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

Date of Report (Date of earliest event reported) September 9, 2015

 

 

 

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 (312) 394-7398		23-2990190
333-85496		EXELON GENERATION COMPANY, LLC (a Pennsylvania limited liability company) 300 Exelon Way Kennett Square, Pennsylvania 19348-2473 (610) 7650-5959		23-3064219

 

 

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 8 – Other Events

Item 8.01 Other Events.

On September 9, 2015, Exelon Corporation (Exelon) learned the results of the PJM transition capacity auction for the 2017-2018 planning year. All of Exelon Generation Company, LLC’s nuclear plants in the PJM market cleared the auction. Exelon will defer any decisions about the future operations of its Quad Cities and Byron nuclear plants for one year. As a result, Exelon plans to continue operating its Quad Cities nuclear power plant through at least May 2018. The Byron plant is already obligated to operate through May 2019.

The table set forth below lists Exelon’s cleared nuclear and fossil capacity and base cleared volumes for the 2016-2017 and 2017-2018 transition auctions and the 2018-2019 base auction by zone and auction.

 

Cleared Volumes (MWs)*		16/17 Transition Auction								17/18 Transition Auction								18/19 Base Auction
		CP				Price				CP				Price				CP				Price				Base				Price
ComEd
Fossil/Other			—			$	134.00				—			$	151.50				—			$	215.00				25			$	200.21
Nuclear			9,950			$	134.00				9,975			$	151.50				8,625			$	215.00				—			$	200.21
Total			9,950			$	134.00				9,975			$	151.50				8,625			$	215.00				25			$	200.21
EMAAC
Fossil/Other			25			$	134.00				850			$	151.50				2,075			$	225.42				1,050			$	210.63
Nuclear			3,950			$	134.00				4,950			$	151.50				4,325			$	225.42				—			$	210.63
Total			3,975			$	134.00				5,800			$	151.50				6,400			$	225.42				1,050			$	210.63
SWMAAC
Fossil/Other			—			$	134.00				—			$	151.50				—			$	164.77				—			$	149.98
Nuclear			425			$	134.00				825			$	151.50				850			$	164.77				—			$	149.98
Total			425			$	134.00				825			$	151.50				850			$	164.77				—			$	149.98
BGE
Fossil/Other			75			$	134.00				150			$	151.50				300			$	164.77				425			$	149.98
Nuclear			—			$	134.00				—			$	151.50				—			$	164.77				—			$	149.98
Total			75			$	134.00				150			$	151.50				300			$	164.77				425			$	149.98
Rest of MAAC/RTO
Fossil/Other			—			$	134.00				—			$	151.50				265			$	164.77				50			$	149.98
Nuclear			775			$	134.00				800			$	151.50				—			$	164.77				—			$	149.98
Total			775			$	134.00				800			$	151.50				265			$	164.77				50			$	149.98
GRAND TOTAL
Fossil/Other			100								1,000								2,640								1,550
Nuclear			15,100								16,550								13,800								—
Total			15,200								17,550								16,440								1,550

 

*	Volumes at ownership. Rounded.

A copy of the press release concerning the 2017-2018 transition capacity auction results and the future operations of the Quad Cities and Byron nuclear plants is attached as Exhibit 99.1.

Section 9 – Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits.

 

(d)

Exhibits.

 

Exhibit No.		Description
99.1		Press Release

* * * * *

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Cautionary Statements Regarding Forward-Looking Information

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 and Generation 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 Second Quarter 2015 Quarterly Report on Form 10-Q 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 Exelon and Generation. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this report. Exelon and Generation do not undertake 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, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

September 10, 2015

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EXHIBIT INDEX

 

Exhibit No.		Description
99.1		Press Release

Exhibit 99.1

 

 

Contact:		Paul Elsberg
		Corporate Communications		FOR IMMEDIATE RELEASE
		312-394-7417
		paul.elsberg@exeloncorp.com

EXELON DEFERS DECISIONS ON ITS QUAD CITIES AND BYRON NUCLEAR PLANTS FOR ONE YEAR

Deferral follows outcome of third PJM capacity auction

CHICAGO (Sept. 10, 2015) — Exelon Corporation (NYSE: EXC) today announced that all of its nuclear plants in the PJM market cleared in the transition capacity auction for the 2017-18 planning year and that the company will defer any decisions about the future operations of its Quad Cities and Byron nuclear plants for one year. As a result, the company plans to continue operating its Quad Cities nuclear power plant through at least May 2018. The Byron plant is already obligated to operate through May 2019.

Exelon intends to bid Quad Cities, Byron, Three Mile Island and all eligible nuclear plants into the 2019-2020 PJM capacity auction next year. The decision to defer retirement decisions comes after rigorous analysis of the present and future economics of the plants, taking into consideration the constructive market trends stemming from the PJM capacity auction reforms.

“While Quad Cities and Byron remain economically challenged, we are encouraged by the results of the recent capacity auctions. The new market reforms help to recognize the unique value of always-on nuclear power, while preserving the reliability of our electric system,” said Chris Crane, Exelon president and CEO. “However, these plants are long-lived assets with decades of useful life left, and today’s decision is only a short-term reprieve. Policy reforms are still needed to level the playing field for all forms of clean energy and best position the state of Illinois to meet EPA’s new carbon reduction rules.”

Exelon will continue its dialogue with Illinois policymakers about market and policy reforms that properly value nuclear power for the economic and environmental benefits it provides.

Exelon has long supported efforts to reduce carbon dioxide emissions from the power sector and has invested in clean technologies to improve the quality of the air for the benefit of its customers. The EPA’s Clean Power Plan, which mandates significant reductions in carbon emissions from power plants, will require the states and the power sector to find the most cost-effective solutions to achieve the required reductions.

 

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The Illinois Environmental Protection Agency determined that the loss of two nuclear plants would increase emissions by about 24 million short tons, more than doubling the emissions reductions required under the EPA’s carbon reduction rules and making it twice as costly to comply. The Illinois EPA calculated the incremental societal cost of losing two plants at more than $10 billion — a figure that does not include the additional billions of dollars early retirements would cost in the form of higher energy bills, reduced electric reliability and lost jobs.

The auction results for the 2017-18 planning year take effect in June 2017. The transition auction was the second of two held by PJM to supplement its prior base capacity auctions for the 2016-17 and 2017-18 planning years with the new capacity performance product, which is designed to strengthen electric grid reliability.

Unlike Quad Cities and Byron, Exelon’s Clinton nuclear plant operates in MISO territory and did not benefit from the PJM auction results. While a MISO capacity auction held earlier this year helped reduce Clinton’s economic losses, the plant remains economically challenged and is at risk of premature retirement if conditions do not improve.

Grid operator PJM holds a capacity auction annually to ensure enough power generation resources are available to meet demand in its region covering all or part of 13 states and the District of Columbia. Although capacity revenue in a single year is an important consideration in a plant’s long-term viability, it is just one of several factors Exelon uses to make decisions about its plants’ future operations.

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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.

 

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