2012 10K - Exelon Corporation

At December 31, 2012, Generation’s short and long-term commitments relating to the purchase of energy and capacity from and to
unaffiliated utilities and others were as follows:
Net Capacity
Purchases
Power-
Related
Purchases
Transmission Rights
Purchases
Purchased Energy
from CENG Total
2013 $ 374 $ 95 $ 28 $ 777 $1,274
2014 353 69 26 516 964
2015 350 25 13 — 388
2016 266 11 2 — 279
2017 203 3 2 — 208
Thereafter 469 5 34 — 508
Total $ 2,015 $ 208 $ 105 $ 1,293 $3,621
(a) Net capacity purchases include PPAs and other capacity contracts including those that are accounted for as operating leases. Amounts presented in the commitments
represent Generation’s expected payments under these arrangements at December 31, 2012, net of fixed capacity payments expected to be received by Generation
under contracts to resell such acquired capacity to third parties under long-term capacity sale contracts. Expected payments include certain capacity charges which
are contingent on plant availability.
(b) Power-Related Purchases include firm REC purchase agreements. The table excludes renewable energy purchases that are contingent in nature.
(c) Transmission rights purchases include estimated commitments for additional transmission rights that will be required to fulfill firm sales contracts.
As part of reaching a comprehensive agreement with EDF in October 2010, the existing power purchase agreements with CENG were
modified to be unit-contingent through the end of their original term in 2014. Under these agreements, CENG has the ability to fix the energy
price on a forward basis by entering into monthly energy hedge transactions for a portion of the future sale, while any unhedged portions will
be provided at market prices by default. Additionally, beginning in 2015 and continuing to the end of the life of the respective plants,
Generation agreed to purchase 50.01% of the available output of CENG’s nuclear plants at market prices. Generation discloses in the table
above commitments to purchase from CENG at fixed prices. All commitments to purchase from CENG at market prices, which include all
purchases subsequent to December 31, 2014, are excluded from the table. Generation continues to own a 50.01% membership interest in
CENG that is accounted for as an equity method investment. See Note 22 of the Combined Notes to Consolidated Financial Statements for
more details on this arrangement.
Capital Expenditures
(a) (b) (c)
Generation’s business is capital intensive and requires significant investments in nuclear fuel and energy generation assets and in
other internal infrastructure projects. Generation’s estimated capital expenditures for 2013 are as follows:
(in millions)
(a)
Nuclear fuel $ 1,000
Production plant 1,000
(b)
Renewable energy projects 575
Uprates 225
Other 50
Total $2,850
(a) Includes Generation’s share of the investment in nuclear fuel for the co-owned Salem plant.
(b) Primarily relates to expenditures for the completion of the Antelope Valley development project.
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