Annual Statements Open main menu
  1. Annual Statements
  2. » Companies
  3. » EXELON CORP
  4. » Quarter Report: 2022 March (Form 10-Q)

EXELON CORP - Quarter Report: 2022 March (Form 10-Q)


UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 2022
or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File NumberName of Registrant; State or Other Jurisdiction of Incorporation; Address of Principal Executive Offices; and Telephone NumberIRS Employer Identification Number
001-16169EXELON CORPORATION23-2990190
(a Pennsylvania corporation)
10 South Dearborn Street
P.O. Box 805379
Chicago, Illinois 60680-5379
(800) 483-3220
001-01839COMMONWEALTH EDISON COMPANY36-0938600
(an Illinois corporation)
10 South Dearborn Street
49th Floor
Chicago, Illinois 60603-2300
(312) 394-4321
000-16844PECO ENERGY COMPANY23-0970240
(a Pennsylvania corporation)
P.O. Box 8699
2301 Market Street
Philadelphia, Pennsylvania 19101-8699
(215) 841-4000
001-01910BALTIMORE GAS AND ELECTRIC COMPANY52-0280210
(a Maryland corporation)
2 Center Plaza
110 West Fayette Street
Baltimore, Maryland 21201-3708
(410) 234-5000
001-31403PEPCO HOLDINGS LLC52-2297449
(a Delaware limited liability company)
701 Ninth Street, N.W.
Washington, District of Columbia 20068-0001
(202) 872-2000
001-01072POTOMAC ELECTRIC POWER COMPANY53-0127880
(a District of Columbia and Virginia corporation)
701 Ninth Street, N.W.
Washington, District of Columbia 20068-001
(202) 872-2000
001-01405DELMARVA POWER & LIGHT COMPANY51-0084283
(a Delaware and Virginia corporation)
500 North Wakefield Drive
Newark, Delaware 19702-5440
(202) 872-2000
001-03559ATLANTIC CITY ELECTRIC COMPANY21-0398280
(a New Jersey corporation)
500 North Wakefield Drive
Newark, Delaware 19702-5440
(202) 872-2000


Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
EXELON CORPORATION:
Common stock, without par valueEXCThe Nasdaq Stock Market LLC
PECO ENERGY COMPANY:
Trust Receipts of PECO Energy Capital Trust III, each representing a 7.38% Cumulative Preferred Security, Series D, $25 stated value, issued by PECO Energy Capital, L.P. and unconditionally guaranteed by PECO Energy Company
EXC/28New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  x  No  o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes  x  No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Exelon CorporationLarge Accelerated FilerxAccelerated Filer
☐
Non-accelerated Filer
☐
Smaller Reporting Company
☐
Emerging Growth Company
☐
Commonwealth Edison CompanyLarge Accelerated Filer
☐
Accelerated Filer
☐
Non-accelerated FilerxSmaller Reporting Company
☐
Emerging Growth Company
☐
PECO Energy CompanyLarge Accelerated Filer
☐
Accelerated Filer
☐
Non-accelerated FilerxSmaller Reporting Company
☐
Emerging Growth Company
☐
Baltimore Gas and Electric CompanyLarge Accelerated Filer
☐
Accelerated Filer
☐
Non-accelerated FilerxSmaller Reporting Company
☐
Emerging Growth Company
☐
Pepco Holdings LLCLarge Accelerated Filer
☐
Accelerated Filer
☐
Non-accelerated FilerxSmaller Reporting Company
☐
Emerging Growth Company
☐
Potomac Electric Power CompanyLarge Accelerated Filer
☐
Accelerated Filer
☐
Non-accelerated FilerxSmaller Reporting Company
☐
Emerging Growth Company
☐
Delmarva Power & Light CompanyLarge Accelerated Filer
☐
Accelerated Filer
☐
Non-accelerated FilerxSmaller Reporting Company
☐
Emerging Growth Company
☐
Atlantic City Electric CompanyLarge Accelerated Filer
☐
Accelerated Filer
☐
Non-accelerated FilerxSmaller Reporting Company
☐
Emerging Growth Company
☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes  ☐  No  x

The number of shares outstanding of each registrant’s common stock as of March 31, 2022 was:
Exelon Corporation Common Stock, without par value980,209,605
Commonwealth Edison Company Common Stock, $12.50 par value127,021,391
PECO Energy Company Common Stock, without par value170,478,507
Baltimore Gas and Electric Company Common Stock, without par value1,000
Pepco Holdings LLCnot applicable
Potomac Electric Power Company Common Stock, $0.01 par value100
Delmarva Power & Light Company Common Stock, $2.25 par value1,000
Atlantic City Electric Company Common Stock, $3.00 par value8,546,017


TABLE OF CONTENTS
Page No.
1




Page No.
2




Page No.
3



Table of Contents
GLOSSARY OF TERMS AND ABBREVIATIONS
Exelon Corporation and Related Entities
ExelonExelon Corporation
ComEdCommonwealth Edison Company
PECOPECO Energy Company
BGEBaltimore Gas and Electric Company
Pepco Holdings or PHIPepco Holdings LLC
PepcoPotomac Electric Power Company
DPLDelmarva Power & Light Company
ACEAtlantic City Electric Company
RegistrantsExelon, ComEd, PECO, BGE, PHI, Pepco, DPL, and ACE, collectively
Utility RegistrantsComEd, PECO, BGE, Pepco, DPL, and ACE, collectively
ACE Funding or ATFAtlantic City Electric Transition Funding LLC
BSCExelon Business Services Company, LLC
Exelon CorporateExelon in its corporate capacity as a holding company
PCIPotomac Capital Investment Corporation and its subsidiaries
PECO Trust IIIPECO Energy Capital Trust III
PECO Trust IVPECO Energy Capital Trust IV
PHI CorporatePHI in its corporate capacity as a holding company
PHISCOPHI Service Company
Former Related Entities
ConstellationConstellation Energy Corporation
GenerationConstellation Energy Generation, LLC (formerly Exelon Generation Company, LLC, a subsidiary of Exelon prior to separation on February 1, 2022)
4



Table of Contents
GLOSSARY OF TERMS AND ABBREVIATIONS
Other Terms and Abbreviations
Note - of the 2021 Form 10-KReference to specific Combined Note to Consolidated Financial Statements within Exelon's 2021 Annual Report on Form 10-K
AECAlternative Energy Credit that is issued for each megawatt hour of generation from a qualified alternative energy source
AFUDCAllowance for Funds Used During Construction
AMIAdvanced Metering Infrastructure
AOCIAccumulated Other Comprehensive Income (Loss)
AROAsset Retirement Obligation
BGSBasic Generation Service
CEJA (formerly Clean Energy Law in the Exelon 2021 Form 10-K)Climate and Equitable Jobs Act; Illinois Public Act 102-0662 signed into law on September 15, 2021
CERCLAComprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended
CMCCarbon Mitigation Credit
CODMChief Operating Decision Maker(s)
DC PLUGDistrict of Columbia Power Line Undergrounding Initiative
DCPSCPublic Service Commission of the District of Columbia
DEPSCDelaware Public Service Commission
DOEEDistrict of Columbia Department of Energy & Environment
DPPDeferred Purchase Price
EIMAEnergy Infrastructure Modernization Act (Illinois Senate Bill 1652 and Illinois House Bill 3036)
EPAUnited States Environmental Protection Agency
ERCOTElectric Reliability Council of Texas
ERISAEmployee Retirement Income Security Act of 1974, as amended
ETACEnergy Transition Assistance Charge
FEJAIllinois Public Act 99-0906 or Future Energy Jobs Act
FERCFederal Energy Regulatory Commission
GAAPGenerally Accepted Accounting Principles in the United States
GCRGas Cost Rate
GSAGeneration Supply Adjustment
GWhGigawatt hour
ICCIllinois Commerce Commission
Illinois Settlement LegislationLegislation enacted in 2007 affecting electric utilities in Illinois
IPAIllinois Power Agency
IRCInternal Revenue Code
IRSInternal Revenue Service
LIBORLondon Interbank Offered Rate
MDPSCMaryland Public Service Commission
MGPManufactured Gas Plant
mmcfMillion Cubic Feet
MWMegawatt
MWhMegawatt hour
N/ANot applicable
NDTNuclear Decommissioning Trust
NJBPUNew Jersey Board of Public Utilities
NPNSNormal Purchase Normal Sale scope exception
5



Table of Contents
GLOSSARY OF TERMS AND ABBREVIATIONS
Other Terms and Abbreviations
NPSNational Park Service
OCIOther Comprehensive Income
OPEBOther Postretirement Employee Benefits
PAPUCPennsylvania Public Utility Commission
PGCPurchased Gas Cost Clause
PJMPJM Interconnection, LLC
POLRProvider of Last Resort
PPAPower Purchase Agreement
PP&EProperty, plant, and equipment
PRPPotentially Responsible Parties
RECRenewable Energy Credit which is issued for each megawatt hour of generation from a qualified renewable energy source
Regulatory Agreement UnitsNuclear generating units or portions thereof whose decommissioning-related activities are subject to contractual elimination under regulatory accounting
RFPRequest for Proposal
RiderReconcilable Surcharge Recovery Mechanism
ROEReturn on equity
ROURight-of-use
RPSRenewable Energy Portfolio Standards
RTORegional Transmission Organization
SECUnited States Securities and Exchange Commission
SOFR Secured Overnight Financing Rate
SOSStandard Offer Service
STRIDEMaryland Strategic Infrastructure Development and Enhancement Program
TCJATax Cuts and Jobs Act
Transition BondsTransition Bonds issued by ACE Funding
ZECZero Emission Credit or Zero Emission Certificate
6



Table of Contents
FILING FORMAT
This combined Form 10-Q is being filed separately by Exelon Corporation, Commonwealth Edison Company, PECO Energy Company, Baltimore Gas and Electric Company, Pepco Holdings LLC, Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company (Registrants). Information contained herein relating to any individual Registrant is filed by such Registrant on its own behalf. No Registrant makes any representation as to information relating to any other Registrant.
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. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “predicts,” and variations on such words, and similar expressions that reflect our current views with respect to future events and operational, economic, and financial performance, are intended to identify such forward-looking statements.
The factors that could cause actual results to differ materially from the forward-looking statements made by the Registrants include those factors discussed herein, as well as the items discussed in (1) the Registrants' combined 2021 Annual Report on Form 10-K in (a) Part I, ITEM 1A. Risk Factors, (b) Part II, ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, and (c) Part II, ITEM 8. Financial Statements and Supplementary Data: Note 19, Commitments and Contingencies; (2) this Quarterly Report on Form 10-Q in (a) Part II, ITEM 1A. Risk Factors, (b) Part I, ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, and (c) Part I, ITEM 1. Financial Statements: Note 12, Commitments and Contingencies; and (3) other factors discussed in filings with the SEC by the Registrants.
Investors 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.
WHERE TO FIND MORE INFORMATION
The SEC maintains an Internet site at www.sec.gov that contains reports, proxy and information statements, and other information that the Registrants file electronically with the SEC. These documents are also available to the public from commercial document retrieval services and the Registrants' website at www.exeloncorp.com. Information contained on the Registrants' website shall not be deemed incorporated into, or to be a part of, this Report.
7



Table of Contents
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
8



Table of Contents

EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
March 31,
(In millions, except per share data)20222021
Operating revenues
Electric operating revenues$4,481 $3,870 
Natural gas operating revenues817 633 
Revenues from alternative revenue programs29 129 
Total operating revenues5,327 4,632 
Operating expenses
Purchased power1,581 1,140 
Purchased fuel338 218 
Purchased power and fuel from affiliates159 293 
Operating and maintenance1,178 1,083 
Depreciation and amortization817 757 
Taxes other than income taxes354 317 
Total operating expenses4,427 3,808 
Operating income900 824 
Other income and (deductions)
Interest expense, net(332)(312)
Interest expense to affiliates(6)(6)
Other, net137 58 
Total other deductions(201)(260)
Income from continuing operations before income taxes699 564 
Income taxes218 39 
Net income from continuing operations after income taxes481 525 
Net income (loss) from discontinued operations after income taxes (Note 2)117 (789)
Net income (loss)598 (264)
Net income attributable to noncontrolling interests1 25 
Net income (loss) attributable to common shareholders$597 $(289)
Amounts attributable to common shareholders:
Net income from continuing operations481 525 
Net income (loss) from discontinued operations116 (814)
Net income (loss) attributable to common shareholders$597 $(289)
Comprehensive income (loss), net of income taxes
Net income (loss)$598 $(264)
Other comprehensive income (loss), net of income taxes
Pension and non-pension postretirement benefit plans:
Prior service benefit reclassified to periodic benefit cost— (1)
Actuarial loss reclassified to periodic benefit cost14 56 
Pension and non-pension postretirement benefit plan valuation adjustment— (2)
Unrealized gain on foreign currency translation— 1 
Other comprehensive income14 54 
Comprehensive income (loss)612 (210)
Comprehensive income attributable to noncontrolling interests 1 25 
Comprehensive income (loss) attributable to common shareholders$611 $(235)
Average shares of common stock outstanding:
Basic981 977 
Assumed exercise and/or distributions of stock-based awards— 1 
Diluted(a)
981 978 
Earnings per average common share from continuing operations
Basic$0.49 $0.53 
Diluted$0.49 $0.53 
Earnings (losses) per average common share from discontinued operations
Basic$0.12 $(0.83)
Diluted$0.12 $(0.83)
__________
(a)The number of stock options not included in the calculation of diluted common shares outstanding due to their antidilutive effect were none and less than 1 million for the three months ended March 31, 2022 and 2021, respectively.
See the Combined Notes to Consolidated Financial Statements
9



Table of Contents
EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Cash flows from operating activities
Net income (loss)$598 $(264)
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation, amortization, and accretion, including nuclear fuel and energy contract amortization1,024 2,104 
Asset impairments— 1 
Gain on sales of assets and businesses(10)(71)
Deferred income taxes and amortization of investment tax credits110 (142)
Net fair value changes related to derivatives(59)(178)
Net realized and unrealized losses (gains) on NDT funds205 (118)
Net unrealized losses on equity investments16 23 
Other non-cash operating activities232 (170)
Changes in assets and liabilities:
Accounts receivable(711)(372)
Inventories125 77 
Accounts payable and accrued expenses291 (176)
Option premiums (paid) received, net(39)16 
Collateral received, net1,142 273 
Income taxes77 113 
Pension and non-pension postretirement benefit contributions(574)(537)
Other assets and liabilities(645)(1,840)
Net cash flows provided by (used in) operating activities1,782 (1,261)
Cash flows from investing activities
Capital expenditures(1,922)(2,140)
Proceeds from NDT fund sales488 2,908 
Investment in NDT funds(516)(2,939)
Collection of DPP169 1,574 
Proceeds from sales of assets and businesses16 680 
Other investing activities(54)12 
Net cash flows (used in) provided by investing activities(1,819)95 
Cash flows from financing activities
Changes in short-term borrowings(700)597 
Proceeds from short-term borrowings with maturities greater than 90 days1,150 500 
Repayments on short-term borrowings with maturities greater than 90 days(350)— 
Issuance of long-term debt4,301 1,705 
Retirement of long-term debt(6)(79)
Dividends paid on common stock(332)(374)
Proceeds from employee stock plans9 31 
Transfer of cash, restricted cash, and cash equivalents to Constellation(2,594)— 
Other financing activities(62)(46)
Net cash flows provided by financing activities1,416 2,334 
Increase in cash, restricted cash, and cash equivalents1,379 1,168 
Cash, restricted cash, and cash equivalents at beginning of period1,619 1,166 
Cash, restricted cash, and cash equivalents at end of period$2,998 $2,334 
Supplemental cash flow information
Decrease in capital expenditures not paid$(322)$(324)
Increase in DPP348 1,339 
(Decrease) increase in PP&E related to ARO update(335)2 
See the Combined Notes to Consolidated Financial Statements
10



Table of Contents
EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
ASSETS
Current assets
Cash and cash equivalents$2,476 $672 
Restricted cash and cash equivalents430 321 
Accounts receivable
Customer accounts receivable2,3652,189
Customer allowance for credit losses(389)(320)
Customer accounts receivable, net1,976 1,869 
Other accounts receivable1,1481,068
Other allowance for credit losses(81)(72)
Other accounts receivable, net1,067 996 
Inventories, net
Fossil fuel and emission allowances39 105 
Materials and supplies473 476 
Regulatory assets1,221 1,296 
Other463 387 
Current assets of discontinued operations— 7,835 
Total current assets8,145 13,957 
Property, plant, and equipment (net of accumulated depreciation and amortization of $14,878 and $14,430 as of March 31, 2022 and December 31, 2021, respectively)
65,465 64,558 
Deferred debits and other assets
Regulatory assets8,200 8,224 
Investments244 250 
Goodwill6,630 6,630 
Receivable related to Regulatory Agreement Units2,969 — 
Other1,045 885 
Property, plant, and equipment, deferred debits, and other assets of discontinued operations— 38,509 
Total deferred debits and other assets19,088 54,498 
Total assets$92,698 $133,013 
See the Combined Notes to Consolidated Financial Statements
11



Table of Contents
EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Short-term borrowings$1,900 $1,248 
Long-term debt due within one year2,154 2,153 
Accounts payable2,175 2,379 
Accrued expenses1,029 1,137 
Payables to affiliates6 5 
Regulatory liabilities394 376 
Mark-to-market derivative liabilities— 18 
Unamortized energy contract liabilities13 89 
Other964 766 
Current liabilities of discontinued operations— 7,940 
Total current liabilities8,635 16,111 
Long-term debt35,008 30,749 
Long-term debt to financing trusts390 390 
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits11,089 10,611 
Asset retirement obligations273 271 
Pension obligations1,447 2,051 
Non-pension postretirement benefit obligations800 811 
Regulatory liabilities9,192 9,628 
Mark-to-market derivative liabilities144 201 
Unamortized energy contract liabilities42 146 
Other2,187 1,573 
Long-term debt, deferred credits, and other liabilities of discontinued operations— 25,676 
Total deferred credits and other liabilities25,174 50,968 
Total liabilities69,207 98,218 
Commitments and contingencies
Shareholders’ equity
Common stock (No par value, 2,000 shares authorized, 980 shares and 979 shares outstanding at March 31, 2022 and December 31, 2021, respectively)
20,299 20,324 
Treasury stock, at cost (2 shares at March 31, 2022 and December 31, 2021)
(123)(123)
Retained earnings4,028 16,942 
Accumulated other comprehensive loss, net(713)(2,750)
Total shareholders’ equity23,491 34,393 
Noncontrolling interests— 402 
Total equity23,491 34,795 
Total liabilities and shareholders’ equity$92,698 $133,013 

See the Combined Notes to Consolidated Financial Statements
12



Table of Contents
EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited)
Three Months Ended March 31, 2022
(In millions, shares
in thousands)		Issued
Shares		Common
Stock		Treasury
Stock		Retained
Earnings		Accumulated
Other
Comprehensive
Loss, net		Noncontrolling
Interests		Total Shareholders'
Equity
Balance, December 31, 2021981,291 $20,324 $(123)$16,942 $(2,750)$402 $34,795 
Net income— — — 597 — 1 598 
Long-term incentive plan activity540 (13)— — — — (13)
Employee stock purchase plan issuances211 9 — — — — 9 
Changes in equity of noncontrolling interests— — — — — (7)(7)
Distribution of Constellation (Note 2)— (21)— (13,179)2,023 (396)(11,573)
Common stock dividends
($0.34/common share)
— — — (332)— — (332)
Other comprehensive income, net of income taxes— — — — 14 — 14 
Balance, March 31, 2022982,042 $20,299 $(123)$4,028 $(713)$— $23,491 

Three Months Ended March 31, 2021
(In millions, shares
in thousands)		Issued
Shares		Common
Stock		Treasury
Stock		Retained
Earnings		Accumulated
Other
Comprehensive
Loss, net		Noncontrolling
Interests		Total Shareholders'
Equity
Balance, December 31, 2020977,466 $19,373 $(123)$16,735 $(3,400)$2,283 $34,868 
Net (loss) income— — — (289)— 25 (264)
Long-term incentive plan activity640 5 — — — — 5 
Employee stock purchase plan issuances902 34 — — — — 34 
Changes in equity of noncontrolling interests— — — — — (10)(10)
Common stock dividends
($0.38/common share)
— — — (374)— — (374)
Other comprehensive income, net of income taxes— — — — 54 — 54 
Balance, March 31, 2021979,008 $19,412 $(123)$16,072 $(3,346)$2,298 $34,313 

See the Combined Notes to Consolidated Financial Statements
13



Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Operating revenues
Electric operating revenues$1,688 $1,475 
Revenues from alternative revenue programs40 54 
Operating revenues from affiliates6 6 
Total operating revenues1,734 1,535 
Operating expenses
Purchased power579 442 
Purchased power from affiliate59 85 
Operating and maintenance266 245 
Operating and maintenance from affiliates85 71 
Depreciation and amortization321 292 
Taxes other than income taxes96 75 
Total operating expenses1,406 1,210 
Operating income328 325 
Other income and (deductions)
Interest expense, net(97)(93)
Interest expense to affiliates(3)(3)
Other, net12 7 
Total other income and (deductions)(88)(89)
Income before income taxes240 236 
Income taxes52 39 
Net income $188 $197 
Comprehensive income $188 $197 

See the Combined Notes to Consolidated Financial Statements
14



Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Cash flows from operating activities
Net income$188 $197 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization321 292 
Deferred income taxes and amortization of investment tax credits54 63 
Other non-cash operating activities(9)(9)
Changes in assets and liabilities:
Accounts receivable(45)23 
Receivables from and payables to affiliates, net(42)(15)
Inventories3 (1)
Accounts payable and accrued expenses (154)(176)
Collateral received, net43 5 
Income taxes(2)(23)
Pension and non-pension postretirement benefit contributions(176)(171)
Other assets and liabilities(37)(159)
Net cash flows provided by operating activities144 26 
Cash flows from investing activities
Capital expenditures(617)(613)
Other investing activities7 7 
Net cash flows used in investing activities(610)(606)
Cash flows from financing activities
Changes in short-term borrowings— (188)
Issuance of long-term debt750 700 
Dividends paid on common stock(144)(127)
Contributions from parent167 198 
Other financing activities(10)(9)
Net cash flows provided by financing activities763 574 
Increase (decrease) in cash, restricted cash, and cash equivalents297 (6)
Cash, restricted cash, and cash equivalents at beginning of period384 405 
Cash, restricted cash, and cash equivalents at end of period$681 $399 
Supplemental cash flow information
Decrease in capital expenditures not paid$(50)$(107)
See the Combined Notes to Consolidated Financial Statements
15



Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
ASSETS
Current assets
   Cash and cash equivalents$343 $131 
   Restricted cash and cash equivalents246 210 
   Accounts receivable
   Customer accounts receivable702647
   Customer allowance for credit losses(92)(73)
       Customer accounts receivable, net610 574 
   Other accounts receivable219227
   Other allowance for credit losses(20)(17)
       Other accounts receivable, net 199 210 
   Receivables from affiliates3 16 
   Inventories, net167 170 
   Regulatory assets316 335 
   Other80 76 
   Total current assets1,964 1,722 
Property, plant, and equipment (net of accumulated depreciation and amortization of $6,267 and $6,099 as of March 31, 2022 and December 31, 2021, respectively)
26,325 25,995 
Deferred debits and other assets
   Regulatory assets1,883 1,870 
   Investments6 6 
   Goodwill2,625 2,625 
   Receivables from affiliates— 2,761 
   Receivable related to Regulatory Agreement Units2,484 — 
   Prepaid pension asset1,245 1,086 
   Other481 405 
   Total deferred debits and other assets8,724 8,753 
Total assets$37,013 $36,470 
See the Combined Notes to Consolidated Financial Statements
16



Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
   Accounts payable$553 $647 
   Accrued expenses275 384 
   Payables to affiliates66 121 
   Customer deposits98 99 
   Regulatory liabilities190 185 
   Mark-to-market derivative liabilities— 18 
   Other161 133 
   Total current liabilities1,343 1,587 
Long-term debt10,515 9,773 
Long-term debt to financing trust205 205 
Deferred credits and other liabilities
   Deferred income taxes and unamortized investment tax credits4,761 4,685 
   Asset retirement obligations145 144 
   Non-pension postretirement benefits obligations168 169 
   Regulatory liabilities6,551 6,759 
   Mark-to-market derivative liabilities144 201 
   Other615 592 
   Total deferred credits and other liabilities12,384 12,550 
   Total liabilities24,447 24,115 
Commitments and contingencies
Shareholders’ equity
   Common stock 1,588 1,588 
   Other paid-in capital9,243 9,076 
   Retained earnings1,735 1,691 
   Total shareholders’ equity12,566 12,355 
Total liabilities and shareholders’ equity$37,013 $36,470 
See the Combined Notes to Consolidated Financial Statements
17



Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited)
Three Months Ended March 31, 2022
(In millions)Common
Stock		Other
Paid-In
Capital		Retained
Earnings		Total
Shareholders’
Equity
Balance, December 31, 2021$1,588 $9,076 $1,691 $12,355 
Net income— — 188 188 
Common stock dividends— — (144)(144)
Contributions from parent— 167 — 167 
Balance, March 31, 2022$1,588 $9,243 $1,735 $12,566 
Three Months Ended March 31, 2021
(In millions)Common
Stock		Other
Paid-In
Capital		Retained
Earnings		Total
Shareholders’
Equity
Balance, December 31, 2020$1,588 $8,285 $1,456 $11,329 
Net income— — 197 197 
Common stock dividends— — (127)(127)
Contributions from parent— 198 — 198 
Balance, March 31, 2021$1,588 $8,483 $1,526 $11,597 
See the Combined Notes to Consolidated Financial Statements
18



Table of Contents

PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
 Three Months Ended
March 31,
(In millions)20222021
Operating revenues
Electric operating revenues$734 $649 
Natural gas operating revenues306 228 
Revenues from alternative revenue programs6 10 
Operating revenues from affiliates1 2 
Total operating revenues1,047 889 
Operating expenses
Purchased power 229 189 
Purchased fuel145 86 
Purchased power from affiliate33 41 
Operating and maintenance196 193 
Operating and maintenance from affiliates51 41 
Depreciation and amortization92 86 
Taxes other than income taxes47 43 
Total operating expenses793 679 
Operating income254 210 
Other income and (deductions)
Interest expense, net(38)(35)
Interest expense to affiliates(3)(3)
Other, net7 5 
Total other income and (deductions)(34)(33)
Income before income taxes220 177 
Income taxes14 10 
Net income$206 $167 
Comprehensive income$206 $167 
See the Combined Notes to Consolidated Financial Statements
19



Table of Contents
PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Cash flows from operating activities
Net income$206 $167 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization92 86 
Deferred income taxes and amortization of investment tax credits14 6 
Other non-cash operating activities15 12 
Changes in assets and liabilities:
Accounts receivable(40)(5)
Receivables from and payables to affiliates, net(31)(2)
Inventories27 13 
Accounts payable and accrued expenses (24)(36)
Income taxes— 3 
Pension and non-pension postretirement benefit contributions(12)(16)
Other assets and liabilities(106)(103)
Net cash flows provided by operating activities141 125 
Cash flows from investing activities
Capital expenditures(344)(295)
Changes in Exelon intercompany money pool— (48)
Other investing activities2 1 
Net cash flows used in investing activities(342)(342)
Cash flows from financing activities
Issuance of long-term debt— 375 
Changes in Exelon intercompany money pool65 (40)
Dividends paid on common stock(100)(85)
Contributions from parent227 — 
Other financing activities(1)(4)
Net cash flows provided by financing activities191 246 
(Decrease) increase in cash, restricted cash, and cash equivalents(10)29 
Cash, restricted cash, and cash equivalents at beginning of period44 26 
Cash, restricted cash, and cash equivalents at end of period$34 $55 
Supplemental cash flow information
(Decrease) increase in capital expenditures not paid$(41)$(44)
See the Combined Notes to Consolidated Financial Statements
20



Table of Contents
PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
ASSETS
Current assets
Cash and cash equivalents$26 $36 
Restricted cash and cash equivalents8 8 
Accounts receivable
Customer accounts receivable528489
Customer allowance for credit losses(125)(105)
Customer accounts receivable, net403 384 
Other accounts receivable129116
Other allowance for credit losses(9)(7)
Other accounts receivable, net120 109 
Receivables from affiliates— 1 
Inventories, net
Fossil fuel23 51 
Materials and supplies46 45 
Prepaid utility taxes117 1 
Regulatory assets57 48 
Other30 28 
Total current assets830 711 
Property, plant, and equipment (net of accumulated depreciation and amortization of $4,004 and $3,964 as of March 31, 2022 and December 31, 2021, respectively)
11,334 11,117 
Deferred debits and other assets
Regulatory assets1,000 943 
Investments33 34 
Receivables from affiliates— 597 
Receivable related to Regulatory Agreement Units486 — 
Prepaid pension asset401 386 
Other29 36 
Total deferred debits and other assets1,949 1,996 
Total assets$14,113 $13,824 
See the Combined Notes to Consolidated Financial Statements
21



Table of Contents
PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities
Long-term debt due within one year$350 $350 
Accounts payable477 494 
Accrued expenses105 136 
Payables to affiliates38 70 
Borrowings from Exelon intercompany money pool65 — 
Customer deposits50 48 
Regulatory liabilities94 94 
Other41 35 
Total current liabilities1,220 1,227 
Long-term debt3,848 3,847 
Long-term debt to financing trusts184 184 
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits2,495 2,421 
Asset retirement obligations29 29 
Non-pension postretirement benefits obligations287 286 
Regulatory liabilities523 635 
Other82 83 
Total deferred credits and other liabilities3,416 3,454 
Total liabilities8,668 8,712 
Commitments and contingencies
Shareholder’s equity
Common stock3,655 3,428 
Retained earnings1,790 1,684 
Total shareholder’s equity5,445 5,112 
Total liabilities and shareholder's equity$14,113 $13,824 
See the Combined Notes to Consolidated Financial Statements
22



Table of Contents
PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER’S EQUITY
(Unaudited)
Three Months Ended March 31, 2022
(In millions)Common
Stock		Retained
Earnings		Total
Shareholder's
Equity
Balance, December 31, 2021$3,428 $1,684 $5,112 
Net income— 206 206 
Common stock dividends— (100)(100)
Contributions from parent227 — 227 
Balance, March 31, 2022$3,655 $1,790 $5,445 
Three Months Ended March 31, 2021
(In millions)Common
Stock		Retained
Earnings		Total
Shareholder's
Equity
Balance, December 31, 2020$3,014 $1,519 $4,533 
Net income— 167 167 
Common stock dividends— (85)(85)
Balance, March 31, 2021$3,014 $1,601 $4,615 
See the Combined Notes to Consolidated Financial Statements
23



Table of Contents

BALTIMORE GAS AND ELECTRIC COMPANY
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Operating revenues
Electric operating revenues$735 $620 
Natural gas operating revenues424 330 
Revenues from alternative revenue programs(12)18 
Operating revenues from affiliates7 6 
Total operating revenues1,154 974 
Operating expenses
Purchased power285 162 
Purchased fuel151 99 
Purchased power and fuel from affiliate18 70 
Operating and maintenance167 152 
Operating and maintenance from affiliates51 45 
Depreciation and amortization171 152 
Taxes other than income taxes76 72 
Total operating expenses919 752 
Operating income235 222 
Other income and (deductions)
Interest expense, net(35)(34)
Other, net7 8 
Total other income and (deductions)(28)(26)
Income before income taxes207 196 
Income taxes9 (13)
Net income$198 $209 
Comprehensive income$198 $209 
See the Combined Notes to Consolidated Financial Statements
24



Table of Contents
BALTIMORE GAS AND ELECTRIC COMPANY
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Cash flows from operating activities
Net income$198 $209 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization171 152 
Deferred income taxes and amortization of investment tax credits5 (4)
Other non-cash operating activities44 2 
Changes in assets and liabilities:
Accounts receivable(80)12 
Receivables from and payables to affiliates, net(2)(15)
Inventories32 9 
Accounts payable and accrued expenses(30)(59)
Income taxes4 (9)
Pension and non-pension postretirement benefit contributions(56)(65)
Other assets and liabilities(9)(103)
Net cash flows provided by operating activities277 129 
Cash flows from investing activities
Capital expenditures(303)(336)
Other investing activities3 2 
Net cash flows used in investing activities(300)(334)
Cash flows from financing activities
Changes in short-term borrowings120 156 
Dividends paid on common stock(76)(74)
Other financing activities(1)— 
Net cash flows provided by financing activities43 82 
Increase (decrease) in cash, restricted cash, and cash equivalents20 (123)
Cash, restricted cash, and cash equivalents at beginning of period55 145 
Cash, restricted cash, and cash equivalents at end of period$75 $22 
Supplemental cash flow information
Decrease in capital expenditures not paid$(32)$(80)
See the Combined Notes to Consolidated Financial Statements
25



Table of Contents
BALTIMORE GAS AND ELECTRIC COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
ASSETS
Current assets
Cash and cash equivalents$41 $51 
Restricted cash and cash equivalents34 4 
Accounts receivable
Customer accounts receivable519436
Customer allowance for credit losses (59)(38)
    Customer accounts receivable, net460 398 
Other accounts receivable 126124
Other allowance for credit losses(11)(9)
     Other accounts receivable, net115 115 
Receivables from affiliates— 1 
Inventories, net
Fossil fuel12 42 
Materials and supplies51 53 
Prepaid utility taxes46 49 
Regulatory assets175 215 
Other11 8 
Total current assets945 936 
Property, plant, and equipment (net of accumulated depreciation and amortization of $4,376 and $4,299 as of March 31, 2022 and December 31, 2021, respectively)
10,736 10,577 
Deferred debits and other assets
Regulatory assets467 477 
Investments6 14 
Prepaid pension asset315 276 
Other40 44 
Total deferred debits and other assets828 811 
Total assets$12,509 $12,324 
See the Combined Notes to Consolidated Financial Statements
26



Table of Contents
BALTIMORE GAS AND ELECTRIC COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities
Short-term borrowings$250 $130 
Long-term debt due within one year250 250 
Accounts payable299 349 
Accrued expenses168 176 
Payables to affiliates37 48 
Customer deposits98 97 
Regulatory liabilities35 26 
Other61 48 
Total current liabilities1,198 1,124 
Long-term debt3,711 3,711 
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits1,755 1,686 
Asset retirement obligations26 26 
Non-pension postretirement benefits obligations170 175 
Regulatory liabilities872 934 
Other85 98 
Total deferred credits and other liabilities2,908 2,919 
Total liabilities7,817 7,754 
Commitments and contingencies
Shareholder's equity
Common stock2,575 2,575 
Retained earnings2,117 1,995 
Total shareholder's equity4,692 4,570 
Total liabilities and shareholder's equity$12,509 $12,324 

See the Combined Notes to Consolidated Financial Statements
27



Table of Contents
BALTIMORE GAS AND ELECTRIC COMPANY
STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(Unaudited)
Three Months Ended March 31, 2022
(In millions)Common
Stock		Retained
Earnings		Total
Shareholder's
Equity
Balance, December 31, 2021$2,575 $1,995 $4,570 
Net income— 198 198 
Common stock dividends— (76)(76)
Balance, March 31, 2022$2,575 $2,117 $4,692 
Three Months Ended March 31, 2021
(In millions)Common
Stock		Retained
Earnings		Total
Shareholder's
Equity
Balance, December 31, 2020$2,318 $1,879 $4,197 
Net income— 209 209 
Common stock dividends— (74)(74)
Balance, March 31, 2021$2,318 $2,014 $4,332 
See the Combined Notes to Consolidated Financial Statements
28



Table of Contents


PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Operating revenues
Electric operating revenues$1,323 $1,124 
Natural gas operating revenues83 71 
Revenues from alternative revenue programs(5)46 
Operating revenues from affiliates3 3 
Total operating revenues1,404 1,244 
Operating expenses
Purchased power487 348 
Purchased fuel42 33 
Purchased power from affiliates 50 98 
Operating and maintenance248 216 
Operating and maintenance from affiliates51 40 
Depreciation and amortization218 210 
Taxes other than income taxes119 113 
Total operating expenses1,215 1,058 
Operating income189 186 
Other income and (deductions)
Interest expense, net(69)(67)
Other, net17 17 
Total other income and (deductions)(52)(50)
Income before income taxes 137 136 
Income taxes7 8 
Net income$130 $128 
Comprehensive income$130 $128 
See the Combined Notes to Consolidated Financial Statements
29



Table of Contents
PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Cash flows from operating activities
Net income$130 $128 
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization218 210 
Deferred income taxes and amortization of investment tax credits2 4 
Other non-cash operating activities35 (25)
Changes in assets and liabilities:
Accounts receivable(21)56 
Receivables from and payables to affiliates, net(51)(18)
Inventories7 5 
Accounts payable and accrued expenses(23)(24)
Income taxes5 3 
Pension and non-pension postretirement benefit contributions(67)(36)
Other assets and liabilities(3)(94)
Net cash flows provided by operating activities232 209 
Cash flows from investing activities
Capital expenditures(409)(456)
Other investing activities2 1 
Net cash flows used in investing activities(407)(455)
Cash flows from financing activities
Changes in short-term borrowings(468)(368)
Issuance of long-term debt700 625 
Retirement of long-term debt— (44)
Changes in Exelon intercompany money pool39 3 
Distributions to member(102)(81)
Contributions from member704 560 
Other financing activities(9)(5)
Net cash flows provided by financing activities864 690 
Increase in cash, restricted cash, and cash equivalents689 444 
Cash, restricted cash, and cash equivalents at beginning of period213 160 
Cash, restricted cash, and cash equivalents at end of period$902 $604 
Supplemental cash flow information
Decrease in capital expenditures not paid$(55)$(33)
See the Combined Notes to Consolidated Financial Statements
30



Table of Contents
PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
ASSETS
Current assets
Cash and cash equivalents$796 $136 
Restricted cash and cash equivalents106 77 
Accounts receivable
Customer accounts receivable618616
Customer allowance for credit losses(113)(104)
Customer accounts receivable, net505 512 
Other accounts receivable288283
Other allowance for credit losses(41)(39)
Other accounts receivable, net247 244 
Receivables from affiliates— 2 
Inventories, net
Fossil fuel4 11 
Materials and supplies209 209 
Regulatory assets432 432 
Other69 69 
Total current assets2,368 1,692 
Property, plant, and equipment (net of accumulated depreciation and amortization of $2,256 and $2,108 as of March 31, 2022 and December 31, 2021, respectively)
16,701 16,498 
Deferred debits and other assets
Regulatory assets1,770 1,794 
Investments142 145 
Goodwill4,005 4,005 
Prepaid pension asset392 344 
Deferred income taxes5 8 
Other253 258 
Total deferred debits and other assets6,567 6,554 
Total assets$25,636 $24,744 
See the Combined Notes to Consolidated Financial Statements
31



Table of Contents
PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
LIABILITIES AND MEMBER'S EQUITY
Current liabilities
Short-term borrowings$— $468 
Long-term debt due within one year400 399 
Accounts payable522 578 
Accrued expenses264 281 
Payables to affiliates51 104 
Borrowings from Exelon intercompany money pool46 7 
Customer deposits80 81 
Regulatory liabilities 72 68 
Unamortized energy contract liabilities13 89 
PPA termination obligation85 — 
Other215 171 
Total current liabilities1,748 2,246 
Long-term debt7,833 7,148 
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits2,723 2,675 
Asset retirement obligations70 70 
Non-pension postretirement benefit obligations60 66 
Regulatory liabilities 1,182 1,238 
Unamortized energy contract liabilities42 146 
Other661 570 
Total deferred credits and other liabilities4,738 4,765 
Total liabilities14,319 14,159 
Commitments and contingencies
Member's equity
Membership interest11,499 10,795 
Undistributed losses(182)(210)
Total member's equity11,317 10,585 
Total liabilities and member's equity$25,636 $24,744 
See the Combined Notes to Consolidated Financial Statements
32



Table of Contents
PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CHANGES IN MEMBER'S EQUITY
(Unaudited)
Three Months Ended March 31, 2022
(In millions)Membership InterestUndistributed (Losses)/EarningsTotal Member's Equity
Balance, December 31, 2021$10,795 $(210)$10,585 
Net income— 130 130 
Distributions to member— (102)(102)
Contributions from member704 — 704 
Balance, March 31, 2022$11,499 $(182)$11,317 

Three Months Ended March 31, 2021
(In millions)Membership InterestUndistributed (Losses)/EarningsTotal Member's Equity
Balance, December 31, 2020$10,112 $(68)$10,044 
Net income— 128 128 
Distributions to member— (81)(81)
Contributions from member560 — 560 
Balance, March 31, 2021$10,672 $(21)$10,651 
See the Combined Notes to Consolidated Financial Statements
33



Table of Contents

POTOMAC ELECTRIC POWER COMPANY
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Operating revenues
Electric operating revenues620 $526 
Revenues from alternative revenue programs(7)26 
Operating revenues from affiliates1 1 
Total operating revenues614 553 
Operating expenses
Purchased power174 92 
Purchased power from affiliate39 74 
Operating and maintenance73 56 
Operating and maintenance from affiliates58 52 
Depreciation and amortization108 102 
Taxes other than income taxes95 90 
Total operating expenses547 466 
Operating income67 87 
Other income and (deductions)
Interest expense, net(36)(34)
Other, net13 12 
Total other income and (deductions)(23)(22)
Income before income taxes44 65 
Income taxes(2)6 
Net income$46 $59 
Comprehensive income$46 $59 
See the Combined Notes to Consolidated Financial Statements
34



Table of Contents
POTOMAC ELECTRIC POWER COMPANY
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Cash flows from operating activities
Net income$46 $59 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization108 102 
Deferred income taxes and amortization of investment tax credits(2)4 
Other non-cash operating activities12 (25)
Changes in assets and liabilities:
Accounts receivable(2)26 
Receivables from and payables to affiliates, net(25)(9)
Inventories— 1 
Accounts payable and accrued expenses 5 — 
Income taxes1 2 
Pension and non-pension postretirement benefit contributions(5)(5)
Other assets and liabilities(18)(58)
Net cash flows provided by operating activities120 97 
Cash flows from investing activities
Capital expenditures(218)(220)
Other investing activities1 1 
Net cash flows used in investing activities(217)(219)
Cash flows from financing activities
Changes in short-term borrowings(175)(35)
Issuance of long-term debt400 150 
Dividends paid on common stock(42)(28)
Contributions from parent387 138 
Other financing activities(5)(1)
Net cash flows provided by financing activities565 224 
Increase in cash, restricted cash, and cash equivalents468 102 
Cash, restricted cash, and cash equivalents at beginning of period68 65 
Cash, restricted cash, and cash equivalents at end of period$536 $167 
Supplemental cash flow information
Decrease in capital expenditures not paid$(36)$(16)
See the Combined Notes to Consolidated Financial Statements
35



Table of Contents
POTOMAC ELECTRIC POWER COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
ASSETS
Current assets
Cash and cash equivalents$502 $34 
Restricted cash and cash equivalents34 34 
Accounts receivable
Customer accounts receivable278277
Customer allowance for credit losses(40)(37)
Customer accounts receivable, net238 240 
Other accounts receivable157160
Other allowance for credit losses(18)(16)
Other accounts receivable, net139 144 
Inventories, net119 119 
Regulatory assets216 213 
Other29 25 
Total current assets1,277 809 
Property, plant, and equipment (net of accumulated depreciation and amortization of $3,929 and $3,875 as of March 31, 2022 and December 31, 2021, respectively)
8,229 8,104 
Deferred debits and other assets
Regulatory assets496 532 
Investments119 120 
Prepaid pension asset279 279 
Other58 59 
Total deferred debits and other assets952 990 
Total assets$10,458 $9,903 
See the Combined Notes to Consolidated Financial Statements
36



Table of Contents
POTOMAC ELECTRIC POWER COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities
Short-term borrowings$— $175 
Long-term debt due within one year314 313 
Accounts payable246 272 
Accrued expenses158 160 
Payables to affiliates34 59 
Customer deposits36 35 
Regulatory liabilities 18 14 
Merger related obligation27 27 
Other64 55 
Total current liabilities897 1,110 
Long-term debt3,527 3,132 
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits1,293 1,275 
Asset retirement obligations45 45 
Non-pension postretirement benefit obligations— 3 
Regulatory liabilities 533 549 
Other297 314 
Total deferred credits and other liabilities2,168 2,186 
Total liabilities6,592 6,428 
Commitments and contingencies
Shareholder's equity
Shareholder's Equity
Common stock 2,689 2,302 
Retained earnings1,177 1,173 
Total shareholder's equity3,866 3,475 
Total liabilities and shareholder's equity$10,458 $9,903 
See the Combined Notes to Consolidated Financial Statements
37



Table of Contents
POTOMAC ELECTRIC POWER COMPANY
STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(Unaudited)
Three Months Ended March 31, 2022
(In millions)Common StockRetained EarningsTotal Shareholder's Equity
Balance, December 31, 2021$2,302 $1,173 $3,475 
Net income— 46 46 
Common stock dividends— (42)(42)
Contributions from parent387 — 387 
Balance, March 31, 2022$2,689 $1,177 $3,866 

Three Months Ended March 31, 2021
(In millions)Common StockRetained EarningsTotal Shareholder's Equity
Balance, December 31, 2020$2,058 $1,145 $3,203 
Net income— 59 59 
Common stock dividends— (28)(28)
Contributions from parent138 — 138 
Balance, March 31, 2021$2,196 $1,176 $3,372 

See the Combined Notes to Consolidated Financial Statements
38



Table of Contents

DELMARVA POWER & LIGHT COMPANY
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Operating revenues
Electric operating revenues$348 $300 
Natural gas operating revenues83 71 
Revenues from alternative revenue programs(1)9 
Operating revenues from affiliates1 2 
Total operating revenues431 382 
Operating expenses
Purchased power137 103 
Purchased fuel42 33 
Purchased power from affiliates10 20 
Operating and maintenance51 44 
Operating and maintenance from affiliates 42 39 
Depreciation and amortization57 53 
Taxes other than income taxes18 17 
Total operating expenses357 309 
Operating income74 73 
Other income and (deductions)
Interest expense, net(16)(15)
Other, net2 3 
Total other income and (deductions)(14)(12)
Income before income taxes60 61 
Income taxes4 5 
Net income$56 $56 
Comprehensive income$56 $56 
See the Combined Notes to Consolidated Financial Statements
39



Table of Contents
DELMARVA POWER & LIGHT COMPANY
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Cash flows from operating activities
Net income$56 $56 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization57 53 
Deferred income taxes and amortization of investment tax credits5 2 
Other non-cash operating activities9 (1)
Changes in assets and liabilities:
Accounts receivable(17)15 
Receivables from and payables to affiliates, net(17)(11)
Inventories8 2 
Accounts payable and accrued expenses15 11 
Income taxes(1)3 
Pension and non-pension postretirement benefit contributions(1)— 
Other assets and liabilities33 (26)
Net cash flows provided by operating activities147 104 
Cash flows from investing activities
Capital expenditures(103)(112)
Other investing activities1 — 
Net cash flows used in investing activities(102)(112)
Cash flows from financing activities
Changes in short-term borrowings(149)(146)
Issuance of long-term debt125 125 
Dividends paid on common stock(41)(40)
Contributions from parent144 120 
Other financing activities(2)(2)
Net cash flows provided by financing activities77 57 
Increase in cash, restricted cash, and cash equivalents122 49 
Cash, restricted cash, and cash equivalents at beginning of period71 15 
Cash, restricted cash, and cash equivalents at end of period$193 $64 
Supplemental cash flow information
Decrease in capital expenditures not paid$(8)$(15)
    
See the Combined Notes to Consolidated Financial Statements
40



Table of Contents
DELMARVA POWER & LIGHT COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
ASSETS
Current assets
Cash and cash equivalents$120 $28 
Restricted cash and cash equivalents73 43 
Accounts receivable
Customer accounts receivable164149
Customer allowance for credit losses(24)(18)
Customer accounts receivable, net140 131 
Other accounts receivable6258
Other allowance for credit losses(9)(8)
Other accounts receivable, net53 50 
Receivables from affiliates— 1 
Inventories, net
Fossil fuel4 11 
Materials and supplies53 54 
Prepaid utility taxes10 20 
Regulatory assets66 68 
Other19 16 
Total current assets538 422 
Property, plant, and equipment (net of accumulated depreciation and amortization of $1,671 and $1,635 as of March 31, 2022 and December 31, 2021, respectively)
4,612 4,560 
Deferred debits and other assets
Regulatory assets208 212 
Prepaid pension asset157 157 
Other58 61 
Total deferred debits and other assets423 430 
Total assets$5,573 $5,412 
See the Combined Notes to Consolidated Financial Statements
41



Table of Contents
DELMARVA POWER & LIGHT COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities
Short-term borrowings$— $149 
Long-term debt due within one year83 83 
Accounts payable128 131 
Accrued expenses50 40 
Payables to affiliates15 33 
Customer deposits27 28 
Regulatory liabilities 33 25 
Other88 59 
Total current liabilities424 548 
Long-term debt1,852 1,727 
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits825 803 
Asset retirement obligations16 16 
Non-pension postretirement benefits obligations10 11 
Regulatory liabilities423 441 
Other87 89 
Total deferred credits and other liabilities1,361 1,360 
Total liabilities3,637 3,635 
Commitments and contingencies
Shareholder's equity
Common stock 1,353 1,209 
Retained earnings583 568 
Total shareholder's equity1,936 1,777 
Total liabilities and shareholder's equity$5,573 $5,412 
See the Combined Notes to Consolidated Financial Statements
42



Table of Contents
DELMARVA POWER & LIGHT COMPANY
STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(Unaudited)
Three Months Ended March 31, 2022
(In millions)Common Stock Retained EarningsTotal Shareholder's Equity
Balance, December 31, 2021$1,209 $568 $1,777 
Net income— 56 56 
Common stock dividends— (41)(41)
Contributions from parent144 — 144 
Balance, March 31, 2022$1,353 $583 $1,936 

Three Months Ended March 31, 2021
(In millions)Common Stock Retained EarningsTotal Shareholder's Equity
Balance, December 31, 2020$1,089 $587 $1,676 
Net income— 56 56 
Common stock dividends— (40)(40)
Contributions from parent120 — 120 
Balance, March 31, 2021$1,209 $603 $1,812 

See the Combined Notes to Consolidated Financial Statements
43



Table of Contents

ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Operating revenues
Electric operating revenues$345 $298 
Revenues from alternative revenue programs3 11 
Operating revenues from affiliates1 1 
Total operating revenues349 310 
Operating expenses
Purchased power176 153 
Purchased power from affiliate2 4 
Operating and maintenance47 42 
Operating and maintenance from affiliates37 34 
Depreciation and amortization47 47 
Taxes other than income taxes2 2 
Total operating expenses311 282 
Operating income38 28 
Other income and (deductions)
Interest expense, net(14)(15)
Other, net3 1 
Total other income and (deductions)(11)(14)
Income before income taxes27 14 
Income taxes1 — 
Net income$26 $14 
Comprehensive income$26 $14 
See the Combined Notes to Consolidated Financial Statements
44



Table of Contents
ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
(In millions)20222021
Cash flows from operating activities
Net income$26 $14 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization47 47 
Deferred income taxes and amortization of investment tax credits1 (1)
Other non-cash operating activities2 (7)
Changes in assets and liabilities:
Accounts receivable(1)13 
Receivables from and payables to affiliates, net(6)1 
Inventories(1)3 
Accounts payable and accrued expenses(17)(11)
Income taxes— 1 
Pension and non-pension postretirement benefit contributions(7)(3)
Other assets and liabilities— (3)
Net cash flows provided by operating activities44 54 
Cash flows from investing activities
Capital expenditures(87)(123)
Net cash flows used in investing activities(87)(123)
Cash flows from financing activities
Changes in short-term borrowings(144)(187)
Issuance of long-term debt175 350 
Retirement of long-term debt— (44)
Dividends paid on common stock(19)(14)
Contributions from parent173 303 
Other financing activities(3)(3)
Net cash flows provided by financing activities 182 405 
Increase in cash, restricted cash, and cash equivalents139 336 
Cash, restricted cash, and cash equivalents at beginning of period29 30 
Cash, restricted cash, and cash equivalents at end of period$168 $366 
Supplemental cash flow information
Decrease in capital expenditures not paid$(10)$(2)
See the Combined Notes to Consolidated Financial Statements
45



Table of Contents
ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
ASSETS
Current assets
Cash and cash equivalents$168 $29 
Accounts receivable
Customer accounts receivable177190
Customer allowance for credit losses(49)(49)
Customer accounts receivable, net128 141 
Other accounts receivable7976
Other allowance for credit losses(14)(15)
Other accounts receivable, net65 61 
Receivables from affiliates— 2 
Inventories, net37 36 
Regulatory assets137 61 
Other5 3 
Total current assets540 333 
Property, plant, and equipment (net of accumulated depreciation and amortization of $1,458 and $1,420 as of March 31, 2022 and December 31, 2021, respectively)
3,763 3,729 
Deferred debits and other assets
Regulatory assets559 430 
Prepaid pension asset30 27 
Other37 37 
Total deferred debits and other assets626 494 
Total assets$4,929 $4,556 
See the Combined Notes to Consolidated Financial Statements
46



Table of Contents
ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)March 31, 2022December 31, 2021
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities
Short-term borrowings$— $144 
Long-term debt due within one year3 3 
Accounts payable139 165 
Accrued expenses43 44 
Payables to affiliates23 31 
Customer deposits18 18 
Regulatory liabilities20 28 
PPA termination obligation85 — 
Other18 12 
Total current liabilities349 445 
Long-term debt1,754 1,579 
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits692 682 
Non-pension postretirement benefit obligations11 12 
Regulatory liabilities203 214 
Other165 49 
Total deferred credits and other liabilities1,071 957 
Total liabilities3,174 2,981 
Commitments and contingencies
Shareholder's equity
Common stock1,763 1,590 
Retained deficit(8)(15)
Total shareholder's equity1,755 1,575 
Total liabilities and shareholder's equity$4,929 $4,556 

See the Combined Notes to Consolidated Financial Statements
47



Table of Contents
ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(Unaudited)
Three Months Ended March 31, 2022
(In millions)Common StockRetained DeficitTotal Shareholder's Equity
Balance, December 31, 2021$1,590 $(15)$1,575 
Net income— 26 26 
Common stock dividends— (19)(19)
Contributions from parent173 — 173 
Balance, March 31, 2022$1,763 $(8)$1,755 

Three Months Ended March 31, 2021
(In millions)Common Stock Retained EarningsTotal Shareholder's Equity
Balance, December 31, 2020$1,271 $127 $1,398 
Net income— 14 14 
Common stock dividends— (14)(14)
Contributions from parent303 — 303 
Balance, March 31, 2021$1,574 $127 $1,701 

See the Combined Notes to Consolidated Financial Statements
48



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per share data, unless otherwise noted)

Note 1 — Significant Accounting Policies

1. Significant Accounting Policies (All Registrants)
Description of Business
Exelon is a utility services holding company engaged in the energy distribution and transmission businesses through ComEd, PECO, BGE, Pepco, DPL, and ACE.
On February 21, 2021, Exelon's Board of Directors approved a plan to separate the Utility Registrants and Generation. The separation was completed on February 1, 2022, creating two publicly traded companies, Exelon and Constellation. See Note 2 — Discontinued Operations for additional information.
Name of Registrant  Business  Service Territories
Commonwealth Edison CompanyPurchase and regulated retail sale of electricityNorthern Illinois, including the City of Chicago
Transmission and distribution of electricity to retail customers
PECO Energy CompanyPurchase and regulated retail sale of electricity and natural gasSoutheastern Pennsylvania, including the City of Philadelphia (electricity)
Transmission and distribution of electricity and distribution of natural gas to retail customersPennsylvania counties surrounding the City of Philadelphia (natural gas)
Baltimore Gas and Electric CompanyPurchase and regulated retail sale of electricity and natural gasCentral Maryland, including the City of Baltimore (electricity and natural gas)
Transmission and distribution of electricity and distribution of natural gas to retail customers
Pepco Holdings LLCUtility services holding company engaged, through its reportable segments Pepco, DPL, and ACEService Territories of Pepco, DPL, and ACE
Potomac Electric 
Power Company		  Purchase and regulated retail sale of electricity  District of Columbia, and major portions of Montgomery and Prince George’s Counties, Maryland
Transmission and distribution of electricity to retail customers
Delmarva Power &
Light Company		Purchase and regulated retail sale of electricity and natural gasPortions of Delaware and Maryland (electricity)
Transmission and distribution of electricity and distribution of natural gas to retail customersPortions of New Castle County, Delaware (natural gas)
Atlantic City Electric CompanyPurchase and regulated retail sale of electricityPortions of Southern New Jersey
Transmission and distribution of electricity to retail customers
Basis of Presentation
This is a combined quarterly report of all Registrants. The Notes to the Consolidated Financial Statements apply to the Registrants as indicated parenthetically next to each corresponding disclosure. When appropriate, the Registrants are named specifically for their related activities and disclosures. Each of the Registrant’s Consolidated Financial Statements includes the accounts of its subsidiaries. All intercompany transactions have been eliminated, except for the historical transactions between the Utility Registrants and Generation for the purposes of presenting discontinued operations in all periods presented in the Consolidated Statements of Operations and Comprehensive Income.
Through its business services subsidiary, BSC, Exelon provides its subsidiaries with a variety of support services at cost, including legal, human resources, financial, information technology, and supply management services. PHI also has a business services subsidiary, PHISCO, which provides a variety of support services at cost, including legal, accounting, engineering, customer operations, distribution and transmission planning, asset management, system operations, and power procurement, to PHI operating companies. The costs of BSC and PHISCO are directly charged or allocated to the applicable subsidiaries. The results of Exelon’s corporate operations are presented as “Other” in the consolidated financial statements and include intercompany eliminations unless otherwise disclosed.
The accompanying consolidated financial statements as of March 31, 2022 and for the three months ended March 31, 2022 and 2021 are unaudited but, in the opinion of the management of each Registrant include all adjustments that are considered necessary for a fair statement of the Registrants’ respective financial statements in accordance with GAAP. All adjustments are of a normal, recurring nature, except as otherwise disclosed. The
49



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per share data, unless otherwise noted)

Note 1 — Significant Accounting Policies
December 31, 2021 Consolidated Balance Sheets were derived from audited financial statements. The interim financial statements are to be read in conjunction with prior annual financial statements and notes. Additionally, financial results for interim periods are not necessarily indicative of results that may be expected for any other interim period or for the fiscal year ending December 31, 2022. These Combined Notes to Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the SEC for Quarterly Reports on Form 10-Q. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations.
The separation of Constellation, including Generation and its subsidiaries, meets the criteria for discontinued operations and as such, results of operations are presented as discontinued operations and have been excluded from continuing operations for all periods presented. Accounting rules require that certain BSC costs previously allocated to Generation be presented as part of Exelon’s continuing operations as these costs do not qualify as expenses of the discontinued operations. Comprehensive income, shareholders' equity, and cash flows related to Constellation have not been segregated and are included in the Consolidated Statements of Operations and Comprehensive Income, Consolidated Statements of Changes in Shareholders’ Equity, and Consolidated Statements of Cash Flows, respectively, for all periods presented. See Note 2 — Discontinued Operations for additional information.
Prior Period Adjustments and Reclassifications (Exelon, PHI, ACE)
In the first quarter of 2022, management identified an error related to an overstatement of the regulatory liability associated with ACE’s mechanism to recover the cost of Transition Bonds issued in 2002 and 2003 by ACE Funding. Management has concluded that the error was not material to previously issued financial statements for Exelon, PHI or ACE.
The error was corrected through a revision to ACE’s financial statements contained herein. The impact of the error correction was an $8 million increase to ACE’s opening Retained earnings as of January 1, 2021 with a corresponding reduction to Regulatory liabilities of $11 million and an increase to Deferred income taxes and unamortized investment tax credits of $3 million. The impact of the error to ACE’s Total operating revenues and Net income was less than $1 million for the three months ended March 31, 2021. The error did not impact net cash flows provided by operating activities, net cash flows used in investing activities or net cash flows provided by financing activities for the three months ended March 31, 2021.
The error was corrected in the Exelon and PHI financial statements for the three months ended March 31, 2022 as it was not material, resulting in an increase to Net income of $8 million.
2. Discontinued Operations (Exelon)
On February 21, 2021, Exelon's Board of Directors approved a plan to separate the Utility Registrants and Generation, creating two publicly traded companies ("the separation"). Exelon completed the separation on February 1, 2022, through the distribution of 326,663,937 common stock shares of Constellation, the new publicly traded company, to Exelon shareholders. Under the separation plan, Exelon shareholders retained their current shares of Exelon stock and received one share of Constellation common stock for every three shares of Exelon common stock held on January 20, 2022, the record date for the distribution, in a transaction that is tax-free to Exelon and its shareholders for U.S. federal income tax purposes.
Constellation was newly formed and incorporated in Pennsylvania on June 15, 2021 for the purposes of separation and holds Generation (including Generation's subsidiaries).
Pursuant to the separation:
•Exelon entered into four term loans consisting of a 364-day term loan for $1.15 billion and three 18-month term loans for $300 million, $300 million and $250 million, respectively. Exelon issued these term loans primarily to fund the cash payment to Constellation and for general corporate purposes. See Note 10 — Debt and Credit Agreements for additional information.
•Exelon made a cash payment of $1.75 billion to Constellation on January 31, 2022.
50



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
•Exelon contributed its equity ownership interest in Generation to Constellation. Exelon no longer retains any equity ownership interest in Generation or Constellation.
•Exelon transferred certain corporate assets and employee-related obligations to Constellation.
•Exelon received cash from Generation of $258 million to settle the intercompany loan on January 31, 2022. See Note 10 — Debt and Credit Agreements for additional information.
Continuing Involvement
In order to govern the ongoing relationships between Exelon and Constellation after the separation, and to facilitate an orderly transition, Exelon and Constellation have entered into several agreements, including the following:
•Separation Agreement – governs the rights and obligations between Exelon and Constellation regarding certain actions to be taken in connection with the separation, among others, including the allocation of assets and liabilities between Exelon and Constellation.
•Transition Services Agreement (TSA) – governs the terms and conditions of the services that Exelon will provide to Constellation and Constellation will provide to Exelon for an expected period of two years, provided that certain services may be longer than the term and services may be extended with approval from both parties. The services include specified accounting, finance, information technology, human resources, employee benefits and other services that have historically been provided on a centralized basis by BSC. For the period from February 1, 2022 to March 31, 2022, the amounts Exelon billed Constellation and Constellation billed Exelon for these services were $56 million recorded in Other income, net and $9 million recorded in Operating and maintenance expense, respectively.
•Tax Matters Agreement (TMA) – governs the respective rights, responsibilities and obligations of Exelon and Constellation with respect to all tax matters, including tax liabilities and benefits, tax attributes, tax returns, tax contests and other tax sharing regarding U.S. federal, state, local and foreign income taxes, other tax matters and related tax returns. See Note 7. Income Taxes for additional information.
In addition, the Utility Registrants will continue to incur expenses from transactions with Generation after the separation. Prior to the separation, such expenses were primarily recorded as Purchased power from affiliates and an immaterial amount recorded as Operating and maintenance expense from affiliates at the Utility Registrants. After the separation, such expenses are primarily recorded as Purchased power and an immaterial amount recorded as Operating and maintenance expense at the Utility Registrants.
•ComEd had an ICC-approved RFP contract with Generation to provide a portion of ComEd’s electric supply requirements. ComEd also purchased RECs and ZECs from Generation.
•PECO received electric supply from Generation under contracts executed through PECO’s competitive procurement process. In addition, PECO had a ten-year agreement with Generation to sell solar AECs.
•BGE received a portion of its energy requirements from Generation under its MDPSC-approved market-based SOS and gas commodity programs.
•Pepco received electric supply from Generation under contracts executed through Pepco’s competitive procurement process approved by the MDPSC and DCPSC.
•DPL received a portion of its energy requirements from Generation under its MDPSC and DEPSC approved market-based SOS commodity programs.
•ACE received electric supply from Generation under contracts executed through ACE’s competitive procurement process approved by the NJBPU.
ComEd and PECO also have receivables with Generation as a result of the nuclear decommissioning contractual construct whereby, to the extent NDT funds are greater than the underlying ARO at the end of decommissioning, such amounts are due back to ComEd and PECO, as applicable, for payment to their respective customers. See Note 10 — Asset Retirement Obligations of the Combined Notes to Consolidated Financial Statements of the Exelon 2021 Form 10-K and Note 15 — Related Party Transactions for additional information.
51



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
Discontinued Operations
The separation represented a strategic shift that would have a major effect on Exelon’s operations and financial results. Accordingly, the separation meets the criteria for discontinued operations.
The following table presents the results of Constellation that have been reclassified from continuing operations and included in discontinued operations within Exelon’s Consolidated Statements of Operations and Comprehensive Income for the three months ended March 31, 2022 and March 31, 2021.
These results are primarily Generation, which is comprised of Exelon’s Mid-Atlantic, Midwest, New York, ERCOT, and Other Power Regions reportable segments, and include the impact of transaction costs, certain BSC costs, including any transition costs, that were historically allocated and directly attributable to Generation, transactions between Generation and the Utility Registrants, and tax-related adjustments. Transaction costs include costs for external bankers, accountants, appraisers, lawyers, external counsels and other advisors, among others, who are involved in the negotiation, appraisal, due diligence and regulatory approval of the separation. Transition costs are primarily employee-related costs such as recruitment expenses, costs to establish certain stand-alone functions and information technology systems, professional services fees and other separation-related costs during the transition to separate Generation. For the purposes of reporting discontinued operations, these results also include transactions between Generation and the Utility Registrants that were historically eliminated within Exelon’s Consolidated Statements of Operations as these transactions will be ongoing after the separation. Certain BSC costs that were historically allocated to Generation are presented as part of continuing operations in Exelon’s Consolidated Statements of Operations as these costs do not qualify as expenses of the discontinued operations per the accounting rules.
Three Months Ended
March 31,
20222021
Operating revenues
Competitive business revenues$1,855 $5,265 
Competitive business revenues from affiliates161 294 
Total operating revenues2,016 5,559 
Operating expenses
Competitive businesses purchased power and fuel1,138 4,610 
Operating and maintenance(a)
371 904 
Depreciation and amortization94 940 
Taxes other than income taxes44 121 
Total operating expenses1,647 6,575 
Gain on sales of assets and businesses10 71 
Operating income (loss)379 (945)
Other income and (deductions)
Interest expense, net(20)(68)
Other, net(281)167 
Total other income and (deductions) (301)99 
Income (loss) before income taxes78 (846)
Income taxes(40)(58)
Equity in losses of unconsolidated affiliates(1)(1)
Net income (loss)117 (789)
Net income attributable to noncontrolling interests1 25 
Net income (loss) from discontinued operations$116 $(814)
52



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
__________
(a)Includes transaction and transition costs related to the separation of $52 million and $3 million for the three months ended March 31, 2022 and 2021, respectively. $50 million and $2 million of transaction costs and $2 million and less than $1 million of transition costs are included in the results of discontinued operations in the table presented above for the three months ended March 31, 2022 and March 31, 2021, respectively. See discussion above for additional information.
There were no assets and liabilities of discontinued operations included in Exelon’s Consolidated Balance Sheet as of March 31, 2022. Constellation had net assets of $11,573 million that separated on February 1, 2022 that resulted in a reduction to Exelon’s equity during the three months ended March 31, 2022. Refer to the Distribution of Constellation line in Exelon’s Consolidated Statement of Changes in Shareholders’ Equity for further information.
The following table presents the assets and liabilities of discontinued operations in Exelon’s Consolidated Balance Sheet as of December 31, 2021:
December 31, 2021
ASSETS
Current assets
Cash and cash equivalents$510 
Restricted cash and cash equivalents72 
Accounts receivable
Customer accounts receivable1,724
Customer allowance for credit losses(55)
Customer accounts receivable, net1,669 
Other accounts receivable596
Other allowance for credit losses(4)
Other accounts receivable, net592 
Mark-to-market derivative assets2,169 
Inventories, net
Fossil fuel and emission allowances284 
Materials and supplies1,004 
Renewable energy credits529 
Assets held for sale 13 
Other993 
Total current assets of discontinued operations7,835 
Property, plant, and equipment (net of accumulated depreciation and amortization of $15,888)
19,661 
Deferred debits and other assets
Nuclear decommissioning trust funds15,938 
Investments193 
Mark-to-market derivative assets949 
Other1,768 
Total property, plant, and equipment, deferred debits, and other assets of discontinued operations38,509 
Total assets of discontinued operations$46,344 
53



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
December 31, 2021
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Short-term borrowings$2,082 
Long-term debt due within one year1,220 
Accounts payable1,757 
Accrued expenses818 
Mark-to-market derivative liabilities981 
Renewable energy credit obligation779 
Liabilities held for sale 3 
Other300 
Total current liabilities of discontinued operations7,940 
Long-term debt4,575 
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits3,583 
Asset retirement obligations12,819 
Pension obligations939 
Non-pension postretirement benefit obligations876 
Spent nuclear fuel obligation1,210 
Mark-to-market derivative liabilities513 
Other1,161 
Total long-term debt, deferred credits, and other liabilities of discontinued operations25,676 
Total liabilities of discontinued operations$33,616 
The following table presents selected financial information regarding cash flows of the discontinued operations that are included within Exelon’s Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and March 31, 2021.
Three Months Ended March 31, 2022
20222021
Non-cash items included in net income (loss) from discontinued operations:
Depreciation, amortization, and accretion, including nuclear fuel and energy contract amortization$207 $1,346 
Gain on sales of assets and businesses9 (71)
Deferred income taxes and amortization of investment tax credits(143)(234)
Net fair value changes related to derivatives(59)(178)
Net realized and unrealized losses (gains) on NDT fund investments205 (118)
Net unrealized losses on equity investments16 23 
Other decommissioning-related activity36 (332)
Cash flows from investing activities:
Capital expenditures(227)(394)
Collection of DPP169 1,574 
Supplemental cash flow information:
Decrease in capital expenditures not paid(128)(37)
Increase in DPP348 1,339 
Increase in PP&E related to ARO update335 — 
54



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 3 — Regulatory Matters
3. Regulatory Matters (All Registrants)
As discussed in Note 3 — Regulatory Matters of the Exelon 2021 Form 10-K, the Registrants are involved in rate and regulatory proceedings at FERC and their state commissions. The following discusses developments in 2022 and updates to the 2021 Form 10-K.
Distribution Base Rate Case Proceedings
The following tables show the completed and pending distribution base rate case proceedings in 2022.
Completed Distribution Base Rate Case Proceedings
Registrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseApproved Revenue Requirement IncreaseApproved ROEApproval DateRate Effective Date
ComEd - Illinois(a)
April 16, 2021Electric$51 $46 7.36 %December 1, 2021January 1, 2022
PECO - PennsylvaniaMarch 30, 2021Electric246 132 
N/A(b)
November 18, 2021January 1, 2022
BGE - Maryland(c)
May 15, 2020 (amended September 11, 2020)Electric203 140 9.50 %December 16, 2020January 1, 2021
Natural Gas108 74 9.65 %
Pepco - District of Columbia(d)
May 30, 2019 (amended June 1, 2020)Electric136 109 9.275 %June 8, 2021July 1, 2021
Pepco - Maryland(e)
October 26, 2020 (amended March 31, 2021)Electric104 52 9.55 %June 28, 2021June 28, 2021
DPL - Maryland(f)
September 1, 2021 (amended December 23, 2021)Electric27 13 9.60 %March 2, 2022March 2, 2022
ACE - New Jersey(g)
December 9, 2020 (amended February 26, 2021)Electric67 41 9.60 %July 14, 2021January 1, 2022
__________
(a)ComEd's 2022 approved revenue requirement reflects an increase of $37 million for the initial year revenue requirement for 2022 and an increase of $9 million related to the annual reconciliation for 2020. The revenue requirement for 2022 provides for a weighted average debt and equity return on distribution rate base of 5.72%, inclusive of an allowed ROE of 7.36%, reflecting the monthly average yields for 30-year treasury bonds plus 580 basis points. The reconciliation revenue requirement for 2020 provides for a weighted average debt and equity return on distribution rate base of 5.69%, inclusive of an allowed ROE of 7.29%, reflecting the monthly yields on 30-year treasury bonds plus 580 basis points less a performance metrics penalty of 7 basis points.
(b)The PECO electric base rate case proceeding was resolved through a settlement agreement, which did not specify an approved ROE.
(c)Reflects a three-year cumulative multi-year plan for 2021 through 2023. The MDPSC awarded BGE electric revenue requirement increases of $59 million, $39 million, and $42 million, before offsets, in 2021, 2022, and 2023, respectively, and natural gas revenue requirement increases of $53 million, $11 million, and $10 million, before offsets, in 2021, 2022, and 2023, respectively. BGE proposed to use certain tax benefits to fully offset the increases in 2021 and 2022 and partially offset the increase in 2023. However, the MDPSC utilized the tax benefits to fully offset the increases in 2021 and January 2022 such that customer rates remained unchanged. For the remainder of 2022, the MDPSC chose to offset only 25% of the cumulative 2021 and 2022 electric revenue requirement increases and 50% of the cumulative gas revenue requirement increases. Whether certain tax benefits will be used to offset the customer rate increases in 2023 has not been decided, and BGE cannot predict the outcome.
(d)Reflects a cumulative multi-year plan with 18-months remaining in 2021 through 2022. The DCPSC awarded Pepco electric incremental revenue requirement increases of $42 million and $67 million, before offsets, for 2021 and 2022, respectively. However, the DCPSC utilized the acceleration of refunds for certain tax benefits along with other rate relief to partially offset the customer rate increases by $22 million and $40 million for 2021 and 2022, respectively.
55



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 3 — Regulatory Matters
(e)Reflects a three-year cumulative multi-year plan for April 1, 2021 through March 31, 2024. The MDPSC awarded Pepco electric incremental revenue requirement increases of $21 million, $16 million, and $15 million, before offsets, for the 12-month periods ending March 31, 2022, 2023, and 2024, respectively. Pepco proposed to utilize certain tax benefits to fully offset the increase through 2023 and partially offset customer rate increases in 2024. However, the MDPSC only utilized the acceleration of refunds for certain tax benefits to fully offset the increases such that customer rates remain unchanged through March 31, 2022. On February 23, 2022, the MDPSC chose to offset 25% of the cumulative revenue requirement increase for the 12-month period ending March 31, 2023. Whether certain tax benefits will be used to offset the customer rate increases for the 12-month period ending March 31, 2024 has not been decided, and Pepco cannot predict the outcome.
(f)The approved settlement reflects a 9.60% ROE, which is solely for the purposes of calculating AFUDC and regulatory asset carrying costs.
(g)Requested and approved increases are before New Jersey sales and use tax. The order allows ACE to retain approximately $11 million of certain tax benefits which resulted in a decrease to income tax expense in Exelon's, PHI's, and ACE's Consolidated Statements of Operations and Comprehensive Income in the third quarter of 2021.
Pending Distribution Base Rate Case Proceedings
Registrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseRequested ROEExpected Approval Timing
ComEd - Illinois(a)
April 15, 2022Electric$199 7.85 %Fourth quarter of 2022
PECO - PennsylvaniaMarch 31, 2022Natural Gas82 10.95 %Fourth quarter of 2022
DPL - Delaware(b)
January 14, 2022 (amended February 28, 2022)Natural Gas15 10.30 %First quarter of 2023
__________
(a)ComEd's 2023 requested revenue requirement reflects an increase of $144 million for the initial year revenue requirement for 2023 and an increase of $55 million related to the annual reconciliation for 2021. The revenue requirement for 2023 provides for a weighted average debt and equity return on distribution rate base of 5.94%, inclusive of an allowed ROE of 7.85%, reflecting the average monthly yields for 30-year treasury bonds plus 580 basis points. The reconciliation revenue requirement for 2021 provides for a weighted average debt and equity return on distribution rate base of 5.91%, inclusive of an allowed ROE of 7.78%, reflecting the average monthly yields for 30-year treasury bonds plus 580 basis points less a performance metrics penalty of 7 basis points. This is ComEd's last performance-based electric distribution formula rate update filing under EIMA as a result of the law authorizing the rate setting process sunsetting at the end of 2022. See Note 3. - Regulatory Matters of the Exelon 2021 Form 10-K for additional information on ComEd's transition away from the electric distribution formula rate.
(b)The rates will go into effect on August 14, 2022, subject to refund.
Transmission Formula Rates
The Utility Registrants' transmission rates are each established based on a FERC-approved formula. ComEd, BGE, Pepco, DPL, and ACE are required to file an annual update to the FERC-approved formula on or before May 15, and PECO is required to file on or before May 31, with the resulting rates effective on June 1 of the same year. The annual update for ComEd is based on prior year actual costs and current year projected capital additions (initial year revenue requirement). The update for ComEd also reconciles any differences between the revenue requirement in effect beginning June 1 of the prior year and actual costs incurred for that year (annual reconciliation). The annual update for BGE is based on prior year actual costs and current year projected capital additions, accumulated depreciation, depreciation and amortization expense, and accumulated deferred income taxes. The update for BGE also reconciles any differences between the actual costs and actual revenues for the calendar year (annual reconciliation).
For 2022, the following total increases were included in ComEd’s and BGE's electric transmission formula rate update. PECO, Pepco, DPL, and ACE intend to file by the required deadline for the annual update.
Registrant(a)
Initial Revenue Requirement IncreaseAnnual Reconciliation DecreaseTotal Revenue Requirement Increase
Allowed Return on Rate Base(c)
Allowed ROE(d)
ComEd$24 $(24)$— 8.11 %11.50 %
BGE25 (4)16 (b)7.30 %10.50 %
56



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 3 — Regulatory Matters
(a)All rates are effective June 1, 2022 - May 31, 2023, subject to review by interested parties pursuant to review protocols of ComEd's and BGE's tariff.
(b)The increase in BGE's transmission revenue requirement includes a $5 million reduction related to a FERC-approved dedicated facilities charge to recover the costs of providing transmission service to specifically designated load by BGE.
(c)Represents the weighted average debt and equity return on transmission rate bases.
(d)As part of the FERC-approved settlements of ComEd’s 2007 transmission rate case, the rate of return on common equity is 11.50%, inclusive of a 50-basis-point incentive adder for being a member of a RTO, and the common equity component of the ratio used to calculate the weighted average debt and equity return for the transmission formula rate is currently capped at 55%. As part of the FERC-approved settlement of the ROE complaint against BGE, the rate of return on common equity is 10.50%, inclusive of a 50-basis-point incentive adder for being a member of a RTO.
Other State Regulatory Matters
Illinois Regulatory Matters
CEJA (Exelon and ComEd). On September 15, 2021, the Governor of Illinois signed into law CEJA. CEJA includes, among other features, (1) procurement of CMCs from qualifying nuclear-powered generating facilities, (2) a requirement to file a general rate case or a new four-year multi-year plan no later than January 20, 2023 to establish rates effective after ComEd’s existing performance-based distribution formula rate sunsets, (3) an extension of and certain adjustments to ComEd’s energy efficiency MWh savings goals, (4) revisions to the Illinois RPS requirements, including expanded charges for the procurement of RECs from wind and solar generation, (5) a requirement to accelerate amortization of ComEd’s unprotected excess deferred income taxes ("EDIT") that ComEd was previously directed by the ICC to amortize using the average rate assumption method which equates to approximately 39.5 years, and (6) requirements that the ICC initiate and conduct various regulatory proceedings on subjects including ethics, spending, grid investments, and performance metrics. Regulatory or legal challenges regarding the validity or implementation of CEJA are possible and Exelon and ComEd cannot reasonably predict the outcome of any such challenges.
The ICC initiated a docket to accelerate and fully credit to customers TCJA unprotected property-related EDIT no later than December 31, 2025. On April 13, 2022, a stipulation and agreement on the schedule for the acceleration of EDIT amortization was submitted by ComEd, the Illinois Attorney General's Office, and the Citizens Utility Board. At this time, ComEd cannot predict an outcome of these proceedings.

See Note 3 — Regulatory Matters of the Exelon 2021 Form 10-K for additional information on CEJA (referred to as Clean Energy Law).
New Jersey Regulatory Matters
Termination of Energy Procurement Provisions of PPAs (Exelon, PHI, and ACE).

On December 22, 2021, ACE filed with the NJBPU a petition to terminate the provisions in the PPAs to purchase electricity from two coal-powered generation facilities located in the state of New Jersey. The petition was approved by the NJBPU on March 23, 2022. Upon closing of the transaction on March 31, 2022, ACE recognized a liability of $203 million for the contract termination fee, which is to be paid by the end of 2024, and recognized a corresponding regulatory asset of $203 million.
As of March 31, 2022, the $203 million liability for the contract termination fee consists of $85 million and $118 million included in Other current liabilities and Other deferred credits and other liabilities, respectively, in Exelon's Consolidated Balance Sheet. As of March 31, 2022, the current and noncurrent liability is included in PPA termination obligation and Other deferred credits and other liabilities, respectively, in PHI's and ACE's Consolidated Balance Sheets.
Regulatory Assets and Liabilities
The Utility Registrants' regulatory assets and liabilities have not changed materially since December 31, 2021, unless noted below. See Note 3 — Regulatory Matters of the Exelon 2021 Form 10-K for additional information on the specific regulatory assets and liabilities.
57



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 3 — Regulatory Matters
PECO. Regulatory assets increased $66 million primarily due to an increase of $60 million in the Deferred Income Taxes regulatory asset. Regulatory liabilities decreased by $112 million primarily due to a decrease of $111 million in the Nuclear Decommissioning regulatory liability.
BGE. Regulatory assets decreased $50 million primarily due to a decrease of $19 million in the Electric Energy and Natural Gas Costs regulatory asset and $16 million in the Energy Efficiency and Demand Response Programs regulatory asset. Regulatory liabilities decreased $53 million primarily due to a decrease of $65 million in the Deferred Income Taxes regulatory liability.
ACE. Regulatory assets increased $205 million primarily due to an increase in the Electric Energy Costs regulatory asset as a result of the PPA termination. Regulatory liabilities decreased $19 million primarily due to a decrease of $9 million in the Deferred Income Taxes regulatory liability and $5 million in the Electric Energy Costs regulatory liability.
Capitalized Ratemaking Amounts Not Recognized
The following table presents authorized amounts capitalized for ratemaking purposes related to earnings on shareholders' investment that are not recognized for financial reporting purposes in the Registrants' Consolidated Balance Sheets. These amounts will be recognized as revenues in the related Consolidated Statements of Operations and Comprehensive Income in the periods they are billable to the Utility Registrants' customers.
Exelon
ComEd(a)
PECO
BGE(b)
PHI
Pepco(c)
DPL(c)
ACE
March 31, 2022$49 $2 $— $34 $13 $11 $2 $— 
December 31, 202143 1 — 37 5 3 2 — 
__________
(a)Reflects ComEd's unrecognized equity returns earned for ratemaking purposes on its energy efficiency and electric distribution formula rate regulatory assets.
(b)BGE's authorized amounts capitalized for ratemaking purposes primarily relate to earnings on shareholder's investment on its AMI programs.
(c)Pepco's and DPL's authorized amounts capitalized for ratemaking purposes relate to earnings on shareholder's investment on their respective AMI Programs and Energy Efficiency and Demand Response Programs, and for Pepco District of Columbia revenue decoupling program. The earnings on energy efficiency are on Pepco District of Columbia and DPL Delaware programs only.
4. Revenue from Contracts with Customers (All Registrants)
The Registrants recognize revenue from contracts with customers to depict the transfer of goods or services to customers at an amount that the entities expect to be entitled to in exchange for those goods or services. The primary sources of revenue include regulated electric and gas tariff sales, distribution, and transmission services.
See Note 4 — Revenue from Contracts with Customers of the Exelon 2021 Form 10-K for additional information regarding the primary sources of revenue for the Registrants.
Contract Liabilities
The Registrants record contract liabilities when consideration is received or due prior to the satisfaction of the performance obligations. The Registrants record contract liabilities in Other current liabilities and Other noncurrent liabilities in their Consolidated Balance Sheets.
For PHI, Pepco, DPL, and ACE these contract liabilities primarily relate to upfront consideration received in the third quarter of 2020 for a collaborative arrangement with an unrelated owner and manager of communication infrastructure. The revenue attributable to this arrangement will be recognized as operating revenue over the 35 years under the collaborative arrangement.
Revenues recognized were immaterial for Exelon, PHI, Pepco, DPL, and ACE for the three months ended March 31, 2022 and 2021. As of March 31, 2022 and December 31, 2021, ComEd's, PECO's, and BGE's contract liabilities were immaterial.
58



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 4 — Revenue from Contracts with Customers
Transaction Price Allocated to Remaining Performance Obligations
The following table shows the amounts of future revenues expected to be recorded in each year for performance obligations that are unsatisfied or partially unsatisfied as of March 31, 2022. This disclosure only includes contracts for which the total consideration is fixed and determinable at contract inception. The average contract term varies by customer type and commodity but ranges from one month to several years.
This disclosure excludes the Utility Registrants' gas and electric tariff sales contracts and transmission revenue contracts as they generally have an original expected duration of one year or less and, therefore, do not contain any future, unsatisfied performance obligations to be included in this disclosure.
20222023202420252026 and thereafterTotal
Exelon$6 $8 $6 $5 $82 $107 
PHI6 8 6 5 82 107 
Pepco4 6 5 5 65 85 
DPL1 1 — — 9 11 
ACE1 1 1 — 8 11 
Revenue Disaggregation
The Registrants disaggregate revenue recognized from contracts with customers into categories that depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. See Note 5 — Segment Information for the presentation of the Registrant's revenue disaggregation.
5. Segment Information (All Registrants)
Operating segments for each of the Registrants are determined based on information used by the CODMs in deciding how to evaluate performance and allocate resources at each of the Registrants.
Exelon has six reportable segments, which include ComEd, PECO, BGE, and PHI's three reportable segments consisting of Pepco, DPL, and ACE. ComEd, PECO, BGE, Pepco, DPL, and ACE each represent a single reportable segment, and as such, no separate segment information is provided for these Registrants. Exelon, ComEd, PECO, BGE, Pepco, DPL, and ACE's CODMs evaluate the performance of and allocate resources to ComEd, PECO, BGE, Pepco, DPL, and ACE based on net income.
An analysis and reconciliation of the Registrants’ reportable segment information to the respective information in the consolidated financial statements for the three months ended March 31, 2022 and 2021 is as follows:


59



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
Three Months Ended March 31, 2022 and 2021
ComEdPECOBGEPHI
Other(a)
Intersegment
Eliminations		Exelon
Operating revenues(b):
2022
Electric revenues$1,734 $741 $736 $1,318 $— $(7)$4,522 
Natural gas revenues— 306 418 83 — (2)$805 
Shared service and other revenues— — — 3 576 (579)$— 
Total operating revenues$1,734 $1,047 $1,154 $1,404 $576 $(588)$5,327 
2021
Electric revenues$1,535 $661 $632 $1,170 $— $(7)$3,991 
Natural gas revenues— 228 342 71 — — 641 
Shared service and other revenues— — — 3 491 (494)— 
Total operating revenues$1,535 $889 $974 $1,244 $491 $(501)$4,632 
Intersegment revenues(c):
2022$6 $1 $7 $3 $576 $(587)$6 
20216 2 6 3 487 (497)7 
Depreciation and amortization:
2022$321 $92 $171 $218 $15 $— $817 
2021292 86 152 210 17 — 757 
Operating expenses:
2022$1,406 $793 $919 $1,215 $625 $(531)$4,427 
20211,210 679 752 1,058 448 (339)3,808 
Interest expense, net:
2022$100 $41 $35 $69 $93 $— $338 
202196 38 34 67 83 — 318 
Income (loss) from continuing operations before income taxes:
2022$240 $220 $207 $137 $(62)$(43)$699 
2021236 177 196 136 (32)(149)564 
Income Taxes:
2022$52 $14 $9 $7 $146 $(10)$218 
202139 10 (13)8 7 (12)39 
Net income (loss) from continuing operations:
2022$188 $206 $198 $130 $(208)$(33)$481 
2021197 167 209 128 (39)(137)525 
Capital Expenditures:
2022$617 $344 $303 $409 $22 $— $1,695 
2021613 295 336 456 46 — 1,746 
Total assets:
March 31, 2022$37,013 $14,113 $12,509 $25,636 $7,583 $(4,156)$92,698 
December 31, 202136,470 13,824 12,324 24,744 7,634 (8,319)86,677 
__________
(a)Other primarily includes Exelon’s corporate operations, shared service entities, and other financing and investment activities.
(b)Includes gross utility tax receipts from customers. The offsetting remittance of utility taxes to the governing bodies is recorded in expenses in the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 14 — Supplemental Financial Information for additional information on total utility taxes.
60



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
(c)See Note 15 — Related Party Transactions for additional information on intersegment revenues.
PHI:
PepcoDPLACE
Other(a)
Intersegment
Eliminations		PHI
Operating revenues(b):
2022
Electric revenues$614 $348 $349 $— $7 $1,318 
Natural gas revenues— 83 — — — 83 
Shared service and other revenues— — — 107 (104)3 
Total operating revenues$614 $431 $349 $107 $(97)$1,404 
2021
Electric revenues$553 $311 $310 $— $(4)$1,170 
Natural gas revenues— 71 — — — 71 
Shared service and other revenues— — — 95 (92)3 
Total operating revenues$553 $382 $310 $95 $(96)$1,244 
Intersegment revenues(c):
2022$1 $1 $1 $97 $(97)$3 
20211 2 1 95 (96)3 
Depreciation and amortization:
2022$108 $57 $47 $6 $— $218 
2021102 53 47 8 — 210 
Operating expenses:
2022$547 $357 $311 $97 $(97)$1,215 
2021466 309 282 97 (96)1,058 
Interest expense, net:
2022$36 $16 $14 $3 $— $69 
202134 15 15 3 — 67 
Income (loss) before income taxes:
2022$44 $60 $27 $6 $— $137 
202165 61 14 (4)— 136 
Income Taxes:
2022$(2)$4 $1 $4 $— $7 
20216 5 — (3)— 8 
Net income (loss):
2022$46 $56 $26 $2 $— $130 
202159 56 14 (1)— 128 
Capital Expenditures:
2022$218 $103 $87 $1 $— $409 
2021220 112 123 1 — 456 
Total assets:
March 31, 2022$10,458 $5,573 $4,929 $4,720 $(44)$25,636 
December 31, 20219,903 5,412 4,556 4,933 (60)24,744 
__________
(a)Other primarily includes PHI’s corporate operations, shared service entities, and other financing and investment activities.
(b)Includes gross utility tax receipts from customers. The offsetting remittance of utility taxes to the governing bodies is recorded in expenses in the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 14 — Supplemental Financial Information for additional information on total utility taxes.
(c)Includes intersegment revenues with ComEd, BGE, and PECO, which are eliminated at Exelon.
61



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
The following tables disaggregate the Registrants' revenues recognized from contracts with customers into categories that depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. For the Utility Registrants, the disaggregation of revenues reflects the two primary utility services of electric sales and natural gas sales (where applicable), with further disaggregation of these tariff sales provided by major customer groups. Exelon’s disaggregated revenues are consistent with the Utility Registrants, but exclude any intercompany revenues.
Three Months Ended March 31, 2022
Revenues from contracts with customersComEdPECOBGEPHIPepcoDPLACE
Electric revenues
Residential$857 $487 $417 $652 $275 $207 $170 
Small commercial & industrial423 111 81 141 38 56 47 
Large commercial & industrial153 64 131 323 253 26 44 
Public authorities & electric railroads14 8 7 16 8 4 4 
Other(a)
239 62 97 193 46 56 81 
Total electric revenues(b)
$1,686 $732 $733 $1,325 $620 $349 $346 
Natural gas revenues
Residential$— $218 $282 $51 $— $51 $— 
Small commercial & industrial— 76 45 21 — 21 — 
Large commercial & industrial— — 65 3 — 3 — 
Transportation— 8 — 4 — 4 — 
Other(c)
— 3 35 4 — 4 — 
Total natural gas revenues(d)
$— $305 $427 $83 $— $83 $— 
Total revenues from contracts with customers$1,686 $1,037 $1,160 $1,408 $620 $432 $346 
Other revenues
Revenues from alternative revenue programs$40 $6 $(12)$(5)$(7)$(1)$3 
Other electric revenues(e)
8 3 4 1 1 — — 
Other natural gas revenues(e)
— 1 2 — — — — 
Total other revenues$48 $10 $(6)$(4)$(6)$(1)$3 
Total revenues for reportable segments$1,734 $1,047 $1,154 $1,404 $614 $431 $349 
62



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
Three Months Ended March 31, 2021
Revenues from contracts with customersComEdPECOBGEPHIPepcoDPLACE
Electric revenues
Residential$741 $433 $362 $605 $253 $190 $162 
Small commercial & industrial367 100 69 118 33 46 39 
Large commercial & industrial134 57 105 248 184 21 43 
Public authorities & electric railroads11 9 7 13 6 4 3 
Other(a)
220 52 77 143 51 41 52 
Total electric revenues(b)
$1,473 $651 $620 $1,127 $527 $302 $299 
Natural gas revenues
Residential$— $160 $216 $46 $— $46 $— 
Small commercial & industrial— 59 35 18 — 18 — 
Large commercial & industrial— — 54 2 — 2 — 
Transportation— 7 — 4 — 4 — 
Other(c)
— 2 31 1 — 1 — 
Total natural gas revenues(d)
$— $228 $336 $71 $— $71 $— 
Total revenues from contracts with customers$1,473 $879 $956 $1,198 $527 $373 $299 
Other revenues
Revenues from alternative revenue programs$54 $10 $18 $46 $26 $9 $11 
Other electric revenues(e)
8 — — — — — — 
Total other revenues$62 $10 $18 $46 $26 $9 $11 
Total revenues for reportable segments$1,535 $889 $974 $1,244 $553 $382 $310 
__________
(a)Includes revenues from transmission revenue from PJM, wholesale electric revenue and mutual assistance revenue.
(b)Includes operating revenues from affiliates in 2022 and 2021 respectively of:
•$6 million, $6 million at ComEd
•$1 million, $1 million at PECO
•$2 million, $2 million at BGE
•$3 million, $3 million at PHI
•$1 million, $1 million at Pepco
•$2 million, $2 million at DPL
•$1 million, $1 million at ACE
(c)Includes revenues from off-system natural gas sales.
(d)Includes operating revenues from affiliates in 2022 and 2021 respectively of:
•less than $1 million, less than $1 million at PECO
•$6 million, $4 million at BGE
(e)Includes late payment charge revenues.

63



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 6 — Accounts Receivable
6. Accounts Receivable (All Registrants)
Allowance for Credit Losses on Accounts Receivable
The following tables present the rollforward of Allowance for Credit Losses on Customer Accounts Receivable.
Three Months Ended March 31, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of December 31, 2021$320 $73 $105 $38 $104 $37 $18 $49 
Plus: Current period provision for expected credit losses(a)
110 26 31 26 27 11 7 9 
Less: Write-offs, net of recoveries(b)(c)
41 7 11 5 18 8 1 9 
Balance as of March 31, 2022$389 $92 $125 $59 $113 $40 $24 $49 
Three Months Ended March 31, 2021
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of December 31, 2020$334 $97 $116 $35 $86 $32 $22 $32 
Plus: Current period provision for expected credit losses(d)
70 21 20 9 20 11 6 3 
Less: Write-offs, net of recoveries(b)
27 15 6 1 5 2 3 — 
Balance as of March 31, 2021$377 $103 $130 $43 $101 $41 $25 $35 
__________
(a)For PECO, BGE and ACE, the increase is primarily as a result of increased receivable balances due to the increased aging of receivables. For BGE, also reflects increased receivable balance due to colder weather.
(b)Recoveries were not material to the Registrants.
(c)For ACE, the increase in 2022 is primarily related to the termination of the moratorium, which beginning in March 2020, prevented customer disconnections for non-payment. With disconnection activities restarting in January 2022, write-offs of aging accounts receivable increased throughout the year.
(d)The increase is primarily as a result of increased receivable balances due to the colder weather and the increased aging of receivables, the temporary suspension of customer disconnections for non-payment, temporary cessation of new late payment fees, and reconnection of service for customers previously disconnected due to COVID-19.

The following tables present the rollforward of Allowance for Credit Losses on Other Accounts Receivable.
Three Months Ended March 31, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of December 31, 2021$72 $17 $7 $9 $39 $16 $8 $15 
Plus: Current period provision for expected credit losses14 4 3 3 4 2 1 1 
Less: Write-offs, net of recoveries(a)
5 1 1 1 2 — — 2 
Balance as of March 31, 2022$81 $20 $9 $11 $41 $18 $9 $14 
Three Months Ended March 31, 2021
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of December 31, 2020$71 $21 $8 $9 $33 $13 $9 $11 
Plus: Current period provision for expected credit losses10 1 4 1 4 2 1 1 
Less: Write-offs, net of recoveries(a)
2 — 1 1 — — — — 
Balance as of March 31, 2021$79 $22 $11 $9 $37 $15 $10 $12 
64



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 6 — Accounts Receivable
__________
(a)Recoveries were not material to the Registrants.
Unbilled Customer Revenue
The following table provides additional information about unbilled customer revenues recorded in the Registrants' Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021.
Unbilled customer revenues(a)
ExelonComEdPECOBGEPHIPepcoDPLACE
March 31, 2022$629 $189 $127 $139 $174 $89 $50 $35 
December 31, 2021747 240 161 171 175 82 53 40 
__________
(a)Unbilled customer revenues are classified in Customer accounts receivables, net in the Registrants' Consolidated Balance Sheets.
Other Purchases of Customer and Other Accounts Receivables
The Utility Registrants are required, under separate legislation and regulations in Illinois, Pennsylvania, Maryland, District of Columbia, Delaware, and New Jersey, to purchase certain receivables from alternative retail electric and, as applicable, natural gas suppliers that participate in the utilities' consolidated billing. The following tables present the total receivables purchased.
Total receivables purchased
Exelon(a)
ComEdPECO
BGE(a)
PHIPepcoDPLACE
Three months ended March 31, 2022$1,044 $248 $292 $222 $282 $174 $57 $51 
Three months ended March 31, 20211,023 266 290 199 268 166 56 46 
__________
(a)Includes $4 million and $12 million of receivables purchased from Generation for the three months ended March 31, 2022 and 2021, respectively.

65



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 7 — Income Taxes
7. Income Taxes (All Registrants)
Rate Reconciliation
The effective income tax rate from continuing operations varies from the U.S. federal statutory rate principally due to the following:
Three Months Ended March 31, 2022(a)
ExelonComEd
PECO(b)
BGE(b)
PHI
Pepco(b)
DPL
ACE(b)
U.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %
Increase (decrease) due to:
State income taxes, net of Federal income tax benefit(c)
21.1 8.0 (0.1)2.4 3.7 (4.5)6.2 6.8 
Plant basis differences(3.6)(0.6)(11.3)(0.9)(1.6)(2.6)(0.7)(1.3)
Excess deferred tax amortization(11.5)(6.3)(3.2)(17.6)(17.7)(17.4)(19.4)(22.2)
Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.2)(0.2)
Tax credits(d)
1.7 (0.3)— (0.4)(0.4)(0.4)(0.3)(0.3)
Other(e)
2.6 — — (0.1)0.2 (0.6)0.1 (0.1)
Effective income tax rate31.2 %21.7 %6.4 %4.3 %5.1 %(4.5)%6.7 %3.7 %

Three Months Ended March 31, 2021(a)
Exelon
ComEd
PECO(f)
BGE(f)
PHI
Pepco
DPL
ACE(f)
U.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %
Increase (decrease) due to:
State income taxes, net of Federal income tax benefit2.8 6.8 (1.6)(10.1)6.1 5.5 6.4 6.9 
Plant basis differences(3.4)(0.6)(10.5)(1.4)(1.5)(2.1)(0.7)(0.9)
Excess deferred tax amortization(12.0)(6.9)(3.2)(15.5)(19.3)(15.1)(18.5)(28.7)
Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.2)(0.2)
Tax credits(0.3)(0.2)— (0.4)(0.2)(0.2)(0.1)(0.3)
Other(1.1)(3.5)(0.1)(0.1)(0.1)0.1 0.3 2.2 
Effective income tax rate6.9 %16.5 %5.6 %(6.6)%5.9 %9.2 %8.2 %— %
__________
(a)Positive percentages represent income tax expense. Negative percentages represent income tax benefit.
(b)For PECO, the lower effective tax rate is primarily related to plant basis differences attributable to tax repair deductions. For BGE, the lower effective tax rate is primarily due to the Maryland multi-year plan which resulted in the acceleration of certain income tax benefits. For Pepco, the income tax benefit is primarily due to the Maryland and Washington, D.C. multi-year plans which resulted in the acceleration of certain income tax benefits. For ACE, the lower effective tax rate is primarily due to the acceleration of certain income tax benefits due to distribution rate case settlements.
(c)For Exelon, the higher state income taxes, net of federal income tax benefit, is primarily due to the long-term marginal state income tax rate change of approximately $67 million and the recognition of a valuation allowance of approximately $40 million against the net deferred tax asset position for certain standalone state filing jurisdictions as a result of the separation.
(d)For Exelon, reflects the income tax expense related to the write-off of federal tax credits subject to recapture of approximately $15 million as a result of the separation.
(e)For Exelon, primarily reflects the nondeductible transaction costs of approximately $19 million arising as part of the separation.
(f)For PECO, the lower effective tax rate is primarily related to plant basis differences attributable to tax repair deductions. For BGE, the income tax benefit is primarily due to the Maryland multi-year plan which resulted in the acceleration of
66



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 7 — Income Taxes
certain income tax benefits. For ACE, the lower effective tax rate is primarily due to the acceleration of certain income tax benefits due to distribution rate case settlements.

Unrecognized Tax Benefits
Exelon, PHI and ACE have the following unrecognized tax benefits as of March 31, 2022 and December 31, 2021. ComEd's, PECO's, BGE's, Pepco's, and DPL's amounts are not material.
ExelonPHIACE
March 31, 2022$146 $56 $16 
December 31, 2021143 56 16 
__________
(a)As of March 31, 2022, Exelon recorded a receivable of approximately $50 million in Noncurrent other assets in the Consolidated Balance Sheet for Constellation’s share of unrecognized tax benefits for periods prior to the separation.
Reasonably possible the total amount of unrecognized tax benefits could significantly increase or decrease within 12 months after the reporting date
As of March 31, 2022, ACE has approximately $14 million of unrecognized state tax benefits that could significantly decrease within the 12 months after the reporting date based on the outcome of pending court cases involving other taxpayers. The unrecognized tax benefit, if recognized, may be included in future base rates and that portion would have no impact to the effective tax rate.
Other Tax Matters

Separation (Exelon)

In connection with the separation, Exelon recorded an income tax expense related to continuing operations of approximately $148 million primarily due to the long-term marginal state income tax rate change of approximately $67 million discussed further below, the recognition of valuation allowances of approximately $40 million against the net deferred tax assets positions for certain standalone state filing jurisdictions, the write-off of federal and state tax credits subject to recapture of approximately $17 million, and nondeductible transaction costs for federal and state taxes of approximately $24 million.

Tax Matters Agreement (Exelon)
In connection with the separation, Exelon entered into a TMA with Constellation. The TMA governs the respective rights, responsibilities, and obligations between Exelon and Constellation after the separation with respect to tax liabilities, refunds and attributes for open tax years that Constellation was part of Exelon’s consolidated group for U.S. federal, state, and local tax purposes.
Indemnification for Taxes. As a former subsidiary of Exelon, Constellation has joint and several liability with Exelon to the IRS and certain state jurisdictions relating to the taxable periods prior to the separation. The TMA specifies that Constellation is liable for their share of taxes required to be paid by Exelon with respect to taxable periods prior to the separation to the extent Constellation would have been responsible for such taxes under the existing Exelon tax sharing agreement. As of March 31, 2022, Exelon recorded a receivable of approximately $55 million in Current other assets in the Consolidated Balance Sheet for Constellation’s share of taxes for periods prior to the separation.
Tax Refunds. The TMA specifies that Constellation is entitled to their share of any future tax refunds claimed by Exelon with respect to taxable periods prior to the separation to the extent that Constellation would have received such tax refunds under the existing Exelon tax sharing agreement.

Tax Attributes. At the date of separation certain tax attributes, primarily pre-closing tax credit carryforwards, that were generated by Constellation were required by law to be allocated to Exelon. The TMA also provides that Exelon will reimburse Constellation when those allocated tax credit carryforwards are utilized. As of March 31, 2022, Exelon recorded a payable of approximately $11 million and $484 million in Current other liabilities and Noncurrent other liabilities, respectively, in the Consolidated Balance Sheet for tax credit carryforwards that are expected to be utilized and reimbursed to Constellation.
67



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 7 — Income Taxes
Long-Term Marginal State Income Tax Rate (All Registrants)
In the first quarter of 2022, Exelon updated its marginal state income tax rates for changes in state apportionment due to the separation, which resulted in an increase of approximately $67 million to the deferred tax liability at Exelon, and a corresponding adjustment to income tax expense, net of federal taxes.

8. Retirement Benefits (All Registrants)
Defined Benefit Pension and OPEB
Effective February 1, 2022, in connection with the separation, pension and OPEB obligations and assets for current and former employees of the Constellation business and certain other former employees of Exelon and its subsidiaries transferred to pension and OPEB plans and trusts maintained by Constellation or its subsidiaries. The Exelon New England Union Employees Pension Plan and Constellation Mystic Power, LLC Union Employees Pension Plan Including Plan A and Plan B were transferred. The following OPEB plans were also transferred: Constellation Mystic Power, LLC Post-Employment Medical Account Savings Plan, Exelon New England Union Post-Employment Medical Savings Account Plan, and the Nine Mile Point Nuclear Station, LLC Medical Care and Prescription Drug Plan for Retired Employees.
As a result of the separation, Exelon restructured certain of its qualified pension plans. Pension obligations and assets for current and former employees continuing with Exelon and who are participants in the Exelon Employee Pension Plan for Clinton, TMI, and Oyster Creek, Pension Plan of Constellation Energy Nuclear Group, LLC, and Nine Mile Point Pension Plan were merged into the Pension Plan of Constellation Energy Group, Inc, which was subsequently renamed, Exelon Pension Plan (EPP). Exelon employees who participated in these plans prior to the separation now participate in the EPP. The merging of the plans did not change the benefits offered to the plan participants and, thus, had no impact on Exelon's pension obligations.
68



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 8 — Retirement Benefits
The tables below show the pension and OPEB plans in which employees of each operating company participated as of March 31, 2022:
Operating Company(a)
Name of Plan:ComEd PECO BGE PHIPepcoDPLACE
Qualified Pension Plans:
Exelon Corporation Retirement ProgramXXXXXXX
Exelon Corporation Pension Plan for Bargaining Unit EmployeesX  
Exelon Pension PlanXXXXXXX
Pepco Holdings LLC Retirement PlanXXXXXXX
Non-Qualified Pension Plans:
Exelon Corporation Supplemental Pension Benefit Plan and 2000 Excess Benefit PlanX  X  X
Exelon Corporation Supplemental Management Retirement PlanX  X  XXX
Constellation Energy Group, Inc. Senior Executive Supplemental PlanX  X
Constellation Energy Group, Inc. Supplemental Pension PlanX  X
Constellation Energy Group, Inc. Benefits Restoration PlanXX  X
Baltimore Gas & Electric Company Executive Benefit PlanX  
Baltimore Gas & Electric Company Manager Benefit PlanXX  
Pepco Holdings LLC 2011 Supplemental Executive Retirement PlanXXXX
Conectiv Supplemental Executive Retirement PlanXXX
Pepco Holdings LLC Combined Executive Retirement PlanXX
Atlantic City Electric Director Retirement PlanXX
69



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 8 — Retirement Benefits
Operating Company(a)
Name of Plan: ComEd PECO BGE PHIPepcoDPLACE
OPEB Plans:
PECO Energy Company Retiree Medical Plan  XX  XXXXX
Exelon Corporation Health Care ProgramXXXXXXX
Exelon Corporation Employees’ Life Insurance Plan  X  X  X
Exelon Corporation Health Reimbursement Arrangement Plan  X  X  X
BGE Retiree Medical PlanXXXXXX
BGE Retiree Dental PlanX
Exelon Employee Life Insurance Plan and Family Life Insurance PlanXXXXX
Exelon Retiree Medical Plan of Constellation Energy Nuclear Group, LLCXXX
Exelon Retiree Dental Plan of Constellation Energy Nuclear Group, LLCXXX
Pepco Holdings LLC Welfare Plan for RetireesXXXXXXX
__________
(a)Employees generally remain in their legacy benefit plans when transferring between operating companies.
As of February 1, 2022, in connection with the separation, Exelon's pension and OPEB plans were remeasured. The remeasurement and separation resulted in a decrease to the pension obligation, net of plan assets, of $921 million and a decrease to the OPEB obligation of $893 million. Additionally, accumulated other comprehensive loss, decreased by $1,994 million (after-tax) and regulatory assets and liabilities increased by $14 million and $5 million respectively. Key assumptions were held consistent with the year end December 31, 2021 assumptions with the exception of the discount rate.
The majority of the 2022 pension benefit cost for the Exelon-sponsored plans is calculated using an expected long-term rate of return on plan assets of 7.00% and a discount rate of 3.24%. The majority of the 2022 OPEB cost is calculated using an expected long-term rate of return on plan assets of 6.44% for funded plans and a discount rate of 3.20%.
During the first quarter of 2022, Exelon received an updated valuation of its pension and OPEB to reflect actual census data as of February 1, 2022. This valuation resulted in a decrease to the pension obligation of $24 million and an increase to the OPEB obligation of $5 million. Additionally, accumulated other comprehensive loss increased by $5 million (after-tax) and regulatory assets and liabilities decreased by $30 million and $3 million, respectively.
A portion of the net periodic benefit cost for all plans is capitalized within the Consolidated Balance Sheets. The following table presents the components of Exelon's net periodic benefit costs, prior to capitalization, for the three months ended March 31, 2022 and 2021.
70



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 8 — Retirement Benefits
Pension BenefitsOPEB
Three Months Ended March 31,Three Months Ended March 31,
2022202120222021
Components of net periodic benefit cost:
Service cost$61 $74 $10 $14 
Interest cost110 102 19 17 
Expected return on assets(209)(213)(25)(26)
Amortization of:
Prior service cost (credit)1 1 (5)(6)
Actuarial loss76 100 4 7 
Curtailment benefits— — — (1)
Net periodic benefit cost$39 $64 $3 $5 
The amounts below represent the Registrants' allocated pension and OPEB costs. For Exelon, the service cost component is included in Operating and maintenance expense and Property, plant, and equipment, net while the non-service cost components are included in Other, net and Regulatory assets. For the Utility Registrants, the service cost and non-service cost components are included in Operating and maintenance expense and Property, plant, and equipment, net in their consolidated financial statements.
 Three Months Ended March 31,
Pension and OPEB Costs20222021
Exelon$42 $69 
ComEd16 32 
PECO(2)2 
BGE11 15 
PHI13 12 
Pepco2 2 
DPL1 1 
ACE3 3 
Defined Contribution Savings Plan
The Registrants participate in a 401(k) defined contribution savings plan that is sponsored by Exelon. The plan is qualified under applicable sections of the IRC and allow employees to contribute a portion of their pre-tax and/or after-tax income in accordance with specified guidelines. All Registrants match a percentage of the employee contributions up to certain limits. The following table presents the matching contributions to the savings plans for the three months ended March 31, 2022 and 2021, respectively.
Three Months Ended March 31,
Savings Plans Matching Contributions20222021
Exelon$20 $20 
ComEd8 8 
PECO3 3 
BGE2 2 
PHI3 3 
Pepco1 1 
DPL1 1 
ACE— — 

71



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 9 — Derivative Financial Instruments
9. Derivative Financial Instruments (All Registrants)
The Registrants use derivative instruments to manage commodity price risk related to ongoing business operations.
Authoritative guidance requires that derivative instruments be recognized as either assets or liabilities at fair value, with changes in fair value of the derivative recognized in earnings immediately. Other accounting treatments are available through special election and designation, provided they meet specific, restrictive criteria both at the time of designation and on an ongoing basis. These alternative permissible accounting treatments include NPNS, cash flow hedges, and fair value hedges. At ComEd, derivative economic hedges related to commodities are recorded at fair value and offset by a corresponding regulatory asset or liability. For all NPNS derivative instruments, accounts receivable or accounts payable are recorded when derivatives settle and revenue or expense is recognized in earnings as the underlying physical commodity is sold or consumed.
ComEd’s use of cash collateral is generally unrestricted unless ComEd is downgraded below investment grade. Cash collateral held by PECO, BGE, Pepco, DPL, and ACE must be deposited in an unaffiliated major U.S. commercial bank or foreign bank with a U.S. branch office that meet certain qualifications.
Commodity Price Risk
The Registrants employ established policies and procedures to manage their risks associated with market fluctuations in commodity prices by entering into physical and financial derivative contracts, which are either determined to be non-derivative or classified as economic hedges. The Utility Registrants procure electric and natural gas supply through a competitive procurement process approved by each of the respective state utility commissions. The Utility Registrants’ hedging programs are intended to reduce exposure to energy and natural gas price volatility and have no direct earnings impact as the costs are fully recovered from customers through
72



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 9 — Derivative Financial Instruments
regulatory-approved recovery mechanisms. The following table provides a summary of the Utility Registrants’ primary derivative hedging instruments, listed by commodity and accounting treatment.

RegistrantCommodityAccounting TreatmentHedging Instrument
ComEdElectricityNPNSFixed price contracts based on all requirements in the IPA procurement plans.
Electricity
Changes in fair value of economic hedge recorded to an offsetting regulatory asset or liability(a)
20-year floating-to-fixed energy swap contracts beginning June 2012 based on the renewable energy resource procurement requirements in the Illinois Settlement Legislation of approximately 1.3 million MWhs per year.
PECOElectricityNPNSFixed price contracts for default supply requirements through full requirements contracts.
GasNPNSFixed price contracts to cover about 10% of planned natural gas purchases in support of projected firm sales.
BGEElectricityNPNSFixed price contracts for all SOS requirements through full requirements contracts.
GasNPNSFixed price contracts for between 10-20% of forecasted system supply requirements for flowing (i.e., non-storage) gas for the November through March period.
PepcoElectricityNPNSFixed price contracts for all SOS requirements through full requirements contracts.
DPLElectricityNPNSFixed price contracts for all SOS requirements through full requirements contracts.
GasNPNSFixed and index priced contracts through full requirements contracts.
Changes in fair value of economic hedge recorded to an offsetting regulatory asset or liability(b)
Exchange traded future contracts for up to 50% of estimated monthly purchase requirements each month, including purchases for storage injections.
ACEElectricityNPNSFixed price contracts for all BGS requirements through full requirements contracts.
__________
(a)See Note 3 — Regulatory Matters of the 2021 Form 10-K for additional information.
(b)The fair value of the DPL economic hedge is not material as of March 31, 2022 and December 31, 2021.
The fair value of derivative economic hedges is presented in current and noncurrent Mark-to-market derivative liabilities in Exelon's and ComEd's Consolidated Balance Sheets.
Credit Risk
The Registrants would be exposed to credit-related losses in the event of non-performance by counterparties on executed derivative instruments. The credit exposure of derivative contracts, before collateral, is represented by the fair value of contracts at the reporting date. The Utility Registrants have contracts to procure electric and natural gas supply that provide suppliers with a certain amount of unsecured credit. If the exposure on the supply contract exceeds the amount of unsecured credit, the suppliers may be required to post collateral. The net credit exposure is mitigated primarily by the ability to recover procurement costs through customer rates. As of March 31, 2022, the amount of cash collateral held with external counterparties by Exelon, ComEd, PHI, and DPL was $192 million, $72 million, $86 million, and $73 million, respectively, which is recorded in Other current liabilities in Exelon's, ComEd's, PHI's, and DPL's Consolidated Balance Sheets. The amounts for PECO, BGE, Pepco, and ACE were not material as of March 31, 2022. As of December 31, 2021, the amounts for ComEd and DPL were $41 million and $43 million, respectively. The amounts for Exelon, PECO, BGE, PHI, Pepco, and ACE were not material as of December 31, 2021.
73



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 9 — Derivative Financial Instruments
The Utility Registrants’ electric supply procurement contracts do not contain provisions that would require them to post collateral. PECO’s, BGE’s, and DPL’s natural gas procurement contracts contain provisions that could require PECO, BGE, and DPL to post collateral in the form of cash or credit support, which vary by contract and counterparty, with thresholds contingent upon PECO’s, BGE's, and DPL’s credit rating. As of March 31, 2022, PECO, BGE, and DPL were not required to post collateral for any of these agreements. If PECO, BGE, or DPL lost their investment grade credit rating as of March 31, 2022, they could have been required to post collateral to their counterparties of $39 million, $62 million, and $16 million, respectively.
10. Debt and Credit Agreements (All Registrants)
Short-Term Borrowings
Exelon Corporate, ComEd, and BGE meet their short-term liquidity requirements primarily through the issuance of commercial paper. PECO meets their short-term liquidity requirements primarily through the issuance of commercial paper and borrowings from the Exelon intercompany money pool. Pepco, DPL, and ACE meet their short-term liquidity requirements primarily through the issuance of commercial paper and borrowings from the PHI intercompany money pool. PHI Corporate meets its short-term liquidity requirements primarily through the issuance of short-term notes and borrowings from the Exelon intercompany money pool. The Registrants may use their respective credit facilities for general corporate purposes, including meeting short-term funding requirements and the issuance of letters of credit.
Commercial Paper
The following table reflects the Registrants' commercial paper programs as of March 31, 2022 and December 31, 2021. PECO and ComEd had no commercial paper borrowings as of March 31, 2022 and December 31, 2021.
Outstanding Commercial
Paper as of		Average Interest Rate on
Commercial Paper Borrowings as of
Commercial Paper IssuerMarch 31, 2022December 31, 2021March 31, 2022December 31, 2021
Exelon(a)
$250 $599 0.87 %0.35 %
BGE250 130 0.87 %0.37 %
PHI(b)
— 469 — %0.35 %
Pepco— 175 — %0.33 %
DPL— 149 — %0.36 %
ACE— 145 — %0.35 %
__________
(a)Exelon Corporate had no outstanding commercial paper borrowings as of March 31, 2022 and December 31, 2021.
(b)Represents the consolidated amounts of Pepco, DPL, and ACE.
Revolving Credit Agreements
On February 1, 2022, Exelon Corporate and the Utility Registrants' each entered into a new 5-year revolving credit facility that replaced its existing syndicated revolving credit facility. The following table reflects the credit agreements:
BorrowerAggregate Bank CommitmentInterest Rate
Exelon Corporate900 SOFR plus 1.275 %
ComEd1,000 SOFR plus 1.000 %
PECO600 SOFR plus 0.900 %
BGE600 SOFR plus 0.900 %
Pepco300 SOFR plus 1.075 %
DPL300 SOFR plus 1.000 %
ACE300 SOFR plus 1.075 %
See Note 17 — Debt and Credit Agreements of the Exelon 2021 Form 10-K for additional information on the Registrants' credit facilities.
74



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 10 — Debt and Credit Agreements
Short-Term Loan Agreements
On March 23, 2017, Exelon Corporate entered into a term loan agreement for $500 million. The loan agreement was renewed on March 14, 2022 and will expire on March 16, 2023. Pursuant to the loan agreement, loans made thereunder bear interest at a variable rate equal to SOFR plus 0.65% and all indebtedness thereunder is unsecured. The loan agreement is reflected in Exelon's Consolidated Balance Sheets within Short-term borrowings.
On March 31, 2021, Exelon Corporate entered into a 364-day term loan agreement for $150 million with a variable interest rate of LIBOR plus 0.65% and an expiration date of March 30, 2022. Exelon Corporate repaid the term loan on March 30, 2022.
In connection with the separation, on January 24, 2022, Exelon Corporate entered into a 364-day term loan agreement for $1.15 billion. The loan agreement will expire on January 23, 2023. Pursuant to the loan agreement, loans made thereunder bear interest at a variable rate equal to SOFR plus 0.75% with a 22.5 basis point increase commencing on July 24, 2022. All indebtedness pursuant to the loan agreement is unsecured.
Long-Term Debt
Issuance of Long-Term Debt
75



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 10 — Debt and Credit Agreements
During the three months ended March 31, 2022, the following long-term debt was issued:
CompanyTypeInterest RateMaturityAmountUse of Proceeds
ExelonSMBC Term Loan AgreementSOFR plus 0.65%July 21, 2023$300Fund a cash payment to Constellation and for general corporate purposes.
ExelonU.S. Bank Term Loan AgreementSOFR plus 0.65%July 21, 2023300Fund a cash payment to Constellation and for general corporate purposes.
ExelonPNC Term Loan AgreementSOFR plus 0.65%July 24, 2023250Fund a cash payment to Constellation and for general corporate purposes.
ExelonNotes 2.75%March 15, 2027650Repay existing indebtedness and for general corporate purposes.
ExelonNotes3.35%March 15, 2032650Repay existing indebtedness and for general corporate purposes.
ExelonNotes4.10%March 15, 2052700Repay existing indebtedness and for general corporate purposes.
ComEdFirst Mortgage Bonds, Series 1323.15%March 15, 2032300Repay outstanding commercial paper obligations and to fund other general corporate purposes.
ComEdFirst Mortgage Bonds, Series 1333.85%March 15, 2052450Repay outstanding commercial paper obligations and to fund other general corporate purposes.
Pepco(a)
First Mortgage Bonds3.97%March 24, 2052400Repay existing indebtedness and for general corporate purposes.
DPLFirst Mortgage Bonds3.06%February 15, 2052125Repay existing indebtedness and for general corporate purposes.
ACEFirst Mortgage Bonds2.27%February 15, 203225Repay existing indebtedness and for general corporate purposes.
ACEFirst Mortgage Bonds3.06%February 15, 2052150Repay existing indebtedness and for general corporate purposes.
__________
(a)On March 24, 2022, Pepco entered into a purchase agreement of First Mortgage Bonds of $225 million at 3.35% due on September 15, 2032. The closing date of the issuance is expected to occur in September 2022.
Long-Term Debt to Affiliates
As of December 31, 2021, Exelon Corporate had $319 million recorded to intercompany notes receivable from Generation. See Note 17 — Debt and Credit Agreements of the Exelon 2021 Form 10-K for additional information. In connection with the separation, on January 31, 2022, Exelon Corporate received cash from Generation of $258 million to settle the intercompany loan.
Debt Covenants
As of March 31, 2022, the Registrants are in compliance with debt covenants.
76



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
11. Fair Value of Financial Assets and Liabilities (All Registrants)
Exelon measures and classifies fair value measurements in accordance with the hierarchy as defined by GAAP. The hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows:
•Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities that the Registrants have the ability to liquidate as of the reporting date.
•Level 2 - inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.
•Level 3 - unobservable inputs, such as internally developed pricing models or third-party valuations for the asset or liability due to little or no market activity for the asset or liability.
Fair Value of Financial Liabilities Recorded at Amortized Cost
The following tables present the carrying amounts and fair values of the Registrants’ short-term liabilities, long-term debt, and trust preferred securities (long-term debt to financing trusts or junior subordinated debentures) as of March 31, 2022 and December 31, 2021. The Registrants have no financial liabilities classified as Level 1.
The carrying amounts of the Registrants’ short-term liabilities as presented in their Consolidated Balance Sheets are representative of their fair value (Level 2) because of the short-term nature of these instruments.
March 31, 2022December 31, 2021
Carrying AmountFair ValueCarrying AmountFair Value
Level 2Level 3TotalLevel 2Level 3Total
Long-Term Debt, including amounts due within one year(a)
Exelon$37,162 $35,174 $2,645 $37,819 $32,902 $34,897 $2,217 $37,114 
ComEd10,515 10,894 — 10,894 9,773 11,305 — 11,305 
PECO4,198 4,244 50 4,294 4,197 4,740 50 4,790 
BGE3,961 3,969 — 3,969 3,961 4,406 — 4,406 
PHI8,233 5,453 2,595 8,048 7,547 5,970 2,167 8,137 
Pepco3,841 2,901 1,272 4,173 3,445 3,201 975 4,176 
DPL1,935 1,300 592 1,892 1,810 1,426 552 1,978 
ACE1,757 1,007 732 1,739 1,582 1,091 641 1,732 
Long-Term Debt to Financing Trusts
Exelon$390 $— $435 $435 $390 $— $470 $470 
ComEd205 — 228 228 205 — 248 248 
PECO184 — 207 207 184 — 222 222 
__________
(a)Includes unamortized debt issuance costs, unamortized debt discount and premium, net, purchase accounting fair value adjustments, and finance lease liabilities which are not fair valued. Refer to Note 17 - Debt and Credit Agreements of the Exelon 2021 Form 10-K for unamortized debt issuance costs, unamortized debt discount and premium, net, and purchase accounting fair value adjustments and Note 11 - Leases of the Exelon 2021 Form 10-K for finance lease liabilities.

77



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
Recurring Fair Value Measurements
The following tables present assets and liabilities measured and recorded at fair value in the Registrants' Consolidated Balance Sheets on a recurring basis and their level within the fair value hierarchy as of March 31, 2022 and December 31, 2021:
Exelon
As of March 31, 2022As of December 31, 2021
Level 1Level 2Level 3TotalLevel 1 Level 2Level 3Total
Assets
Cash equivalents(a)
$2,418 $— $— $2,418 $524 $— $— $524 
Rabbi trust investments
Cash equivalents65 — — 65 60 — — 60 
Mutual funds55 — — 55 60 — — 60 
Fixed income— 9 — 9 — 10 — 10 
Life insurance contracts — 63 37 100 — 61 37 98 
Rabbi trust investments subtotal120 72 37 229 120 71 37 228 
Total assets2,538 72 37 2,647 644 71 37 752 
Liabilities
Mark-to-market derivative liabilities— — (144)(144)— — (219)(219)
Deferred compensation obligation— (84)— (84)— (131)— (131)
Total liabilities— (84)(144)(228)— (131)(219)(350)
Total net assets (liabilities)$2,538 $(12)$(107)$2,419 $644 $(60)$(182)$402 

__________    
(a)Exelon excludes cash of $470 million and $464 million as of March 31, 2022 and December 31, 2021, respectively, and restricted cash of $110 million and $49 million as of March 31, 2022 and December 31, 2021, respectively, and includes long-term restricted cash of $92 million and $44 million as of March 31, 2022 and December 31, 2021, respectively, which is reported in Other deferred debits in the Consolidated Balance Sheets.

78



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities

ComEd, PECO, and BGE
ComEdPECOBGE
As of March 31, 2022Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash equivalents(a)
$537 $— $— $537 $9 $— $— $9 $— $— $— $— 
Rabbi trust investments
Cash equivalents— — — — 1 — — 1 — — — — 
Mutual funds— — — — 9 — — 9 7 — — 7 
Life insurance contracts — — — — — 17 — 17 — — — — 
Rabbi trust investments subtotal— — — — 10 17 — 27 7 — — 7 
Total assets537 — — 537 19 17 — 36 7 — — 7 
Liabilities
Mark-to-market derivative liabilities(b)
— — (144)(144)— — — — — — — — 
Deferred compensation obligation— (9)— (9)— (8)— (8)— (5)— (5)
Total liabilities— (9)(144)(153)— (8)— (8)— (5)— (5)
Total net assets (liabilities)$537 $(9)$(144)$384 $19 $9 $— $28 $7 $(5)$— $2 
ComEdPECOBGE
As of December 31, 2021Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash equivalents(a)
$237 $— $— $237 $9 $— $— $9 $— $— $— $— 
Rabbi trust investments
Mutual funds— — — — 11 — — 11 14 — — 14 
Life insurance contracts — — — — — 16 — 16 — — — — 
Rabbi trust investments subtotal— — — — 11 16 — 27 14 — — 14 
Total assets237 — — 237 20 16 — 36 14 — — 14 
Liabilities
Mark-to-market derivative liabilities(b)
— — (219)(219)— — — — — — — — 
Deferred compensation obligation— (10)— (10)— (9)— (9)— (7)— (7)
Total liabilities— (10)(219)(229)— (9)— (9)— (7)— (7)
Total net assets (liabilities)$237 $(10)$(219)$8 $20 $7 $— $27 $14 $(7)$— $7 
__________
(a)ComEd excludes cash of $71 million and $105 million as of March 31, 2022 and December 31, 2021, respectively, and restricted cash of $73 million and $42 million as of March 31, 2022 and December 31, 2021, respectively, and includes long-term restricted cash of $92 million and $43 million as of March 31, 2022 and December 31, 2021, respectively, which is reported in Other deferred debits in the Consolidated Balance Sheets. PECO excludes cash of $25 million and $35 million as of March 31, 2022 and December 31, 2021, respectively. BGE excludes cash of $41 million and $51 million as of March 31, 2022 and December 31, 2021, respectively, and restricted cash of $34 million and $4 million as of March 31, 2022 and December 31, 2021, respectively.
(b)The Level 3 balance consists of the current and noncurrent liability of none and $144 million, respectively, as of March 31, 2022 and $18 million and $201 million, respectively, as of December 31, 2021 related to floating-to-fixed energy swap contracts with unaffiliated suppliers.

79



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
PHI, Pepco, DPL, and ACE
As of March 31, 2022As of December 31, 2021
PHI Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash equivalents(a)
$599 $— $— $599 $110 $— $— $110 
Rabbi trust investments
Cash equivalents61 — — 61 59 — — 59 
Mutual funds12 — — 12 14 — — 14 
Fixed income— 9 — 9 — 10 — 10 
Life insurance contracts— 24 36 60 — 27 35 62 
Rabbi trust investments subtotal73 33 36 142 73 37 35 145 
Total assets672 33 36 741 183 37 35 255 
Liabilities
Deferred compensation obligation— (17)— (17)— (18)— (18)
Total liabilities— (17)— (17)— (18)— (18)
Total net assets$672 $16 $36 $724 $183 $19 $35 $237 
PepcoDPLACE
As of March 31, 2022Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash equivalents(a)
$294 $— $— $294 $152 $— $— $152 $153 $— $— $153 
Rabbi trust investments
Cash equivalents59 — — 59 — — — — — — — — 
Life insurance contracts— 24 36 60 — — — — — — — — 
Rabbi trust investments subtotal59 24 36 119 — — — — — — — — 
Total assets353 24 36 413 152 — — 152 153 — — 153 
Liabilities
Deferred compensation obligation— (2)— (2)— — — — — — — — 
Total liabilities— (2)— (2)— — — — — — — — 
Total net assets$353 $22 $36 $411 $152 $— $— $152 $153 $— $— $153 
80



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
PepcoDPLACE
As of December 31, 2021Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash equivalents(a)
$31 $— $— $31 $43 $— $— $43 $— $— $— $— 
Rabbi trust investments
Cash equivalents58 — — 58 — — — — — — — — 
Life insurance contracts— 27 35 62 — — — — — — — — 
Rabbi trust investments subtotal58 27 35 120 — — — — — — — — 
Total assets89 27 35 151 43 — — 43 — — — — 
Liabilities
Deferred compensation obligation— (2)— (2)— — — — — — — — 
Total liabilities— (2)— (2)— — — — — — — — 
Total net assets$89 $25 $35 $149 $43 $— $— $43 $— $— $— $— 
__________
(a)PHI excludes cash of $300 million and $100 million as of March 31, 2022 and December 31, 2021, respectively, and restricted cash of $3 million as of both March 31, 2022 and December 31, 2021. Pepco excludes cash of $239 million and $34 million as of March 31, 2022 and December 31, 2021, respectively, and restricted cash of $3 million as of both March 31, 2022 and December 31, 2021. DPL excludes cash of $41 million and $28 million as of March 31, 2022 and December 31, 2021, respectively. ACE excludes cash of $15 million and $29 million as of March 31, 2022 and December 31, 2021, respectively.
81



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
Reconciliation of Level 3 Assets and Liabilities
The following tables present the fair value reconciliation of Level 3 assets and liabilities measured at fair value on a recurring basis during the three months ended March 31, 2022 and 2021:
ExelonComEdPHI and Pepco
Three months ended March 31, 2022Total Mark-to-Market
Derivatives		Life Insurance Contracts
Balance as of January 1, 2022$(182)$(219)$35 
Total realized / unrealized gains
Included in net income(a)
1 — 1 
Included in regulatory assets75 75 
(b)
— 
Transfers out of Level 3(1)— — 
Balance as of March 31, 2022$(107)$(144)$36 
The amount of total gains included in income attributed to the change in unrealized gains related to assets and liabilities as of March 31, 2022$1 $— $1 
ExelonComEdPHI and Pepco
Three Months Ended March 31, 2021Total Mark-to-Market
Derivatives		Life Insurance Contracts
Balance as of January 1, 2021$(267)$(301)$34 
Total realized / unrealized gains
Included in net income(a)
1 — 1 
Included in regulatory assets6 6 
(b)
— 
Balance as of March 31, 2021$(260)$(295)$35 
The amount of total gains included in income attributed to the change in unrealized gain related to assets and liabilities as of March 31, 2021$1 $— $1 
__________
(a)Classified in Operating and maintenance expense in the Consolidated Statements of Operations and Comprehensive Income.
(b)Includes $69 million of increases in fair value and an increase for realized losses due to settlements of $6 million recorded in purchased power expense associated with floating-to-fixed energy swap contracts with unaffiliated suppliers for the three months ended March 31, 2022. Includes $2 million of decreases in fair value and an increase for realized losses due to settlements of $8 million recorded in purchased power expense associated with floating-to-fixed energy swap contracts with unaffiliated suppliers for the three months ended March 31, 2021.

Valuation Techniques Used to Determine Fair Value
Exelon’s valuation techniques used to measure the fair value of the assets and liabilities shown in the tables below are in accordance with the policies discussed in Note 18 — Fair Value of Financial Assets and Liabilities of the Exelon 2021 Form 10-K.
82



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
Mark-to-Market Derivatives (Exelon and ComEd)
The table below discloses the significant inputs to the forward curve used to value mark-to-market derivatives.
Type of tradeFair Value as of March 31, 2022Fair Value as of December 31, 2021Valuation
Technique		Unobservable
Input		2022 Range & Arithmetic Average2021 Range & Arithmetic Average
Mark-to-market derivatives$(144)$(219)Discounted
Cash Flow
Forward heat
rate(a)
8.90x-9.10x9.00x9x-10x9.13x
Marketability
reserve		4%-5%4.35%3%-7%4.77%
Renewable
factor		92%-120%98%92%-120%97%
__________
(a)Quoted forward natural gas rates are utilized to project the forward power curve for the delivery of energy at specified future dates.
The inputs listed above, which are as of the balance sheet date, would have a direct impact on the fair value of the above instruments if they were adjusted. An increase to the marketability reserves would decrease the fair value. An increase to the forward heat rate or renewable factor would increase the fair value accordingly.

12. Commitments and Contingencies (All Registrants)
The following is an update to the current status of commitments and contingencies set forth in Note 19 — Commitments and Contingencies of the Exelon 2021 Form 10-K.
Commitments
PHI Merger Commitments (Exelon, PHI, Pepco, DPL, and ACE). Approval of the PHI Merger in Delaware, New Jersey, Maryland, and the District of Columbia was conditioned upon Exelon and PHI agreeing to certain commitments. The following amounts represent total commitment costs that have been recorded since the acquisition date and the total remaining obligations for Exelon, PHI, Pepco, DPL, and ACE as of March 31, 2022:
DescriptionExelon PHI Pepco DPLACE
Total commitments$513 $320 $120 $89 $111 
Remaining commitments(a)
65 55 46 6 3 
__________
(a)Remaining commitments extend through 2026 and include rate credits, energy efficiency programs and delivery system modernization.
In addition, Exelon has committed to purchase 100 MWs of wind energy in PJM. DPL has committed to conducting three RFPs to procure up to a total of 120 MWs of wind RECs for the purpose of meeting Delaware's renewable portfolio standards. DPL has conducted two of the three wind REC RFPs. The first 40 MW wind REC tranche was conducted in 2017 and did not result in a purchase agreement. The second 40 MW wind REC tranche was conducted in 2018 and resulted in a proposed REC purchase agreement that was approved by the DEPSC in 2019. The RFP for the third and final 40 MW wind REC tranche will be conducted in the second half of 2022.

83



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 12 — Commitments and Contingencies
Commercial Commitments (All Registrants). The Registrants’ commercial commitments as of March 31, 2022, representing commitments potentially triggered by future events were as follows:
Expiration within
Total202220232024202520262027 and beyond
Exelon
Letters of credit$14 $12 $2 $— $— $— $— 
Surety bonds(a)
201 188 11 2 — — — 
Financing trust guarantees378 — — — — — 378 
Guaranteed lease residual values(b)
30 1 3 6 5 5 10 
Total commercial commitments $623 $201 $16 $8 $5 $5 $388 
ComEd
Letters of credit$7 $7 $— $— $— $— $— 
Surety bonds(a)
17 12 3 2 — — — 
Financing trust guarantees200 — — — — — 200 
Total commercial commitments $224 $19 $3 $2 $— $— $200 
PECO
Letters of credit$1 $1 $— $— $— $— $— 
Surety bonds(a)
3 2 1 — — — — 
Financing trust guarantees178 — — — — — 178 
Total commercial commitments $182 $3 $1 $— $— $— $178 
BGE
Letters of credit$2 $2 $— $— $— $— $— 
Surety bonds(a)
4 3 1 — — — — 
Total commercial commitments $6 $5 $1 $— $— $— $— 
PHI
Surety bonds(a)
$94 $91 $3 $— $— $— $— 
Guaranteed lease residual values(b)
30 1 3 6 5 5 10 
Total commercial commitments $124 $92 $6 $6 $5 $5 $10 
Pepco
Surety bonds(a)
$84 $84 $— $— $— $— $— 
Guaranteed lease residual values(b)
10 — 1 2 2 2 3 
Total commercial commitments $94 $84 $1 $2 $2 $2 $3 
DPL
Surety bonds(a)
$6 $3 $3 $— $— $— $— 
Guaranteed lease residual values(b)
13 1 1 3 2 2 4 
Total commercial commitments $19 $4 $4 $3 $2 $2 $4 
ACE
Surety bonds(a)
$4 $4 $— $— $— $— $— 
Guaranteed lease residual values(b)
7 — 1 1 1 1 3 
Total commercial commitments $11 $4 $1 $1 $1 $1 $3 
__________
(a)Surety bonds — Guarantees issued related to contract and commercial agreements, excluding bid bonds.
84



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 12 — Commitments and Contingencies
(b)Represents the maximum potential obligation in the event that the fair value of certain leased equipment and fleet vehicles is zero at the end of the maximum lease term. The lease term associated with these assets ranges from 1 to 8 years. The maximum potential obligation at the end of the minimum lease term would be $73 million guaranteed by Exelon and PHI, of which $25 million, $30 million, and $18 million is guaranteed by Pepco, DPL, and ACE, respectively. Historically, payments under the guarantees have not been made and PHI believes the likelihood of payments being required under the guarantees is remote.
Environmental Remediation Matters
General (All Registrants). The Registrants’ operations have in the past, and may in the future, require substantial expenditures to comply with environmental laws. Additionally, under Federal and state environmental laws, the Registrants are generally liable for the costs of remediating environmental contamination of property now or formerly owned by them and of property contaminated by hazardous substances generated by them. The Registrants own or lease a number of real estate parcels, including parcels on which their operations or the operations of others may have resulted in contamination by substances that are considered hazardous under environmental laws. In addition, the Registrants are currently involved in a number of proceedings relating to sites where hazardous substances have been deposited and may be subject to additional proceedings in the future. Unless otherwise disclosed, the Registrants cannot reasonably estimate whether they will incur significant liabilities for additional investigation and remediation costs at these or additional sites identified by the Registrants, environmental agencies or others, or whether such costs will be recoverable from third parties, including customers. Additional costs could have a material, unfavorable impact on the Registrants' financial statements.
MGP Sites (All Registrants). ComEd, PECO, BGE, and DPL have identified sites where former MGP or gas purification activities have or may have resulted in actual site contamination. For almost all of these sites, there are additional PRPs that may share responsibility for the ultimate remediation of each location.
•ComEd has 21 sites that are currently under some degree of active study and/or remediation. ComEd expects the majority of the remediation at these sites to continue through at least 2031.
•PECO has 6 sites that are currently under some degree of active study and/or remediation. PECO expects the majority of the remediation at these sites to continue through at least 2023.
•BGE has 4 sites that currently require some level of remediation and/or ongoing activity. BGE expects the majority of the remediation at these sites to continue through at least 2023.
•DPL has 1 site that is currently under study and the required cost at the site is not expected to be material.
The historical nature of the MGP and gas purification sites and the fact that many of the sites have been buried and built over, impacts the ability to determine a precise estimate of the ultimate costs prior to initial sampling and determination of the exact scope and method of remedial activity. Management determines its best estimate of remediation costs using all available information at the time of each study, including probabilistic and deterministic modeling for ComEd and PECO, and the remediation standards currently required by the applicable state environmental agency. Prior to completion of any significant clean up, each site remediation plan is approved by the appropriate state environmental agency.
ComEd, pursuant to an ICC order, and PECO, pursuant to a PAPUC order, are currently recovering environmental remediation costs of former MGP facility sites through customer rates. While BGE and DPL do not have riders for MGP clean-up costs, they have historically received recovery of actual clean-up costs in distribution rates.
85



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 12 — Commitments and Contingencies
As of March 31, 2022 and December 31, 2021, the Registrants had accrued the following undiscounted amounts for environmental liabilities in Other current liabilities and Other deferred credits and other liabilities in their respective Consolidated Balance Sheets:
March 31, 2022December 31, 2021
Total environmental
investigation and
remediation liabilities		Portion of total related to
MGP investigation and
remediation		Total environmental
investigation and
remediation liabilities		Portion of total related to
MGP investigation and
remediation
Exelon$354 $305 $352 $303 
ComEd279 279 279 279 
PECO21 20 22 20 
BGE7 6 6 4 
PHI42 — 42 — 
Pepco40 — 40 — 
DPL1 — 1 — 
ACE1 — 1 — 
Benning Road Site (Exelon, PHI, and Pepco). In September 2010, PHI received a letter from EPA identifying the Benning Road site as one of six land-based sites potentially contributing to contamination of the lower Anacostia River. A portion of the site, which is owned by Pepco, was formerly the location of an electric generating facility owned by Pepco subsidiary, Pepco Energy Services, which became a part of Generation, following the 2016 merger between PHI and Exelon. This generating facility was deactivated in June 2012. The remaining portion of the site consists of a Pepco transmission and distribution service center that remains in operation. In December 2011, the U.S. District Court for the District of Columbia approved a Consent Decree entered into by Pepco and Pepco Energy Services (hereinafter "Pepco Entities") with the DOEE, which requires the Pepco Entities to conduct a Remedial Investigation and Feasibility Study (RI/FS) for the Benning Road site and an approximately 10 to 15-acre portion of the adjacent Anacostia River. The purpose of this RI/FS is to define the nature and extent of contamination from the Benning Road site and to evaluate remedial alternatives.
Pursuant to an internal agreement between the Pepco Entities, since 2013, Pepco has performed the work required by the Consent Decree and has been reimbursed for that work by an agreed upon allocation of costs between the Pepco Entities. In September 2019, the Pepco Entities issued a draft “final” RI report which DOEE approved on February 3, 2020. The Pepco Entities are developing a FS to evaluate possible remedial alternatives for submission to DOEE. The Court has established a schedule for completion of the FS, and approval by the DOEE, by September 16, 2022. After completion and approval of the FS, DOEE will prepare a Proposed Plan for public comment and then issue a Record of Decision (ROD) identifying any further response actions determined to be necessary. As part of the separation between Exelon and Constellation in February 2022, the internal agreement between the Pepco Entities for completion and payment for the remaining Consent Decree work was memorialized in a formal agreement for post-separation activities. A second post-separation assumption agreement between Exelon and Constellation transferred any of the potential remaining remediation liability, if any, of PES/Generation to a non-utility subsidiary of Exelon which going forward will be responsible for those liabilities. Exelon, PHI, and Pepco have determined that a loss associated with this matter is probable and have accrued an estimated liability, which is included in the table above.
Anacostia River Tidal Reach (Exelon, PHI, and Pepco). Contemporaneous with the Benning Road site RI/FS, being performed by the Pepco Entities, DOEE and National Park Service ("NPS") have been conducting a separate RI/FS focused on the entire tidal reach of the Anacostia River extending from just north of the Maryland-District of Columbia boundary line to the confluence of the Anacostia and Potomac Rivers. The river-wide RI incorporated the results of the river sampling performed by the Pepco Entities as part of the Benning RI/FS, as well as similar sampling efforts conducted by owners of other sites adjacent to this segment of the river and supplemental river sampling conducted by DOEE’s contractor. In April 2018, DOEE released a draft RI report for public review and comment. Pepco submitted written comments to the draft RI and participated in a public hearing.
Exelon, PHI, and Pepco have determined that it is probable that costs for remediation will be incurred and recorded a liability in the third quarter 2019 for management’s best estimate of its share of those costs. On September 30, 2020, DOEE released its Interim ROD. The Interim ROD reflects an adaptive management
86



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 12 — Commitments and Contingencies
approach which will require several identified “hot spots” in the river to be addressed first while continuing to conduct studies and to monitor the river to evaluate improvements and determine potential future remediation plans. The adaptive management process chosen by DOEE is less intrusive, provides more long-term environmental certainty, is less costly, and allows for site specific remediation plans already underway, including the plan for the Benning Road site to proceed to conclusion. Pepco concluded that incremental exposure remains reasonably possible, but management cannot reasonably estimate a range of loss beyond the amounts recorded, which are included in the table above.
On July 12, 2021, DOEE and NPS held a virtual meeting with the PRP's in response to a General Notice Letter sent by each agency inviting the PRP's to participate in discussions, which Pepco attended.
In addition to the activities associated with the remedial process outlined above, CERCLA separately requires federal and state (here including Washington, D.C.) Natural Resource Trustees (federal or state agencies designated by the President or the relevant state, respectively, or Indian tribes) to conduct an assessment of any damages to natural resources within their jurisdiction as a result of the contamination that is being remediated. The Trustees can seek compensation from responsible parties for such damages, including restoration costs. During the second quarter of 2018, Pepco became aware that the Trustees are in the beginning stages of a Natural Resources Damages (NRD) assessment, a process that often takes many years beyond the remedial decision to complete. Pepco has entered into negotiations with the Trustees to evaluate possible incorporation of NRD assessment and restoration as part of its remedial activities associated with the Benning site to accelerate the NRD benefits for that portion of the Anacostia River Sediment Project ("ARSP") assessment. Pepco has concluded that a loss associated with the eventual NRD assessment is reasonably possible. Due to the very early stage of the assessment process, Pepco cannot reasonably estimate the final range of loss potentially resulting from this process.
As noted in the Benning Road Site disclosure above, as part of the separation of Exelon and Constellation in February 2022, an assumption agreement was executed transferring any potential future remediation liabilities associated with the Benning Site remediation to a non-utility subsidiary of Exelon. Similarly, any potential future liability associated with the ARSP was also assumed by this entity.
Litigation and Regulatory Matters
Deferred Prosecution Agreement (DPA) and Related Matters (Exelon and ComEd). Exelon and ComEd received a grand jury subpoena in the second quarter of 2019 from the U.S. Attorney’s Office for the Northern District of Illinois (USAO) requiring production of information concerning their lobbying activities in the State of Illinois. On October 4, 2019, Exelon and ComEd received a second grand jury subpoena from the USAO requiring production of records of any communications with certain individuals and entities. On October 22, 2019, the SEC notified Exelon and ComEd that it had also opened an investigation into their lobbying activities. On July 17, 2020, ComEd entered into a DPA with the USAO to resolve the USAO investigation. Under the DPA, the USAO filed a single charge alleging that ComEd improperly gave and offered to give jobs, vendor subcontracts, and payments associated with those jobs and subcontracts for the benefit of the Speaker of the Illinois House of Representatives and the Speaker’s associates, with the intent to influence the Speaker’s action regarding legislation affecting ComEd’s interests. The DPA provides that the USAO will defer any prosecution of such charge and any other criminal or civil case against ComEd in connection with the matters identified therein for a three-year period subject to certain obligations of ComEd, including payment to the U.S. Treasury of $200 million, which was paid in November 2020. Exelon was not made party to the DPA, and therefore the investigation by the USAO into Exelon’s activities ended with no charges being brought against Exelon. The SEC’s investigation remains ongoing and Exelon and ComEd have cooperated fully and intend to continue to cooperate fully with the SEC. Exelon and ComEd cannot predict the outcome of the SEC investigation. No loss contingency has been reflected in Exelon's and ComEd's consolidated financial statements with respect to the SEC investigation, as this contingency is neither probable nor reasonably estimable at this time.
Subsequent to Exelon announcing the receipt of the subpoenas, various lawsuits were filed, and various demand letters were received related to the subject of the subpoenas, the conduct described in the DPA and the SEC's investigation, including:
•Four putative class action lawsuits against ComEd and Exelon were filed in federal court on behalf of ComEd customers in the third quarter of 2020 alleging, among other things, civil violations of federal racketeering laws. In addition, the Citizens Utility Board (CUB) filed a motion to intervene in these cases
87



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 12 — Commitments and Contingencies
on October 22, 2020 which was granted on December 23, 2020. On December 2, 2020, the court appointed interim lead plaintiffs in the federal cases which consisted of counsel for three of the four federal cases. These plaintiffs filed a consolidated complaint on January 5, 2021. CUB also filed its own complaint against ComEd only on the same day. The remaining federal case, Potter, et al. v. Exelon et al, differed from the other lawsuits as it named additional individual defendants not named in the consolidated complaint. However, the Potter plaintiffs voluntarily dismissed their complaint without prejudice on April 5, 2021. ComEd and Exelon moved to dismiss the consolidated class action complaint and CUB’s complaint on February 4, 2021 and briefing was completed on March 22, 2021. On March 25, 2021, the parties agreed, along with state court plaintiffs, discussed below, to jointly engage in mediation. The parties participated in a one-day mediation on June 7, 2021 but no settlement was reached. On September 9, 2021, the federal court granted Exelon’s and ComEd’s motion to dismiss and dismissed the plaintiffs’ and CUB’s federal law claim with prejudice. The federal court also dismissed the related state law claims made by the federal plaintiffs and CUB on jurisdictional grounds. Plaintiffs appealed dismissal of the federal law claim to the Seventh Circuit Court of Appeals. Plaintiffs and CUB also refiled their state law claims in state court and moved to consolidate them with the already pending consumer state court class action, discussed below. Plaintiffs' opening appeal brief in the Seventh Circuit was filed on January 14, 2022. Exelon and ComEd filed their response brief on March 7, 2022, and plaintiffs filed their reply brief on April 6, 2022. The court has scheduled oral argument for May 17, 2022.
•Three putative class action lawsuits against ComEd and Exelon were filed in Illinois state court in the third quarter of 2020 seeking restitution and compensatory damages on behalf of ComEd customers. The cases were consolidated into a single action in October of 2020. In November 2020, CUB filed a motion to intervene in the cases pursuant to an Illinois statute allowing CUB to intervene as a party or otherwise participate on behalf of utility consumers in any proceeding which affects the interest of utility consumers. On November 23, 2020, the court allowed CUB’s intervention, but denied CUB's request to stay these cases. Plaintiffs subsequently filed a consolidated complaint, and ComEd and Exelon filed a motion to dismiss on jurisdictional and substantive grounds on January 11, 2021. Briefing on that motion was completed on March 2, 2021. The parties agreed, on March 25, 2021, along with the federal court, plaintiffs discussed above, to jointly engage in mediation. The parties participated in a one-day mediation on June 7, 2021 but no settlement was reached. On December 23, 2021, the state court granted ComEd and Exelon's motion to dismiss with prejudice. On December 30, 2021, plaintiffs filed a motion to reconsider that dismissal and for permission to amend their complaint. The court denied the plaintiffs' motion on January 21, 2022. Plaintiffs have appealed the court's ruling dismissing their complaint to the First District Court of Appeals. On February 15, 2022, Exelon and ComEd moved to dismiss the federal plaintiffs' refiled state law claims, seeking dismissal on the same legal grounds asserted in their motion to dismiss the original state court plaintiffs' complaint. The court granted dismissal of the refiled state claims on February 16, 2022. The original federal plaintiffs appealed that dismissal on February 18, 2022. The two state appeals were consolidated on March 21, 2022. Plaintiffs' opening appellate briefs are currently due June 3, 2022.
•A putative class action lawsuit against Exelon and certain officers of Exelon and ComEd was filed in federal court in December 2019 alleging misrepresentations and omissions in Exelon’s SEC filings related to ComEd’s lobbying activities and the related investigations. The complaint was amended on September 16, 2020, to dismiss two of the original defendants and add other defendants, including ComEd. Defendants filed a motion to dismiss in November 2020. The court denied the motion in April 2021. On May 26, 2021, defendants moved the court to certify its order denying the motion to dismiss for interlocutory appeal. Briefing on the motion was completed in June 2021. That motion was denied on January 28, 2022. In May 2021, the parties each filed respective initial discovery disclosures. On June 9, 2021, defendants filed their answer and affirmative defenses to the complaint and the parties engaged thereafter in discovery. On September 9, 2021, the U.S. government moved to intervene in the lawsuit and stay discovery until the parties entered into an amendment to their protective order that would prohibit the parties from requesting discovery into certain matters, including communications with the U.S. government. The court ordered said amendment to the protective order on November 15, 2021 and discovery resumed. On February 10, 2022, the court granted an extension of the amendment to the protective order, at the U.S. government's request, to May 15, 2022 and directed the parties to submit a proposed joint schedule for the additional case proceedings by May 13, 2022.
88



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 12 — Commitments and Contingencies
•Several shareholders have sent letters to the Exelon Board of Directors from 2020 through May 2022 demanding, among other things, that the Exelon Board of Directors investigate and address alleged breaches of fiduciary duties and other alleged violations by Exelon and ComEd officers and directors related to the conduct described in the DPA. In the first quarter of 2021, the Exelon Board of Directors appointed a Special Litigation Committee (“SLC”) consisting of disinterested and independent parties to investigate and address these shareholders’ allegations and make recommendations to the Exelon Board of Directors based on the outcome of the SLC’s investigation. In July 2021, one of the demand letter shareholders filed a derivative action against current and former Exelon and ComEd officers and directors, and against Exelon, as nominal defendant, asserting the same claims made in its demand letter. On October 12, 2021, the parties to the derivative action filed an agreed motion to stay that litigation for 120 days in order to allow the SLC to continue its investigation, which the court granted. On January 31, 2022, the parties jointly moved the court to extend the stay an additional 120 days.
•Two separate shareholder requests seeking review of certain Exelon books and records were received in August 2021 and January 2022. Exelon responded to both requests and both shareholders have since sent formal shareholder demands to the Exelon Board, as discussed above.
No loss contingencies have been reflected in Exelon’s and ComEd’s consolidated financial statements with respect to these matters, as such contingencies are neither probable nor reasonably estimable at this time.
The ICC continues to conduct an investigation into rate impacts of conduct admitted in the DPA initiated on August 12, 2021. On December 16, 2021, ComEd filed direct testimony addressing the costs recovered from customers related to the DPA and Exelon's funding of the fine paid by ComEd. In that testimony, ComEd proposed to voluntarily refund to customers compensation costs of the former officers charged with wrongdoing in connection with events described in the DPA for the period during which those events occurred as well as costs, previously proposed to be returned, of individuals and entities specifically identified in the DPA, as well as individuals and entities who were referred to ComEd as part of the conduct described in the DPA and who failed, during their tenure at ComEd, to perform work to management expectations. The testimony supports the calculation of the refund amount and proposes a refund mechanism (one-time bill credit in April 2023) and also addresses other topics outlined by statute and the ICC orders initiating the investigation. On April 14, 2022, in response to rebuttal testimony from ICC staff and the Illinois Attorney General, City of Chicago, and CUB, ComEd filed surrebuttal testimony, in which ComEd proposed to increase its voluntary customer refund to $38 million of ICC and FERC jurisdictional amounts, and estimated interest to resolve the issue of the potential expenditure of customer monies on activities identified in the DPA in this matter. An accrual for the amount of the voluntary customer refund has been recorded in Other deferred credits and other liabilities in Exelon’s and ComEd’s Consolidated Balance Sheets as of March 31, 2022. The voluntary customer refund will not be recovered in rates or charged to customers and ComEd will not seek or accept reimbursement or indemnification from any source other than Exelon. The evidentiary hearing on the remaining contested issue was held on April 28, 2022. A final order is expected by September 9, 2022.
Savings Plan Claim (Exelon). On December 6, 2021, seven current and former employees filed a putative ERISA class action suit in U.S. District Court for the Northern District of Illinois against Exelon, its Board of Directors, the former Board Investment Oversight Committee, the Corporate Investment Committee, individual defendants, and other unnamed fiduciaries of the Exelon Corporation Employee Savings Plan (“Plan”). The complaint alleges that the defendants violated their fiduciary duties under the Plan by including certain investment options that allegedly were more expensive than and underperformed similar passively-managed or other funds available in the marketplace and permitting a third-party administrative service provider/recordkeeper and an investment adviser to charge excessive fees for the services provided. The plaintiffs seek declaratory, equitable and monetary relief on behalf of the Plan and participants. On February 16, 2022, the court granted the parties' stipulated dismissal of the individual named defendants without prejudice. The remaining defendants filed a motion to dismiss the complaint on February 25, 2022. The plaintiffs filed their response brief on March 28, 2022 and the defendants filed their reply on April 11, 2022. On March 4, 2022, the Chamber of Commerce filed a brief of amicus curiae in support of the defendants' motion to dismiss. No loss contingencies have been reflected in Exelon’s consolidated financial statements with respect to this matter, as such contingencies are neither probable nor reasonably estimable at this time.
General (All Registrants). The Registrants are involved in various other litigation matters that are being defended and handled in the ordinary course of business. The assessment of whether a loss is probable or reasonably possible, and whether the loss or a range of loss is estimable, often involves a series of complex
89



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 12 — Commitments and Contingencies
judgments about future events. The Registrants maintain accruals for such losses that are probable of being incurred and subject to reasonable estimation. Management is sometimes unable to estimate an amount or range of reasonably possible loss, particularly where (1) the damages sought are indeterminate, (2) the proceedings are in the early stages, or (3) the matters involve novel or unsettled legal theories. In such cases, there is considerable uncertainty regarding the timing or ultimate resolution of such matters, including a possible eventual loss.
13. Changes in Accumulated Other Comprehensive Income (Exelon)
The following tables present changes in Exelon's AOCI, net of tax, by component:
Three Months Ended March 31, 2022 Cash Flow Hedges
Pension and
Non-Pension
Postretirement
Benefit Plan
Items(a)
Foreign
Currency
Items		Total
Balance at December 31, 2021$(6)$(2,721)$(23)$(2,750)
Separation of Constellation6 1,994 23 2,023 
Amounts reclassified from AOCI— 14 — 14 
Net current-period OCI— 14 — 14 
Balance at March 31, 2022$— $(713)$— $(713)
Three Months Ended March 31, 2021Losses on Cash Flow Hedges
Pension and
Non-Pension
Postretirement
Benefit Plan
Items(a)
Foreign
Currency
Items		Total
Balance at December 31, 2020$(5)$(3,372)$(23)$(3,400)
OCI before reclassifications— (2)1 (1)
Amounts reclassified from AOCI— 55 — 55 
Net current-period OCI— 53 1 54 
Balance at March 31, 2021$(5)$(3,319)$(22)$(3,346)
______
(a)This AOCI component is included in the computation of net periodic pension and OPEB cost. Additionally, as of February 1, 2022, in connection with the separation, Exelon's pension and OPEB plans were remeasured. See Note 8 — Retirement Benefits for additional information. See Exelon's Statements of Operations and Comprehensive Income for individual components of AOCI.
The following table presents income tax benefit (expense) allocated to each component of Exelon's other comprehensive income (loss):
Three Months Ended March 31,
20222021
Pension and non-pension postretirement benefit plans:
Prior service benefit reclassified to periodic benefit cost$— $1 
Actuarial loss reclassified to periodic benefit cost(5)(19)


14. Supplemental Financial Information (All Registrants)
Supplemental Statement of Operations Information
The following tables provide additional information about material items recorded in the Registrants' Consolidated Statements of Operations and Comprehensive Income:
90



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 14 — Supplemental Financial Information
Taxes other than income taxes
ExelonComEdPECOBGEPHIPepcoDPLACE
Three Months Ended March 31, 2022
Utility taxes(a)
$221 $78 $38 $27 $78 $70 $7 $1 
Property94 10 4 46 34 23 10 1 
Payroll37 7 4 4 7 2 1 1 
Three Months Ended March 31, 2021
Utility taxes(a)
$193 $59 $35 $25 $74 $67 $6 $1 
Property86 8 4 42 32 21 10 1 
Payroll33 7 4 5 7 2 1 — 
_________
(a)The Registrants' utility taxes represent municipal and state utility taxes and gross receipts taxes related to their operating revenues. The offsetting collection of utility taxes from customers is recorded in revenues in the Registrants’ Consolidated Statements of Operations and Comprehensive Income.
Other, net
ExelonComEdPECOBGEPHIPepcoDPLACE
Three Months Ended March 31, 2022
AFUDC — Equity$36 $8 $7 $6 $15 $11 $2 $2 
Non-service net periodic benefit cost17 — — — — — — — 
Three Months Ended March 31, 2021
AFUDC — Equity$28 $4 $6 $7 $11 $9 $1 $1 
Non-service net periodic benefit cost20 — — — — — — — 
Supplemental Cash Flow Information
The following tables provide additional information about material items recorded in the Registrants' Consolidated Statements of Cash Flows.
91



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 14 — Supplemental Financial Information
Depreciation and amortization
Exelon(a)
ComEdPECOBGEPHIPepcoDPLACE
Three Months Ended March 31, 2022
Property, plant, and equipment(b)
$726 $254 $88 $117 $164 $72 $45 $41 
Amortization of regulatory assets(b)
179 67 4 54 54 36 12 6 
Amortization of intangible assets, net(b)
6 — — — — — — — 
Amortization of energy contract assets and liabilities(c)
3 — — — — — — — 
Nuclear fuel(d)
66 — — — — — — — 
ARO accretion(e)
44 — — — — — — — 
Total depreciation, amortization, and accretion$1,024 $321 $92 $171 $218 $108 $57 $47 
Three Months Ended March 31, 2021
Property, plant, and equipment(b)
$1,522 $239 $82 $106 $154 $67 $42 $37 
Amortization of regulatory assets(b)
160 53 4 46 56 35 11 10 
Amortization of intangible assets, net(b)
15 — — — — — — — 
Amortization of energy contract assets and liabilities(c)
4 — — — — — — — 
Nuclear fuel(d)
276 — — — — — — — 
ARO accretion(e)
127 — — — — — — — 
Total depreciation, amortization, and accretion$2,104 $292 $86 $152 $210 $102 $53 $47 
__________
(a)Exelon's amounts include amounts related to Generation prior to the separation. See Note 2 — Discontinued Operations for additional information.
(b)Included in Depreciation and amortization in the Registrants' Consolidated Statements of Operations and Comprehensive Income.
(c)Included in Operating revenues or Purchased power and fuel expense in the Registrants’ Consolidated Statements of Operations and Comprehensive Income.
(d)Included in Purchased fuel expense in Exelon's Consolidated Statement of Operations and Comprehensive Income.
(e)Included in Operating and maintenance expense in Exelon's Consolidated Statement of Operations and Comprehensive Income.
92



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 14 — Supplemental Financial Information
Other non-cash operating activities
Exelon(a)
ComEdPECOBGEPHIPepcoDPLACE
Three Months Ended March 31, 2022
Pension and non-pension postretirement benefit costs$44 $16 $(2)$12 $13 $2 $1 $3 
Allowance for credit losses78 17 27 18 18 9 6 3 
Other decommissioning-related activity36 — — — — — — — 
Energy-related options60 — — — — — — — 
True-up adjustments to decoupling mechanisms and formula rates(b)
(29)(40)(6)12 5 7 1 (3)
Long-term incentive plan25 — — — — — — — 
Amortization of operating ROU asset23 1 — 7 7 2 2 1 
AFUDC — Equity(36)(8)(7)(6)(15)(11)(2)(2)
Three Months Ended March 31, 2021
Pension and non-pension postretirement benefit costs$95 $32 $2 $14 $12 $2 $1 $3 
Allowance for credit losses85 13 24 4 10 5 4 1 
Other decommissioning-related activity(322)— — — — — — — 
Energy-related options17 — — — — — — — 
True-up adjustments to decoupling mechanisms and formula rates(b)
(129)(54)(10)(18)(46)(26)(9)(11)
Long-term incentive plan32 — — — — — — — 
Amortization of operating ROU asset37 — — 7 7 1 3 1 
AFUDC — Equity(28)(4)(6)(7)(11)(9)(1)(1)
__________
(a)Exelon's amounts include amounts related to Generation prior to the separation. See Note 2 — Discontinued Operations for additional information.
(b)For ComEd, reflects the true-up adjustments in regulatory assets and liabilities associated with its distribution, energy efficiency, distributed generation, and transmission formula rates. For BGE, Pepco, DPL, and ACE, reflects the change in regulatory assets and liabilities associated with their decoupling mechanisms and transmission formula rates. For PECO, reflects the change in regulatory assets and liabilities associated with its transmission formula rates. See Note 3 — Regulatory Matters of the Exelon Form 10-K for additional information.

93



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 14 — Supplemental Financial Information
The following tables provide a reconciliation of cash, cash equivalents, and restricted cash reported within the Registrants’ Consolidated Balance Sheets that sum to the total of the same amounts in their Consolidated Statements of Cash Flows.
ExelonComEdPECOBGEPHIPepcoDPLACE
March 31, 2022
Cash and cash equivalents$2,476 $343 $26 $41 $796 $502 $120 $168 
Restricted cash and cash equivalents430 246 8 34 106 34 73 — 
Restricted cash included in other long-term assets92 92 — — — — — — 
Total cash, restricted cash, and cash equivalents$2,998 $681 $34 $75 $902 $536 $193 $168 
December 31, 2021
Cash and cash equivalents$672 $131 $36 $51 $136 $34 $28 $29 
Restricted cash and cash equivalents321 210 8 4 77 34 43 — 
Restricted cash included in other long-term assets44 43 — — — — — — 
Cash, restricted cash, and cash equivalents from discontinued operations582— — — — — — — 
Total cash, restricted cash, and cash equivalents$1,619 $384 $44 $55 $213 $68 $71 $29 
March 31, 2021
Cash and cash equivalents$1,908 $86 $48 $21 $558 $134 $64 $353 
Restricted cash and cash equivalents374 270 7 1 37 33 — 4 
Restricted cash included in other long-term assets52 43 — — 9 — — 9 
Total cash, restricted cash, and cash equivalents(a)
$2,334 $399 $55 $22 $604 $167 $64 $366 
December 31, 2020
Cash and cash equivalents$663 $83 $19 $144 $111 $30 $15 $17 
Restricted cash and cash equivalents438 279 7 1 39 35 — 3 
Restricted cash included in other long-term assets53 43 — — 10 — — 10 
Cash, restricted cash, and cash equivalents - Held for Sale12 — — — — — — — 
Total cash, restricted cash, and cash equivalents(a)
$1,166 $405 $26 $145 $160 $65 $15 $30 
__________
(a)Exelon's amounts include amounts related to Generation prior to the separation. See Note 2 — Discontinued Operations for additional information.

For additional information on restricted cash see Note 1 — Significant Accounting Policies of the Exelon 2021 Form 10-K.
94



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 14 — Supplemental Financial Information
Supplemental Balance Sheet Information
The following table provides additional information about material items recorded in the Registrants' Consolidated Balance Sheets.
Accrued expenses
ExelonComEdPECOBGEPHIPepcoDPLACE
March 31, 2022
Compensation-related accruals(a)
$370 $95 $51 $48 $73 $26 $15 $12 
Taxes accrued258 95 15 78 94 85 10 9 
Interest accrued346 66 36 39 77 37 21 17 
December 31, 2021
Compensation-related accruals(a)
$596 $155 $77 $78 $113 $35 $20 $17 
Taxes accrued253 94 14 53 96 88 9 11 
Interest accrued297 116 41 44 52 28 8 11 
__________
(a)Primarily includes accrued payroll, bonuses and other incentives, vacation, and benefits.
15. Related Party Transactions (All Registrants)
Utility Registrants' expense with Generation
The Utility Registrants incurred expenses from transactions with the Generation affiliate as described in the footnotes to the table below prior to separation on February 1, 2022. Such expenses were primarily recorded as Purchased power from affiliates and an immaterial amount recorded as Operating and maintenance expense from affiliates at the Utility Registrants:
 Three Months Ended March 31,
 20222021
ComEd(a)
$59 $85 
PECO(b)
33 42 
BGE(c)
18 72 
PHI51 100 
Pepco(d)
39 75 
DPL(e)
10 21 
ACE(f)
2 4 
__________
(a)ComEd had an ICC-approved RFP contract with Generation to provide a portion of ComEd’s electric supply requirements. ComEd also purchased RECs and ZECs from Generation.
(b)PECO received electric supply from Generation under contracts executed through PECO’s competitive procurement process. In addition, PECO had a ten-year agreement with Generation to sell solar AECs.
(c)BGE received a portion of its energy requirements from Generation under its MDPSC-approved market-based SOS and gas commodity programs.
(d)Pepco received electric supply from Generation under contracts executed through Pepco's competitive procurement process approved by the MDPSC and DCPSC.
(e)DPL received a portion of its energy requirements from Generation under its MDPSC and DEPSC approved market-based SOS commodity programs.
(f)ACE received electric supply from Generation under contracts executed through ACE's competitive procurement process approved by the NJBPU.
95



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 15 — Related Party Transactions

Service Company Costs for Corporate Support
The Registrants receive a variety of corporate support services from BSC. Pepco, DPL, and ACE also receive corporate support services from PHISCO. See Note 1 — Significant Accounting Policies for additional information regarding BSC and PHISCO.
The following table presents the service company costs allocated to the Registrants:
Operating and maintenance from affiliatesCapitalized costs
Three Months Ended March 31,Three Months Ended March 31,
2022202120222021
Exelon
   BSC$205 $114 
   PHISCO19 17 
ComEd
   BSC$85 $71 85 45 
PECO
   BSC49 39 36 17 
BGE
   BSC51 43 38 20 
PHI
   BSC50 39 46 32 
   PHISCO19 17 
Pepco
   BSC29 22 17 13 
   PHISCO29 30 8 7 
DPL
   BSC18 14 14 10 
   PHISCO24 25 6 5 
ACE
   BSC15 12 15 8 
   PHISCO21 22 5 5 
96



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 15 — Related Party Transactions

Current Receivables from/Payables to affiliates
The following tables present current receivables from affiliates and current payables to affiliates:
March 31, 2022
Receivables from affiliates:
Payables to affiliates:ComEdPECOBGEPepcoDPLACEBSCPHISCOOtherTotal
ComEd$— $— $— $— $— $64 $— $2 $66 
PECO$— — — — — 33 — 5 38 
BGE— — — — — 35 — 2 37 
PHI— — — — — — 7 1 10 18 
Pepco— — — — — 19 15 — 34 
DPL— — — — — 3 12 — 15 
ACE— — — — — 12 11 — 23 
Other3 — — — — — — — 3 
Total$3 $— $— $— $— $— $173 $39 $19 $234 
December 31, 2021
Receivables from affiliates:
Payables to affiliates:ComEdPECOBGEPepcoDPLACEGenerationBSCPHISCOOtherTotal
ComEd$— $— $— $— $— 41 $71 $— $9 $121 
PECO$— — — — — 30 36 — 4 70 
BGE— — — — — 4 41 — 3 48 
PHI— 1 — — — 1 — 5 — 9 16 
Pepco— — 1 1 1 20 21 12 3 59 
DPL— — — — — 4 17 11 1 33 
ACE— — — — — 7 13 9 2 31 
Generation13 — — — — — 102 — 16 131 
Other3 — — — — — 11 — — 14 
Total$16 $1 $1 $— $1 $2 $117 $306 $32 $47 $523 
Borrowings from Exelon/PHI intercompany money pool
To provide an additional short-term borrowing option that will generally be more favorable to the borrowing participants than the cost of external financing both Exelon and PHI operate an intercompany money pool. ComEd, PECO, and PHI Corporate participate in the Exelon money pool. Pepco, DPL, and ACE participate in the PHI intercompany money pool.
Noncurrent Receivables from affiliates
ComEd and PECO have noncurrent receivables with Generation as a result of the nuclear decommissioning contractual construct whereby, to the extent NDT funds are greater than the underlying ARO at the end of decommissioning, such amounts are due back to ComEd and PECO, as applicable, for payment to their respective customers. The receivables are recorded in Receivable related to Regulatory Agreement Units as of March 31, 2022 and in noncurrent Receivables from affiliates as of December 31, 2021. See Note 10 — Asset Retirement Obligations of the Combined Notes to Consolidated Financial Statements of the Exelon 2021 Form 10-K for additional information.
Long-term debt to financing trusts
The following table presents Long-term debt to financing trusts:
97



Table of Contents
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 15 — Related Party Transactions

March 31, 2022December 31, 2021
ExelonComEdPECOExelonComEdPECO
ComEd Financing III$206 $205 $— $206 $205 $— 
PECO Trust III81 — 81 81 — 81 
PECO Trust IV103 — 103 103 — 103 
Total$390 $205 $184 $390 $205 $184 

98



Table of Contents

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Dollars in millions except per share data, unless otherwise noted)
Exelon
Executive Overview
Exelon is a utility services holding company engaged in the energy distribution and transmission businesses through ComEd, PECO, BGE, Pepco, DPL, and ACE.
Exelon has six reportable segments consisting of ComEd, PECO, BGE, Pepco, DPL, and ACE. See Note 1 — Significant Accounting Policies and Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for additional information regarding Exelon's principal subsidiaries and reportable segments.
Exelon’s consolidated financial information includes the results of its seven separate operating subsidiary registrants, ComEd, PECO, BGE, PHI, Pepco, DPL, and ACE, which, along with Exelon, are collectively referred to as the Registrants. The following combined Management’s Discussion and Analysis of Financial Condition and Results of Operations is separately filed by Exelon, ComEd, PECO, BGE, PHI, Pepco, DPL, and ACE. However, none of the Registrants makes any representation as to information related solely to any of the other Registrants.
Financial Results of Operations
GAAP Results of Operations. The following table sets forth Exelon's GAAP consolidated Net income attributable to common shareholders from continuing operations and the Utility Registrants' Net income for the three months ended March 31, 2022 compared to the same period in 2021. For additional information regarding the financial results for the three months ended March 31, 2022 and 2021 see the discussions of Results of Operations by Registrant.
Three Months Ended March 31,(Unfavorable) Favorable Variance
20222021
Exelon$481 $525 $(44)
ComEd188 197 (9)
PECO206 167 39 
BGE198 209 (11)
PHI130 128 2 
Pepco46 59 (13)
DPL56 56 — 
ACE26 14 12 
Other(a)
(241)(176)(65)
__________
(a)Primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investing activities.

The separation of Constellation, including Generation and its subsidiaries, meets the criteria for discontinued operations and as such, Generation's results of operations are presented as discontinued operations and have been excluded from Exelon's continuing operations for all periods presented.
Accounting rules require that certain BSC costs previously allocated to Generation be presented as part of Exelon’s continuing operations as these costs do not qualify as expenses of the discontinued operations. Such costs are included in Other in the table above. See further discussion below.
Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021. Net income attributable to common shareholders from continuing operations decreased by $44 million and diluted
99



Table of Contents

earnings per average common share from continuing operations decreased to $0.49 in 2022 from $0.53 in 2021 primarily due to:
•An income tax expense recorded in connection with the separation primarily due to the long-term marginal state income tax rate change, the recognition of valuation allowances against the net deferred tax assets positions for certain standalone state filing jurisdictions, and nondeductible transaction costs;
•Higher depreciation expense at BGE and PHI; and
•Higher storm costs at PHI.
The decreases were partially offset by:
•Higher electric distribution earnings from higher rate base and higher allowed electric distribution ROE due to an increase in treasury rates at ComEd;

•The favorable impacts of regulatory rate increases at PECO, BGE, and PHI; and
•Lower BSC costs presented in Exelon’s continuing operations, which were previously allocated to Generation but do not qualify as expenses of the discontinued operation per the accounting rules. Such costs, on a pre-tax basis, were $28 million for the period in 2022 prior to the separation on February 1, 2022 (January 1, 2022 to January 31, 2022) and $106 million for the three months ended March 31, 2021.
Adjusted (non-GAAP) Operating Earnings. In addition to net income, Exelon evaluates its operating performance using the measure of Adjusted (non-GAAP) operating earnings because management believes it represents earnings directly related to the ongoing operations of the business. Adjusted (non-GAAP) operating earnings exclude certain costs, expenses, gains and losses, and other specified items. This information is intended to enhance an investor’s overall understanding of year-to-year operating results and provide an indication of Exelon’s baseline operating performance excluding items that are considered by management to be not directly related to the ongoing operations of the business. In addition, this information is among the primary indicators management uses as a basis for evaluating performance, allocating resources, setting incentive compensation targets, and planning and forecasting of future periods. Adjusted (non-GAAP) operating earnings is not a presentation defined under GAAP and may not be comparable to other companies’ presentations or deemed more useful than the GAAP information provided elsewhere in this report.
100



Table of Contents

The following table provides a reconciliation between net income attributable to common shareholders from continuing operations as determined in accordance with GAAP and adjusted (non-GAAP) operating earnings for the three months ended March 31, 2022 compared to the same period in 2021.
Three Months Ended March 31,
20222021
(In millions, except per share data)Earnings per
Diluted Share		Earnings per
Diluted Share
Net Income Attributable to Common Shareholders from Continuing Operations$481 $0.49 $525 $0.53 
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $1)— — (1)— 
COVID-19 Direct Costs (net of taxes of $1)(a)
— — 2 — 
Acquisition Related Costs (net of taxes of $2)(b)
— — 6 0.01 
ERP System Implementation Costs (net of taxes of $0 and $2, respectively)(c)
1 — 5 0.01 
Separation Costs (net of taxes of $7 and $1, respectively)(d)
17 0.02 5 0.01 
Income Tax-Related Adjustments (entire amount represents tax expense)(e)
134 0.14 — — 
Adjusted (non-GAAP) Operating Earnings$634 $0.64 $542 $0.55 
__________
Note:
Amounts may not sum due to rounding.
Unless otherwise noted, the income tax impact of each reconciling item between GAAP Net Income from Continuing Operations and Adjusted (non-GAAP) Operating Earnings is based on the marginal statutory federal and state income tax rates for each Registrant, taking into account whether the income or expense item is taxable or deductible, respectively, in whole or in part. The marginal statutory income tax rates for 2022 and 2021 ranged from 24.0% to 29.0%.

(a)Represents direct costs related to COVID-19 consisting primarily of costs to acquire personal protective equipment, costs for cleaning supplies and services, and costs to hire healthcare professionals to monitor the health of employees, which are recorded in Operating and maintenance expense.
(b)Reflects certain BSC costs related to the acquisition of Electricite de France SA's (EDF's) interest in CENG, which was completed in the third quarter of 2021, that were historically allocated to Generation but are presented as part of continuing operations in Exelon’s results as these costs do not qualify as expenses of the discontinued operations per the accounting rules.
(c)Reflects costs related to a multi-year Enterprise Resource Program (ERP) system implementation, which are recorded in Operating and maintenance expense.
(d)Represents costs related to the separation primarily comprised of system-related costs, third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the separation, and employee-related severance costs, which are recorded in Operating and maintenance expense.
(e)In connection with the separation, Exelon recorded an income tax expense primarily due to the long-term marginal state income tax rate change, the recognition of valuation allowances against the net deferred tax assets positions for certain standalone state filing jurisdictions, and nondeductible transaction costs.

Significant 2022 Transactions and Developments
Separation
On February 21, 2021, Exelon’s Board of Directors approved a plan to separate the Utility Registrants and Generation, creating two publicly traded companies (“the separation”). Exelon completed the separation on February 1, 2022. Constellation was newly formed and incorporated in Pennsylvania on June 15, 2021 for the purpose of separation and holds Generation. The separation represented a strategic shift that would have a major effect on Exelon’s operations and financial results. Accordingly, the separation meets the criteria for discontinued operations. See Note 2 — Discontinued Operations of the Combined Notes to Consolidated Financial Statements for additional information on the separation and discontinued operations.
101



Table of Contents

In connection with the separation, Exelon incurred separation costs impacting continuing operations of $24 million and $4 million on a pre-tax basis for the three months ended March 31, 2022 and March 31, 2021, respectively, which are recorded in Operating and maintenance expense. Total separation costs impacting continuing operations for the remainder of 2022 are not expected to be material. These costs are excluded from Adjusted (non-GAAP) Operating Earnings. The separation costs are primarily comprised of system-related costs, third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the separation, and employee-related severance costs.
Distribution Base Rate Case Proceedings
The Utility Registrants file base rate cases with their regulatory commissions seeking increases or decreases to their electric transmission and distribution, and gas distribution rates to recover their costs and earn a fair return on their investments. The outcomes of these regulatory proceedings impact the Utility Registrants’ current and future financial statements.
The following tables show the Utility Registrants’ completed and pending distribution base rate case proceedings in 2022. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information on these and other regulatory proceedings.
Completed Distribution Base Rate Case Proceedings
Registrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseApproved Revenue Requirement IncreaseApproved ROEApproval DateRate Effective Date
ComEd - IllinoisApril 16, 2021Electric$51 $46 7.36 %December 1, 2021January 1, 2022
PECO - PennsylvaniaMarch 30, 2021Electric246 132 N/ANovember 18, 2021January 1, 2022
BGE - MarylandMay 15, 2020 (amended September 11, 2020)Electric203 140 9.50 %December 16, 2020January 1, 2021
Natural Gas108 74 9.65 %
Pepco - District of ColumbiaMay 30, 2019 (amended June 1, 2020)Electric136 109 9.28 %June 8, 2021July 1, 2021
Pepco - MarylandOctober 26, 2020 (amended March 31, 2021)Electric104 52 9.55 %June 28, 2021June 28, 2021
DPL - MarylandSeptember 1, 2021 (amended December 23, 2021)Electric27 13 9.60 %March 2, 2022March 2, 2022
ACE - New JerseyDecember 9, 2020 (amended February 26, 2021)Electric67 41 9.60 %July 14, 2021January 1, 2022
102



Table of Contents

Pending Distribution Base Rate Case Proceedings
Registrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseRequested ROEExpected Approval Timing
ComEd - IllinoisApril 15, 2022Electric$199 7.85 %Fourth quarter of 2022
PECO - PennsylvaniaMarch 31, 2022Natural Gas82 10.95 %Fourth quarter of 2022
DPL - DelawareJanuary 14, 2022 (amended February 28, 2022)Natural Gas15 10.30 %First quarter of 2023
Transmission Formula Rates
For 2022, the following total increases were included in ComEd’s and BGE's electric transmission formula rate update. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information on these and other regulatory proceedings.
RegistrantInitial Revenue Requirement IncreaseAnnual Reconciliation DecreaseTotal Revenue Requirement IncreaseAllowed Return on Rate BaseAllowed ROE
ComEd$24 $(24)$— 8.11 %11.50 %
BGE25 (4)16 7.30 %10.50 %

Other Key Business Drivers and Management Strategies
The following discussion of other key business driver and management strategies includes current developments of previously disclosed matters and new issues arising during the period that may impact future financial statements. This section should be read in conjunction with ITEM 1. Business and ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Other Key Business Drivers and Management Strategies in the Registrants' combined 2021 Form 10-K and Note 12 — Commitments and Contingencies of the Combined Notes to Consolidated Financial Statements in this report for additional information on various environmental matters.
Legislative and Regulatory Developments
Infrastructure Investment and Jobs Act
On November 15, 2021, President Biden signed the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA) into law. IIJA provides for approximately $550 billion in new federal spending. Categories of funding include funding for a variety of infrastructure needs, including but not limited to: (1) power and grid reliability and resilience, (2) resilience for cybersecurity to address critical infrastructure needs, and (3) electric vehicle charging infrastructure for alternative fuel corridors. Federal agencies are in the process of developing guidelines to implement spending programs under IIJA. The time needed to develop these guidelines will vary with some limited program applications opened as early as the first quarter of 2022. The Registrants are analyzing the legislation and considering possible opportunities to apply for funding, either directly or in potential collaborations with state and/or local agencies and key stakeholders. The Registrants cannot predict the ultimate timing and success of securing funding from programs under IIJA.
Critical Accounting Policies and Estimates
Management of each of the Registrants makes a number of significant estimates, assumptions, and judgments in the preparation of its financial statements. At March 31, 2022, the Registrants’ critical accounting policies and estimates had not changed significantly from December 31, 2021 except for critical accounting policies and estimates that relate to Generation, which are no longer applicable to the Registrants. See ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS — Critical Accounting Policies and Estimates in the Registrants' 2021 Form 10-K for further information.
103



Table of Contents

Results of Operations by Registrant
Results of Operations — ComEd
Three Months Ended
March 31,		Favorable
(Unfavorable)
Variance
20222021
Operating revenues$1,734 $1,535 $199 
Operating expenses
Purchased power638 527 (111)
Operating and maintenance351 316 (35)
Depreciation and amortization321 292 (29)
Taxes other than income taxes96 75 (21)
Total operating expenses1,406 1,210 (196)
Operating income328 325 3 
Other income and (deductions)
Interest expense, net(100)(96)(4)
Other, net12 7 5 
Total other income and (deductions)(88)(89)1 
Income before income taxes240 236 4 
Income taxes 52 39 (13)
Net income $188 $197 $(9)
Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021. Net income decreased by $9 million as compared to the same period in 2021, primarily due to the voluntary customer refund related to the ICC investigation of matters identified in the Deferred Prosecution Agreement, partially offset by increases in electric distribution formula rate earnings (reflecting the impacts of higher rate base and higher allowed electric distribution ROE due to an increase in treasury rates). See Note 12 - Commitments and Contingencies of the Combined Notes to Consolidated Financial Statements for additional information related to the Deferred Prosecution Agreement.
The changes in Operating revenues consisted of the following:
Three Months Ended
March 31, 2022
Increase
Distribution$45 
Transmission21 
Energy efficiency7 
Other3 
76 
Regulatory required programs 123 
Total increase$199 
Revenue Decoupling. The demand for electricity is affected by weather and customer usage. Operating revenues are not impacted by abnormal weather, usage per customer or number of customers as a result of revenue decoupling mechanisms implemented pursuant to FEJA.
Distribution Revenue. EIMA and FEJA provide for a performance-based formula rate, which requires an annual reconciliation of the revenue requirement in effect to the actual costs that the ICC determines are prudently and reasonably incurred in a given year. Electric distribution revenue varies from year to year based upon fluctuations in the underlying costs, (e.g., severe weather and storm restoration), investments being recovered, and allowed ROE. Electric distribution revenue increased for the three months ended March 31, 2022 as compared to the
104




Table of Contents
ComEd
same period in 2021, due to the impact of higher rate base, higher allowed ROE due to an increase in treasury rates, and higher fully recoverable costs.
Transmission Revenue. Under a FERC-approved formula, transmission revenue varies from year to year based upon fluctuations in the underlying costs, capital investments being recovered, and the highest daily peak load, which is updated annually in January based on the prior calendar year. Generally, increases/decreases in the highest daily peak load will result in higher/lower transmission revenue. Transmission revenue increased for the three months ended March 31, 2022 as compared to the same periods in 2021 primarily due to the impact of higher rate base and higher fully recoverable costs.
Energy Efficiency Revenue. FEJA provides for a performance-based formula rate, which requires an annual reconciliation of the revenue requirement in effect to the actual costs that the ICC determines are prudently and reasonably incurred in a given year. Under FEJA, energy efficiency revenue varies from year to year based upon fluctuations in the underlying costs, investments being recovered, and allowed ROE. Energy efficiency revenue increased for the three months ended March 31, 2022 as compared to the same period in 2021, primarily due to increased regulatory asset amortization, which is fully recoverable.
Other Revenue primarily includes assistance provided to other utilities through mutual assistance programs. Other revenue remained relatively the same for the three months ended March 31, 2022 as compared to the same period in 2021.
Regulatory Required Programs represents revenues collected under approved riders to recover costs incurred for regulatory programs such as recoveries under the credit loss expense tariff, environmental costs associated with MGP sites, Energy Transition Assistance Charge ("ETAC"), and costs related to electricity, ZEC and REC procurement. ETAC is a retail customer surcharge collected by electric utilities operating in Illinois established by CEJA and remitted to an Illinois state agency for programs to support clean energy jobs and training. The riders are designed to provide full and current cost recovery. The costs of these programs are included in Purchased power expense, Operating and maintenance expense, Depreciation and amortization expense and Taxes other than income. Customers have the choice to purchase electricity from competitive electric generation suppliers. Customer choice programs do not impact the volume of deliveries as ComEd remains the distribution service provider for all customers and charges a regulated rate for distribution service, which is recorded in Operating revenues. For customers that choose to purchase electric generation from competitive suppliers, ComEd either acts as the billing agent or the competitive supplier separately bills its own customers, and therefore does not record Operating revenues or Purchased power expense related to the electricity. For customers that choose to purchase electric generation from ComEd, ComEd is permitted to recover the electricity, ZEC, and REC procurement costs without mark-up and therefore records equal and offsetting amounts in Operating revenues and Purchased power expense related to the electricity, ZECs, and RECs.
See Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for the presentation of ComEd's revenue disaggregation.
The increase of $111 million for the three months ended March 31, 2022 compared to the same period in 2021, in Purchased power expense is offset in Operating revenues as part of regulatory required programs.
105




Table of Contents
ComEd
The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
March 31, 2022
Increase (Decrease)
Storm-related costs$1 
Pension and non-pension postretirement benefits expense(7)
Labor, other benefits, contracting and materials2 
BSC costs14 
Other(a)
21 
31 
Regulatory required programs(b)
4 
Total increase$35 
__________
(a)The increase is primarily due to the voluntary customer refund related to the ICC investigation of matters identified in the Deferred Prosecution Agreement. See Note 12 - Commitments and Contingencies of the Combined Notes to Consolidated Financial Statements for additional information related to the Deferred Prosecution Agreement.
(b)ComEd is allowed to recover from or refund to customers the difference between its annual credit loss expense and the amounts collected in rates annually through a rider mechanism.
The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended
March 31, 2022
Increase
Depreciation and amortization(a)
$15 
Regulatory asset amortization(b)
14 
Total increase$29 
__________
(a)Reflects ongoing capital expenditures.
(b)Includes amortization of ComEd's energy efficiency formula rate regulatory asset
Taxes other than income taxes increased by $21 million for the three months ended March 31, 2022 compared to the same period in 2021, primarily due to taxes related to ETAC, which is recovered through Operating revenues.
Effective income tax rates were 21.7% and 16.5% for the three months ended March 31, 2022 and 2021, respectively. See Note 7 — Income Taxes of the Combined Notes to Consolidated Financial Statements for additional information regarding the components of the effective income tax rates.
106




Table of Contents
PECO
Results of Operations — PECO
Three Months Ended
March 31,		Favorable
(Unfavorable)
Variance
20222021
Operating revenues$1,047 $889 $158 
Operating expenses
Purchased power and fuel407 316 (91)
Operating and maintenance247 234 (13)
Depreciation and amortization92 86 (6)
Taxes other than income taxes47 43 (4)
Total operating expenses793 679 (114)
Operating income254 210 44 
Other income and (deductions)
Interest expense, net(41)(38)(3)
Other, net7 5 2 
Total other income and (deductions)(34)(33)(1)
Income before income taxes220 177 43 
Income taxes14 10 (4)
Net income$206 $167 $39 
Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021. Net income increased by $39 million, primarily due to increases in electric and gas distribution rates, and volume.
The changes in Operating revenues consisted of the following:
Three Months Ended
March 31, 2022
(Decrease) Increase
ElectricGasTotal
Weather$(4)$(5)$(9)
Volume7 7 14 
Pricing33 17 50 
Transmission5 — 5 
Other5 3 8 
46 22 68 
Regulatory required programs36 54 90 
Total increase$82 $76 $158 
Weather. The demand for electricity and natural gas is affected by weather conditions. With respect to the electric business, very warm weather in summer months and, with respect to the electric and natural gas businesses, very cold weather in winter months are referred to as “favorable weather conditions” because these weather conditions result in increased deliveries of electricity and natural gas. Conversely, mild weather reduces demand. During the three months ended March 31, 2022 compared to the same period in 2021, Operating revenues related to weather decreased by the impact of unfavorable weather conditions in PECO's service territory.
Heating and cooling degree-days are quantitative indices that reflect the demand for energy needed to heat or cool a home or business. Normal weather is determined based on historical average heating and cooling degree-days for a 30-year period in PECO's service territory. The changes in heating and cooling degree-days in
107




Table of Contents
PECO
PECO’s service territory for the three months ended March 31, 2022 compared to the same period in 2021 and normal weather consisted of the following:
Three Months Ended March 31,% Change
PECO Service Territory20222021Normal2022 vs. 20212022 vs. Normal
Heating Degree-Days2,228 2,3022,416(3.2)%(7.8)%
Cooling Degree-Days1 51(80.0)%— %
Volume. Electric volume, exclusive of the effects of weather, for the three months ended March 31, 2022, compared to the same period in 2021, increased on a net basis due to an increase in overall usage for customers further increased by customer growth. Natural gas volume for the three months ended March 31, 2022 compared to the same period in 2021, increased due to retail load growth.
Electric Retail Deliveries to Customers (in GWhs)Three Months Ended March 31,% Change
Weather -
Normal
% Change(b)
20222021
Residential3,7583,767(0.2)%1.1 %
Small commercial & industrial1,9371,8813.0 %3.4 %
Large commercial & industrial3,3323,2721.8 %1.9 %
Public authorities & electric railroads18214922.1 %22.4 %
Total electric retail deliveries(a)
9,2099,0691.5 %2.2 %
As of March 31,
Number of Electric Customers20222021
Residential1,521,2551,512,255
Small commercial & industrial155,485154,637
Large commercial & industrial3,1023,109
Public authorities & electric railroads10,34210,237
Total1,690,1841,680,238
__________
(a)Reflects delivery volumes from customers purchasing electricity directly from PECO and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges.
(b)Reflects the change in delivery volumes assuming normalized weather based on the historical 30-year average.
Natural Gas Deliveries to Customers (in mmcf)Three Months Ended
March 31,		% Change
Weather -
Normal
% Change(b)
20222021
Residential20,83720,6740.8 %4.3 %
Small commercial & industrial10,54610,1703.7 %5.8 %
Large commercial & industrial10742.9 %10.2 %
Transportation7,6397,650(0.1)%0.7 %
Total natural gas retail deliveries(a)
39,03238,5011.4 %4.0 %
 As of March 31,
Number of Natural Gas Customers20222021
Residential499,188493,857
Small commercial & industrial44,95944,604
Large commercial & industrial55
Transportation664685
Total544,816539,151
__________
(a)Reflects delivery volumes 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.
(b)Reflects the change in delivery volumes assuming normalized weather based on the historical 30-year average.

108




Table of Contents
PECO
Pricing for the three months ended March 31, 2022 compared to the same period in 2021 increased primarily due to an increase in electric and gas distribution rates charged to customers.
Transmission Revenue. Under a FERC approved formula, transmission revenue varies from year to year based upon fluctuations in the underlying costs and capital investments being recovered.
Other revenue primarily includes revenue related to late payment charges. Other revenues for the three months ended March 31, 2022 compared to the same period in 2021, remained relatively consistent.
Regulatory Required Programs represents revenues collected under approved riders to recover costs incurred for regulatory programs such as energy efficiency, PGC, and the GSA. The riders are designed to provide full and current cost recovery as well as a return. The costs of these programs are included in Purchased power and fuel expense, Operating and maintenance expense, Depreciation and amortization expense, and Income taxes. Customers have the choice to purchase electricity and natural gas from competitive electric generation and natural gas suppliers. Customer choice programs do not impact the volume of deliveries as PECO remains the distribution service provider for all customers and charges a regulated rate for distribution service, which is recorded in Operating revenues. For customers that choose to purchase electric generation or natural gas from competitive suppliers, PECO either acts as the billing agent or the competitive supplier separately bills its own customers and therefore PECO does not record Operating revenues or Purchased power and fuel expense related to the electricity and/or natural gas. For customers that choose to purchase electric generation or natural gas from PECO, PECO is permitted to recover the electricity, natural gas, and REC procurement costs without mark-up and therefore records equal and offsetting amounts in Operating revenues and Purchased power and fuel expense related to the electricity, natural gas, and RECs.     
See Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for the presentation of PECO's revenue disaggregation.
The increase of $91 million for the three months ended March 31, 2022 compared to the same period in 2021, respectively, in Purchased power and fuel expense is offset in Operating revenues as part of regulatory required programs.
The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
March 31, 2022
Increase (Decrease)
BSC costs$10 
Credit loss expense3 
Storm-related costs2 
Labor, other benefits, contracting and materials(2)
Pension and non-pension post retirement benefit expense(1)
Other(2)
10 
Regulatory required programs3 
Total increase$13 

The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended
March 31, 2022
Increase
Depreciation and amortization(a)
$6 
Regulatory asset amortization— 
Total increase$6 
__________
(a)Depreciation and amortization increased primarily due to ongoing capital expenditures.
109




Table of Contents
PECO
Interest expense, net increased $3 million for the three months ended March 31, 2022 compared to the same period in 2021, primarily due to the issuance of debt in 2021.
Effective income tax rates were 6.4% and 5.6% for the three months ended March 31, 2022 and 2021 respectively. See Note 7 — Income Taxes of the Combined Notes to Consolidated Financial Statements for additional information regarding the components of the effective income tax rates.
110




Table of Contents
BGE

Results of Operations — BGE
Three Months Ended
March 31,		Favorable
(Unfavorable)
Variance
20222021
Operating revenues$1,154 $974 $180 
Operating expenses
Purchased power and fuel 454 331 (123)
Operating and maintenance218 197 (21)
Depreciation and amortization171 152 (19)
Taxes other than income taxes76 72 (4)
Total operating expenses919 752 (167)
Operating income235 222 13 
Other income and (deductions)
Interest expense, net(35)(34)(1)
Other, net7 8 (1)
Total other income and (deductions)(28)(26)(2)
Income before income taxes207 196 11 
Income taxes9 (13)(22)
Net income$198 $209 $(11)
Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021. Net income decreased $11 million primarily due to an increase in depreciation expense and credit loss expense, partially offset by favorable impacts of the multi-year plans. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information on the three-year electric and natural gas distribution multi-year plans.
The changes in Operating revenues consisted of the following:
Three Months Ended
March 31, 2022
Increase
ElectricGasTotal
Distribution$14 $10 $24 
Transmission5 — 5 
Other8 2 10 
27 12 39 
Regulatory required programs78 63 141 
Total increase$105 $75 $180 
Revenue Decoupling. The demand for electricity and natural gas is affected by weather and customer usage. However, Operating revenues are not impacted by abnormal weather or usage per customer as a result of a monthly rate adjustment that provides for fixed distribution revenue per customer by customer class. While Operating revenues are not impacted by abnormal weather or usage per customer, they are impacted by changes in the number of customers.
 As of March 31,
Number of Electric Customers20222021
Residential1,199,272 1,192,470 
Small commercial & industrial115,363 114,819 
Large commercial & industrial12,674 12,505 
Public authorities & electric railroads268 266 
Total1,327,577 1,320,060 
111




Table of Contents
BGE

As of March 31,
Number of Natural Gas Customers20222021
Residential653,397 648,824 
Small commercial & industrial38,356 38,318 
Large commercial & industrial6,193 6,120 
Total697,946 693,262 
Distribution Revenue increased for the three months ended March 31, 2022, compared to the same period in 2021, due to favorable impacts of the multi-year plans.
Transmission Revenue. Under a FERC-approved formula, transmission revenue varies from year to year based upon fluctuations in the underlying costs and capital investments being recovered. Transmission revenue increased for the three months ended March 31, 2022, compared to the same period in 2021, primarily due to the increases in underlying costs and capital investments.
Other Revenue includes revenue related to late payment charges, mutual assistance, off-system sales, and service application fees. Other revenue increased for the three months ended March 31, 2022, compared to the same period in 2021, primarily due to an increase in late fees charged to customers.
Regulatory Required Programs represent revenues collected under approved riders to recover costs incurred for regulatory programs such as conservation, demand response, STRIDE, and the POLR mechanism. The riders are designed to provide full and current cost recovery, as well as a return in certain instances. The costs of these programs are included in Purchased power and fuel expense, Operating and maintenance expense, Depreciation and amortization expense, and Taxes other than income taxes. Customers have the choice to purchase electricity and natural gas from competitive electric generation and natural gas suppliers. Customer choice programs do not impact the volume of deliveries as BGE remains the distribution service provider for all customers and charges a regulated rate for distribution service, which is recorded in Operating revenues. For customers that choose to purchase electric generation or natural gas from competitive suppliers, BGE acts as the billing agent and therefore does not record Operating revenues or Purchased power and fuel expense related to the electricity and/or natural gas. For customers that choose to purchase electric generation or natural gas from BGE, BGE is permitted to recover the electricity and natural gas procurement costs from customers and therefore records the amounts related to the electricity and/or natural gas in Operating revenues and Purchased power and fuel expense. BGE recovers electricity and natural gas procurement costs from customers with a slight mark-up.
See Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for the presentation of BGE's revenue disaggregation.
The increase of $123 million for the three months ended March 31, 2022 compared to the same period in 2021, in Purchased power and fuel expense is fully offset in Operating revenues as part of regulatory required programs.

112




Table of Contents
BGE

The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
March 31, 2022
  Increase (Decrease)
Labor, other benefits, contracting, and materials$4 
Pension and non-pension postretirement benefits expense(3)
BSC costs8 
Credit loss expense14 
Other(3)
20 
Regulatory required programs1 
Total increase$21 
The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended
March 31, 2022
Increase
Depreciation and amortization(a)
$9 
Regulatory required programs7 
Regulatory asset amortization3 
Total increase$19 
__________
(a)Depreciation and amortization increased primarily due to ongoing capital expenditures.

Effective income tax rates were 4.3% and (6.6)% for the three months ended March 31, 2022 and 2021, respectively. The change is primarily due to decreases in the multi-year plans' accelerated income tax benefits in 2022 as compared to 2021. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information on the three-year electric and natural gas distribution multi-year plans and Note 7 — Income Taxes of the Combined Notes to Consolidated Financial Statements for additional information regarding the components of the effective income tax rates.
113




Table of Contents
PHI
Results of Operations — PHI
PHI’s Results of Operations include the results of its three reportable segments, Pepco, DPL, and ACE. PHI also has a business services subsidiary, PHISCO, which provides a variety of support services and the costs are directly charged or allocated to the applicable subsidiaries. Additionally, the results of PHI’s corporate operations include interest costs from various financing activities. All material intercompany accounts and transactions have been eliminated in consolidation. The following table sets forth PHI's GAAP consolidated Net income, by Registrant, for the three months ended March 31, 2022 compared to the same period in 2021. See the Results of Operations for Pepco, DPL, and ACE for additional information.
Three Months Ended March 31,Favorable (Unfavorable) Variance
20222021
PHI$130 $128 $2 
Pepco46 59 (13)
DPL
56 56 — 
ACE26 14 12 
Other(a)
2 (1)3 
_________
(a)Primarily includes eliminating and consolidating adjustments, PHI's corporate operations, shared service entities, and other financing and investing activities.

Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021. Net Income increased by $2 million primarily due to favorable impacts as a result of Pepco's Maryland and District of Columbia multi-year plans and higher electric distribution rates at DPL and ACE, partially offset by an increase in storm costs and depreciation expense.

114




Table of Contents
Pepco

Results of Operations — Pepco
Three Months Ended March 31,Favorable (Unfavorable) Variance
20222021
Operating revenues$614 $553 $61 
Operating expenses
Purchased power 213 166 (47)
Operating and maintenance131 108 (23)
Depreciation and amortization108 102 (6)
Taxes other than income taxes95 90 (5)
Total operating expenses547 466 (81)
Operating income 67 87 (20)
Other income and (deductions)
Interest expense, net(36)(34)(2)
Other, net13 12 1 
Total other income and (deductions)(23)(22)(1)
Income before income taxes44 65 (21)
Income taxes(2)6 8 
Net income$46 $59 $(13)

Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021. Net income decreased $13 million primarily due to an increase in storm costs, depreciation expense, and credit loss expense, partially offset by the favorable impacts of the Maryland and District of Columbia multi-year plans.
The changes in Operating revenues consisted of the following:
Three Months Ended March 31, 2022
Increase (Decrease)
Distribution$6 
Transmission3 
Other(3)
6 
Regulatory required programs55 
Total increase$61 
Revenue Decoupling. The demand for electricity is affected by weather and customer usage. However, Operating revenues from electric distribution in both Maryland and the District of Columbia are not impacted by abnormal weather or usage per customer as a result of a bill stabilization adjustment (BSA) that provides for a fixed distribution charge per customer by customer class. While Operating revenues are not impacted by abnormal weather or usage per customer, they are impacted by changes in the number of customers.
As of March 31,
Number of Electric Customers20222021
Residential846,258 835,415 
Small commercial & industrial54,509 53,738 
Large commercial & industrial22,620 22,492 
Public authorities & electric railroads184 174 
Total923,571 911,819 
Distribution Revenue increased for the three months ended March 31, 2022 compared to the same period in 2021 primarily due to favorable impacts of the Maryland and District of Columbia multi-year plans.
115




Table of Contents
Pepco

Transmission Revenue Under a FERC-approved formula, transmission revenue varies from year to year based upon fluctuations in the underlying costs and capital investments being recovered. Transmission revenue increased for the three months ended March 31, 2022, compared to the same period in 2021, primarily due to increases in underlying costs.
Other Revenue includes rental revenue, revenue related to late payment charges, mutual assistance revenues, and recoveries of other taxes.
Regulatory Required Programs represent revenues collected under approved riders to recover costs incurred for regulatory programs such as energy efficiency programs, DC PLUG, and SOS procurement and administrative costs. The riders are designed to provide full and current cost recovery as well as a return in certain instances. The costs of these programs are included in Purchased power expense, Operating and maintenance expense, Depreciation and amortization expense, and Taxes other than income taxes. Customers have the choice to purchase electricity from competitive electric generation suppliers. Customer choice programs do not impact the volume of deliveries, as Pepco remains the distribution service provider for all customers and charges a regulated rate for distribution service, which is recorded in Operating revenues. For customers that choose to purchase electric generation from competitive suppliers, Pepco acts as the billing agent and therefore, Pepco does not record Operating revenues or Purchased power expense related to the electricity. For customers that choose to purchase electric generation from Pepco, Pepco is permitted to recover the electricity and REC procurement costs from customers and therefore records the amounts related to the electricity and RECs in Operating revenues and Purchased power expense. Pepco recovers electricity and REC procurement costs from customers with a slight mark-up.
See Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for the presentation of Pepco's revenue disaggregation.
The increase of $47 million for the three months ended March 31, 2022 compared to the same period in 2021, in Purchased power expense is fully offset in Operating revenues as part of regulatory required programs.
The changes in Operating and maintenance expense consisted of the following:
Three Months Ended March 31, 2022
Increase
Storm-related costs$6 
BSC and PHISCO Costs6 
Credit loss expense4 
Labor, other benefits, contracting and materials4 
Other3 
23 
Regulatory required programs— 
Total increase$23 
116




Table of Contents
Pepco

The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended March 31, 2022
Increase (Decrease)
Depreciation and amortization(a)
$5 
Regulatory asset amortization(4)
Regulatory required programs5 
Total increase$6 
_________
(a)Depreciation and amortization increased primarily due to ongoing capital expenditures.

Effective income tax rates were (4.5)% and 9.2% for the three months ended March 31, 2022 and 2021, respectively. The change is primarily due to the acceleration of certain income tax benefits as a result of the Maryland and District of Columbia multi-year plans. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statement for additional information on the three-year electric distribution multi-year plans and Note 7 — Income Taxes of the Combined Notes to Consolidated Financial Statements for additional information regarding the components of the effective income tax rates.
117




Table of Contents
DPL

Results of Operations — DPL
Three Months Ended March 31,Favorable (Unfavorable) Variance
20222021
Operating revenues$431 $382 $49 
Operating expenses
Purchased power and fuel 189 156 (33)
Operating and maintenance93 83 (10)
Depreciation and amortization57 53 (4)
Taxes other than income taxes18 17 (1)
Total operating expenses357 309 (48)
Operating income74 73 1 
Other income and (deductions)
Interest expense, net(16)(15)(1)
Other, net2 3 (1)
Total other income and (deductions)(14)(12)(2)
Income before income taxes60 61 (1)
Income taxes4 5 1 
Net income $56 $56 $— 
Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021. Net income remained consistent.
The changes in Operating revenues consisted of the following:
Three Months Ended
March 31, 2022
Increase
ElectricGasTotal
Volume$5 $1 $6 
Distribution6 2 8 
Transmission2 — 2 
13 3 16 
Regulatory required programs25 8 33 
Total increase$38 $11 $49 
Revenue Decoupling. The demand for electricity is affected by weather and customer usage. However, Operating revenues from electric distribution in Maryland are not impacted by abnormal weather or usage per customer as a result of a bill stabilization adjustment (BSA) that provides for a fixed distribution charge per customer by customer class. While Operating revenues from electric distribution customers in Maryland are not impacted by abnormal weather or usage per customer, they are impacted by changes in the number of customers.
Weather. The demand for electricity and natural gas in Delaware is affected by weather conditions. With respect to the electric business, very warm weather in summer months and, with respect to the electric and natural gas businesses, very cold weather in winter months are referred to as "favorable weather conditions” because these weather conditions result in increased deliveries of electricity and natural gas. Conversely, mild weather reduces demand. During the three months ended March 31, 2022 compared to the same period in 2021, Operating revenues related to weather remained consistent.
118




Table of Contents
DPL

Heating and cooling degree days are quantitative indices that reflect the demand for energy needed to heat or cool a home or business. Normal weather is determined based on historical average heating and cooling degree days for a 20-year period in DPL's Delaware electric service territory and a 30-year period in DPL's Delaware natural gas service territory. The changes in heating and cooling degree days in DPL’s Delaware service territory for the three months ended March 31, 2022 compared to same period in 2021 and normal weather consisted of the following:
Three Months Ended March 31,% Change
Delaware Electric Service Territory20222021Normal2022 vs. 20212022 vs. Normal
Heating Degree-Days2,355 2,358 2,480 (0.1)%(5.0)%
Cooling Degree-Days3 3 — — %— %
Three Months Ended March 31,% Change
Delaware Natural Gas Service Territory20222021Normal2022 vs. 20212022 vs. Normal
Heating Degree-Days2,355 2,358 2,500 (0.1)%(5.8)%
Volume, exclusive of the effects of weather, increased for the three months ended March 31, 2022 compared to the same period in 2021 primarily due to customer growth and usage.
Electric Retail Deliveries to Delaware Customers (in GWhs)Three Months Ended
March 31,		% Change
Weather - Normal
% Change(b)
20222021
Residential895 854 4.8 %4.2 %
Small commercial & industrial370 342 8.2 %7.7 %
Large commercial & industrial765 689 11.0 %11.0 %
Public authorities & electric railroads9 9 — %5.3 %
Total electric retail deliveries(a)
2,039 1,894 7.7 %7.3 %
As of March 31,
Number of Total Electric Customers (Maryland and Delaware)20222021
Residential478,009 473,917 
Small commercial & industrial63,296 62,647 
Large commercial & industrial1,221 1,208 
Public authorities & electric railroads603 608 
Total543,129 538,380 
_________
(a)Reflects delivery volumes from customers purchasing electricity directly from DPL and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges.
(b)Reflects the change in delivery volumes assuming normalized weather based on the historical 20-year average.
Natural Gas Retail Deliveries to Delaware Customers (in mmcf)Three Months Ended
March 31,		% Change
Weather - Normal
% Change(b)
20222021
Residential4,453 4,394 1.3 %0.3 %
Small commercial & industrial1,983 1,868 6.2 %6.0 %
Large commercial & industrial457 457 — %0.1 %
Transportation2,207 2,224 (0.8)%(0.7)%
Total natural gas deliveries(a)
9,100 8,943 1.8 %1.3 %
119




Table of Contents
DPL

As of March 31,
Number of Delaware Natural Gas Customers20222021
Residential128,695 127,522 
Small commercial & industrial10,097 10,043 
Large commercial & industrial17 19 
Transportation159 160 
Total138,968 137,744 
__________
(a)Reflects delivery volumes from customers purchasing natural gas directly from DPL and customers purchasing natural gas from a competitive natural gas supplier as all customers are assessed distribution charges.
(b)Reflects the change in delivery volumes assuming normalized weather based on the historical 30-year average.

Distribution Revenue increased for the three months ended March 31, 2022 compared to the same period in 2021 primarily due to higher electric distribution rates in Maryland that became effective in March 2022, higher Distribution System Improvement Charge (DSIC) rates in Delaware that became effective in January 2022, and higher approved electric distribution rates in Delaware that became effective in September 2021.
Transmission Revenues. Under a FERC-approved formula, transmission revenue varies from year to year based upon fluctuations in the underlying costs and capital investments being recovered. Transmission revenue increased for the three months ended March 31, 2022, compared to the same period in 2021, primarily due to increases in underlying costs.
Other Revenue includes rental revenue, revenue related to late payment charges, mutual assistance revenues, and recoveries of other taxes.
Regulatory Required Programs represent revenues collected under approved riders to recover costs incurred for regulatory programs such as energy efficiency programs, DE Renewable Portfolio Standards, SOS procurement and administrative costs, and GCR costs. The riders are designed to provide full and current cost recovery as well as a return in certain instances. The costs of these programs are included in Purchased power and fuel expense, Operating and maintenance expense, Depreciation and amortization expense, and Taxes other than income taxes. All customers have the choice to purchase electricity from competitive electric generation suppliers; however, only certain commercial and industrial customers have the choice to purchase natural gas from competitive natural gas suppliers. Customer choice programs do not impact the volume of deliveries as DPL remains the distribution service provider for all customers and charges a regulated rate for distribution service, which is recorded in Operating revenues. For customers that choose to purchase electric generation or natural gas from competitive suppliers, DPL either acts as the billing agent or the competitive supplier separately bills its own customers, and therefore does not record Operating revenues or Purchased power and fuel expense related to the electricity and/or natural gas. For customers that choose to purchase electric generation or natural gas from DPL, DPL is permitted to recover the electricity, natural gas, and REC procurement costs from customers and therefore records the amounts related to the electricity, natural gas, and RECs in Operating revenues and Purchased power and fuel expense. DPL recovers electricity and REC procurement costs from customers with a slight mark-up, and natural gas costs without mark-up.
See Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for the presentation of DPL's revenue disaggregation.
The increase of $33 million for the three months ended March 31, 2022, compared to the same period in 2021, respectively, in Purchased power and fuel expense is fully offset in Operating revenues as part of regulatory required programs.
120




Table of Contents
DPL

The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
March 31, 2022
Increase
BSC and PHISCO costs
$3 
Storm-related costs
3 
Credit loss expense
2 
Labor, other benefits, contracting and materials
(2)
Other
3 
9 
Regulatory required programs1 
Total increase$10 
The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended
March 31, 2022
Increase
Depreciation and amortization(a)
$3 
Regulatory asset amortization— 
Regulatory required programs1 
Total increase$4 
_________
(a)Depreciation and amortization increased primarily due to ongoing capital expenditures.

Effective income tax rates were 6.7% and 8.2% for the three months ended March 31, 2022 and 2021, respectively. See Note 7 — Income Taxes of the Combined Notes to Consolidated Financial Statements for additional information regarding the components of the effective income tax rates.
121




Table of Contents
ACE

Results of Operations — ACE
Three Months Ended March 31,Favorable (Unfavorable) Variance
20222021
Operating revenues$349 $310 $39 
Operating expenses
Purchased power 178 157 (21)
Operating and maintenance84 76 (8)
Depreciation and amortization47 47 — 
Taxes other than income taxes2 2 — 
Total operating expenses311 282 (29)
Operating income 38 28 10 
Other income and (deductions)
Interest expense, net(14)(15)1 
Other, net3 1 2 
Total other income and (deductions)(11)(14)3 
Income before income taxes27 14 13 
Income taxes1 — (1)
Net income $26 $14 $12 

Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021. Net income increased $12 million primarily due to increases in distribution rates.
The changes in Operating revenues consisted of the following:
Three Months Ended March 31, 2022
 Increase
Weather$1 
Volume2 
Distribution11 
Transmission5 
19 
Regulatory required programs20 
Total increase$39 
Revenue Decoupling. The demand for electricity is affected by weather and customer usage. However, Operating revenues from electric distribution in New Jersey are not impacted by abnormal weather or usage per customer as a result of the Conservation Incentive Program (CIP) which became effective, prospectively, in the third quarter of 2021. The CIP compares current distribution revenues by customer class to approved target revenues established in ACE’s most recent distribution base rate case. The CIP is calculated annually, and recovery is subject to certain conditions, including an earnings test and ceilings on customer rate increases. While Operating revenues are not impacted by abnormal weather or usage per customer, they are impacted by changes in the number of customers. See Note 3 — Regulatory Matters of the Combined Notes to the Consolidated Financial Statements for additional information.
Weather. Prior to the third quarter of 2021, the demand for electricity was affected by weather conditions. With respect to the electric business, very warm weather in summer months and very cold weather in winter months are referred to as “favorable weather conditions” because these weather conditions result in increased deliveries of electricity. Conversely, mild weather reduces demand. During the three months ended March 31, 2022 compared to the same period in 2021, Operating revenues related to weather increased due to the absence of impacts in the first quarter of 2022 as a result of the CIP.
122




Table of Contents
ACE

Heating and cooling degree days are quantitative indices that reflect the demand for energy needed to heat or cool a home or business. Normal weather is determined based on historical average heating and cooling degree days for a 20-year period in ACE’s service territory. The changes in heating and cooling degree days in ACE’s service territory for the three months ended March 31, 2022 compared to same period in 2021 and normal weather consisted of the following:
Three Months Ended March 31,Normal% Change
Heating and Cooling Degree-Days202220212022 vs. 20212022 vs. Normal
Heating Degree-Days2,436 2,348 2,454 3.7 %(0.7)%
Cooling Degree-Days2 4 1 (50.0)%100.0 %
Volume, exclusive of the effects of weather, increased for the three months ended March 31, 2022 compared to the same period in 2021, due to the absence of impacts in the first quarter of 2022 as a result of the CIP.
Electric Retail Deliveries to Customers (in GWhs)Three Months Ended
March 31,		% Change
Weather - Normal % Change(b)
20222021
Residential918 928 (1.1)%(2.3)%
Small commercial & industrial339 305 11.1 %9.7 %
Large commercial & industrial703 716 (1.8)%(2.4)%
Public authorities & electric railroads14 13 7.7 %6.2 %
Total electric retail deliveries(a)
1,974 1,962 0.6 %(0.4)%

As of March 31,
Number of Electric Customers20222021
Residential500,511 498,396 
Small commercial & industrial62,124 61,771 
Large commercial & industrial3,124 3,267 
Public authorities & electric railroads724 704 
Total566,483 564,138 
_________
(a)Reflects delivery volumes from customers purchasing electricity directly from ACE and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges.
(b)Reflects the change in delivery volumes assuming normalized weather based on the historical 20-year average.
Distribution Revenue increased for the three months ended March 31, 2022 compared to the same period in 2021 due to higher distribution rates that become effective in January 2022.
Transmission Revenues. Under a FERC-approved formula, transmission revenue varies from year to year based upon fluctuations in the underlying costs and capital investments being recovered. Transmission revenue increased for the three months ended March 31, 2022, compared to the same period in 2021, primarily due to increases in capital investment and underlying costs.
Other Revenue includes rental revenue, service connection fees, and mutual assistance revenues.
Regulatory Required Programs represent revenues collected under approved riders to recover costs incurred for regulatory programs such as energy efficiency programs, Societal Benefits Charge, Transition Bonds, and BGS procurement and administrative costs. The riders are designed to provide full and current cost recovery as well as a return in certain instances. The costs of these programs are included in Purchased power expense, Operating and maintenance expense, Depreciation and amortization expense, and Taxes other than income taxes. Customers have the choice to purchase electricity from competitive electric generation suppliers. Customer choice programs do not impact the volume of deliveries, as ACE remains the distribution service provider for all customers and charges a regulated rate for distribution service, which is recorded in Operating revenues. For customers that choose to purchase electric generation from competitive suppliers, ACE acts as the billing agent and therefore, ACE does not record Operating revenues or Purchased power expense related to the electricity. For customers that choose to purchase electric generation from ACE, ACE is permitted to recover the
123




Table of Contents
ACE

electricity, ZEC, and REC procurement costs without mark-up and therefore records equal and offsetting amounts in Operating revenues and Purchased power expense related to the electricity, ZECs, and RECs.
See Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for the presentation of ACE's revenue disaggregation.
The increase of $21 million for the three months ended March 31, 2022 compared to the same period in 2021, respectively, in Purchased power expense is fully offset in Operating revenues as part of regulatory required programs.
The changes in Operating and maintenance expense consisted of the following:
Three Months Ended March 31, 2022
Increase
BSC and PHISCO costs$2 
Labor, other benefits, contracting and materials1 
Storm-related costs1 
4 
Regulatory required programs(a)
4 
Total increase$8 
_________
(a)ACE is allowed to recover from or refund to customers the difference between its annual credit loss expense and the amounts collected in rates annually through the Societal Benefits Charge.
The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended March 31, 2022
Increase (Decrease)
Depreciation and amortization(a)
$3 
Regulatory asset amortization1 
Regulatory required programs(4)
Total$— 
_________
(a)Depreciation and amortization increased primarily due to ongoing capital expenditures.
Effective income tax rates were 3.7% and 0.0% for the three months ended March 31, 2022 and 2021, respectively. See Note 7 — Income Taxes of the Combined Notes to Consolidated Financial Statements for additional information regarding the components of the effective income tax rates.
124



Table of Contents
Liquidity and Capital Resources (All Registrants)
All results included throughout the liquidity and capital resources section are presented on a GAAP basis.
The Registrants’ operating and capital expenditures requirements are provided by internally generated cash flows from operations, as well as funds from external sources in the capital markets and through bank borrowings. The Registrants’ businesses are capital intensive and require considerable capital resources. Each of the Registrants annually evaluates its financing plan, dividend practices, and credit line sizing, focusing on maintaining its investment grade ratings while meeting its cash needs to fund capital requirements, including construction expenditures, retire debt, pay dividends, and fund pension and OPEB obligations. The Registrants spend a significant amount of cash on capital improvements and construction projects that have a long-term return on investment. Additionally, the Utility Registrants operate in rate-regulated environments in which the amount of new investment recovery may be delayed or limited and where such recovery takes place over an extended period of time. Each Registrant’s access to external financing on reasonable terms depends on its credit ratings and current overall capital market business conditions, including that of the utility industry in general. If these conditions deteriorate to the extent that the Registrants no longer have access to the capital markets at reasonable terms, the Registrants have access to credit facilities with aggregate bank commitments of $4.0 billion. The Registrants utilize their credit facilities to support their commercial paper programs, provide for other short-term borrowings and to issue letters of credit. See the “Credit Matters and Cash Requirements” section below for additional information. The Registrants expect cash flows to be sufficient to meet operating expenses, financing costs, and capital expenditure requirements. See Note 10 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information on the Registrants’ debt and credit agreements.
Cash flows related to Constellation have not been presented as discontinued operations and are included in the Consolidated Statements of Cash Flows for all periods presented. The Exelon Consolidated Statement of Cash Flows for the three months ended March 31, 2022 includes one month of cash flows from Generation. The Exelon Consolidated Statement of Cash Flows for the three months ended March 31, 2021 includes three months of cash flows from Generation. This is the primary reason for the changes in cash flows as shown in the tables unless otherwise noted below.
Cash Flows from Operating Activities
The Utility Registrants' cash flows from operating activities primarily result from the transmission and distribution of electricity and, in the case of PECO, BGE, and DPL, gas distribution services. The Utility Registrants' distribution services are provided to an established and diverse base of retail customers. The Utility Registrants' future cash flows may be affected by the economy, weather conditions, future legislative initiatives, future regulatory proceedings with respect to their rates or operations, and their ability to achieve operating cost reductions.
See Note 3 — Regulatory Matters of the Exelon 2021 Form 10-K and Note 12 — Commitments and Contingencies of the Combined Notes to Consolidated Financial Statements for additional information on regulatory and legal proceedings and proposed legislation.
125



Table of Contents
The following table provides a summary of the change in cash flows from operating activities for the three months ended March 31, 2022 and 2021 by Registrant:
Increase (decrease) in cash flows from operating activitiesExelonComEdPECOBGE PHIPepcoDPLACE
Net income (loss)$862 $(9)$39 $(11)$2 $(13)$— $12 
Adjustments to reconcile net income to cash:
Non-cash operating activities69 20 17 70 66 37 17 11 
Option premiums (paid), net(55)— — — — — — — 
Collateral received, net869 38 — — — — — — 
Income taxes(36)21 (3)13 2 (1)(4)(1)
Pension and non-pension postretirement benefit contributions(37)(5)4 9 (31)— (1)(4)
Changes in working capital and other noncurrent assets and liabilities1,371 53 (41)67 (16)— 31 (28)
Increase (decrease) in cash flows from operating activities$3,043 $118 $16 $148 $23 $23 $43 $(10)
Changes in the Registrants' cash flows from operations were generally consistent with changes in each Registrant’s respective results of operations, as adjusted by changes in working capital in the normal course of business, except as discussed below. See above for additional information related to cash flows from Generation. Significant operating cash flow impacts for the Registrants and Generation for the three months ended March 31, 2022 and 2021 were as follows:
•See Note 14 — Supplemental Financial Information of the Combined Notes to Consolidated Financial Statements and the Registrants’ Consolidated Statements of Cash Flows for additional information on non-cash operating activities.
•Changes in collateral depended upon whether Generation was in a net mark-to-market liability or asset position, and collateral may have been required to be posted with or collected from its counterparties. In addition, the collateral posting and collection requirements differed depending on whether the transactions were on an exchange or in the over-the-counter markets.
•See Note 7 — Income Taxes of the Combined Notes to Consolidated Financial Statements and the Registrants' Consolidated Statements of Cash Flows for additional information on income taxes.
•Changes in working capital and other noncurrent assets and liabilities for the Utility Registrants and Exelon Corporate total $88 million and for Generation total $1,283 million. The change for Generation primarily relates to the revolving accounts receivable financing arrangement. See Note 6 — Accounts Receivable of the Exelon 2021 Form 10-K and the Collection of DPP discussion below for additional information.
126



Table of Contents
Cash Flows from Investing Activities
The following table provides a summary of the change in cash flows from investing activities for the three months ended March 31, 2022 and 2021 by Registrant:
(Decrease) increase in cash flows from investing activitiesExelonComEdPECOBGE PHIPepcoDPLACE
Capital expenditures$218 $(4)$(49)$33 $47 $2 $9 $36 
Investment in NDT fund sales, net3 — — — — — — — 
Collection of DPP(1,405)— — — — — — — 
Proceeds from sales of assets and businesses(664)— — — — — — — 
Changes in intercompany money pool— — 48 — — — — — 
Other investing activities(66)— 1 1 1 — 1 — 
(Decrease) increase in cash flows from investing activities$(1,914)$(4)$— $34 $48 $2 $10 $36 
Significant investing cash flow impacts for the Registrants for three months ended March 31, 2022 and 2021 were as follows:
•Variances in capital expenditures are primarily due to the timing of cash expenditures for capital projects. See the "Credit Matters and Cash Requirements" section below for additional information on projected capital expenditure spending. See Note 2 — Discontinued Operations of the Combined Notes to Consolidated Financial Statements for capital expenditures related to Generation prior to the separation.
•Collection of DPP relates to the revolving accounts receivable financing agreement which Generation entered into in April of 2020. See Note 6 — Accounts Receivable of the Exelon 2021 Form 10-K for additional information on the transaction and the DPP, including the $400 million of additional funding received in February and March of 2021.
•Proceeds from sales of assets and businesses decreased primarily due to the sale of a significant portion of Generation's solar business in 2021. See Note 2 — Mergers, Acquisitions, and Dispositions of the Exelon 2021 Form 10-K for additional information.
•Changes in intercompany money pool are driven by short-term borrowing needs. Refer below for more information regarding the intercompany money pool.
Cash Flows from Financing Activities
The following table provides a summary of the change in cash flows from financing activities for the three months ended March 31, 2022 and 2021 by Registrant:
127



Table of Contents
Increase (decrease) in cash flows from financing activitiesExelonComEdPECOBGE PHIPepcoDPLACE
Changes in short-term borrowings, net$(997)$188 $— $(36)$(100)$(140)$(3)$43 
Long-term debt, net2,669 50 (375)— 119 250 — (131)
Changes in intercompany money pool— — 105 — 36 — — — 
Dividends paid on common stock42 (17)(15)(2)— (14)(1)(5)
Distributions to member— — — — (21)— — — 
Contributions from(to) parent/member— (31)227 — 144 249 24 (130)
Transfer of cash, restricted cash, and cash equivalents to Constellation(2,594)— — — — — — — 
Other financing activities(38)(1)3 (1)(4)(4)— — 
Increase (decrease) in cash flows from financing activities$(918)$189 $(55)$(39)$174 $341 $20 $(223)
Significant financing cash flow impacts for the Registrants for the three months ended March 31, 2022 and 2021 were as follows:
•Changes in short-term borrowings, net, is driven by repayments on and issuances of notes due in less than 365 days. Refer to Note 10 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information on short-term borrowings for the Registrants. These changes also included repayments of $552 million in commercial paper and term loans by Generation prior to the separation.
•Long-term debt, net, varies due to debt issuances and redemptions each year. Refer to Note 10 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information on debt issuances. Refer to the debt redemptions table below for additional information.
•Changes in intercompany money pool are driven by short-term borrowing needs. Refer below for more information regarding the intercompany money pool.
•Exelon’s ability to pay dividends on its common stock depends on the receipt of dividends paid by its operating subsidiaries. The payments of dividends to Exelon by its subsidiaries in turn depend on their results of operations and cash flows and other items affecting retained earnings. See Note 19 — Commitments and Contingencies of the Exelon 2021 Form 10-K for additional information on dividend restrictions. See below for quarterly dividends declared.
•Refer to Note 2 - Discontinued Operations for the transfer of cash, restricted cash, and cash equivalents to Constellation related to the separation.
•For the three months ended March 31, 2022, other financing activities primarily consists of debt issuance costs. See Note 10 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information of the Registrants’ debt issuances.
Debt
See Note 10 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information on the Registrants’ debt issuances.
During the three months ended March 31, 2022, there were no long-term debt retirements or redemptions. However, as of May 9, 2022, the following long-term debt was retired and/or redeemed:
128



Table of Contents
CompanyTypeInterest RateMaturityAmount
PepcoFirst Mortgage Bonds3.05 %April 1, 2022$200 
ExelonJunior Subordinated Notes 3.50 %May 2, 20221,150 
Dividends
Quarterly dividends declared by the Exelon Board of Directors during the three months ended March 31, 2022 and for the second quarter of 2022 were as follows:
PeriodDeclaration DateShareholder of Record DateDividend Payable Date
Cash per Share(a)
First Quarter 2022February 8, 2022February 25, 2022March 10, 2022$0.3375 
Second Quarter 2022April 26, 2022May 13, 2022June 10, 2022$0.3375 
_________
(a)Exelon's Board of Directors approved an updated dividend policy for 2022. The 2022 quarterly dividend will be $0.3375 per share.
Credit Matters and Cash Requirements
The Registrants fund liquidity needs for capital investment, working capital, energy hedging, and other financial commitments through cash flows from continuing operations, public debt offerings, commercial paper markets, and large, diversified credit facilities. The credit facilities include $4.0 billion in aggregate total commitments of which $3.7 billion was available to support additional commercial paper as of March 31, 2022, and of which no financial institution has more than 7% of the aggregate commitments for the Registrants. The Registrants had access to the commercial paper markets and had availability under their revolving credit facilities during the three months ended March 31, 2022 to fund their short-term liquidity needs, when necessary. On February 1, 2022, Exelon Corporate and the Utility Registrants each entered into a new 5-year revolving credit facility that replaced its existing syndicated revolving credit facility. See Note 10 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information. The Registrants routinely review the sufficiency of their liquidity position, including appropriate sizing of credit facility commitments, by performing various stress test scenarios, such as commodity price movements, increases in margin-related transactions, changes in hedging levels, and the impacts of hypothetical credit downgrades. The Registrants have continued to closely monitor events in the financial markets and the financial institutions associated with the credit facilities, including monitoring credit ratings and outlooks, credit default swap levels, capital raising, and merger activity. See PART I. ITEM 1A. RISK FACTORS of the Exelon 2021 Form 10-K for additional information regarding the effects of uncertainty in the capital and credit markets.
The Registrants believe their cash flows from operating activities, access to credit markets, and their credit facilities provide sufficient liquidity to support the estimated future cash requirements.
Pursuant to the Separation Agreement between Exelon and Constellation, Exelon made a cash payment of $1.75 billion to Generation on January 31, 2022. See Note 2 — Discontinued Operations of the Combined Notes to Consolidated Financial Statements for additional information on the separation.
The following table presents the incremental collateral that each Utility Registrant would have been required to provide in the event each Utility Registrant lost its investment grade credit rating at March 31, 2022 and available credit facility capacity prior to any incremental collateral at March 31, 2022:
129



Table of Contents
PJM Credit Policy Collateral
Other Incremental Collateral Required(a)
Available Credit Facility Capacity Prior to Any Incremental Collateral
ComEd$40 $— $998 
PECO2 39 600 
BGE2 62 350 
Pepco2 — 300 
DPL2 16 300 
ACE1 — 300 
_________
(a)Represents incremental collateral related to natural gas procurement contracts.
Capital Expenditure Spending
As of March 31, 2022, the most recent estimates of capital expenditures for plant additions and improvements for 2022 are as follows:        
(In millions)TransmissionDistributionGas
Total(a)
ExelonN/AN/AN/A$6,900 
ComEd475 2,000 N/A2,475 
PECO200 800 325 1,325 
BGE250 500 475 1,225 
PHI575 1,200 75 1,850 
Pepco275 675 N/A950 
DPL125 250 75 450 
ACE175 275 N/A450 
__________
(a)Numbers rounded to the nearest $25M and may not sum due to rounding.
Projected capital expenditures and other investments are subject to periodic review and revision to reflect changes in economic conditions and other factors.
Pension and Other Postretirement Benefits
Management considers various factors when making pension funding decisions, including actuarially determined minimum contribution requirements under ERISA, contributions required to avoid benefit restrictions and at-risk status as defined by the Pension Protection Act of 2006 (the Act), management of the pension obligation, and regulatory implications. The Act requires the attainment of certain funding levels to avoid benefit restrictions (such as an inability to pay lump sums or to accrue benefits prospectively), and at-risk status (which triggers higher minimum contribution requirements and participant notification). The projected contributions reflect a funding strategy to make levelized annual contributions with the objective of achieving 100% funded status on an ABO basis over time. This level funding strategy helps minimize volatility of future period required pension contributions. Post-separation, Exelon's estimated annual qualified pension contributions will be approximately $313 million in 2022. In connection with the separation, additional qualified pension contributions of $207 million and $33 million were completed on February 1, 2022 and March 2, 2022, respectively. Unlike the qualified pension plans, Exelon’s non-qualified pension plans are not funded, given that they are not subject to statutory minimum contribution requirements.
While OPEB plans are also not subject to statutory minimum contribution requirements, Exelon does fund certain of its plans. For Exelon's funded OPEB plans, contributions generally equal accounting costs, however, Exelon’s management has historically considered several factors in determining the level of contributions to its OPEB plans, including liabilities management, levels of benefit claims paid, and regulatory implications (amounts deemed prudent to meet regulatory expectations and best assure continued rate recovery).
130



Table of Contents
Credit Facilities
Exelon Corporate, ComEd, and BGE meet their short-term liquidity requirements primarily through the issuance of commercial paper. PECO meet their short-term liquidity requirements primarily through the issuance of commercial paper and borrowings from the Exelon intercompany money pool. Pepco, DPL, and ACE meet their short-term liquidity requirements primarily through the issuance of commercial paper and borrowings from the PHI intercompany money pool. PHI Corporate meets its short-term liquidity requirements primarily through the issuance of short-term notes and the Exelon intercompany money pool. The Registrants may use their respective credit facilities for general corporate purposes, including meeting short-term funding requirements and the issuance of letters of credit.
See Note 10 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information on the Registrants’ credit facilities and short term borrowing activity.
Security Ratings
The Registrants’ access to the capital markets, including the commercial paper market, and their respective financing costs in those markets, may depend on the securities ratings of the entity that is accessing the capital markets.
The Registrants’ borrowings are not subject to default or prepayment as a result of a downgrading of securities, although such a downgrading of a Registrant’s securities could increase fees and interest charges under that Registrant’s credit agreements.
As part of the normal course of business, the Registrants enter into contracts that contain express provisions or otherwise permit the Registrants and their counterparties to demand adequate assurance of future performance when there are reasonable grounds for doing so. In accordance with the contracts and applicable contracts law, if the Registrants are downgraded by a credit rating agency, it is possible that a counterparty would attempt to rely on such a downgrade as a basis for making a demand for adequate assurance of future performance, which could include the posting of collateral. See Note 9 — Derivative Financial Instruments of the Combined Notes to Consolidated Financial Statements for additional information on collateral provisions.
The credit ratings for ComEd, PECO, BGE, and DPL did not change for the three months ended March 31, 2022. On January 14, 2022, Fitch lowered Exelon Corporate's long-term and senior unsecured ratings from BBB+ to BBB and affirmed the short-term rating of F2. In addition, Fitch upgraded Pepco, ACE, and PHI's long-term rating from BBB to BBB+ and upgraded Pepco and ACE's senior secured rating from A- to A.
Intercompany Money Pool
To provide an additional short-term borrowing option that will generally be more favorable to the borrowing participants than the cost of external financing, both Exelon and PHI operate an intercompany money pool. Maximum amounts contributed to and borrowed from the money pool by participant and the net contribution or borrowing as of March 31, 2022, are presented in the following table. Pepco, ACE, and DPL had no activity within the PHI intercompany money pool during the three months ended March 31, 2022.
During the Three Months Ended March 31, 2022As of March 31, 2022
Exelon Intercompany Money PoolMaximum
Contributed		Maximum
Borrowed		Contributed
(Borrowed)
Exelon Corporate$396 $— $312 
PECO— (95)(65)
BSC— (377)(246)
PHI Corporate— (54)(46)
PCI50 — 45 
Shelf Registration Statements
Exelon and the Utility Registrants have a currently effective combined shelf registration statement unlimited in amount, filed with the SEC, that will expire in August 2022. The ability of each Registrant to sell securities off the
131



Table of Contents
shelf registration statement or to access the private placement markets will depend on a number of factors at the time of the proposed sale, including other required regulatory approvals, as applicable, the current financial condition of the Registrant, its securities ratings and market conditions.
Regulatory Authorizations
The Utility Registrants are required to obtain short-term and long-term financing authority from Federal and State Commissions as follows:
As of March 31, 2022
Short-term Financing AuthorityRemaining Long-term Financing Authority
CommissionExpiration DateAmountCommissionExpiration DateAmount
ComEd(a)
FERCDecember 31, 2023$2,500 ICCJanuary 1, 2025$1,343 
PECO(b)
FERCDecember 31, 20231,500 PAPUCDecember 31, 20241,900 
BGEFERCDecember 31, 2023700 MDPSCN/A500 
PepcoFERCDecember 31, 2023500 MDPSC / DCPSCDecember 31, 2022225 
DPLFERCDecember 31, 2023500 MDPSC / DEPSCDecember 31, 202247 
ACE(c)
NJBPUDecember 31, 2023350 NJBPUDecember 31, 2022— 
_________
(a)On November 18, 2021, ComEd received approval from the ICC for $2 billion in new money long-term debt financing authority with an effective date of January 1, 2022.
(b)On December 2, 2021, PECO received approval from the PAPUC for $2.5 billion in new long-term debt financing authority with an effective date of January 1, 2022.
(c)ACE is currently in the process of renewing its long-term financing authority with the NJBPU and expects approval by August 1, 2022.

132



Table of Contents
ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
The Registrants hold commodity and financial instruments that are exposed to the following market risks:
•Commodity price risk, which is discussed further below.
•Counterparty credit risk associated with non-performance by counterparties on executed derivative instruments and participation in all, or some of the established, wholesale spot energy markets that are administered by PJM. The credit policies of PJM may, under certain circumstances, require that losses arising from the default of one member on spot energy market transactions be shared by the remaining participants. See Note 9 — Derivative Financial Instruments of the Combined Notes to Consolidated Financial Statements for a detailed discussion of counterparty credit risk related to derivative instruments.
•Equity price and interest rate risk associated with Exelon’s pension and OPEB plan trusts. See Note 15 — Retirement Benefits of the Exelon 2021 Form 10-K for additional information.
•Interest rate risk associated with changes in interest rates for the Registrants’ outstanding long-term debt. This risk is significantly reduced as substantially all of the Registrants’ outstanding debt has fixed interest rates. There is inherent interest rate risk related to refinancing maturing debt by issuing new long-term debt. The Registrants use a combination of fixed-rate and variable-rate debt to manage interest rate exposure. See Note 10 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information.
The Registrants operate primarily under cost-based rate regulation limiting exposure to the effects of market risk. Hedging programs are utilized to reduce exposure to energy and natural gas price volatility and have no direct earnings impacts as the costs are fully recovered through regulatory-approved recovery mechanisms.
Exelon manages these risks through risk management policies and objectives for risk assessment, control and valuation, counterparty credit approval, and the monitoring and reporting of risk exposures. Risk management issues are reported to Exelon’s Executive Committee, the Risk Management Committees of each Utility Registrant, and the Audit and Risk Committee of Exelon’s Board of Directors.
Commodity Price Risk
Commodity price risk is associated with price movements resulting from changes in supply and demand, fuel costs, market liquidity, weather conditions, governmental regulatory and environmental policies, and other factors. To the extent the total amount of energy Exelon purchases differs from the amount of energy it has contracted to sell, Exelon is exposed to market fluctuations in commodity prices. Exelon seeks to mitigate its commodity price risk through the sale and purchase of electricity and natural gas.
ComEd entered into 20-year floating-to-fixed renewable energy swap contracts beginning in June 2012, which are considered an economic hedge and have changes in fair value recorded to an offsetting regulatory asset or liability. ComEd has block energy contracts to procure electric supply that are executed through a competitive procurement process, which are considered derivatives and qualify for NPNS, and as a result are accounted for on an accrual basis of accounting. PECO, BGE, Pepco, DPL, and ACE have contracts to procure electric supply that are executed through a competitive procurement process. BGE, Pepco, DPL, and ACE have certain full requirements contracts, which are considered derivatives and qualify for NPNS, and as a result are accounted for on an accrual basis of accounting. Other full requirements contracts are not derivatives.
PECO, BGE, and DPL also have executed derivative natural gas contracts, which either qualify for NPNS or have no mark-to-market balances because the derivatives are index priced, to hedge their long-term price risk in the natural gas market. The hedging programs for natural gas procurement have no direct impact on their financial statements.
For additional information on these contracts, see Note 9 — Derivative Financial Instruments and Note 11 — Fair Value of Financial Assets and Liabilities of the Combined Notes to Consolidated Financial Statements.
The following table presents the maturity and source of fair value for Exelon’s and ComEd’s mark-to-market commodity contract liabilities. These liabilities are associated with ComEd’s floating-to-fixed energy swap
133



Table of Contents
contracts with unaffiliated suppliers. The table provides two fundamental pieces of information. First, the table provides the source of fair value used in determining the carrying amount of Exelon's and ComEd's total mark-to-market liabilities. Second, the table shows the maturity, by year, of Exelon's and ComEd's commodity contract liabilities giving an indication of when these mark-to-market amounts will settle and either generate or require cash. See Note 11 — Fair Value of Financial Assets and Liabilities of the Combined Notes to Consolidated Financial Statements for additional information regarding fair value measurements and the fair value hierarchy.
Maturities WithinTotal Fair
Value
202220232024202520262027 and Beyond
Prices based on model or other valuation methods (Level 3)$(1)$(8)$(18)$(18)$(18)$(81)$(144)
ITEM 4.    CONTROLS AND PROCEDURES
During the first quarter of 2022, each of the Registrants' management, including its principal executive officer and principal financial officer, evaluated its disclosure controls and procedures related to the recording, processing, summarizing, and reporting of information in its periodic reports that it files with the SEC. These disclosure controls and procedures have been designed by the Registrants to ensure that (a) material information relating to that Registrant, including its consolidated subsidiaries, is accumulated and made known to that Registrant's management, including its principal executive officer and principal financial officer, by other employees of that Registrant and its subsidiaries as appropriate to allow timely decisions regarding required disclosure, and (b) this information is recorded, processed, summarized, evaluated, and reported, as applicable, within the time periods specified in the SEC’s rules and forms. Due to the inherent limitations of control systems, not all misstatements may be detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls could be circumvented by the individual acts of some persons or by collusion of two or more people.
Accordingly, as of March 31, 2022, the principal executive officer and principal financial officer of each of the Registrants concluded that such Registrant’s disclosure controls and procedures were effective to accomplish its objectives. The Registrants continually strive to improve their disclosure controls and procedures to enhance the quality of its financial reporting and to maintain dynamic systems that change as conditions warrant. There were no changes in internal control over financial reporting during the first quarter of 2022 that materially affected, or are reasonably likely to materially affect, any of the Registrants' internal control over financial reporting.
PART II — OTHER INFORMATION
ITEM 1.    LEGAL PROCEEDINGS
The Registrants are parties to various lawsuits and regulatory proceedings in the ordinary course of their respective businesses. For information regarding material lawsuits and proceedings, see (a) ITEM 3. LEGAL PROCEEDINGS of Exelon’s 2021 Form 10-K and (b) Notes 3 — Regulatory Matters and 12 — Commitments and Contingencies of the Combined Notes to Consolidated Financial Statements in PART I, ITEM 1. FINANCIAL STATEMENTS of this Report. Such descriptions are incorporated herein by these references.
ITEM 1A.    RISK FACTORS
Risks Related to All Registrants
At March 31, 2022, the Registrants' risk factors were consistent with the risk factors described in the Registrants' combined 2021 Form 10-K in ITEM 1A. RISK FACTORS.
ITEM 4.    MINE SAFETY DISCLOSURES
All Registrants
Not applicable to the Registrants.
134



Table of Contents
ITEM 5.    OTHER INFORMATION
All Registrants
None.

ITEM 6.    EXHIBITS
Certain of the following exhibits are incorporated herein by reference under Rule 12b-32 of the Securities and Exchange Act of 1934, as amended. Certain other instruments which would otherwise be required to be listed below have not been so listed because such instruments do not authorize securities in an amount which exceeds 10% of the total assets of the applicable Registrant and its subsidiaries on a consolidated basis and the relevant Registrant agrees to furnish a copy of any such instrument to the Commission upon request.
Exhibit No.Description
101.INSInline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCHInline XBRL Taxonomy Extension Schema Document.
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document.
101.LABInline XBRL Taxonomy Extension Labels Linkbase Document.
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document.
104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*Filed herewith
135



Table of Contents
Certifications Pursuant to Rule 13a-14(a) and 15d-14(a) of the Securities and Exchange Act of 1934 as to the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022 filed by the following officers for the following companies:
Exhibit No.Description
136



Table of Contents
Certifications Pursuant to Section 1350 of Chapter 63 of Title 18 United States Code (Sarbanes — Oxley Act of 2002) as to the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022 filed by the following officers for the following companies:
Exhibit No.Description
137



Table of Contents
SIGNATURES

Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
EXELON CORPORATION
 
/s/    CHRISTOPHER M. CRANE/s/    JOSEPH NIGRO
Christopher M. CraneJoseph Nigro
President, Chief Executive Officer
(Principal Executive Officer) and Director		Senior Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
/s/    FABIAN E. SOUZA
Fabian E. Souza
Senior Vice President and Corporate Controller
(Principal Accounting Officer)
May 9, 2022
138



Table of Contents
Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
COMMONWEALTH EDISON COMPANY
 
/s/ GIL C. QUINIONES/s/ ELISABETH J. GRAHAM
Gil C. QuinionesElisabeth J. Graham
Chief Executive Officer
(Principal Executive Officer)		Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/    STEVEN J. CICHOCKI
Steven J. Cichocki
Director, Accounting
(Principal Accounting Officer)
May 9, 2022
139



Table of Contents
Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
PECO ENERGY COMPANY
 
/s/    MICHAEL A. INNOCENZO/s/    ROBERT J. STEFANI
Michael A. InnocenzoRobert J. Stefani
President and Chief Executive Officer
(Principal Executive Officer)		Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/    CAROLINE FULGINITI
Caroline Fulginiti
Director, Accounting
(Principal Accounting Officer)
May 9, 2022

140



Table of Contents
Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
BALTIMORE GAS AND ELECTRIC COMPANY
 
/s/    CARIM V. KHOUZAMI/s/    DAVID M. VAHOS
Carim V. KhouzamiDavid M. Vahos
Chief Executive Officer
(Principal Executive Officer)		Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
 /s/ JASON T. JONES
Jason T. Jones
Director, Accounting
(Principal Accounting Officer)
May 9, 2022

141



Table of Contents
Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
PEPCO HOLDINGS LLC
/s/ J. TYLER ANTHONY/s/    PHILLIP S. BARNETT
J. Tyler AnthonyPhillip S. Barnett
President and Chief Executive Officer
(Principal Executive Officer)		Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ JULIE E. GIESE
Julie E. Giese
Director, Accounting
(Principal Accounting Officer)
May 9, 2022

142



Table of Contents
Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
POTOMAC ELECTRIC POWER COMPANY
/s/ J. TYLER ANTHONY/s/    PHILLIP S. BARNETT
J. Tyler AnthonyPhillip S. Barnett
President and Chief Executive Officer
(Principal Executive Officer)		Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ JULIE E. GIESE
Julie E. Giese
Director, Accounting
(Principal Accounting Officer)
May 9, 2022

143



Table of Contents
Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
DELMARVA POWER & LIGHT COMPANY
/s/ J. TYLER ANTHONY/s/    PHILLIP S. BARNETT
J. Tyler AnthonyPhillip S. Barnett
President and Chief Executive Officer
(Principal Executive Officer)		Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ JULIE E. GIESE
Julie E. Giese
Director, Accounting
(Principal Accounting Officer)
May 9, 2022

144



Table of Contents
Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
ATLANTIC CITY ELECTRIC COMPANY
/s/ J. TYLER ANTHONY/s/    PHILLIP S. BARNETT
J. Tyler AnthonyPhillip S. Barnett
President and Chief Executive Officer
(Principal Executive Officer)		Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ JULIE E. GIESE
Julie E. Giese
Director, Accounting
(Principal Accounting Officer)
May 9, 2022
145