2012 10K - Exelon Corporation

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Name Age Position Period Diaz Jr., Romulo L. 66 Vice President and General Counsel, PECO 2012 - Present Vice President, Governmental and External Affairs, PECO 2009 - 2012 Associate General Counsel, Exelon 2008 - 2009 City Solicitor, City of Philadelphia 2005 - 2008 Bailey, Scott A. 36 Vice President and Controller, PECO 2012 - Present Assistant Controller, Generation 2011 - 2012 Director of Accounting, Power Team 2007 - 2011 BGE Name Age Position Period DeFontes Jr., Kenneth W. 62 President and Chief Executive Officer, BGE 2004 - Present Senior Vice President, Constellation Energy 2004 - 2012 Woerner, Stephen J. 45 Chief Operating Officer, BGE 2012 - Present Senior Vice President, BGE 2009 - Present Vice President and Chief Integration Officer, Constellation Energy 2011 - 2012 Vice President and Chief Information Officer, Constellation Energy 2010 - 2011 Vice President, Transformation, Constellation Energy 2009 - 2010 Senior Vice President, Gas and Electric Operations and Planning, BGE 2007 - 2009 Khouzami, Carim V. 38 Vice President, Chief Financial Officer and Treasurer, BGE 2011 - Present Executive Director, Investor Relations, Constellation Energy 2009 - 2011 Director, Corporate Strategy and Development, Constellation Energy 2008 - 2009 Case, Mark D. 51 Vice President, Strategy and Regulatory Affairs, BGE 2012 - Present Senior Vice President, Strategy and Regulatory Affairs, BGE 2007 - 2012 Dempsey, Mary E. 57 Vice President, Governmental Affairs, BGE 2012 - Present Executive Director, State Affairs, Constellation Energy 2010 - 2012 Managing Director, Public Affairs, Constellation Energy 2008 - 2009 Mills, Jeannette M. 46 Vice President, Customer Operations, BGE 2012 - Present Chief Customer Officer, BGE 2011 - Present Senior Vice President, Customer Relations and Account Services, BGE 2008 - 2012 Senior Vice President, Gas Operations and Planning, BGE 2007 - 2008 Gahagan, Daniel P. 59 Vice President and General Counsel, BGE 2007 - Present Vahos, David M. 40 Vice President and Controller, BGE 2012 - Present Executive Director, Audit, Constellation 2010 - 2012 Director, Finance, BGE 2006 - 2010 38
ITEM 1A. RISK FACTORS Each of the Registrants operates in a market and regulatory environment that poses significant risks, many of which are beyond the Registrant’s control. Management of each Registrant regularly meets with the Chief Risk Officer and the RMC, which comprises officers of the Registrants, to identify and evaluate the most significant risks of the Registrants’ businesses, and the appropriate steps to manage and mitigate those risks. The Chief Risk Officer and senior executives of the Registrants discuss those risks with the risk oversight and audit committees of the Exelon Board of directors and the ComEd, PECO and BGE Boards of Directors. In addition, the Exelon Board of directors’ generation oversight and energy delivery oversight committees, respectively, evaluate risks related to the generation and energy delivery businesses. The risk factors discussed below may adversely affect one or more of the Registrants’ results of operations and cash flows and the market prices of their publicly traded securities. Each of the Registrants has disclosed the known material risks that affect its business at this time. However, there may be further risks and uncertainties that are not presently known or that are not currently believed by a Registrant to be material that may adversely affect its performance or financial condition in the future. The Registrants’ most significant risks arise as a consequence of: (1) Generation’s position as a predominantly nuclear generator selling power into competitive energy markets, and (2) the role of ComEd, PECO and BGE as operators of electric transmission and distribution systems in three of the largest metropolitan areas in the United States. The Registrants’ major risks fall primarily under the following categories: • Market and Financial Risks. Exelon’s and Generation’s market and financial risks include the risk of price fluctuations in the wholesale and retail power markets. Wholesale power prices are a function of supply and demand, which in turn are driven by factors such as the price of fuels, in particular the price of natural gas and coal, that drive the wholesale market prices that Generation’s nuclear power plants receive, the rate of expansion of subsidized low carbon generation such as wind energy in the markets in which Generation’s output is sold, and the impacts on energy demand of factors such as weather, economic conditions and implementation of energy efficiency and demand response programs. In addition, the load serving and retail marketing activities compete for customers in a competitive environment which impacts the margins that Generation can earn and the volumes that it is able to serve. • Regulatory and Legislative Risks. The Registrants’ regulatory and legislative risks include changes to the laws and regulations that govern competitive markets and utility cost recovery, and that drive environmental policy. In particular, Exelon’s and Generation’s financial performance may be adversely affected by changes that could affect Generation’s ability to sell power into the competitive wholesale power markets at market-based prices. In addition, potential regulation and legislation regarding climate change and renewable portfolio standards could increase the pace of development of wind energy facilities, which could put downward pressure in some markets on wholesale market prices for electricity from Generation’s nuclear assets, partially offsetting any additional value Exelon and Generation might derive from Generation’s nuclear assets under a carbon constrained regulatory regime that might exist in the future. Also, regulatory actions in Illinois, Pennsylvania or Maryland could materially lower returns for ComEd, PECO and BGE, respectively. • Operational Risks. The Registrants’ operational risks include those risks inherent in running the nation’s largest fleet of nuclear power reactors and large electric and gas distribution systems. The safe and effective operation of the nuclear facilities and the ability to effectively manage the associated decommissioning obligations as well as the ability to maintain the availability, reliability and safety of its energy delivery systems are fundamental to Exelon’s ability to protect and grow shareholder value. Additionally, the operating costs of ComEd, PECO and BGE and the opinions of customers and regulators of ComEd, PECO and BGE are 39
Page 1 and 2: UNITED STATES SECURITIES AND EXCHAN
Page 3 and 4: Exelon Generation Company, LLC and
Page 5 and 6: Page No. ITEM 7A. QUANTITATIVE AND
Page 7 and 8: GLOSSARY OF TERMS AND ABBREVIATIONS
Page 9 and 10: Other Terms and Abbreviations LTIP
Page 11 and 12: FILING FORMAT This combined Annual
Page 13 and 14: including the City of Baltimore, as
Page 15 and 16: following the merger completion. In
Page 17 and 18: egulations by the NRC may require a
Page 19 and 20: of new merchant nuclear power plant
Page 21 and 22: y third parties. In 2012 and 2011,
Page 23 and 24: the type of underlying asset. Gener
Page 25 and 26: ComEd ComEd is engaged principally
Page 27 and 28: due to weather events or conditions
Page 29 and 30: Smart Meter, Smart Grid and Energy
Page 31 and 32: BGE’s highest peak load occurred
Page 33 and 34: • a liquefied natural gas facilit
Page 35 and 36: Environmental Regulation General Ex
Page 37 and 38: attributable to low level radioacti
Page 39 and 40: hydro and pumped storage, and suppl
Page 41 and 42: Name Age Position Period Pramaggior
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Page 47 and 48: under their obligations for operati
Page 49 and 50: ComEd’s financial swap contract w
Page 51 and 52: 1999 sale of fossil generating asse
Page 53 and 54: lived assets for potential impairme
Page 55 and 56: were weather and the economy. With
Page 57 and 58: Generation’s affiliation with Com
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Page 61 and 62: Generation may be negatively affect
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Page 69 and 70: ITEM 2. PROPERTIES Generation The f
Page 71 and 72: Primary Net Station Region Location
Page 73 and 74: Transmission and Distribution PECO
Page 75 and 76: (Dollars in millions except per sha
Page 77 and 78: PECO As of January 31, 2013, there
Page 79 and 80: ITEM 6. SELECTED FINANCIAL DATA Exe
Page 81 and 82: December 31, (In millions) 2012 201
Page 83 and 84: Item 7. MANAGEMENT’S DISCUSSION A
Page 85 and 86: purchased power and fuel expense in
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Page 91 and 92: Hedging Strategy Exelon’s policy
Page 93 and 94: number of factors, including RTO re
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On December 16, 2011, the U.S. EPA
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In April 2011, the NRC named six se
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FERC Ameren Order. In July 2012, FE
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decommissioning. Probabilities assi
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guidance, which became effective Ja
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Impairment may occur when the carry
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changes or experience different fro
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Sensitivity to Changes in Key Assum
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The Registrants account for derivat
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Interest Rate Derivative Instrument
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upon actual costs incurred and inve
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Net Income Year Ended December 31,
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Generation’s supply sources by re
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decreased realized margins in 2011
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Year Ended December 31, 2011 Compar
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ecorded in 2012, a $36 million barg
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Electric revenues and purchased pow
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Volume—delivery Revenues net of p
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Operating and Maintenance Expense Y
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Other, Net The changes in other, ne
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Operating Revenues Net of Purchased
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The changes in PECO’s operating r
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The changes in operating and mainte
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year ended December 31, 2011 includ
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Results of Operations—BGE 2012 20
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Volume. Heating and cooling degree
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Other Other revenues increased duri
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BGE Electric Operating Statistics a
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The Registrants primarily use their
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Cash flows provided by operations f
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(e) The projected capital expenditu
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Company Issuances of long-term debt
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From time to time and as market con
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Other Credit Matters Capital Struct
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Contractual Obligations The followi
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ComEd Total 2013 Payment due within
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• variable interest entities, see
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ComEd The financial swap contract b
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Generation ComEd PECO Intercompany
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Credit Risk, Collateral, and Contin
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PECO’s supplier master agreements
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PECO As of December 31, 2012, PECO
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ITEM 7. MANAGEMENT’S DISCUSSION A
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ITEM 8. FINANCIAL STATEMENTS AND SU
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Management’s Report on Internal C
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Management’s Report on Internal C
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Report of Independent Registered Pu
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Report of Independent Registered Pu
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Exelon Corporation and Subsidiary C
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Exelon Generation Company, LLC and
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Commonwealth Edison Company and Sub
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(In millions) Commonwealth Edison C
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PECO Energy Company and Subsidiary
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BALTIMORE GAS AND ELECTRIC COMPANY
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BALTIMORE GAS AND ELECTRIC COMPANY
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(In millions) BALTIMORE GAS AND ELE
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Combined Notes to Consolidated Fina
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Formula Rate Tariff Combined Notes
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4. Merger and Acquisitions Combined
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For the Year Ended December 31, 201
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For the Year Ended December 31, 201
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BGE Combined Notes to Consolidated
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Year Ended December 31, 2011 (As Re
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Generation Combined Notes to Consol
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Other Tax Matters Combined Notes to
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Components of AOCI and Regulatory A
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Contributions Combined Notes to Con
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Eddystone Station and Cromby Statio
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Other Purchase Obligations Combined
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Solid and Hazardous Waste Combined
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Accumulated Other Comprehensive Inc
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ITEM 9. CHANGES IN AND DISAGREEMENT
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PART III Exelon Generation Company,
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ITEM 12. SECURITY OWNERSHIP OF CERT
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ITEM 14. PRINCIPAL ACCOUNTING FEES
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1. Basis of Presentation Exelon Cor
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5. Related Party Transactions Exelo
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Baltimore Gas and Electric Company
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Exhibit No. Description 2-13 Contri
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Exhibit No. Description 4-2 Exelon
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Exhibit No. Description 4-5 4-6 Ind
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Exhibit No. Description 4-31 Series
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Exhibit No. Description 10-31 Amend
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Exhibit No. Description 10-57 Admin
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Exhibit No. Description 24-29 Chari
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SIGNATURES Pursuant to the requirem
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Exelon Generation Company, LLC Rati
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PECO Energy Company Ratio of Earnin
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Exelon Corporation Subsidiary Listi
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CLT Energy Services Group, L.L.C. P
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Exelon AOG Holding #1, Inc. Delawar
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Michigan Wind 1, LLC Delaware Michi
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Exelon Generation Company, LLC Subs
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Cogenex Corporation MA CoLa Resourc
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Exelon New Boston, LLC DE Exelon Ne
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Residential Solar Holding, LLC DE R
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PECO Energy Company Subsidiary List
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CONSENT OF INDEPENDENT REGISTERED P
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POWER OF ATTORNEY Exhibit 24.2 KNOW
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POWER OF ATTORNEY Exhibit 24.10 KNO
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I, Christopher M. Crane, certify th
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I, Christopher M. Crane, certify th
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I, Anne R. Pramaggiore, certify tha
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I, Craig L. Adams, certify that: CE
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I, Kenneth W. DeFontes Jr., certify
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Certificate Pursuant to Section 135
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2012 10K - Exelon Corporation

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