—				—				—
Operating income			413				4				417				326				—				326
Other income and (deductions)
Interest expense, net			(73	)			—				(73	)			(81	)			—				(81	)
Other, net			13				—				13				14				—				14
Total other income and (deductions)			(60	)			—				(60	)			(67	)			—				(67	)
Income before income taxes			353				4				357				259				—				259
Income taxes			141				2	(b)			143				103				—				103
Net income			212				2				214				156				—				156
Preference stock dividends			10				—				10				10				—				10
Net income attributable to common shareholders		$	202			$	2			$	204			$	146			$	—			$	146

 

(a)	Results reported in accordance with GAAP.

(b)	Adjustment to exclude certain integration costs associated with the pending PHI acquisition.

 

20

---

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions)

 

		Other (a)
		Three Months Ended September 30, 2015												Three Months Ended September 30, 2014
		GAAP (b)				Adjustments				Adjusted Non- GAAP				GAAP (b)				Adjustments				Adjusted Non- GAAP
Operating revenues		$	(208	)		$	—			$	(208	)		$	(112	)		$	—			$	(112	)
Operating expenses
Purchased power and fuel			(207	)			—				(207	)			(110	)			—				(110	)
Operating and maintenance			(14	)			(5	)(c)			(19	)			(12	)			(9	)(c)			(21	)
Depreciation and amortization			19				—				19				13				—				13
Taxes other than income			7				—				7				6				—				6
Total operating expenses			(195	)			(5	)			(200	)			(103	)			(9	)			(112	)
Equity in losses of unconsolidated affiliates			—				—				—				(1	)			—				(1	)
Gain on sale of assets			—				—				—				1				—				1
Operating loss			(13	)			5				(8	)			(9	)			9				—
Other income and (deductions)
Interest expense			(49	)			—				(49	)			(33	)			21	(c),(e)			(12	)
Other, net			4				—				4				2				—				2
Total other income and (deductions)			(45	)			—				(45	)			(31	)			21				(10	)
Loss before income taxes			(58	)			5				(53	)			(40	)			30				(10	)
																				(c),(e),
Income tax benefit			(20	)			3	(c)			(17	)			(9	)			9	(f),(g)			—
Net loss		$	(38	)		$	2			$	(36	)		$	(31	)		$	21			$	(10	)
		Nine Months Ended September 30, 2015												Nine Months Ended September 30, 2014
		GAAP (b)				Adjustments				Adjusted Non- GAAP				GAAP (b)				Adjustments				Adjusted Non- GAAP
Operating revenues		$	(578	)		$	—			$	(578	)		$	(649	)		$	—			$	(649	)
Operating expenses
Purchased power and fuel			(571	)			—				(571	)			(641	)			—				(641	)
Operating and maintenance			(15	)			(41	)(c),(d)			(56	)			(9	)			(43	)(c),(d)			(52	)
Depreciation and amortization			47				—				47				41				—				41
Taxes other than income			20				—				20				22				—				22
Total operating expenses			(519	)			(41	)			(560	)			(587	)			(43	)			(630	)
Gain on sale of assets			1				—				1				1				—				1
Operating loss			(58	)			41				(17	)			(61	)			43				(18	)
Other income and (deductions)
Interest expense			(81	)			(15	)(c),(e)			(96	)			(54	)			29	(c),(e)			(25	)
Other, net			(16	)			—				(16	)			7				—				7
Total other income and (deductions)			(97	)			(15	)			(112	)			(47	)			29				(18	)
Loss before income taxes			(155	)			26				(129	)			(108	)			72				(36	)
																				(c),(d),
								(c),(d),												(e),(f),
Income tax benefit			(55	)			7	(e),(f)			(48	)			(50	)			28	(g)			(22	)
Equity in earnings of unconsolidated affiliates			1				—				1				—				—				—
Net loss			(99	)			19				(80	)			(58	)			44				(14	)

 

(a)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

(b)	Results reported in accordance with GAAP.

(c)	Adjustment to exclude certain costs associated with the pending PHI acquisition including, if and when applicable, professional fees, employee-related expenses, integration activities, upfront credit facilities fees, merger commitments, and certain pre-acquisition contingencies.

(d)	Adjustment to exclude a charge to earnings related to the impairment of investments in long-term leases in both 2015 and 2014.

(e)	Adjustment to exclude the mark-to-market impact of Exelon Corporate’s forward-starting interest rate swaps related to financing for the pending PHI acquisition.

(f)	Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(g)	Adjustment to exclude the impacts associated with the sale or retirement of generating stations.

 

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EXELON CORPORATION

Exelon Generation Statistics

 

		Three Months Ended,
		September 30, 2015				June 30, 2015				March 31, 2015				December 31, 2014				September 30, 2014
Supply Source (GWh)
Nuclear Generation
Mid-Atlantic (a)			16,446				15,619				15,718				15,768				15,993
Midwest			23,927				23,448				22,427				23,777				24,379
New York (a)			4,807				4,738				4,512				4,988				4,891
Total Nuclear Generation			45,180				43,805				42,657				44,533				45,263
Fossil and Renewables (a)
Mid-Atlantic			719				750				559				2,268				2,385
Midwest			262				363				432				424				212
New England			1,840				135				600				411				1,789
New York			1				1				1				1				1
ERCOT			2,306				872				1,422				1,624				2,331
Other Power Regions (b)			1,945				2,096				1,973				1,999				2,285
Total Fossil and Renewables			7,073				4,217				4,987				6,727				9,003
Purchased Power
Mid-Atlantic			3,511				1,384				1,824				929				1,110
Midwest			515				407				589				513				260
New England			5,787				5,742				6,408				4,763				3,231
ERCOT			2,422				2,903				2,244				1,966				2,184
Other Power Regions (b)			5,189				4,170				3,307				3,389				4,397
Total Purchased Power			17,424				14,606				14,372				11,560				11,182
Total Supply/Sales by Region (d)
Mid-Atlantic (c)			20,676				17,753				18,101				18,965				19,488
Midwest (c)			24,704				24,218				23,448				24,714				24,851
New England			7,627				5,877				7,008				5,174				5,020
New York			4,808				4,739				4,513				4,989				4,892
ERCOT			4,728				3,775				3,666				3,590				4,515
Other Power Regions (b)			7,134				6,266				5,280				5,388				6,682
Total Supply/Sales by Region			69,677				62,628				62,016				62,820				65,448
		Three Months Ended,
		September 30, 2015				June 30, 2015				March 31, 2015				December 31, 2014				September 30, 2014
Outage Days (e)
Refueling			27				71				89				97				18
Non-refueling			11				18				32				8				20
Total Outage Days			38				89				121				105				38

 

(a)

Includes the proportionate share of output where Generation has an undivided ownership interest in jointly-owned generating plants and includes the total output of plants that are fully consolidated (e.g. CENG). Nuclear generation includes physical volumes of 3,808 GWh, 3,743 GWh, 3,284 GWh, 3,902 GWh, and 3,726 GWh in the Mid-Atlantic region and 4,807 GWh, 4,738 GWh, 4,512 GWh, 4,988 GWh, and 4,891 GWh in the New York region for the three months ended September 30, 2015, June 30, 2015, March 31, 2015, December 31, 2014, and September 30, 2014, respectively for CENG.

(b)	Other Power Regions includes South, West and Canada.

(c)	Includes affiliate sales to PECO and BGE in the Mid-Atlantic region and affiliate sales to ComEd in the Midwest region.

(d)	Total sales do not include physical trading volumes of 1,913 GWh, 1,657 GWh, 1,808 GWh, 2,442 GWh, and 3,006 GWh for the three months ended September 30, 2015, June 30, 2015, March 31, 2015, December 31, 2014, and September 30, 2014, respectively.

(e)	Outage days exclude Salem.

 

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EXELON CORPORATION

Exelon Generation Statistics

Nine Months Ended September 30, 2015 and 2014

 

		September 30, 2015				September 30, 2014
Supply Source (GWh)
Nuclear Generation
Mid-Atlantic (a)			47,783				43,042
Midwest			69,802				70,223
New York (a)			14,057				8,657
Total Nuclear Generation			131,642				121,922
Fossil and Renewables (a)
Mid-Atlantic			2,028				8,758
Midwest			1,057				948
New England			2,575				4,822
New York			3				3
ERCOT			4,600				5,541
Other Power Regions (c)			6,014				5,954
Total Fossil and Renewables			16,277				26,026
Purchased Power
Mid-Atlantic (b)			6,719				5,152
Midwest			1,511				1,491
New England			17,937				7,591
New York (b)			—				2,857
ERCOT			7,569				6,685
Other Power Regions (c)			12,666				11,406
Total Purchased Power			46,402				35,182
Total Supply/Sales by Region (e)
Mid-Atlantic (d)			56,530				56,952
Midwest (d)			72,370				72,662
New England			20,512				12,413
New York			14,060				11,517
ERCOT			12,169				12,226
Other Power Regions (c)			18,680				17,360
Total Supply/Sales by Region			194,321				183,130

 

(a)

Includes the proportionate share of output where Generation has an undivided ownership interest in jointly-owned generating plants and includes the total output of plants that are fully consolidated (e.g. CENG). Nuclear generation for the nine months ended September 30, 2015 includes physical volumes of 10,835 GWh in the Mid-Atlantic region and 14,057 GWh in the New York region for CENG. Nuclear generation for the nine months ended September 30, 2014 includes physical volumes of 7,507 GWh in the Mid-Atlantic region and 8,657 GWh in the New York region for CENG.

(b)	Purchased power includes physical volumes of 2,489 GWh in the Mid-Atlantic and 2,857 GWh in New York as a result of the PPA with CENG for the nine months ended September 30, 2014, respectively. As of the integration date of April 1, 2014, CENG volumes are included in nuclear generation.

(c)	Other Power Regions includes South, West and Canada.

(d)	Includes affiliate sales to PECO and BGE in the Mid-Atlantic region and affiliate sales to ComEd in the Midwest region.

(e)	Total sales do not include physical proprietary trading volumes of 5,378 GWh and 8,129 GWh for the nine months ended September 30, 2015 and 2014, respectively.

 

23

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EXELON CORPORATION

ComEd Statistics

Three Months Ended September 30, 2015 and 2014

 

		Electric Deliveries (in GWhs)																Revenue (in millions)
		2015				2014				% Change				Weather- Normal % Change				2015				2014				% Change
Retail Deliveries and Sales(a)
Residential			7,919				7,332				8.0	%			(0.6	)%		$	690			$	566				21.9	%
Small Commercial & Industrial			8,579				8,366				2.5	%			0.3	%			361				349				3.4	%
Large Commercial & Industrial			7,250				7,245				0.1	%			(1.3	)%			121				115				5.2	%
Public Authorities & Electric Railroads			295				301				(2.0	)%			(2.1	)%			10				10				—	%
Total Retail			24,043				23,244				3.4	%			(0.5	)%			1,182				1,040				13.7	%
Other Revenue(b)																			194				182				6.6	%
Total Electric Revenue																		$	1,376			$	1,222				12.6	%
Purchased Power																		$	390			$	326				19.6	%

 

														% Change
Heating and Cooling Degree-Days		2015				2014				Normal				From 2014				From Normal
Heating Degree-Days			55				111				119				(50.5	)%			(53.8	)%
Cooling Degree-Days			634				537				613				18.1	%			3.4	%

Nine Months Ended September 30, 2015 and 2014

 

		Electric Deliveries (in GWhs)																Revenue (in millions)
		2015				2014				% Change				Weather- Normal % Change				2015				2014				% Change
Retail Deliveries and Sales(a)
Residential			20,602				20,920				(1.5	)%			(1.8	)%		$	1,785			$	1,572				13.5	%
Small Commercial & Industrial			24,305				24,456				(0.6	)%			(0.4	)%			1,029				1,033				(0.4	)%
Large Commercial & Industrial			20,807				21,109				(1.4	)%			(1.3	)%			339				343				(1.2	)%
Public Authorities & Electric Railroads			964				1,001				(3.7	)%			(3.1	)%			33				35				(5.7	)%
Total Retail			66,678				67,486				(1.2	)%			(1.2	)%			3,186				2,983				6.8	%
Other Revenue(b)																			523				501				4.4	%
Total Electric Revenue																		$	3,709			$	3,484				6.5	%
Purchased Power																		$	991			$	915				8.3	%

 

														% Change
Heating and Cooling Degree-Days		2015				2014				Normal				From 2014				From Normal
Heating Degree-Days			4,373				4,680				4,048				(6.6	)%			8.0	%
Cooling Degree-Days			805				796				831				1.1	%			(3.1	)%
Number of Electric Customers														2015				2014
Residential															3,524,253				3,486,438
Small Commercial & Industrial															369,151				367,446
Large Commercial & Industrial															1,996				1,992
Public Authorities & Electric Railroads															4,826				4,821
Total															3,900,226				3,860,697

 

(a)

Reflects delivery volumes and revenues from customers purchasing electricity directly from ComEd and customers purchasing electricity from a competitive electric generation supplier, as all customers are assessed delivery charges. For customers purchasing electricity from ComEd, revenue also reflects the cost of energy and transmission.

(b)	Other revenue primarily includes transmission revenue from PJM. Other items include rental revenues, revenues related to late payment charges, revenues from other utilities for mutual assistance programs and recoveries of environmental costs associated with MGP sites.

 

24

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EXELON CORPORATION

PECO Statistics

Three Months Ended September 30, 2015 and 2014

 

		Electric and Gas Deliveries																Revenue (in millions)
		2015				2014				% Change				Weather- Normal % Change				2015				2014				% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential			3,940				3,551				11.0	%			(2.3	)%		$	461			$	413				11.6	%
Small Commercial & Industrial			2,219				2,096				5.9	%			1.0	%			113				107				5.6	%
Large Commercial & Industrial			4,227				4,086				3.5	%			0.7	%			58				52				11.5	%
Public Authorities & Electric Railroads			224				241				(7.1	)%			(7.1	)%			8				7				14.3	%
Total Retail			10,610				9,974				6.4	%			(0.5	)%			640				579				10.5	%
Other Revenue (b)																			51				55				(7.3	)%
Total Electric Revenue																			691				634				9.0	%
Gas (in mmcfs)
Retail Deliveries and Sales
Retail Sales (c)			3,639				3,893				(6.5	)%			(3.2	)%			42				54				(22.2	)%
Transportation and Other			7,457				5,750				29.7	%			17.5	%			7				5				40.0	%
Total Gas			11,096				9,643				15.1	%			9.3	%			49				59				(16.9	)%
Total Electric and Gas Revenues																		$	740			$	693				6.8	%
Purchased Power and Fuel																		$	278			$	255				9.0	%

 

														% Change
Heating and Cooling Degree-Days		2015				2014				Normal				From 2014				From Normal
Heating Degree-Days			—				14				38				(100.0	)%			(100.0	)%
Cooling Degree-Days			1,186				911				929				30.2	%			27.7	%

Nine Months Ended September 30, 2015 and 2014

 

		Electric and Gas Deliveries																Revenue (in millions)
		2015				2014				% Change				Weather- Normal % Change				2015				2014				% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential			10,929				10,200				7.1	%			(0.4	)%		$	1,276			$	1,195				6.8	%
Small Commercial & Industrial			6,306				6,098				3.4	%			0.6	%			330				319				3.4	%
Large Commercial & Industrial			11,744				11,604				1.2	%			(0.1	)%			166				169				(1.8	)%
Public Authorities & Electric Railroads			667				722				(7.6	)%			(7.6	)%			23				23				—	%
Total Retail			29,646				28,624				3.6	%			(0.2	)%			1,795				1,706				5.2	%
Other Revenue (b)																			155				165				(6.1	)%
Total Electric Revenue																			1,950				1,871				4.2	%
Gas (in mmcfs)
Retail Deliveries and Sales
Retail Sales (c)			45,734				44,487				2.8	%			3.2	%			410				444				(7.7	)%
Transportation and Other			21,585				20,124				7.3	%			2.9	%			26				28				(7.1	)%
Total Gas			67,319				64,611				4.2	%			3.1	%			436				472				(7.6	)%
Total Electric and Gas Revenues																		$	2,386			$	2,343				1.8	%
Purchased Power and Fuel																		$	953			$	960				(0.7	)%

 

														% Change
Heating and Cooling Degree-Days		2015				2014				Normal				From 2014				From Normal
Heating Degree-Days			3,264				3,251				2,981				0.4	%			9.5	%
Cooling Degree-Days			1,699				1,286				1,278				32.1	%			32.9	%

 

Number of Electric Customers		2015				2014				Number of Gas Customers		2015				2014
Residential			1,439,951				1,429,293			Residential			465,023				459,678
Small Commercial & Industrial			148,920				149,172			Commercial & Industrial			42,544				42,008
Large Commercial & Industrial			3,093				3,103			Total Retail			507,567				501,686
Public Authorities & Electric Railroads			9,801				9,737			Transportation			837				866
Total			1,601,765				1,591,305			Total			508,404				502,552

 

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(a)

Reflects delivery volumes and revenue from customers purchasing electricity directly from PECO and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges. For customers purchasing electricity from PECO, revenue also reflects the cost of energy and transmission.

(b)	Other revenue includes transmission revenue from PJM and wholesale electric revenue.

(c)

Reflects delivery volumes and revenue from customers purchasing natural gas directly from PECO and customers purchasing natural gas from a competitive natural gas supplier as all customers are assessed distribution charges. For customers purchasing natural gas from PECO, revenue also reflects the cost of natural gas.

 

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EXELON CORPORATION

BGE Statistics

Three Months Ended September 30, 2015 and 2014

 

		Electric and Gas Deliveries												Revenue (in millions)
		2015				2014				% Change				2015				2014				% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential			3,458				3,291				5.1	%		$	379			$	348				8.9	%
Small Commercial & Industrial			788				805				(2.1	)%			70				72				(2.8	)%
Large Commercial & Industrial			3,829				3,818				0.3	%			122				134				(9.0	)%
Public Authorities & Electric Railroads			75				79				(5.1	)%			9				8				12.5	%
Total Retail			8,150				7,993				2.0	%			580				562				3.2	%
Other Revenue (b)															75				69				8.7	%
Total Electric Revenue															655				631				3.8	%
Gas (in mmcfs)
Retail Deliveries and Sales (c)
Retail Sales			11,719				10,257				14.3	%			66				62				6.5	%
Transportation and Other (d)			612				304				101.3	%			4				4				—	%
Total Gas			12,331				10,561				16.8	%			70				66				6.1	%
Total Electric and Gas Revenues														$	725			$	697				4.0	%
Purchased Power and Fuel														$	311			$	297				4.7	%

 

														% Change
Heating and Cooling Degree-Days		2015				2014				Normal				From 2014				From Normal
Heating Degree-Days			46				82				81				(43.9	)%			(43.2	)%
Cooling Degree-Days			592				484				593				22.3	%			(0.2	)%

Nine Months Ended September 30, 2015 and 2014

 

		Electric and Gas Deliveries												Revenue (in millions)
		2015				2014				% Change				2015				2014				% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential			10,266				10,023				2.4	%		$	1,131			$	1,077				5.0	%
Small Commercial & Industrial			2,413				2,343				3.0	%			208				208				—	%
Large Commercial & Industrial			10,735				10,880				(1.3	)%			351				377				(6.9	)%
Public Authorities & Electric Railroads			224				236				(5.1	)%			24				24				—	%
Total Retail			23,638				23,482				0.7	%			1,714				1,686				1.7	%
Other Revenue (b)															194				207				(6.3	)%
Total Electric Revenue															1,908				1,893				0.8	%
Gas (in mmcfs)
Retail Deliveries and Sales (c)
Retail Sales			72,481				71,479				1.4	%			450				439				2.5	%
Transportation and Other (d)			4,521				7,508				(39.8	)%			30				72				(58.3	)%
Total Gas			77,002				78,987				(2.5	)%			480				511				(6.1	)%
Total Electric and Gas Revenues														$	2,388			$	2,404				(0.7	)%
Purchased Power and Fuel														$	1,037			$	1,094				(5.2	)%

 

														% Change
Heating and Cooling Degree-Days		2015				2014				Normal				From 2014				From Normal
Heating Degree-Days			3,418				3,439				2,985				(0.6	)%			14.5	%
Cooling Degree-Days			909				717				849				26.8	%			7.1	%

 

Number of Electric Customers		2015				2014				Number of Gas Customers		2015				2014
Residential			1,132,836				1,123,644			Residential			613,571				610,750
Small Commercial & Industrial			112,888				112,580			Commercial & Industrial			43,885				43,963
Large Commercial & Industrial			11,863				11,707			Total Retail			657,456				654,713
Public Authorities & Electric Railroads			286				290			Transportation			—				—
Total			1,257,873				1,248,221			Total			657,456				654,713

 

(a)

Reflects delivery volumes and revenues from customers purchasing electricity directly from BGE and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges. For customers purchasing electricity from BGE, revenue also reflects the cost of energy and transmission.

 

27

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(b)	Other revenue includes wholesale transmission revenue and late payment charges.

(c)

Reflects delivery volumes and revenues from customers purchasing natural gas directly from BGE and customers purchasing natural gas from a competitive natural gas supplier as all customers are assessed distribution charges. For customers purchasing natural gas from BGE, revenue also reflects the cost of natural gas.

(d)

Transportation and other gas revenue includes off-system revenue of 612 mmcfs ($3 million) and 304 mmcfs ($2 million) for the three months ended September 30, 2015 and 2014, respectively and 4,521 mmcfs ($28 million) and 7,508 mmcfs ($60 million) for the nine months ended September 30, 2015 and 2014, respectively.

 

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