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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 JuneSeptember 30, 20222023
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
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 CompanyEXC/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 FilerNon-accelerated FilerSmaller Reporting CompanyEmerging Growth Company
Commonwealth Edison CompanyLarge Accelerated FilerAccelerated FilerNon-accelerated FilerxSmaller Reporting CompanyEmerging Growth Company
PECO Energy CompanyLarge Accelerated FilerAccelerated FilerNon-accelerated FilerxSmaller Reporting CompanyEmerging Growth Company
Baltimore Gas and Electric CompanyLarge Accelerated FilerAccelerated FilerNon-accelerated FilerxSmaller Reporting CompanyEmerging Growth Company
Pepco Holdings LLCLarge Accelerated FilerAccelerated FilerNon-accelerated FilerxSmaller Reporting CompanyEmerging Growth Company
Potomac Electric Power CompanyLarge Accelerated FilerAccelerated FilerNon-accelerated FilerxSmaller Reporting CompanyEmerging Growth Company
Delmarva Power & Light CompanyLarge Accelerated FilerAccelerated FilerNon-accelerated FilerxSmaller Reporting CompanyEmerging Growth Company
Atlantic City Electric CompanyLarge Accelerated FilerAccelerated FilerNon-accelerated FilerxSmaller Reporting CompanyEmerging 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 JuneSeptember 30, 20222023 was:
Exelon Corporation Common Stock, without par value980,472,436995,437,416
Commonwealth Edison Company Common Stock, $12.50 par value127,021,391127,021,396
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
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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)
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Table of Contents
GLOSSARY OF TERMS AND ABBREVIATIONS
Other Terms and Abbreviations
2021 Form 10-KThe Registrants' Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on February 25, 2022
2021 Recast Form 10-KThe Registrants' Current Report on Form 8-K filed with the SEC on June 30, 2022 to recast Exelon's consolidated financial statements and certain other financial information originally included in the 2021 Form 10-K
Note - of the 2021 Recast2022 Form 10-KReference to specific Combined Note to Consolidated Financial Statements in the 2021 Recastwithin Exelon's 2022 Annual Report on Form 10-K
AECABOAccumulated Benefit Obligation
AECsAlternative Energy CreditCredits that isare 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
ATMAt the market
BGSBasic Generation Service
BSABill Stabilization Adjustment
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
CIPConservation Incentive Program
CMCCarbon Mitigation Credit
CODMCODMsChief Operating Decision Maker(s)Makers
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
DPADeferred Prosecution Agreement
DPPDeferred Purchase Price
DSICDistribution System Improvement Charge
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
ERPEnterprise Resource Program
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
GWhGWhsGigawatt hourhours
ICCIllinois Commerce Commission
IIJAInfrastructure Investment and Jobs Act
IIPInfrastructure Investment Program
Illinois Settlement LegislationLegislation enacted in 2007 affecting electric utilities in Illinois
IPAIllinois Power Agency
IRAInflation Reduction Act
IRCInternal Revenue Code
IRSInternal Revenue Service
LIBORLondon Interbank Offered Rate
MDPSCMaryland Public Service Commission
MGPManufactured Gas Plant
mmcfMillion Cubic Feet
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Table of Contents
GLOSSARY OF TERMS AND ABBREVIATIONS
Other Terms and Abbreviations
MDPSCMaryland Public Service Commission
MGPManufactured Gas Plant
mmcfMillion Cubic Feet
MMGMiddle Mile Grant
MRPMulti-Year Rate Plan
MWMegawatt
MWhMegawatt hour
N/ANot applicable
NAVNet Asset Value
NDTNuclear Decommissioning Trust
NJBPUNew Jersey Board of Public Utilities
NPNSNormal Purchase Normal Sale scope exception
NPSNational Park Service
NRDNatural Resources Damages
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
PRPPRPsPotentially 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
SOFRSecured 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 1995federal securities laws that are subject to risks and uncertainties. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “predicts,” "should," 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 20212022 Form 10-K in (a) Part I, ITEM 1A. Risk Factors; (2) the 2021 Recast Form 10-K in (a)Factors, (b) Part II, ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, and (b)(c) Part II, ITEM 8. Financial Statements and Supplementary Data: Note 17, 18,Commitments and Contingencies; (3)(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 (4)(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.
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Table of Contents
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
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Table of Contents

EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
(In millions, except per share data)2022202120222021
Operating revenues
Electric operating revenues$3,934 $3,739 $8,415 $7,609 
Natural gas operating revenues307 234 1,124 867 
Revenues from alternative revenue programs(2)47 27 176 
Total operating revenues4,239 4,020 9,566 8,652 
Operating expenses
Purchased power1,167 1,006 2,748 2,146 
Purchased fuel107 58 445 276 
Purchased power and fuel from affiliates— 257 159 550 
Operating and maintenance1,109 1,073 2,288 2,155 
Depreciation and amortization830 736 1,647 1,494 
Taxes other than income taxes330 314 684 631 
Total operating expenses3,543 3,444 7,971 7,252 
(Loss) gain on sales of assets and businesses(2)(2)
Operating income694 580 1,593 1,404 
Other income and (deductions)
Interest expense, net(352)(318)(684)(630)
Interest expense to affiliates(6)(6)(13)(13)
Other, net175 73 313 131 
Total other income and (deductions)(183)(251)(384)(512)
Income from continuing operations before income taxes511 329 1,209 892 
Income taxes46 263 42 
Equity in earnings of unconsolidated affiliates— — — 
Net income from continuing operations after income taxes465 326 946 851 
Net income (loss) from discontinued operations after income taxes (Note 2)— 150 117 (640)
Net income465 476 1,063 211 
Net income attributable to noncontrolling interests— 75 99 
Net income attributable to common shareholders$465 $401 $1,062 $112 
Amounts attributable to common shareholders:
Net income from continuing operations465 326 946 851 
Net income (loss) from discontinued operations— 75 116 (739)
Net income attributable to common shareholders$465 $401 $1,062 $112 
Comprehensive income, net of income taxes
Net income$465 $476 $1,063 $211 
Other comprehensive income (loss), net of income taxes
Pension and non-pension postretirement benefit plans:
Prior service benefit reclassified to periodic benefit cost(1)(2)
Actuarial loss reclassified to periodic benefit cost10 56 24 112 
Pension and non-pension postretirement benefit plan valuation adjustment— — — (2)
Unrealized gain on foreign currency translation— — 
Other comprehensive income12 57 26 111 
Comprehensive income477 533 1,089 322 
Comprehensive income attributable to noncontrolling interests— 75 99 
Comprehensive income attributable to common shareholders$477 $458 $1,088 $223 
Average shares of common stock outstanding:
Basic981 978 981 978 
Assumed exercise and/or distributions of stock-based awards
Diluted(a)
982 979 982 979 
Earnings per average common share from continuing operations
Basic$0.47 $0.33 $0.96 $0.87 
Diluted$0.47 $0.33 $0.96 $0.87 
Earnings (losses) per average common share from discontinued operations
Basic$— $0.08 $0.12 $(0.76)
Diluted$— $0.08 $0.12 $(0.76)
__________
(a)The number of stock options not included in the calculation of diluted common shares outstanding due to their antidilutive effect were none for the three and six months ended June 30, 2022 and 2021, respectively.
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions, except per share data)2023202220232022
Operating revenues
Electric operating revenues$5,684 $4,557 $14,579 $12,972 
Natural gas operating revenues188 224 1,268 1,348 
Revenues from alternative revenue programs108 64 513 92 
Total operating revenues5,980 4,845 16,360 14,412 
Operating expenses
Purchased power2,364 1,404 5,766 4,152 
Purchased fuel33 80 449 524 
Purchased power and fuel from affiliates— — — 159 
Operating and maintenance1,187 1,148 3,535 3,436 
Depreciation and amortization890 825 2,616 2,472 
Taxes other than income taxes383 377 1,063 1,061 
Total operating expenses4,857 3,834 13,429 11,804 
Loss on sale of assets and businesses— — — (2)
Operating income1,123 1,011 2,931 2,606 
Other income and (deductions)
Interest expense, net(431)(359)(1,259)(1,044)
Interest expense to affiliates(6)(6)(18)(19)
Other, net81 122 331 435 
Total other income and (deductions)(356)(243)(946)(628)
Income from continuing operations before income taxes767 768 1,985 1,978 
Income taxes67 92 274 356 
Net income from continuing operations after income taxes700 676 1,711 1,622 
Net income from discontinued operations after income taxes (Note 2)— — — 117 
Net income700 676 1,711 1,739 
Net income attributable to noncontrolling interests— — — 
Net income attributable to common shareholders$700 $676 $1,711 $1,738 
Amounts attributable to common shareholders:
Net income from continuing operations700 676 1,711 1,622 
Net income from discontinued operations— — — 116 
Net income attributable to common shareholders$700 $676 $1,711 $1,738 
Comprehensive income, net of income taxes
Net income$700 $676 $1,711 $1,739 
Other comprehensive income, net of income taxes
Pension and non-pension postretirement benefit plans:
Actuarial losses reclassified to periodic benefit cost16 22 33 
Pension and non-pension postretirement benefit plans valuation adjustments(3)— (16)
Unrealized gains on cash flow hedges21 — 36 — 
Other comprehensive income34 42 35 
Comprehensive income734 685 1,753 1,774 
Comprehensive income attributable to noncontrolling interests— — — 
Comprehensive income attributable to common shareholders$734 $685 $1,753 $1,773 
Average shares of common stock outstanding:
Basic996 988 996 983 
Assumed exercise and/or distributions of stock-based awards— 
Diluted997 989 996 984 
Earnings per average common share from continuing operations
Basic$0.70 $0.68 $1.72 $1.65 
Diluted$0.70 $0.68 $1.72 $1.65 
Earnings per average common share from discontinued operations
Basic$— $— $— $0.12 
Diluted$— $— $— $0.12 
See the Combined Notes to Consolidated Financial Statements
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Table of Contents

EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
(In millions)20222021
Cash flows from operating activities
Net income$1,063 $211 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation, amortization, and accretion, including nuclear fuel and energy contract amortization1,854 4,180 
Asset impairments— 500 
Gain on sales of assets and businesses(8)(83)
Deferred income taxes and amortization of investment tax credits143 (163)
Net fair value changes related to derivatives(59)(490)
Net realized and unrealized losses (gains) on NDT funds205 (376)
Net unrealized losses (gains) on equity investments16 (96)
Other non-cash operating activities276 (331)
Changes in assets and liabilities:
Accounts receivable(795)(16)
Inventories12 
Accounts payable and accrued expenses544 (87)
Option premiums (paid) received, net(39)
Collateral received, net1,689 957 
Income taxes23 190 
Regulatory assets and liabilities, net(376)(276)
Pension and non-pension postretirement benefit contributions(585)(559)
Other assets and liabilities(723)(2,426)
Net cash flows provided by operating activities3,240 1,138 
Cash flows from investing activities
Capital expenditures(3,507)(4,040)
Proceeds from NDT fund sales488 4,438 
Investment in NDT funds(516)(4,538)
Collection of DPP169 2,209 
Proceeds from sales of assets and businesses16 724 
Other investing activities17 
Net cash flows used in investing activities(3,346)(1,190)
Cash flows from financing activities
Changes in short-term borrowings(597)(666)
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 debt5,151 2,455 
Retirement of long-term debt(1,707)(630)
Dividends paid on common stock(663)(747)
Proceeds from employee stock plans17 47 
Transfer of cash, restricted cash, and cash equivalents to Constellation(2,594)— 
Other financing activities(84)(64)
Net cash flows provided by financing activities323 895 
Increase in cash, restricted cash, and cash equivalents217 843 
Cash, restricted cash, and cash equivalents at beginning of period1,619 1,166 
Cash, restricted cash, and cash equivalents at end of period$1,836 $2,009 
Supplemental cash flow information
Decrease in capital expenditures not paid$(276)$(313)
Increase in DPP348 1,958 
(Decrease) increase in PP&E related to ARO update(335)
Nine Months Ended
September 30,
(In millions)20232022
Cash flows from operating activities
Net income$1,711 $1,739 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation, amortization, and accretion, including nuclear fuel and energy contract amortization2,616 2,679 
Asset impairments— 46 
Gain on sales of assets and businesses— (8)
Deferred income taxes and amortization of investment tax credits210 256 
Net fair value changes related to derivatives21 (59)
Net realized and unrealized losses on NDT funds— 205 
Net unrealized losses on equity investments— 16 
Other non-cash operating activities(237)265 
Changes in assets and liabilities:
Accounts receivable82 (1,049)
Inventories(8)(121)
Accounts payable and accrued expenses(454)823 
Option premiums paid, net— (39)
Collateral (paid) received, net(183)1,456 
Income taxes50 
Regulatory assets and liabilities, net(395)(689)
Pension and non-pension postretirement benefit contributions(97)(596)
Other assets and liabilities(24)(786)
Net cash flows provided by operating activities3,292 4,141 
Cash flows from investing activities
Capital expenditures(5,540)(5,179)
Proceeds from NDT fund sales— 488 
Investment in NDT funds— (516)
Collection of DPP— 169 
Proceeds from sales of assets and businesses— 16 
Other investing activities25 36 
Net cash flows used in investing activities(5,515)(4,986)
Cash flows from financing activities
Changes in short-term borrowings(1,116)(335)
Proceeds from short-term borrowings with maturities greater than 90 days400 1,150 
Repayments on short-term borrowings with maturities greater than 90 days(150)(925)
Issuance of long-term debt5,300 5,801 
Retirement of long-term debt(1,209)(2,067)
Issuance of common stock— 563 
Dividends paid on common stock(1,074)(999)
Proceeds from employee stock plans30 26 
Transfer of cash, restricted cash, and cash equivalents to Constellation— (2,594)
Other financing activities(101)(121)
Net cash flows provided by financing activities2,080 499 
Decrease in cash, restricted cash, and cash equivalents(143)(346)
Cash, restricted cash, and cash equivalents at beginning of period1,090 1,619 
Cash, restricted cash, and cash equivalents at end of period$947 $1,273 
Supplemental cash flow information
Decrease in capital expenditures not paid$(169)$(147)
Increase in DPP— 348 
(Decrease) increase in PP&E related to ARO update(4)331 
See the Combined Notes to Consolidated Financial Statements
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Table of Contents
EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
ASSETSASSETSASSETS
Current assetsCurrent assetsCurrent assets
Cash and cash equivalentsCash and cash equivalents$816 $672 Cash and cash equivalents$300 $407 
Restricted cash and cash equivalentsRestricted cash and cash equivalents961 321 Restricted cash and cash equivalents435 566 
Accounts receivableAccounts receivableAccounts receivable
Customer accounts receivableCustomer accounts receivable2,2192,189Customer accounts receivable2,5752,544
Customer allowance for credit lossesCustomer allowance for credit losses(354)(320)Customer allowance for credit losses(341)(327)
Customer accounts receivable, netCustomer accounts receivable, net1,865 1,869 Customer accounts receivable, net2,234 2,217 
Other accounts receivableOther accounts receivable1,4031,068Other accounts receivable1,1681,426
Other allowance for credit lossesOther allowance for credit losses(81)(72)Other allowance for credit losses(88)(82)
Other accounts receivable, netOther accounts receivable, net1,322 996 Other accounts receivable, net1,080 1,344 
Inventories, netInventories, netInventories, net
Fossil fuelFossil fuel133 105 Fossil fuel105 208 
Materials and suppliesMaterials and supplies491 476 Materials and supplies657 547 
Regulatory assetsRegulatory assets1,239 1,296 Regulatory assets2,307 1,641 
OtherOther515 387 Other401 406 
Current assets of discontinued operations— 7,835 
Total current assetsTotal current assets7,342 13,957 Total current assets7,519 7,336 
Property, plant, and equipment (net of accumulated depreciation and amortization of $15,242 and $14,430 as of June 30, 2022 and December 31, 2021, respectively)66,456 64,558 
Property, plant, and equipment (net of accumulated depreciation and amortization of $16,836 and $15,930 as of September 30, 2023 and December 31, 2022, respectively)Property, plant, and equipment (net of accumulated depreciation and amortization of $16,836 and $15,930 as of September 30, 2023 and December 31, 2022, respectively)72,458 69,076 
Deferred debits and other assetsDeferred debits and other assetsDeferred debits and other assets
Regulatory assetsRegulatory assets8,350 8,224 Regulatory assets8,128 8,037 
GoodwillGoodwill6,630 6,630 Goodwill6,630 6,630 
Receivable related to Regulatory Agreement UnitsReceivable related to Regulatory Agreement Units2,265 — Receivable related to Regulatory Agreement Units2,923 2,897 
InvestmentsInvestments235 250 Investments246 232 
OtherOther1,017 885 Other1,355 1,141 
Property, plant, and equipment, deferred debits, and other assets of discontinued operations— 38,509 
Total deferred debits and other assetsTotal deferred debits and other assets18,497 54,498 Total deferred debits and other assets19,282 18,937 
Total assetsTotal assets$92,295 $133,013 Total assets$99,259 $95,349 
See the Combined Notes to Consolidated Financial Statements
11




Table of Contents
EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
LIABILITIES AND SHAREHOLDERS’ EQUITYLIABILITIES AND SHAREHOLDERS’ EQUITYLIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilitiesCurrent liabilitiesCurrent liabilities
Short-term borrowingsShort-term borrowings$2,003 $1,248 Short-term borrowings$1,720 $2,586 
Long-term debt due within one yearLong-term debt due within one year505 2,153 Long-term debt due within one year1,654 1,802 
Accounts payableAccounts payable2,451 2,379 Accounts payable2,684 3,382 
Accrued expensesAccrued expenses1,057 1,137 Accrued expenses1,315 1,226 
Payables to affiliatesPayables to affiliatesPayables to affiliates
Regulatory liabilitiesRegulatory liabilities411 376 Regulatory liabilities437 437 
Mark-to-market derivative liabilitiesMark-to-market derivative liabilities— 18 Mark-to-market derivative liabilities44 
Unamortized energy contract liabilitiesUnamortized energy contract liabilities11 89 Unamortized energy contract liabilities10 
OtherOther1,588 766 Other933 1,155 
Current liabilities of discontinued operations— 7,940 
Total current liabilitiesTotal current liabilities8,031 16,111 Total current liabilities8,800 10,611 
Long-term debtLong-term debt35,789 30,749 Long-term debt39,431 35,272 
Long-term debt to financing trustsLong-term debt to financing trusts390 390 Long-term debt to financing trusts390 390 
Deferred credits and other liabilitiesDeferred credits and other liabilitiesDeferred credits and other liabilities
Deferred income taxes and unamortized investment tax creditsDeferred income taxes and unamortized investment tax credits11,240 10,611 Deferred income taxes and unamortized investment tax credits11,792 11,250 
Regulatory liabilitiesRegulatory liabilities8,513 9,628 Regulatory liabilities9,236 9,112 
Pension obligationsPension obligations1,406 2,051 Pension obligations1,085 1,109 
Non-pension postretirement benefit obligationsNon-pension postretirement benefit obligations800 811 Non-pension postretirement benefit obligations515 507 
Asset retirement obligationsAsset retirement obligations275 271 Asset retirement obligations269 269 
Mark-to-market derivative liabilitiesMark-to-market derivative liabilities103 201 Mark-to-market derivative liabilities113 83 
Unamortized energy contract liabilitiesUnamortized energy contract liabilities38 146 Unamortized energy contract liabilities29 35 
OtherOther2,054 1,573 Other2,129 1,967 
Long-term debt, deferred credits, and other liabilities of discontinued operations— 25,676 
Total deferred credits and other liabilitiesTotal deferred credits and other liabilities24,429 50,968 Total deferred credits and other liabilities25,168 24,332 
Total liabilitiesTotal liabilities68,639 98,218 Total liabilities73,789 70,605 
Commitments and contingenciesCommitments and contingencies00Commitments and contingencies
Shareholders’ equityShareholders’ equityShareholders’ equity
Common stock (No par value, 2,000 shares authorized, 980 shares and 979 shares outstanding at June 30, 2022 and December 31, 2021, respectively)20,319 20,324 
Treasury stock, at cost (2 shares at June 30, 2022 and December 31, 2021)(123)(123)
Common stock (No par value, 2,000 shares authorized, 995 shares and 994 shares outstanding as of September 30, 2023 and December 31, 2022, respectively)Common stock (No par value, 2,000 shares authorized, 995 shares and 994 shares outstanding as of September 30, 2023 and December 31, 2022, respectively)20,956 20,908 
Treasury stock, at cost (2 shares as of September 30, 2023 and December 31, 2022)Treasury stock, at cost (2 shares as of September 30, 2023 and December 31, 2022)(123)(123)
Retained earningsRetained earnings4,161 16,942 Retained earnings5,233 4,597 
Accumulated other comprehensive loss, netAccumulated other comprehensive loss, net(701)(2,750)Accumulated other comprehensive loss, net(596)(638)
Total shareholders’ equityTotal shareholders’ equity23,656 34,393 Total shareholders’ equity25,470 24,744 
Noncontrolling interests— 402 
Total equity23,656 34,795 
Total liabilities and shareholders’ equityTotal liabilities and shareholders’ equity$92,295 $133,013 Total liabilities and shareholders’ equity$99,259 $95,349 

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)
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
(In millions, shares
in thousands)
(In millions, shares
in thousands)
Issued
Shares
Common
Stock
Treasury
Stock
Retained
Earnings
Accumulated
Other
Comprehensive
Loss, net
Noncontrolling
Interests
Total Shareholders'
Equity
(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 
Balance at December 31, 2022Balance at December 31, 2022995,830 $20,908 $(123)$4,597 $(638)$— $24,744 
Net incomeNet income— — — 597 — 598 Net income— — — 669 — — 669 
Long-term incentive plan activityLong-term incentive plan activity540 (13)— — — — (13)Long-term incentive plan activity306 — — — — 
Employee stock purchase plan issuancesEmployee stock purchase plan issuances211 — — — — Employee stock purchase plan issuances266 12 — — — — 12 
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 
Common stock dividends
($0.36/common share)
Common stock dividends
($0.36/common share)
— — — (359)— (359)
Other comprehensive loss, net of income taxesOther comprehensive loss, net of income taxes— — — — (1)— (1)
Balance at March 31, 2023Balance at March 31, 2023996,402 $20,921 $(123)$4,907 $(639)$— $25,066 
Net incomeNet income— — — 465 — — 465 Net income— — — 343 — — 343 
Long-term incentive plan activityLong-term incentive plan activity21 10 — — — — 10 Long-term incentive plan activity372 — — — — 
Employee stock purchase plan issuancesEmployee stock purchase plan issuances242 10 — — — — 10 Employee stock purchase plan issuances278 11 — — — — 11 
Changes in equity of noncontrolling interests— — — — — — — 
Common stock dividends
($0.34/common share)
— — — (332)— — (332)
Other comprehensive income, net of income taxes— — — — 12 — 12 
Balance, June 30, 2022982,305 $20,319 $(123)$4,161 $(701)$— $23,656 
Common stock dividends
($0.36/common share)
Common stock dividends
($0.36/common share)
— — — (359)— — (359)
Other comprehensive income, net of income taxesOther comprehensive income, net of income taxes— — — — — 
Balance at June 30, 2023Balance at June 30, 2023997,052 $20,941 $(123)$4,891 $(630)$— $25,079 
Net incomeNet income— — — 700 — — 700 
Long-term incentive plan activityLong-term incentive plan activity(84)— — — — 
Employee stock purchase plan issuancesEmployee stock purchase plan issuances302 12 — — — — 12 
Common stock dividends
($0.36/common share)
Common stock dividends
($0.36/common share)
— — — (358)— — (358)
Other comprehensive income, net of income taxesOther comprehensive income, net of income taxes— — — — 34 — 34 
Balance at September 30, 2023Balance at September 30, 2023997,270 $20,956 $(123)$5,233 $(596)$— $25,470 





















EXELON CORPORATION AND SUBSIDIARY COMPANIES
See the Combined Notes to Consolidated Financial Statements
13




Table of Contents
EXELON CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited)
Six Months Ended June 30, 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 — — — — 
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 
Net income— — — 401 — 75 476 
Long-term incentive plan activity237 24 — — — — 24 
Employee stock purchase plan issuances420 18 — — — — 18 
Changes in equity of noncontrolling interests— — — — — (13)(13)
Common stock dividends
($0.38/common share)
— — — (375)— — (375)
Other comprehensive income, net of income taxes— — — — 57 — 57 
Balance, June 30, 2021979,665 $19,454 $(123)$16,098 $(3,289)$2,360 $34,500 

Nine Months Ended September 30, 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 at December 31, 2021981,291 $20,324 $(123)$16,942 $(2,750)$402 $34,795 
Net income— — — 597 — 598 
Long-term incentive plan activity540 (13)— — — — (13)
Employee stock purchase plan issuances211 — — — — 
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 at March 31, 2022982,042 $20,299 $(123)$4,028 $(713)$— $23,491 
Net income— — — 465 — — 465 
Long-term incentive plan activity21 10 — — — — 10 
Employee stock purchase plan issuances242 10 — — — — 10 
Common stock dividends
($0.34/common share)
— — — (332)— — (332)
Other comprehensive income, net of income taxes— — — — 12 — 12 
Balance at June 30, 2022982,305 $20,319 $(123)$4,161 $(701)$— $23,656 
Net Income— — — 676 — — 676 
Long-term incentive plan activity— — — — — 
Employee stock purchase plan issuances275 10 — — — — 10 
Issuance of common stock12,995 563 563 
Common stock dividends
($0.34/common share)
— — — (335)— — (335)
Other comprehensive income, net of income taxes— — — — — 
Balance at September 30, 2022995,575 $20,895 $(123)$4,502 $(692)$— $24,582 





See the Combined Notes to Consolidated Financial Statements
14




Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
(In millions)2022202120222021
Operating revenues
Electric operating revenues$1,387 $1,503 $3,075 $2,977 
Revenues from alternative revenue programs35 75 64 
Operating revenues from affiliates11 
Total operating revenues1,425 1,517 3,158 3,052 
Operating expenses
Purchased power283 421 862 862 
Purchased power from affiliate— 79 59 163 
Operating and maintenance258 250 523 495 
Operating and maintenance from affiliates80 73 166 144 
Depreciation and amortization328 296 649 589 
Taxes other than income taxes90 77 185 153 
Total operating expenses1,039 1,196 2,444 2,406 
Loss on sales of assets(2)— (2)— 
Operating income384 321 712 646 
Other income and (deductions)
Interest expense, net(101)(95)(197)(187)
Interest expense to affiliates(3)(3)(7)(6)
Other, net13 15 26 22 
Total other income and (deductions)(91)(83)(178)(171)
Income before income taxes293 238 534 475 
Income taxes66 46 119 85 
Net income$227 $192 $415 $390 
Comprehensive income$227 $192 $415 $390 

See the Combined Notes to Consolidated Financial Statements
15




Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
(In millions)20222021
Cash flows from operating activities
Net income$415 $390 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization649 589 
Deferred income taxes and amortization of investment tax credits122 143 
Other non-cash operating activities(18)23 
Changes in assets and liabilities:
Accounts receivable(163)(48)
Receivables from and payables to affiliates, net(43)
Inventories(2)(2)
Accounts payable and accrued expenses123 (45)
Collateral received, net60 
Income taxes(19)(34)
Regulatory assets and liabilities, net(267)(181)
Pension and non-pension postretirement benefit contributions(178)(173)
Other assets and liabilities(91)(111)
Net cash flows provided by operating activities588 558 
Cash flows from investing activities
Capital expenditures(1,208)(1,162)
Other investing activities15 12 
Net cash flows used in investing activities(1,193)(1,150)
Cash flows from financing activities
Changes in short-term borrowings— (290)
Issuance of long-term debt750 700 
Dividends paid on common stock(289)(253)
Contributions from parent335 395 
Other financing activities(12)(11)
Net cash flows provided by financing activities784 541 
Increase (decrease) in cash, restricted cash, and cash equivalents179 (51)
Cash, restricted cash, and cash equivalents at beginning of period384 405 
Cash, restricted cash, and cash equivalents at end of period$563 $354 
Supplemental cash flow information
Decrease in capital expenditures not paid$(44)$(93)
See the Combined Notes to Consolidated Financial Statements
16




Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions)2023202220232022
Operating revenues
Electric operating revenues$2,124 $1,284 $5,417 $4,359 
Revenues from alternative revenue programs135 88 405 163 
Operating revenues from affiliates14 14 
Total operating revenues2,268 1,378 5,836 4,536 
Operating expenses
Purchased power896 121 2,068 982 
Purchased power from affiliate— — — 59 
Operating and maintenance293 286 814 809 
Operating and maintenance from affiliates92 69 263 236 
Depreciation and amortization357 333 1,045 982 
Taxes other than income taxes100 104 282 289 
Total operating expenses1,738 913 4,472 3,357 
Loss on sale of assets— — — (2)
Operating income530 465 1,364 1,177 
Other income and (deductions)
Interest expense, net(116)(101)(347)(298)
Interest expense to affiliates(3)(3)(10)(10)
Other, net16 14 50 40 
Total other income and (deductions)(103)(90)(307)(268)
Income before income taxes427 375 1,057 909 
Income taxes94 84 235 203 
Net income$333 $291 $822 $706 
Comprehensive income$333 $291 $822 $706 

See the Combined Notes to Consolidated Financial Statements
15




Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
(In millions)20232022
Cash flows from operating activities
Net income$822 $706 
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization1,045 982 
Deferred income taxes and amortization of investment tax credits164 192 
Other non-cash operating activities(392)(89)
Changes in assets and liabilities:
Accounts receivable(111)(351)
Receivables from and payables to affiliates, net(12)(54)
Inventories(64)(9)
Accounts payable and accrued expenses(199)226 
Collateral received, net28 69 
Income taxes50 — 
Regulatory assets and liabilities, net(248)(499)
Pension and non-pension postretirement benefit contributions(26)(179)
Other assets and liabilities(72)(152)
Net cash flows provided by operating activities985 842 
Cash flows from investing activities
Capital expenditures(1,926)(1,801)
Other investing activities21 
Net cash flows used in investing activities(1,918)(1,780)
Cash flows from financing activities
Changes in short-term borrowings(150)233 
Proceeds from short-term borrowings with maturities greater than 90 days400 — 
Repayments on short-term borrowings with maturities greater than 90 days(150)— 
Issuance of long-term debt975 750 
Dividends paid on common stock(560)(434)
Contributions from parent570 503 
Other financing activities(12)(10)
Net cash flows provided by financing activities1,073 1,042 
Increase in cash, restricted cash, and cash equivalents140 104 
Cash, restricted cash, and cash equivalents at beginning of period511 384 
Cash, restricted cash, and cash equivalents at end of period$651 $488 
Supplemental cash flow information
Decrease in capital expenditures not paid$(27)$(30)
See the Combined Notes to Consolidated Financial Statements
16




Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
ASSETSASSETSASSETS
Current assetsCurrent assetsCurrent assets
Cash and cash equivalents Cash and cash equivalents$120 $131  Cash and cash equivalents$79 $67 
Restricted cash and cash equivalents Restricted cash and cash equivalents384 210  Restricted cash and cash equivalents360 327 
Accounts receivable Accounts receivable Accounts receivable
Customer accounts receivable Customer accounts receivable589647 Customer accounts receivable842558
Customer allowance for credit losses Customer allowance for credit losses(81)(73) Customer allowance for credit losses(76)(59)
Customer accounts receivable, net Customer accounts receivable, net508 574  Customer accounts receivable, net766 499 
Other accounts receivable Other accounts receivable448227 Other accounts receivable249441
Other allowance for credit losses Other allowance for credit losses(18)(17) Other allowance for credit losses(20)(17)
Other accounts receivable, net Other accounts receivable, net430 210  Other accounts receivable, net229 424 
Receivables from affiliates Receivables from affiliates16  Receivables from affiliates
Inventories, net Inventories, net171 170  Inventories, net260 196 
Regulatory assets Regulatory assets325 335  Regulatory assets1,439 775 
Other Other143 76  Other113 92 
Total current assets Total current assets2,084 1,722  Total current assets3,249 2,383 
Property, plant, and equipment (net of accumulated depreciation and amortization of $6,400 and $6,099 as of June 30, 2022 and December 31, 2021, respectively)26,673 25,995 
Property, plant, and equipment (net of accumulated depreciation and amortization of $7,061 and $6,673 as of September 30, 2023 and December 31, 2022, respectively)Property, plant, and equipment (net of accumulated depreciation and amortization of $7,061 and $6,673 as of September 30, 2023 and December 31, 2022, respectively)28,678 27,513 
Deferred debits and other assetsDeferred debits and other assetsDeferred debits and other assets
Regulatory assets Regulatory assets2,134 1,870  Regulatory assets2,736 2,667 
Goodwill Goodwill2,625 2,625  Goodwill2,625 2,625 
Receivables from affiliates— 2,761 
Receivable related to Regulatory Agreement Units Receivable related to Regulatory Agreement Units1,973 —  Receivable related to Regulatory Agreement Units2,716 2,660 
Investments Investments Investments
Prepaid pension asset Prepaid pension asset1,232 1,086  Prepaid pension asset1,220 1,206 
Other Other467 405  Other812 601 
Total deferred debits and other assets Total deferred debits and other assets8,437 8,753  Total deferred debits and other assets10,115 9,765 
Total assetsTotal assets$37,194 $36,470 Total assets$42,042 $39,661 
See the Combined Notes to Consolidated Financial Statements
17




Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
LIABILITIES AND SHAREHOLDERS’ EQUITYLIABILITIES AND SHAREHOLDERS’ EQUITYLIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilitiesCurrent liabilitiesCurrent liabilities
Short-term borrowings Short-term borrowings$677 $577 
Accounts payable Accounts payable$756 $647  Accounts payable850 1,010 
Accrued expenses Accrued expenses345 384  Accrued expenses405 415 
Payables to affiliates Payables to affiliates65 121  Payables to affiliates62 74 
Customer deposits Customer deposits99 99  Customer deposits115 108 
Regulatory liabilities Regulatory liabilities216 185  Regulatory liabilities189 226 
Mark-to-market derivative liabilities Mark-to-market derivative liabilities— 18  Mark-to-market derivative liabilities21 
Other Other253 133  Other201 191 
Total current liabilities Total current liabilities1,734 1,587  Total current liabilities2,520 2,606 
Long-term debtLong-term debt10,516 9,773 Long-term debt11,484 10,518 
Long-term debt to financing trustLong-term debt to financing trust205 205 Long-term debt to financing trust205 205 
Deferred credits and other liabilitiesDeferred credits and other liabilitiesDeferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits Deferred income taxes and unamortized investment tax credits4,852 4,685  Deferred income taxes and unamortized investment tax credits5,269 5,021 
Regulatory liabilities Regulatory liabilities6,111 6,759  Regulatory liabilities7,190 6,913 
Asset retirement obligations Asset retirement obligations145 144  Asset retirement obligations151 148 
Non-pension postretirement benefits obligations Non-pension postretirement benefits obligations168 169  Non-pension postretirement benefits obligations172 165 
Mark-to-market derivative liabilities Mark-to-market derivative liabilities103 201  Mark-to-market derivative liabilities113 79 
Other Other544 592  Other740 642 
Total deferred credits and other liabilities Total deferred credits and other liabilities11,923 12,550  Total deferred credits and other liabilities13,635 12,968 
Total liabilities Total liabilities24,378 24,115  Total liabilities27,844 26,297 
Commitments and contingenciesCommitments and contingencies00Commitments and contingencies
Shareholders’ equityShareholders’ equityShareholders’ equity
Common stock Common stock1,588 1,588  Common stock1,588 1,588 
Other paid-in capital Other paid-in capital9,411 9,076  Other paid-in capital10,316 9,746 
Retained earnings Retained earnings1,817 1,691  Retained earnings2,294 2,030 
Total shareholders’ equity Total shareholders’ equity12,816 12,355  Total shareholders’ equity14,198 13,364 
Total liabilities and shareholders’ equityTotal liabilities and shareholders’ equity$37,194 $36,470 Total liabilities and shareholders’ equity$42,042 $39,661 
    
See the Combined Notes to Consolidated Financial Statements
18




Table of Contents
COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited)
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
(In millions)(In millions)Common
Stock
Other
Paid-In
Capital
Retained
Earnings
Total
Shareholders’
Equity
(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 
Balance at December 31, 2022Balance at December 31, 2022$1,588 $9,746 $2,030 $13,364 
Net incomeNet income— — 188 188 Net income— — 241 241 
Common stock dividendsCommon stock dividends— — (144)(144)Common stock dividends— — (187)(187)
Contributions from parentContributions from parent— 167 — 167 Contributions from parent— 186 — 186 
Balance, March 31, 2022$1,588 $9,243 $1,735 $12,566 
Balance at March 31, 2023Balance at March 31, 2023$1,588 $9,932 $2,084 $13,604 
Net incomeNet income— — 227 227 Net income— — 249 249 
Common stock dividendsCommon stock dividends— — (145)(145)Common stock dividends— — (187)(187)
Contributions from parentContributions from parent— 168 — 168 Contributions from parent— 186 — 186 
Balance, June 30, 2022$1,588 $9,411 $1,817 $12,816 
Balance at June 30, 2023Balance at June 30, 2023$1,588 $10,118 $2,146 $13,852 
Net incomeNet income— — 333 333 
Common stock dividendsCommon stock dividends— — (185)(185)
Contributions from parentContributions from parent— 198 — 198 
Balance at September 30, 2023Balance at September 30, 2023$1,588 $10,316 $2,294 $14,198 
Six Months Ended June 30, 2021Nine Months Ended September 30, 2022
(In millions)(In millions)Common
Stock
Other
Paid-In
Capital
Retained
Earnings
Total
Shareholders’
Equity
(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 
Balance at December 31, 2021Balance at December 31, 2021$1,588 $9,076 $1,691 $12,355 
Net incomeNet income— — 197 197 Net income— — 188 188 
Common stock dividendsCommon stock dividends— — (127)(127)Common stock dividends— — (144)(144)
Contributions from parentContributions from parent— 198 — 198 Contributions from parent— 167 — 167 
Balance, March 31, 2021$1,588 $8,483 $1,526 $11,597 
Balance at March 31, 2022Balance at March 31, 2022$1,588 $9,243 $1,735 $12,566 
Net incomeNet income— — 192 192 Net income— — 227 227 
Common stock dividendsCommon stock dividends— — (126)(126)Common stock dividends— — (145)(145)
Contributions from parentContributions from parent— 197 — 197 Contributions from parent— 168 — 168 
Balance, June 30, 2021$1,588 $8,680 $1,592 $11,860 
Balance at June 30, 2022Balance at June 30, 2022$1,588 $9,411 $1,817 $12,816 
Net incomeNet income— — 291 291 
Common stock dividendsCommon stock dividends— — (145)(145)
Contributions from parentContributions from parent— 168 — 168 
Balance at September 30, 2022Balance at September 30, 2022$1,588 $9,579 $1,963 $13,130 
See the Combined Notes to Consolidated Financial Statements
19




Table of Contents

PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions)(In millions)2022202120222021(In millions)2023202220232022
Operating revenuesOperating revenuesOperating revenues
Electric operating revenuesElectric operating revenues$707 $602 $1,441 $1,251 Electric operating revenues$957 $943 $2,478 $2,384 
Natural gas operating revenuesNatural gas operating revenues108 82 414 310 Natural gas operating revenues67 73 492 487 
Revenues from alternative revenue programsRevenues from alternative revenue programs— 17 Revenues from alternative revenue programs11 (5)
Operating revenues from affiliatesOperating revenues from affiliatesOperating revenues from affiliates
Total operating revenuesTotal operating revenues816 693 1,863 1,582 Total operating revenues1,037 1,014 2,977 2,877 
Operating expensesOperating expensesOperating expenses
Purchased powerPurchased power244 145 472 334 Purchased power396 377 994 850 
Purchased fuelPurchased fuel39 22 184 108 Purchased fuel15 26 203 210 
Purchased power from affiliatePurchased power from affiliate— 40 33 81 Purchased power from affiliate— — — 33 
Operating and maintenanceOperating and maintenance168 166 364 360 Operating and maintenance217 197 622 561 
Operating and maintenance from affiliatesOperating and maintenance from affiliates47 43 99 83 Operating and maintenance from affiliates60 46 164 144 
Depreciation and amortizationDepreciation and amortization93 87 185 173 Depreciation and amortization100 92 297 277 
Taxes other than income taxesTaxes other than income taxes48 49 95 92 Taxes other than income taxes59 60 156 155 
Total operating expensesTotal operating expenses639 552 1,432 1,231 Total operating expenses847 798 2,436 2,230 
Operating incomeOperating income177 141 431 351 Operating income190 216 541 647 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(40)(39)(78)(74)Interest expense, net(51)(42)(142)(120)
Interest expense to affiliatesInterest expense to affiliates(3)(3)(6)(6)Interest expense to affiliates(1)(3)(7)(9)
Other, netOther, net16 12 Other, net11 26 23 
Total other income and (deductions)Total other income and (deductions)(35)(35)(68)(68)Total other income and (deductions)(41)(37)(123)(106)
Income before income taxesIncome before income taxes142 106 363 283 Income before income taxes149 179 418 541 
Income taxesIncome taxes24 12 Income taxes44 67 
Net incomeNet income$133 $104 $339 $271 Net income$146 $135 $410 $474 
Comprehensive incomeComprehensive income$133 $104 $339 $271 Comprehensive income$146 $135 $410 $474 
See the Combined Notes to Consolidated Financial Statements
20




Table of Contents
PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
Nine Months Ended
September 30,
(In millions)(In millions)20222021(In millions)20232022
Cash flows from operating activitiesCash flows from operating activitiesCash flows from operating activities
Net incomeNet income$339 $271 Net income$410 $474 
Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortizationDepreciation and amortization185 173 Depreciation and amortization297 277 
Deferred income taxes and amortization of investment tax creditsDeferred income taxes and amortization of investment tax credits14 21 Deferred income taxes and amortization of investment tax credits(44)49 
Other non-cash operating activitiesOther non-cash operating activities(5)Other non-cash operating activities14 
Changes in assets and liabilities:Changes in assets and liabilities:Changes in assets and liabilities:
Accounts receivableAccounts receivable(29)86 Accounts receivable135 (49)
Receivables from and payables to affiliates, netReceivables from and payables to affiliates, net(40)Receivables from and payables to affiliates, net(2)(34)
InventoriesInventories(8)Inventories35 (59)
Accounts payable and accrued expensesAccounts payable and accrued expenses(46)Accounts payable and accrued expenses(132)25 
Income taxesIncome taxes49 24 Income taxes76 30 
Regulatory assets and liabilities, netRegulatory assets and liabilities, net(24)(14)Regulatory assets and liabilities, net(27)
Pension and non-pension postretirement benefit contributionsPension and non-pension postretirement benefit contributions(13)(15)Pension and non-pension postretirement benefit contributions(1)(13)
Other assets and liabilitiesOther assets and liabilities(70)(126)Other assets and liabilities— (31)
Net cash flows provided by operating activitiesNet cash flows provided by operating activities412 374 Net cash flows provided by operating activities777 656 
Cash flows from investing activitiesCash flows from investing activitiesCash flows from investing activities
Capital expendituresCapital expenditures(658)(577)Capital expenditures(1,068)(991)
Changes in Exelon intercompany money poolChanges in Exelon intercompany money pool(51)— 
Other investing activitiesOther investing activitiesOther investing activities
Net cash flows used in investing activitiesNet cash flows used in investing activities(653)(573)Net cash flows used in investing activities(1,118)(983)
Cash flows from financing activitiesCash flows from financing activitiesCash flows from financing activities
Changes in short-term borrowingsChanges in short-term borrowings210 — Changes in short-term borrowings(239)— 
Issuance of long-term debtIssuance of long-term debt350 375 Issuance of long-term debt575 775 
Retirement of long-term debtRetirement of long-term debt(350)— Retirement of long-term debt(50)(350)
Changes in Exelon intercompany money pool— (40)
Dividends paid on common stockDividends paid on common stock(200)(169)Dividends paid on common stock(303)(299)
Contributions from parentContributions from parent227 395 Contributions from parent348 274 
Other financing activitiesOther financing activities(8)(4)Other financing activities(6)(14)
Net cash flows provided by financing activitiesNet cash flows provided by financing activities229 557 Net cash flows provided by financing activities325 386 
(Decrease) increase in cash, restricted cash, and cash equivalents(Decrease) increase in cash, restricted cash, and cash equivalents(12)358 (Decrease) increase in cash, restricted cash, and cash equivalents(16)59 
Cash, restricted cash, and cash equivalents at beginning of periodCash, restricted cash, and cash equivalents at beginning of period44 26 Cash, restricted cash, and cash equivalents at beginning of period68 44 
Cash, restricted cash, and cash equivalents at end of periodCash, restricted cash, and cash equivalents at end of period$32 $384 Cash, restricted cash, and cash equivalents at end of period$52 $103 
Supplemental cash flow informationSupplemental cash flow informationSupplemental cash flow information
Decrease in capital expenditures not paid$(11)$(16)
(Decrease) increase in capital expenditures not paid(Decrease) increase in capital expenditures not paid$(22)$
See the Combined Notes to Consolidated Financial Statements
21




Table of Contents
PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
ASSETSASSETSASSETS
Current assetsCurrent assetsCurrent assets
Cash and cash equivalentsCash and cash equivalents$23 $36 Cash and cash equivalents$43 $59 
Restricted cash and cash equivalentsRestricted cash and cash equivalentsRestricted cash and cash equivalents
Accounts receivableAccounts receivableAccounts receivable
Customer accounts receivableCustomer accounts receivable493489Customer accounts receivable467635
Customer allowance for credit lossesCustomer allowance for credit losses(107)(105)Customer allowance for credit losses(95)(105)
Customer accounts receivable, netCustomer accounts receivable, net386 384 Customer accounts receivable, net372 530 
Other accounts receivableOther accounts receivable138116Other accounts receivable136153
Other allowance for credit lossesOther allowance for credit losses(10)(7)Other allowance for credit losses(8)(9)
Other accounts receivable, netOther accounts receivable, net128 109 Other accounts receivable, net128 144 
Receivables from affiliatesReceivables from affiliates— Receivables from affiliates
Receivable from Exelon intercompany money poolReceivable from Exelon intercompany money pool51 — 
Inventories, netInventories, netInventories, net
Fossil fuelFossil fuel55 51 Fossil fuel56 99 
Materials and suppliesMaterials and supplies48 45 Materials and supplies60 52 
Prepaid utility taxesPrepaid utility taxes85 Prepaid utility taxes17 — 
Regulatory assetsRegulatory assets61 48 Regulatory assets120 80 
OtherOther36 28 Other52 38 
Total current assetsTotal current assets831 711 Total current assets909 1,015 
Property, plant, and equipment (net of accumulated depreciation and amortization of $4,021 and $3,964 as of June 30, 2022 and December 31, 2021, respectively)11,591 11,117 
Property, plant, and equipment (net of accumulated depreciation and amortization of $4,056 and $4,078 as of September 30, 2023 and December 31, 2022, respectively)Property, plant, and equipment (net of accumulated depreciation and amortization of $4,056 and $4,078 as of September 30, 2023 and December 31, 2022, respectively)12,895 12,125 
Deferred debits and other assetsDeferred debits and other assetsDeferred debits and other assets
Regulatory assetsRegulatory assets1,033 943 Regulatory assets762 652 
Receivables from affiliates— 597 
Receivable related to Regulatory Agreement UnitsReceivable related to Regulatory Agreement Units292 — Receivable related to Regulatory Agreement Units206 237 
InvestmentsInvestments32 34 Investments34 30 
Prepaid pension assetPrepaid pension asset405 386 Prepaid pension asset425 413 
OtherOther32 36 Other28 30 
Total deferred debits and other assetsTotal deferred debits and other assets1,794 1,996 Total deferred debits and other assets1,455 1,362 
Total assetsTotal assets$14,216 $13,824 Total assets$15,259 $14,502 
See the Combined Notes to Consolidated Financial Statements
22




Table of Contents
PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
LIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilitiesCurrent liabilitiesCurrent liabilities
Short-term borrowingsShort-term borrowings$210 $— Short-term borrowings$— $239 
Long-term debt due within one yearLong-term debt due within one year50 350 Long-term debt due within one year— 50 
Accounts payableAccounts payable525 494 Accounts payable543 668 
Accrued expensesAccrued expenses161 136 Accrued expenses183 142 
Payables to affiliatesPayables to affiliates29 70 Payables to affiliates37 42 
Customer depositsCustomer deposits53 48 Customer deposits77 63 
Regulatory liabilitiesRegulatory liabilities75 94 Regulatory liabilities112 75 
OtherOther47 35 Other49 32 
Total current liabilitiesTotal current liabilities1,150 1,227 Total current liabilities1,001 1,311 
Long-term debtLong-term debt4,142 3,847 Long-term debt5,133 4,562 
Long-term debt to financing trustsLong-term debt to financing trusts184 184 Long-term debt to financing trusts184 184 
Deferred credits and other liabilitiesDeferred credits and other liabilitiesDeferred credits and other liabilities
Deferred income taxes and unamortized investment tax creditsDeferred income taxes and unamortized investment tax credits2,534 2,421 Deferred income taxes and unamortized investment tax credits2,286 2,213 
Regulatory liabilitiesRegulatory liabilities329 635 Regulatory liabilities239 270 
Asset retirement obligationsAsset retirement obligations29 29 Asset retirement obligations27 28 
Non-pension postretirement benefits obligationsNon-pension postretirement benefits obligations288 286 Non-pension postretirement benefits obligations287 286 
OtherOther82 83 Other85 85 
Total deferred credits and other liabilitiesTotal deferred credits and other liabilities3,262 3,454 Total deferred credits and other liabilities2,924 2,882 
Total liabilitiesTotal liabilities8,738 8,712 Total liabilities9,242 8,939 
Commitments and contingenciesCommitments and contingencies00Commitments and contingencies
Shareholder’s equityShareholder’s equityShareholder’s equity
Common stockCommon stock3,655 3,428 Common stock4,050 3,702 
Retained earningsRetained earnings1,823 1,684 Retained earnings1,967 1,861 
Total shareholder’s equityTotal shareholder’s equity5,478 5,112 Total shareholder’s equity6,017 5,563 
Total liabilities and shareholder's equityTotal liabilities and shareholder's equity$14,216 $13,824 Total liabilities and shareholder's equity$15,259 $14,502 
See the Combined Notes to Consolidated Financial Statements
23




Table of Contents
PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER’S EQUITY
(Unaudited)
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
(In millions)(In millions)Common
Stock
Retained
Earnings
Total
Shareholder's
Equity
(In millions)Common
Stock
Retained
Earnings
Total
Shareholder's
Equity
Balance, December 31, 2021$3,428 $1,684 $5,112 
Balance at December 31, 2022Balance at December 31, 2022$3,702 $1,861 $5,563 
Net incomeNet income— 206 206 Net income— 166 166 
Common stock dividendsCommon stock dividends— (100)(100)Common stock dividends— (101)(101)
Contributions from parentContributions from parent227 — 227 Contributions from parent330 — 330 
Balance, March 31, 2022$3,655 $1,790 $5,445 
Balance at March 31, 2023Balance at March 31, 2023$4,032 $1,926 $5,958 
Net incomeNet income— 133 133 Net income— 97 97 
Common stock dividendsCommon stock dividends— (100)(100)Common stock dividends— (101)(101)
Balance, June 30, 2022$3,655 $1,823 $5,478 
Balance at June 30, 2023Balance at June 30, 2023$4,032 $1,922 $5,954 
Net incomeNet income— 146 146 
Common stock dividendsCommon stock dividends— (101)(101)
Contributions from parentContributions from parent18 — 18 
Balance at September 30, 2023Balance at September 30, 2023$4,050 $1,967 $6,017 
Six Months Ended June 30, 2021Nine Months Ended September 30, 2022
(In millions)(In millions)Common
Stock
Retained
Earnings
Total
Shareholder's
Equity
(In millions)Common
Stock
Retained
Earnings
Total
Shareholder's
Equity
Balance, December 31, 2020$3,014 $1,519 $4,533 
Balance at December 31, 2021Balance at December 31, 2021$3,428 $1,684 $5,112 
Net incomeNet income— 206 206 
Common stock dividendsCommon stock dividends— (100)(100)
Contributions from parentContributions from parent227 — 227 
Balance at March 31, 2022Balance at March 31, 2022$3,655 $1,790 $5,445 
Net incomeNet income— 167 167 Net income— 133 133 
Common stock dividendsCommon stock dividends— (85)(85)Common stock dividends— (100)(100)
Balance, March 31, 2021$3,014 $1,601 $4,615 
Balance at June 30, 2022Balance at June 30, 2022$3,655 $1,823 $5,478 
Net incomeNet income— 104 104 Net income— 135 135 
Common stock dividendsCommon stock dividends— (84)(84)Common stock dividends— (99)(99)
Contributions from parentContributions from parent395 — 395 Contributions from parent47 — 47 
Balance, June 30, 2021$3,409 $1,621 $5,030 
Balance at September 30, 2022Balance at September 30, 2022$3,702 $1,859 $5,561 
See the Combined Notes to Consolidated Financial Statements
24




Table of Contents

BALTIMORE GAS AND ELECTRIC COMPANY
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions)(In millions)2022202120222021(In millions)2023202220232022
Operating revenuesOperating revenuesOperating revenues
Electric operating revenuesElectric operating revenues$642 $560 $1,377 $1,180 Electric operating revenues$856 $761 $2,306 $2,138 
Natural gas operating revenuesNatural gas operating revenues161 125 585 455 Natural gas operating revenues96 114 627 699 
Revenues from alternative revenue programsRevenues from alternative revenue programs(20)(10)(32)Revenues from alternative revenue programs(22)(8)47 (40)
Operating revenues from affiliatesOperating revenues from affiliates10 13 Operating revenues from affiliates13 
Total operating revenuesTotal operating revenues786 682 1,940 1,656 Total operating revenues932 870 2,986 2,810 
Operating expensesOperating expensesOperating expenses
Purchased powerPurchased power241 133 526 295 Purchased power371 320 975 846 
Purchased fuelPurchased fuel48 27 199 126 Purchased fuel30 170 229 
Purchased power and fuel from affiliate— 59 18 129 
Purchased power from affiliatePurchased power from affiliate— — — 18 
Operating and maintenanceOperating and maintenance154 147 321 299 Operating and maintenance156 185 467 506 
Operating and maintenance from affiliatesOperating and maintenance from affiliates51 46 102 91 Operating and maintenance from affiliates58 50 165 152 
Depreciation and amortizationDepreciation and amortization152 141 322 293 Depreciation and amortization161 148 487 470 
Taxes other than income taxesTaxes other than income taxes71 67 148 139 Taxes other than income taxes80 77 239 225 
Total operating expensesTotal operating expenses717 620 1,636 1,372 Total operating expenses835 810 2,503 2,446 
Operating incomeOperating income69 62 304 284 Operating income97 60 483 364 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(36)(34)(71)(67)Interest expense, net(47)(39)(135)(110)
Other, netOther, net11 16 Other, net14 16 
Total other income and (deductions)Total other income and (deductions)(31)(25)(60)(51)Total other income and (deductions)(41)(34)(121)(94)
Income before income taxesIncome before income taxes38 37 244 233 Income before income taxes56 26 362 270 
Income taxesIncome taxes(8)10 (21)Income taxes11 (7)76 
Net incomeNet income$37 $45 $234 $254 Net income$45 $33 $286 $267 
Comprehensive incomeComprehensive income$37 $45 $234 $254 Comprehensive income$45 $33 $286 $267 
See the Combined Notes to Consolidated Financial Statements
25




Table of Contents
BALTIMORE GAS AND ELECTRIC COMPANY
STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
Nine Months Ended
September 30,
(In millions)(In millions)20222021(In millions)20232022
Cash flows from operating activitiesCash flows from operating activitiesCash flows from operating activities
Net incomeNet income$234 $254 Net income$286 $267 
Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortizationDepreciation and amortization322 293 Depreciation and amortization487 470 
Asset impairmentsAsset impairments— 46 
Deferred income taxes and amortization of investment tax creditsDeferred income taxes and amortization of investment tax credits13 11 Deferred income taxes and amortization of investment tax credits41 
Other non-cash operating activitiesOther non-cash operating activities79 28 Other non-cash operating activities— 101 
Changes in assets and liabilities:Changes in assets and liabilities:Changes in assets and liabilities:
Accounts receivableAccounts receivable(14)73 Accounts receivable194 18 
Receivables from and payables to affiliates, netReceivables from and payables to affiliates, net(11)(19)Receivables from and payables to affiliates, net(7)(9)
InventoriesInventories(27)(9)Inventories45 (74)
Accounts payable and accrued expensesAccounts payable and accrued expenses(12)(51)Accounts payable and accrued expenses(38)15 
Collateral received, net190 
Collateral (paid) received, netCollateral (paid) received, net(22)125 
Income taxesIncome taxes(27)(27)Income taxes19 (20)
Regulatory assets and liabilities, netRegulatory assets and liabilities, net(36)(61)Regulatory assets and liabilities, net(151)(113)
Pension and non-pension postretirement benefit contributionsPension and non-pension postretirement benefit contributions(59)(71)Pension and non-pension postretirement benefit contributions(15)(64)
Other assets and liabilitiesOther assets and liabilities24 (35)Other assets and liabilities46 14 
Net cash flows provided by operating activitiesNet cash flows provided by operating activities676 388 Net cash flows provided by operating activities885 777 
Cash flows from investing activitiesCash flows from investing activitiesCash flows from investing activities
Capital expendituresCapital expenditures(578)(620)Capital expenditures(986)(918)
Other investing activitiesOther investing activities10 Other investing activities
Net cash flows used in investing activitiesNet cash flows used in investing activities(571)(610)Net cash flows used in investing activities(980)(911)
Cash flows from financing activitiesCash flows from financing activitiesCash flows from financing activities
Changes in short-term borrowingsChanges in short-term borrowings(130)— Changes in short-term borrowings(349)26 
Issuance of long-term debtIssuance of long-term debt500 600 Issuance of long-term debt700 500 
Retirement of long-term debtRetirement of long-term debt(300)(250)
Dividends paid on common stockDividends paid on common stock(150)(146)Dividends paid on common stock(237)(225)
Contributions from parentContributions from parent186 — Contributions from parent237 186 
Other financing activitiesOther financing activities(7)(6)Other financing activities(7)(8)
Net cash flows provided by financing activitiesNet cash flows provided by financing activities399 448 Net cash flows provided by financing activities44 229 
Increase in cash, restricted cash, and cash equivalents504 226 
(Decrease) increase in cash, restricted cash, and cash equivalents(Decrease) increase in cash, restricted cash, and cash equivalents(51)95 
Cash, restricted cash, and cash equivalents at beginning of periodCash, restricted cash, and cash equivalents at beginning of period55 145 Cash, restricted cash, and cash equivalents at beginning of period67 55 
Cash, restricted cash, and cash equivalents at end of periodCash, restricted cash, and cash equivalents at end of period$559 $371 Cash, restricted cash, and cash equivalents at end of period$16 $150 
Supplemental cash flow informationSupplemental cash flow informationSupplemental cash flow information
Decrease in capital expenditures not paid$(21)$(71)
(Decrease) increase in capital expenditures not paid(Decrease) increase in capital expenditures not paid$(17)$12 
See the Combined Notes to Consolidated Financial Statements
26




Table of Contents
BALTIMORE GAS AND ELECTRIC COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
ASSETSASSETSASSETS
Current assetsCurrent assetsCurrent assets
Cash and cash equivalentsCash and cash equivalents$354 $51 Cash and cash equivalents$15 $43 
Restricted cash and cash equivalentsRestricted cash and cash equivalents205 Restricted cash and cash equivalents24 
Accounts receivableAccounts receivableAccounts receivable
Customer accounts receivableCustomer accounts receivable462436Customer accounts receivable438617
Customer allowance for credit lossesCustomer allowance for credit losses(57)(38)Customer allowance for credit losses(52)(54)
Customer accounts receivable, net Customer accounts receivable, net405 398  Customer accounts receivable, net386 563 
Other accounts receivableOther accounts receivable122124Other accounts receivable110132
Other allowance for credit lossesOther allowance for credit losses(11)(9)Other allowance for credit losses(9)(10)
Other accounts receivable, net Other accounts receivable, net111 115  Other accounts receivable, net101 122 
Receivables from affiliates— 
Inventories, netInventories, netInventories, net
Fossil fuelFossil fuel68 42 Fossil fuel41 91 
Materials and suppliesMaterials and supplies54 53 Materials and supplies70 65 
Prepaid utility taxesPrepaid utility taxes— 49 Prepaid utility taxes52 
Regulatory assetsRegulatory assets178 215 Regulatory assets227 177 
OtherOther10 Other19 13 
Total current assetsTotal current assets1,385 936 Total current assets861 1,150 
Property, plant, and equipment (net of accumulated depreciation and amortization of $4,464 and $4,299 as of June 30, 2022 and December 31, 2021, respectively)10,899 10,577 
Property, plant, and equipment (net of accumulated depreciation and amortization of $4,679 and $4,583 as of September 30, 2023 and December 31, 2022, respectively)Property, plant, and equipment (net of accumulated depreciation and amortization of $4,679 and $4,583 as of September 30, 2023 and December 31, 2022, respectively)11,893 11,338 
Deferred debits and other assetsDeferred debits and other assetsDeferred debits and other assets
Regulatory assetsRegulatory assets465 477 Regulatory assets591 527 
InvestmentsInvestments14 Investments
Prepaid pension assetPrepaid pension asset307 276 Prepaid pension asset259 291 
OtherOther30 44 Other36 37 
Total deferred debits and other assetsTotal deferred debits and other assets809 811 Total deferred debits and other assets895 862 
Total assetsTotal assets$13,093 $12,324 Total assets$13,649 $13,350 
See the Combined Notes to Consolidated Financial Statements
27




Table of Contents
BALTIMORE GAS AND ELECTRIC COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
LIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilitiesCurrent liabilitiesCurrent liabilities
Short-term borrowingsShort-term borrowings$— $130 Short-term borrowings$59 $408 
Long-term debt due within one yearLong-term debt due within one year250 250 Long-term debt due within one year— 300 
Accounts payableAccounts payable339 349 Accounts payable364 462 
Accrued expensesAccrued expenses133 176 Accrued expenses224 159 
Payables to affiliatesPayables to affiliates30 48 Payables to affiliates33 39 
Customer depositsCustomer deposits100 97 Customer deposits111 105 
Regulatory liabilitiesRegulatory liabilities45 26 Regulatory liabilities36 47 
OtherOther224 48 Other34 55 
Total current liabilitiesTotal current liabilities1,121 1,124 Total current liabilities861 1,575 
Long-term debtLong-term debt4,206 3,711 Long-term debt4,601 3,907 
Deferred credits and other liabilitiesDeferred credits and other liabilitiesDeferred credits and other liabilities
Deferred income taxes and unamortized investment tax creditsDeferred income taxes and unamortized investment tax credits1,777 1,686 Deferred income taxes and unamortized investment tax credits1,905 1,832 
Regulatory liabilitiesRegulatory liabilities869 934 Regulatory liabilities787 816 
Asset retirement obligationsAsset retirement obligations26 26 Asset retirement obligations32 30 
Non-pension postretirement benefits obligationsNon-pension postretirement benefits obligations169 175 Non-pension postretirement benefits obligations160 166 
OtherOther85 98 Other81 88 
Total deferred credits and other liabilitiesTotal deferred credits and other liabilities2,926 2,919 Total deferred credits and other liabilities2,965 2,932 
Total liabilitiesTotal liabilities8,253 7,754 Total liabilities8,427 8,414 
Commitments and contingenciesCommitments and contingencies00Commitments and contingencies
Shareholder's equityShareholder's equityShareholder's equity
Common stockCommon stock2,761 2,575 Common stock3,098 2,861 
Retained earningsRetained earnings2,079 1,995 Retained earnings2,124 2,075 
Total shareholder's equityTotal shareholder's equity4,840 4,570 Total shareholder's equity5,222 4,936 
Total liabilities and shareholder's equityTotal liabilities and shareholder's equity$13,093 $12,324 Total liabilities and shareholder's equity$13,649 $13,350 

See the Combined Notes to Consolidated Financial Statements
28




Table of Contents
BALTIMORE GAS AND ELECTRIC COMPANY
STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(Unaudited)
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
(In millions)(In millions)Common
Stock
Retained
Earnings
Total
Shareholder's
Equity
(In millions)Common
Stock
Retained
Earnings
Total
Shareholder's
Equity
Balance, December 31, 2021$2,575 $1,995 $4,570 
Balance at December 31, 2022Balance at December 31, 2022$2,861 $2,075 $4,936 
Net incomeNet income— 200 200 
Common stock dividendsCommon stock dividends— (80)(80)
Contributions from parentContributions from parent237 — 237 
Balance at March 31, 2023Balance at March 31, 2023$3,098 $2,195 $5,293 
Net incomeNet income— 198 198 Net income— 42 42 
Common stock dividendsCommon stock dividends— (76)(76)Common stock dividends— (79)(79)
Balance, March 31, 2022$2,575 $2,117 $4,692 
Balance at June 30, 2023Balance at June 30, 2023$3,098 $2,158 $5,256 
Net incomeNet income— 45 45 
Common stock dividendsCommon stock dividends— (79)(79)
Balance at September 30, 2023Balance at September 30, 2023$3,098 $2,124 $5,222 
Nine Months Ended September 30, 2022
(In millions)(In millions)Common
Stock
Retained
Earnings
Total
Shareholder's
Equity
Balance at December 31, 2021Balance at December 31, 2021$2,575 $1,995 $4,570 
Net incomeNet income— 198 198 
Common stock dividendsCommon stock dividends— (76)(76)
Balance at March 31, 2022Balance at March 31, 2022$2,575 $2,117 $4,692 
Net incomeNet income— 37 37 Net income— 37 37 
Common stock dividendsCommon stock dividends— (75)(75)Common stock dividends— (75)(75)
Contributions from parentContributions from parent186 — 186 Contributions from parent186 — 186 
Balance, June 30, 2022$2,761 $2,079 $4,840 
Six Months Ended June 30, 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 
Balance at June 30, 2022Balance at June 30, 2022$2,761 $2,079 $4,840 
Net incomeNet income— 45 45 Net income— 33 33 
Common stock dividendsCommon stock dividends— (72)(72)Common stock dividends— (75)(75)
Balance, June 30, 2021$2,318 $1,987 $4,305 
Balance at September 30, 2022Balance at September 30, 2022$2,761 $2,037 $4,798 
See the Combined Notes to Consolidated Financial Statements
29




Table of Contents

PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions)(In millions)2022202120222021(In millions)2023202220232022
Operating revenuesOperating revenuesOperating revenues
Electric operating revenuesElectric operating revenues$1,199 $1,071 $2,522 $2,195 Electric operating revenues$1,762 $1,568 $4,399 $4,090 
Natural gas operating revenuesNatural gas operating revenues37 24 120 94 Natural gas operating revenues24 38 150 157 
Revenues from alternative revenue programsRevenues from alternative revenue programs(17)41 (22)88 Revenues from alternative revenue programs(15)(11)59 (33)
Operating revenues from affiliatesOperating revenues from affiliatesOperating revenues from affiliates
Total operating revenuesTotal operating revenues1,221 1,140 2,626 2,384 Total operating revenues1,773 1,598 4,615 4,223 
Operating expensesOperating expensesOperating expenses
Purchased powerPurchased power401 308 888 656 Purchased power701 586 1,729 1,474 
Purchased fuelPurchased fuel19 61 41 Purchased fuel24 76 85 
Purchased power from affiliates— 79 50 177 
Purchased power from affiliatePurchased power from affiliate— — — 50 
Operating and maintenanceOperating and maintenance245 217 493 434 Operating and maintenance288 237 815 729 
Operating and maintenance from affiliatesOperating and maintenance from affiliates47 39 98 79 Operating and maintenance from affiliates51 40 137 138 
Depreciation and amortizationDepreciation and amortization240 194 459 404 Depreciation and amortization257 238 741 697 
Taxes other than income taxesTaxes other than income taxes114 109 233 222 Taxes other than income taxes134 129 366 362 
Total operating expensesTotal operating expenses1,066 955 2,282 2,013 Total operating expenses1,440 1,254 3,864 3,535 
Operating incomeOperating income155 185 344 371 Operating income333 344 751 688 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(73)(67)(143)(134)Interest expense, net(80)(72)(238)(216)
Other, netOther, net19 20 37 36 Other, net28 19 80 56 
Total other income and (deductions)Total other income and (deductions)(54)(47)(106)(98)Total other income and (deductions)(52)(53)(158)(160)
Income before income taxesIncome before income taxes101 138 238 273 Income before income taxes281 291 593 528 
Income taxesIncome taxes(3)Income taxes49 103 10 
Equity in earnings of unconsolidated affiliate— — — 
Net incomeNet income$100 $141 $230 $269 Net income$232 $289 $490 $518 
Comprehensive incomeComprehensive income$100 $141 $230 $269 Comprehensive income$232 $289 $490 $518 
See the Combined Notes to Consolidated Financial Statements
30




Table of Contents
PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
Nine Months Ended
September 30,
(In millions)(In millions)20222021(In millions)20232022
Cash flows from operating activitiesCash flows from operating activitiesCash flows from operating activities
Net incomeNet income$230 $269 Net income$490 $518 
Adjustments to reconcile net income to net cash flows from operating activities:
Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortizationDepreciation and amortization459 404 Depreciation and amortization741 697 
Deferred income taxes and amortization of investment tax creditsDeferred income taxes and amortization of investment tax credits(7)10 Deferred income taxes and amortization of investment tax credits44 (2)
Other non-cash operating activitiesOther non-cash operating activities76 (50)Other non-cash operating activities80 112 
Changes in assets and liabilities:Changes in assets and liabilities:Changes in assets and liabilities:
Accounts receivableAccounts receivable(92)(30)Accounts receivable(160)(143)
Receivables from and payables to affiliates, netReceivables from and payables to affiliates, net(53)(22)Receivables from and payables to affiliates, net(8)(49)
InventoriesInventories(7)Inventories(22)(35)
Accounts payable and accrued expensesAccounts payable and accrued expenses10 (35)Accounts payable and accrued expenses23 (15)
Collateral received, net403 — 
Collateral (paid) received, netCollateral (paid) received, net(191)230 
Income taxesIncome taxes(2)(1)Income taxes37 (3)
Regulatory assets and liabilities, netRegulatory assets and liabilities, net(71)(33)Regulatory assets and liabilities, net(2)(82)
Pension and non-pension postretirement benefit contributionsPension and non-pension postretirement benefit contributions(70)(40)Pension and non-pension postretirement benefit contributions(15)(75)
Other assets and liabilitiesOther assets and liabilities(86)(98)Other assets and liabilities(98)(71)
Net cash flows provided by operating activitiesNet cash flows provided by operating activities790 377 Net cash flows provided by operating activities919 1,082 
Cash flows from investing activitiesCash flows from investing activitiesCash flows from investing activities
Capital expendituresCapital expenditures(776)(889)Capital expenditures(1,510)(1,174)
Other investing activitiesOther investing activities(2)Other investing activities
Net cash flows used in investing activitiesNet cash flows used in investing activities(773)(891)Net cash flows used in investing activities(1,502)(1,169)
Cash flows from financing activitiesCash flows from financing activitiesCash flows from financing activities
Changes in short-term borrowingsChanges in short-term borrowings(425)(36)Changes in short-term borrowings(241)(468)
Issuance of long-term debtIssuance of long-term debt700 625 Issuance of long-term debt550 925 
Retirement of long-term debtRetirement of long-term debt(200)(249)Retirement of long-term debt— (310)
Changes in Exelon intercompany money poolChanges in Exelon intercompany money pool17 (12)Changes in Exelon intercompany money pool18 36 
Distributions to memberDistributions to member(395)(414)Distributions to member(410)(625)
Contributions from memberContributions from member704 560 Contributions from member475 787 
Other financing activitiesOther financing activities(12)(8)Other financing activities(36)(18)
Net cash flows provided by financing activitiesNet cash flows provided by financing activities389 466 Net cash flows provided by financing activities356 327 
Increase (decrease) in cash, restricted cash, and cash equivalents406 (48)
(Decrease) increase in cash, restricted cash, and cash equivalents(Decrease) increase in cash, restricted cash, and cash equivalents(227)240 
Cash, restricted cash, and cash equivalents at beginning of periodCash, restricted cash, and cash equivalents at beginning of period213 160 Cash, restricted cash, and cash equivalents at beginning of period373 213 
Cash, restricted cash, and cash equivalents at end of periodCash, restricted cash, and cash equivalents at end of period$619 $112 Cash, restricted cash, and cash equivalents at end of period$146 $453 
Supplemental cash flow informationSupplemental cash flow informationSupplemental cash flow information
Decrease in capital expenditures not paidDecrease in capital expenditures not paid$(48)$(41)Decrease in capital expenditures not paid$(96)$(8)
See the Combined Notes to Consolidated Financial Statements
31




Table of Contents
PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
ASSETSASSETSASSETS
Current assetsCurrent assetsCurrent assets
Cash and cash equivalentsCash and cash equivalents$278 $136 Cash and cash equivalents$121 $198 
Restricted cash and cash equivalentsRestricted cash and cash equivalents341 77 Restricted cash and cash equivalents25 175 
Accounts receivableAccounts receivableAccounts receivable
Customer accounts receivableCustomer accounts receivable676616Customer accounts receivable828734
Customer allowance for credit lossesCustomer allowance for credit losses(109)(104)Customer allowance for credit losses(118)(109)
Customer accounts receivable, netCustomer accounts receivable, net567 512 Customer accounts receivable, net710 625 
Other accounts receivableOther accounts receivable291283Other accounts receivable331300
Other allowance for credit lossesOther allowance for credit losses(42)(39)Other allowance for credit losses(51)(46)
Other accounts receivable, netOther accounts receivable, net249 244 Other accounts receivable, net280 254 
Receivables from affiliatesReceivables from affiliatesReceivables from affiliates
Inventories, netInventories, netInventories, net
Fossil fuelFossil fuel10 11 Fossil fuel18 
Materials and suppliesMaterials and supplies217 209 Materials and supplies267 236 
Regulatory assetsRegulatory assets435 432 Regulatory assets366 455 
OtherOther90 69 Other77 96 
Total current assetsTotal current assets2,188 1,692 Total current assets1,858 2,059 
Property, plant, and equipment (net of accumulated depreciation and amortization of $2,365 and $2,108 as of June 30, 2022 and December 31, 2021, respectively)16,915 16,498 
Property, plant, and equipment (net of accumulated depreciation and amortization of $3,044 and $2,618 as of September 30, 2023 and December 31, 2022, respectively)Property, plant, and equipment (net of accumulated depreciation and amortization of $3,044 and $2,618 as of September 30, 2023 and December 31, 2022, respectively)18,577 17,686 
Deferred debits and other assetsDeferred debits and other assetsDeferred debits and other assets
Regulatory assetsRegulatory assets1,714 1,794 Regulatory assets1,568 1,610 
GoodwillGoodwill4,005 4,005 Goodwill4,005 4,005 
InvestmentsInvestments139 145 Investments143 138 
Prepaid pension assetPrepaid pension asset380 344 Prepaid pension asset289 353 
Deferred income taxes
OtherOther245 258 Other216 231 
Total deferred debits and other assetsTotal deferred debits and other assets6,489 6,554 Total deferred debits and other assets6,221 6,337 
Total assetsTotal assets$25,592 $24,744 Total assets$26,656 $26,082 
See the Combined Notes to Consolidated Financial Statements
32




Table of Contents
PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
LIABILITIES AND MEMBER'S EQUITYLIABILITIES AND MEMBER'S EQUITYLIABILITIES AND MEMBER'S EQUITY
Current liabilitiesCurrent liabilitiesCurrent liabilities
Short-term borrowingsShort-term borrowings$43 $468 Short-term borrowings$173 $414 
Long-term debt due within one yearLong-term debt due within one year200 399 Long-term debt due within one year1,146 591 
Accounts payableAccounts payable574 578 Accounts payable664 771 
Accrued expensesAccrued expenses246 281 Accrued expenses324 260 
Payables to affiliatesPayables to affiliates50 104 Payables to affiliates59 66 
Borrowings from Exelon intercompany money poolBorrowings from Exelon intercompany money pool24 Borrowings from Exelon intercompany money pool61 44 
Customer depositsCustomer deposits81 81 Customer deposits98 88 
Regulatory liabilitiesRegulatory liabilities71 68 Regulatory liabilities87 76 
Unamortized energy contract liabilitiesUnamortized energy contract liabilities11 89 Unamortized energy contract liabilities10 
PPA termination obligationPPA termination obligation87 — PPA termination obligation61 87 
OtherOther580 171 Other129 330 
Total current liabilitiesTotal current liabilities1,967 2,246 Total current liabilities2,810 2,737 
Long-term debtLong-term debt7,827 7,148 Long-term debt7,491 7,529 
Deferred credits and other liabilitiesDeferred credits and other liabilitiesDeferred credits and other liabilities
Deferred income taxes and unamortized investment tax creditsDeferred income taxes and unamortized investment tax credits2,752 2,675 Deferred income taxes and unamortized investment tax credits3,023 2,895 
Regulatory liabilitiesRegulatory liabilities1,142 1,238 Regulatory liabilities924 1,011 
Asset retirement obligationsAsset retirement obligations70 70 Asset retirement obligations54 59 
Non-pension postretirement benefit obligationsNon-pension postretirement benefit obligations57 66 Non-pension postretirement benefit obligations45 50 
Unamortized energy contract liabilitiesUnamortized energy contract liabilities38 146 Unamortized energy contract liabilities29 35 
OtherOther615 570 Other495 536 
Total deferred credits and other liabilitiesTotal deferred credits and other liabilities4,674 4,765 Total deferred credits and other liabilities4,570 4,586 
Total liabilitiesTotal liabilities14,468 14,159 Total liabilities14,871 14,852 
Commitments and contingenciesCommitments and contingencies00Commitments and contingencies
Member's equityMember's equityMember's equity
Membership interestMembership interest11,499 10,795 Membership interest12,057 11,582 
Undistributed lossesUndistributed losses(375)(210)Undistributed losses(272)(352)
Total member's equityTotal member's equity11,124 10,585 Total member's equity11,785 11,230 
Total liabilities and member's equityTotal liabilities and member's equity$25,592 $24,744 Total liabilities and member's equity$26,656 $26,082 
See the Combined Notes to Consolidated Financial Statements
33




Table of Contents
PEPCO HOLDINGS LLC AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CHANGES IN MEMBER'S EQUITY
(Unaudited)
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
(In millions)(In millions)Membership InterestUndistributed (Losses)/EarningsTotal Member's Equity(In millions)Membership InterestUndistributed (Losses)/GainsTotal Member's Equity
Balance, December 31, 2021$10,795 $(210)$10,585 
Balance at December 31, 2022Balance at December 31, 2022$11,582 $(352)$11,230 
Net incomeNet income— 130 130 Net income— 155 155 
Distributions to memberDistributions to member— (102)(102)Distributions to member— (112)(112)
Contributions from memberContributions from member704 — 704 Contributions from member405 — 405 
Balance, March 31, 2022$11,499 $(182)$11,317 
Balance at March 31, 2023Balance at March 31, 2023$11,987 $(309)$11,678 
Net incomeNet income— 100 100 Net income— 103 103 
Distributions to memberDistributions to member— (293)(293)Distributions to member— (100)(100)
Balance, June 30, 2022$11,499 $(375)$11,124 
Balance at June 30, 2023Balance at June 30, 2023$11,987 $(306)$11,681 
Net incomeNet income— 232 232 
Distributions to memberDistributions to member— (198)(198)
Contributions from memberContributions from member70 — 70 
Balance at September 30, 2023Balance at September 30, 2023$12,057 $(272)$11,785 

Six Months Ended June 30, 2021Nine Months Ended September 30, 2022
(In millions)(In millions)Membership InterestUndistributed (Losses)/EarningsTotal Member's Equity(In millions)Membership InterestUndistributed (Losses)/GainsTotal Member's Equity
Balance, December 31, 2020$10,112 $(68)$10,044 
Balance at December 31, 2021Balance at December 31, 2021$10,795 $(210)$10,585 
Net incomeNet income— 128 128 Net income— 130 130 
Distributions to memberDistributions to member— (81)(81)Distributions to member— (102)(102)
Contributions from memberContributions from member560 — 560 Contributions from member704 — 704 
Balance, March 31, 2021$10,672 $(21)$10,651 
Balance at March 31, 2022Balance at March 31, 2022$11,499 $(182)$11,317 
Net incomeNet income— 141 141 Net income— 100 100 
Distributions to memberDistributions to member— (333)(333)Distributions to member— (293)(293)
Balance, June 30, 2021$10,672 $(213)$10,459 
Balance at June 30, 2022Balance at June 30, 2022$11,499 $(375)$11,124 
Net incomeNet income— 289 289 
Distributions to memberDistributions to member— (230)(230)
Contributions from memberContributions from member83 — 83 
Balance at September 30, 2022Balance at September 30, 2022$11,582 $(316)$11,266 
See the Combined Notes to Consolidated Financial Statements
34




Table of Contents

POTOMAC ELECTRIC POWER COMPANY
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions)(In millions)2022202120222021(In millions)2023202220232022
Operating revenuesOperating revenuesOperating revenues
Electric operating revenuesElectric operating revenues$580 $503 $1,200 $1,027 Electric operating revenues$839 $730 $2,141 $1,930 
Revenues from alternative revenue programsRevenues from alternative revenue programs(1)19 (7)46 Revenues from alternative revenue programs(18)(8)28 (15)
Operating revenues from affiliatesOperating revenues from affiliatesOperating revenues from affiliates
Total operating revenuesTotal operating revenues581 523 1,195 1,076 Total operating revenues822 724 2,174 1,919 
Operating expensesOperating expensesOperating expenses
Purchased powerPurchased power162 76 336 168 Purchased power288 230 750 566 
Purchased power from affiliatePurchased power from affiliate— 57 39 130 Purchased power from affiliate— — — 39 
Operating and maintenanceOperating and maintenance72 62 145 118 Operating and maintenance89 69 264 214 
Operating and maintenance from affiliatesOperating and maintenance from affiliates56 51 115 103 Operating and maintenance from affiliates60 52 176 166 
Depreciation and amortizationDepreciation and amortization105 96 213 199 Depreciation and amortization112 99 329 312 
Taxes other than income taxesTaxes other than income taxes92 87 186 177 Taxes other than income taxes109 105 291 291 
Total operating expensesTotal operating expenses487 429 1,034 895 Total operating expenses658 555 1,810 1,588 
Operating incomeOperating income94 94 161 181 Operating income164 169 364 331 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(38)(35)(74)(69)Interest expense, net(41)(37)(122)(111)
Other, netOther, net13 13 26 25 Other, net18 14 50 39 
Total other income and (deductions)Total other income and (deductions)(25)(22)(48)(44)Total other income and (deductions)(23)(23)(72)(72)
Income before income taxesIncome before income taxes69 72 113 137 Income before income taxes141 146 292 259 
Income taxesIncome taxes(1)(3)(3)Income taxes21 43 (2)
Net incomeNet income$70 $75 $116 $134 Net income$120 $145 $249 $261 
Comprehensive incomeComprehensive income$70 $75 $116 $134 Comprehensive income$120 $145 $249 $261 
See the Combined Notes to Consolidated Financial Statements
35




Table of Contents
POTOMAC ELECTRIC POWER COMPANY
STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
Nine Months Ended
September 30,
(In millions)(In millions)20222021(In millions)20232022
Cash flows from operating activitiesCash flows from operating activitiesCash flows from operating activities
Net incomeNet income$116 $134 Net income$249 $261 
Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortizationDepreciation and amortization213 199 Depreciation and amortization329 312 
Deferred income taxes and amortization of investment tax creditsDeferred income taxes and amortization of investment tax credits(7)10 Deferred income taxes and amortization of investment tax credits22 (5)
Other non-cash operating activitiesOther non-cash operating activities17 (43)Other non-cash operating activities38 20 
Changes in assets and liabilities:Changes in assets and liabilities:Changes in assets and liabilities:
Accounts receivableAccounts receivable(62)(23)Accounts receivable(84)(87)
Receivables from and payables to affiliates, netReceivables from and payables to affiliates, net(39)(11)Receivables from and payables to affiliates, net(2)(31)
InventoriesInventories(6)Inventories(12)(19)
Accounts payable and accrued expensesAccounts payable and accrued expenses(26)Accounts payable and accrued expenses33 11 
Collateral received, net85 — 
Collateral (paid) received, netCollateral (paid) received, net(26)46 
Income taxesIncome taxes(24)(20)Income taxes15 (25)
Regulatory assets and liabilities, netRegulatory assets and liabilities, net(36)(38)Regulatory assets and liabilities, net(7)(44)
Pension and non-pension postretirement benefit contributionsPension and non-pension postretirement benefit contributions(7)(7)Pension and non-pension postretirement benefit contributions(9)(9)
Other assets and liabilitiesOther assets and liabilities(15)(41)Other assets and liabilities(13)(29)
Net cash flows provided by operating activitiesNet cash flows provided by operating activities241 135 Net cash flows provided by operating activities533 401 
Cash flows from investing activitiesCash flows from investing activitiesCash flows from investing activities
Capital expendituresCapital expenditures(402)(439)Capital expenditures(710)(595)
Changes in PHI intercompany money poolChanges in PHI intercompany money pool(7)— 
Other investing activitiesOther investing activities(2)Other investing activities
Net cash flows used in investing activitiesNet cash flows used in investing activities(400)(441)Net cash flows used in investing activities(709)(593)
Cash flows from financing activitiesCash flows from financing activitiesCash flows from financing activities
Changes in short-term borrowingsChanges in short-term borrowings(132)119 Changes in short-term borrowings(299)(175)
Issuance of long-term debtIssuance of long-term debt400 150 Issuance of long-term debt350 625 
Retirement of long-term debtRetirement of long-term debt(200)— Retirement of long-term debt— (310)
Changes in PHI intercompany money poolChanges in PHI intercompany money pool73 Changes in PHI intercompany money pool— 25 
Dividends paid on common stockDividends paid on common stock(300)(123)Dividends paid on common stock(200)(400)
Contributions from parentContributions from parent387 138 Contributions from parent308 465 
Other financing activitiesOther financing activities(6)(2)Other financing activities(26)(8)
Net cash flows provided by financing activitiesNet cash flows provided by financing activities222 291 Net cash flows provided by financing activities133 222 
Increase (decrease) in cash, restricted cash, and cash equivalents63 (15)
(Decrease) increase in cash, restricted cash, and cash equivalents(Decrease) increase in cash, restricted cash, and cash equivalents(43)30 
Cash, restricted cash, and cash equivalents at beginning of periodCash, restricted cash, and cash equivalents at beginning of period68 65 Cash, restricted cash, and cash equivalents at beginning of period99 68 
Cash, restricted cash, and cash equivalents at end of periodCash, restricted cash, and cash equivalents at end of period$131 $50 Cash, restricted cash, and cash equivalents at end of period$56 $98 
Supplemental cash flow informationSupplemental cash flow informationSupplemental cash flow information
Decrease in capital expenditures not paid$(24)$(15)
(Decrease) increase in capital expenditures not paid(Decrease) increase in capital expenditures not paid$(39)$
See the Combined Notes to Consolidated Financial Statements
36




Table of Contents
POTOMAC ELECTRIC POWER COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
ASSETSASSETSASSETS
Current assetsCurrent assetsCurrent assets
Cash and cash equivalentsCash and cash equivalents$14 $34 Cash and cash equivalents$31 $45 
Restricted cash and cash equivalentsRestricted cash and cash equivalents117 34 Restricted cash and cash equivalents25 54 
Accounts receivableAccounts receivableAccounts receivable
Customer accounts receivableCustomer accounts receivable328277Customer accounts receivable414351
Customer allowance for credit lossesCustomer allowance for credit losses(42)(37)Customer allowance for credit losses(56)(47)
Customer accounts receivable, netCustomer accounts receivable, net286 240 Customer accounts receivable, net358 304 
Other accounts receivableOther accounts receivable165160Other accounts receivable189180
Other allowance for credit lossesOther allowance for credit losses(20)(16)Other allowance for credit losses(29)(25)
Other accounts receivable, netOther accounts receivable, net145 144 Other accounts receivable, net160 155 
Receivables from affiliates— 
Receivable from PHI intercompany money poolReceivable from PHI intercompany money pool— 
Inventories, netInventories, net125 119 Inventories, net147 135 
Regulatory assetsRegulatory assets220 213 Regulatory assets187 235 
OtherOther12 25 Other16 53 
Total current assetsTotal current assets928 809 Total current assets931 981 
Property, plant, and equipment (net of accumulated depreciation and amortization of $3,970 and $3,875 as of June 30, 2022 and December 31, 2021, respectively)8,365 8,104 
Property, plant, and equipment (net of accumulated depreciation and amortization of $4,231 and $4,067 as of September 30, 2023 and December 31, 2022, respectively)Property, plant, and equipment (net of accumulated depreciation and amortization of $4,231 and $4,067 as of September 30, 2023 and December 31, 2022, respectively)9,274 8,794 
Deferred debits and other assetsDeferred debits and other assetsDeferred debits and other assets
Regulatory assetsRegulatory assets478 532 Regulatory assets422 437 
InvestmentsInvestments118 120 Investments124 119 
Prepaid pension assetPrepaid pension asset277 279 Prepaid pension asset252 273 
OtherOther60 59 Other58 53 
Total deferred debits and other assetsTotal deferred debits and other assets933 990 Total deferred debits and other assets856 882 
Total assetsTotal assets$10,226 $9,903 Total assets$11,061 $10,657 
See the Combined Notes to Consolidated Financial Statements
37




Table of Contents
POTOMAC ELECTRIC POWER COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
LIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilitiesCurrent liabilitiesCurrent liabilities
Short-term borrowingsShort-term borrowings$43 $175 Short-term borrowings$— $299 
Long-term debt due within one yearLong-term debt due within one year114 313 Long-term debt due within one year405 
Accounts payableAccounts payable269 272 Accounts payable346 382 
Accrued expensesAccrued expenses124 160 Accrued expenses163 125 
Payables to affiliatesPayables to affiliates29 59 Payables to affiliates32 34 
Borrowings from PHI intercompany money pool73 — 
Customer depositsCustomer deposits36 35 Customer deposits45 39 
Regulatory liabilitiesRegulatory liabilities12 14 Regulatory liabilities24 
Merger related obligationMerger related obligation25 27 Merger related obligation26 26 
OtherOther149 55 Other49 93 
Total current liabilitiesTotal current liabilities874 1,110 Total current liabilities1,090 1,008 
Long-term debtLong-term debt3,528 3,132 Long-term debt3,690 3,747 
Deferred credits and other liabilitiesDeferred credits and other liabilitiesDeferred credits and other liabilities
Deferred income taxes and unamortized investment tax creditsDeferred income taxes and unamortized investment tax credits1,314 1,275 Deferred income taxes and unamortized investment tax credits1,456 1,382 
Regulatory liabilitiesRegulatory liabilities507 549 Regulatory liabilities394 455 
Asset retirement obligationsAsset retirement obligations45 45 Asset retirement obligations36 39 
Non-pension postretirement benefit obligations— 
OtherOther280 314 Other256 244 
Total deferred credits and other liabilitiesTotal deferred credits and other liabilities2,146 2,186 Total deferred credits and other liabilities2,142 2,120 
Total liabilitiesTotal liabilities6,548 6,428 Total liabilities6,922 6,875 
Commitments and contingenciesCommitments and contingencies00Commitments and contingencies
Shareholder's equityShareholder's equityShareholder's equity
Common stockCommon stock2,689 2,302 Common stock3,075 2,767 
Retained earningsRetained earnings989 1,173 Retained earnings1,064 1,015 
Total shareholder's equityTotal shareholder's equity3,678 3,475 Total shareholder's equity4,139 3,782 
Total liabilities and shareholder's equityTotal liabilities and shareholder's equity$10,226 $9,903 Total liabilities and shareholder's equity$11,061 $10,657 
See the Combined Notes to Consolidated Financial Statements
38




Table of Contents
POTOMAC ELECTRIC POWER COMPANY
STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(Unaudited)
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
(In millions)(In millions)Common StockRetained EarningsTotal Shareholder's Equity(In millions)Common StockRetained EarningsTotal Shareholder's Equity
Balance, December 31, 2021$2,302 $1,173 $3,475 
Balance at December 31, 2022Balance at December 31, 2022$2,767 $1,015 $3,782 
Net incomeNet income— 46 46 Net income— 65 65 
Common stock dividendsCommon stock dividends— (42)(42)Common stock dividends— (48)(48)
Contributions from parentContributions from parent387 — 387 Contributions from parent243 — 243 
Balance, March 31, 2022$2,689 $1,177 $3,866 
Balance at March 31, 2023Balance at March 31, 2023$3,010 $1,032 $4,042 
Net incomeNet income— 70 70 Net income— 64 64 
Common stock dividendsCommon stock dividends— (258)(258)Common stock dividends— (67)(67)
Balance, June 30, 2022$2,689 $989 $3,678 
Balance at June 30, 2023Balance at June 30, 2023$3,010 $1,029 $4,039 
Net incomeNet income— 120 120 
Common stock dividendsCommon stock dividends— (85)(85)
Contributions from parentContributions from parent65 — 65 
Balance at September 30, 2023Balance at September 30, 2023$3,075 $1,064 $4,139 

Six Months Ended June 30, 2021Nine Months Ended September 30, 2022
(In millions)(In millions)Common StockRetained EarningsTotal Shareholder's Equity(In millions)Common StockRetained EarningsTotal Shareholder's Equity
Balance, December 31, 2020$2,058 $1,145 $3,203 
Balance at December 31, 2021Balance at December 31, 2021$2,302 $1,173 $3,475 
Net incomeNet income— 59 59 Net income— 46 46 
Common stock dividendsCommon stock dividends— (28)(28)Common stock dividends— (42)(42)
Contributions from parentContributions from parent138 — 138 Contributions from parent387 — 387 
Balance, March 31, 2021$2,196 $1,176 $3,372��
Balance at March 31, 2022Balance at March 31, 2022$2,689 $1,177 $3,866 
Net incomeNet income— 75 75 Net income— 70 70 
Common stock dividendsCommon stock dividends— (95)(95)Common stock dividends— (258)(258)
Balance, June 30, 2021$2,196 $1,156 $3,352 
Balance at June 30, 2022Balance at June 30, 2022$2,689 $989 $3,678 
Net incomeNet income— 145 145 
Common stock dividendsCommon stock dividends— (100)(100)
Contributions from parentContributions from parent78 — 78 
Balance at September 30, 2022Balance at September 30, 2022$2,767 $1,034 $3,801 

See the Combined Notes to Consolidated Financial Statements
39




Table of Contents

DELMARVA POWER & LIGHT COMPANY
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions)(In millions)2022202120222021(In millions)2023202220232022
Operating revenuesOperating revenuesOperating revenues
Electric operating revenuesElectric operating revenues$295 $262 $643 $562 Electric operating revenues$426 $373 $1,108 $1,017 
Natural gas operating revenuesNatural gas operating revenues37 24 120 95 Natural gas operating revenues24 38 150 157 
Revenues from alternative revenue programsRevenues from alternative revenue programs(2)10 (3)19 Revenues from alternative revenue programs(2)— 10 (3)
Operating revenues from affiliatesOperating revenues from affiliatesOperating revenues from affiliates
Total operating revenuesTotal operating revenues332 298 763 680 Total operating revenues450 412 1,273 1,176 
Operating expensesOperating expensesOperating expenses
Purchased powerPurchased power116 82 253 185 Purchased power192 159 486 412 
Purchased fuelPurchased fuel19 61 41 Purchased fuel24 76 85 
Purchased power from affiliates— 17 10 37 
Purchased power from affiliatePurchased power from affiliate— — — 10 
Operating and maintenanceOperating and maintenance45 41 97 85 Operating and maintenance60 45 150 142 
Operating and maintenance from affiliatesOperating and maintenance from affiliates43 39 84 79 Operating and maintenance from affiliates44 39 128 124 
Depreciation and amortizationDepreciation and amortization56 51 113 104 Depreciation and amortization62 59 182 172 
Taxes other than income taxesTaxes other than income taxes17 16 35 33 Taxes other than income taxes19 19 57 54 
Total operating expensesTotal operating expenses296 255 653 564 Total operating expenses386 345 1,079 999 
Operating incomeOperating income36 43 110 116 Operating income64 67 194 177 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(17)(16)(33)(30)Interest expense, net(18)(16)(53)(48)
Other, netOther, netOther, net12 
Total other income and (deductions)Total other income and (deductions)(13)(12)(27)(24)Total other income and (deductions)(13)(13)(41)(39)
Income before income taxesIncome before income taxes23 31 83 92 Income before income taxes51 54 153 138 
Income taxesIncome taxesIncome taxes25 
Net incomeNet income$21 $30 $77 $86 Net income$43 $52 $128 $130 
Comprehensive incomeComprehensive income$21 $30 $77 $86 Comprehensive income$43 $52 $128 $130 
See the Combined Notes to Consolidated Financial Statements
40




Table of Contents
DELMARVA POWER & LIGHT COMPANY
STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
Nine Months Ended
September 30,
(In millions)(In millions)20222021(In millions)20232022
Cash flows from operating activitiesCash flows from operating activitiesCash flows from operating activities
Net incomeNet income$77 $86 Net income$128 $130 
Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortizationDepreciation and amortization113 104 Depreciation and amortization182 172 
Deferred income taxes and amortization of investment tax creditsDeferred income taxes and amortization of investment tax creditsDeferred income taxes and amortization of investment tax credits
Other non-cash operating activitiesOther non-cash operating activities13 (12)Other non-cash operating activities11 22 
Changes in assets and liabilities:Changes in assets and liabilities:Changes in assets and liabilities:
Accounts receivableAccounts receivable(8)24 Accounts receivable(3)
Receivables from and payables to affiliates, netReceivables from and payables to affiliates, net(3)(12)Receivables from and payables to affiliates, net(8)
InventoriesInventories— Inventories(11)
Accounts payable and accrued expensesAccounts payable and accrued expenses12 Accounts payable and accrued expenses(1)— 
Collateral received, net180 — 
Collateral (paid) received, netCollateral (paid) received, net(120)114 
Income taxesIncome taxes14 Income taxes15 
Regulatory assets and liabilities, netRegulatory assets and liabilities, net(11)(13)Regulatory assets and liabilities, net33 (23)
Pension and non-pension postretirement benefit contributionsPension and non-pension postretirement benefit contributions(1)— Pension and non-pension postretirement benefit contributions— (1)
Other assets and liabilitiesOther assets and liabilities(9)Other assets and liabilities23 
Net cash flows provided by operating activitiesNet cash flows provided by operating activities383 193 Net cash flows provided by operating activities274 428 
Cash flows from investing activitiesCash flows from investing activitiesCash flows from investing activities
Capital expendituresCapital expenditures(194)(211)Capital expenditures(416)(294)
Changes in PHI intercompany money poolChanges in PHI intercompany money pool(73)(9)Changes in PHI intercompany money pool(10)(25)
Other investing activitiesOther investing activitiesOther investing activities— 
Net cash flows used in investing activitiesNet cash flows used in investing activities(265)(219)Net cash flows used in investing activities(426)(317)
Cash flows from financing activitiesCash flows from financing activitiesCash flows from financing activities
Changes in short-term borrowingsChanges in short-term borrowings(149)(146)Changes in short-term borrowings(115)(149)
Issuance of long-term debtIssuance of long-term debt125 125 Issuance of long-term debt125 125 
Dividends paid on common stockDividends paid on common stock(56)(63)Dividends paid on common stock(97)(95)
Contributions from parentContributions from parent144 120 Contributions from parent99 147 
Other financing activitiesOther financing activities(4)(3)Other financing activities(6)(4)
Net cash flows provided by financing activitiesNet cash flows provided by financing activities60 33 Net cash flows provided by financing activities24 
Increase in cash, restricted cash, and cash equivalents178 
(Decrease) increase in cash, restricted cash, and cash equivalents(Decrease) increase in cash, restricted cash, and cash equivalents(146)135 
Cash, restricted cash, and cash equivalents at beginning of periodCash, restricted cash, and cash equivalents at beginning of period71 15 Cash, restricted cash, and cash equivalents at beginning of period152 71 
Cash, restricted cash, and cash equivalents at end of periodCash, restricted cash, and cash equivalents at end of period$249 $22 Cash, restricted cash, and cash equivalents at end of period$$206 
Supplemental cash flow informationSupplemental cash flow informationSupplemental cash flow information
Decrease in capital expenditures not paid$(5)$(14)
Increase in capital expenditures not paidIncrease in capital expenditures not paid$— $
    
See the Combined Notes to Consolidated Financial Statements
41




Table of Contents
DELMARVA POWER & LIGHT COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
ASSETSASSETSASSETS
Current assetsCurrent assetsCurrent assets
Cash and cash equivalentsCash and cash equivalents$26 $28 Cash and cash equivalents$$31 
Restricted cash and cash equivalentsRestricted cash and cash equivalents223 43 Restricted cash and cash equivalents121 
Accounts receivableAccounts receivableAccounts receivable
Customer accounts receivableCustomer accounts receivable154149Customer accounts receivable179204
Customer allowance for credit lossesCustomer allowance for credit losses(22)(18)Customer allowance for credit losses(23)(21)
Customer accounts receivable, netCustomer accounts receivable, net132 131 Customer accounts receivable, net156 183 
Other accounts receivableOther accounts receivable5558Other accounts receivable5952
Other allowance for credit lossesOther allowance for credit losses(8)(8)Other allowance for credit losses(9)(7)
Other accounts receivable, netOther accounts receivable, net47 50 Other accounts receivable, net50 45 
Receivables from affiliates— 
Receivable from PHI intercompany poolReceivable from PHI intercompany pool73 — Receivable from PHI intercompany pool10 — 
Inventories, netInventories, netInventories, net
Fossil fuelFossil fuel10 11 Fossil fuel18 
Materials and suppliesMaterials and supplies54 54 Materials and supplies65 58 
Prepaid utility taxesPrepaid utility taxes— 20 Prepaid utility taxes30 23 
Regulatory assetsRegulatory assets68 68 Regulatory assets55 80 
OtherOther29 16 Other14 
Total current assetsTotal current assets662 422 Total current assets390 573 
Property, plant, and equipment (net of accumulated depreciation and amortization of $1,704 and $1,635 as of June 30, 2022 and December 31, 2021, respectively)4,661 4,560 
Property, plant, and equipment (net of accumulated depreciation and amortization of $1,893 and $1,772 as of September 30, 2023 and December 31, 2022, respectively)Property, plant, and equipment (net of accumulated depreciation and amortization of $1,893 and $1,772 as of September 30, 2023 and December 31, 2022, respectively)5,079 4,820 
Deferred debits and other assetsDeferred debits and other assetsDeferred debits and other assets
Regulatory assetsRegulatory assets204 212 Regulatory assets210 202 
Prepaid pension assetPrepaid pension asset156 157 Prepaid pension asset140 153 
OtherOther59 61 Other51 54 
Total deferred debits and other assetsTotal deferred debits and other assets419 430 Total deferred debits and other assets401 409 
Total assetsTotal assets$5,742 $5,412 Total assets$5,870 $5,802 
See the Combined Notes to Consolidated Financial Statements
42




Table of Contents
DELMARVA POWER & LIGHT COMPANY
BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
LIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilitiesCurrent liabilitiesCurrent liabilities
Short-term borrowingsShort-term borrowings$— $149 Short-term borrowings$— $115 
Long-term debt due within one yearLong-term debt due within one year84 83 Long-term debt due within one year584 584 
Accounts payableAccounts payable141 131 Accounts payable161 172 
Accrued expensesAccrued expenses40 40 Accrued expenses63 41 
Payables to affiliatesPayables to affiliates29 33 Payables to affiliates25 22 
Customer depositsCustomer deposits27 28 Customer deposits31 29 
Regulatory liabilitiesRegulatory liabilities31 25 Regulatory liabilities55 44 
OtherOther239 59 Other21 136 
Total current liabilitiesTotal current liabilities591 548 Total current liabilities940 1,143 
Long-term debtLong-term debt1,854 1,727 Long-term debt1,476 1,354 
Deferred credits and other liabilitiesDeferred credits and other liabilitiesDeferred credits and other liabilities
Deferred income taxes and unamortized investment tax creditsDeferred income taxes and unamortized investment tax credits830 803 Deferred income taxes and unamortized investment tax credits896 869 
Regulatory liabilitiesRegulatory liabilities415 441 Regulatory liabilities368 380 
Asset retirement obligationsAsset retirement obligations16 16 Asset retirement obligations12 13 
Non-pension postretirement benefits obligationsNon-pension postretirement benefits obligations10 11 Non-pension postretirement benefits obligations
OtherOther84 89 Other89 84 
Total deferred credits and other liabilitiesTotal deferred credits and other liabilities1,355 1,360 Total deferred credits and other liabilities1,374 1,355 
Total liabilitiesTotal liabilities3,800 3,635 Total liabilities3,790 3,852 
Commitments and contingenciesCommitments and contingencies00Commitments and contingencies
Shareholder's equityShareholder's equityShareholder's equity
Common stockCommon stock1,353 1,209 Common stock1,455 1,356 
Retained earningsRetained earnings589 568 Retained earnings625 594 
Total shareholder's equityTotal shareholder's equity1,942 1,777 Total shareholder's equity2,080 1,950 
Total liabilities and shareholder's equityTotal liabilities and shareholder's equity$5,742 $5,412 Total liabilities and shareholder's equity$5,870 $5,802 
See the Combined Notes to Consolidated Financial Statements
43




Table of Contents
DELMARVA POWER & LIGHT COMPANY
STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(Unaudited)
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
(In millions)(In millions)Common StockRetained EarningsTotal Shareholder's Equity(In millions)Common StockRetained EarningsTotal Shareholder's Equity
Balance, December 31, 2021$1,209 $568 $1,777 
Balance at December 31, 2022Balance at December 31, 2022$1,356 $594 $1,950 
Net incomeNet income— 56 56 Net income— 60 60 
Common stock dividendsCommon stock dividends— (41)(41)Common stock dividends— (42)(42)
Contributions from parentContributions from parent144 — 144 Contributions from parent99 — 99 
Balance, March 31, 2022$1,353 $583 $1,936 
Balance at March 31, 2023Balance at March 31, 2023$1,455 $612 $2,067 
Net incomeNet income— 21 21 Net income— 25 25 
Common stock dividendsCommon stock dividends— (15)(15)Common stock dividends— (18)(18)
Balance, June 30, 2022$1,353 $589 $1,942 
Balance at June 30, 2023Balance at June 30, 2023$1,455 $619 $2,074 
Net incomeNet income— 43 43 
Common stock dividendsCommon stock dividends— (37)(37)
Balance at September 30, 2023Balance at September 30, 2023$1,455 $625 $2,080 

Six Months Ended June 30, 2021Nine Months Ended September 30, 2022
(In millions)(In millions)Common StockRetained EarningsTotal Shareholder's Equity(In millions)Common StockRetained EarningsTotal Shareholder's Equity
Balance, December 31, 2020$1,089 $587 $1,676 
Balance at December 31, 2021Balance at December 31, 2021$1,209 $568 $1,777 
Net incomeNet income— 56 56 Net income— 56 56 
Common stock dividendsCommon stock dividends— (40)(40)Common stock dividends— (41)(41)
Contributions from parentContributions from parent120 — 120 Contributions from parent144 — 144 
Balance, March 31, 2021$1,209 $603 $1,812 
Balance at March 31, 2022Balance at March 31, 2022$1,353 $583 $1,936 
Net incomeNet income— 30 30 Net income— 21 21 
Common stock dividendsCommon stock dividends— (23)(23)Common stock dividends— (15)(15)
Balance, June 30, 2021$1,209 $610 $1,819 
Balance at June 30, 2022Balance at June 30, 2022$1,353 $589 $1,942 
Net incomeNet income— 52 52 
Common stock dividendsCommon stock dividends— (39)(39)
Contributions from parentContributions from parent— 
Balance, September 30, 2022Balance, September 30, 2022$1,356 $602 $1,958 

See the Combined Notes to Consolidated Financial Statements
44




Table of Contents

ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
(In millions)(In millions)2022202120222021(In millions)2023202220232022
Operating revenuesOperating revenuesOperating revenues
Electric operating revenuesElectric operating revenues$323 $306 $668 $605 Electric operating revenues$497 $465 $1,150 $1,132 
Revenues from alternative revenue programsRevenues from alternative revenue programs(15)12 (12)23 Revenues from alternative revenue programs(3)21 (14)
Operating revenues from affiliatesOperating revenues from affiliatesOperating revenues from affiliates— — 
Total operating revenuesTotal operating revenues309 319 658 629 Total operating revenues502 462 1,172 1,120 
Operating expensesOperating expensesOperating expenses
Purchased powerPurchased power123 149 299 302 Purchased power221 197 493 495 
Purchased power from affiliatePurchased power from affiliate— Purchased power from affiliate— — — 
Operating and maintenanceOperating and maintenance50 39 97 82 Operating and maintenance56 47 147 145 
Operating and maintenance from affiliatesOperating and maintenance from affiliates36 34 73 68 Operating and maintenance from affiliates38 33 112 106 
Depreciation and amortizationDepreciation and amortization72 40 118 87 Depreciation and amortization77 74 212 192 
Taxes other than income taxesTaxes other than income taxesTaxes other than income taxes
Total operating expensesTotal operating expenses283 269 593 552 Total operating expenses394 353 971 947 
Operating incomeOperating income26 50 65 77 Operating income108 109 201 173 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(17)(14)(32)(29)Interest expense, net(19)(17)(52)(49)
Other, netOther, net— Other, net13 
Total other income and (deductions)Total other income and (deductions)(15)(14)(27)(27)Total other income and (deductions)(14)(14)(39)(40)
Income before income taxesIncome before income taxes11 36 38 50 Income before income taxes94 95 162 133 
Income taxesIncome taxes— (1)(1)Income taxes23 40 
Net incomeNet income$11 $37 $37 $51 Net income$71 $94 $122 $131 
Comprehensive incomeComprehensive income$11 $37 $37 $51 Comprehensive income$71 $94 $122 $131 
See the Combined Notes to Consolidated Financial Statements
45




Table of Contents
ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
Nine Months Ended
September 30,
(In millions)(In millions)20222021(In millions)20232022
Cash flows from operating activitiesCash flows from operating activitiesCash flows from operating activities
Net incomeNet income$37 $51 Net income$122 $131 
Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortizationDepreciation and amortization118 87 Depreciation and amortization212 192 
Deferred income taxes and amortization of investment tax creditsDeferred income taxes and amortization of investment tax credits— (2)Deferred income taxes and amortization of investment tax credits24 
Other non-cash operating activitiesOther non-cash operating activities25 (14)Other non-cash operating activities(2)36 
Changes in assets and liabilities:Changes in assets and liabilities:Changes in assets and liabilities:
Accounts receivableAccounts receivable(20)(30)Accounts receivable(85)(53)
Receivables from and payables to affiliates, netReceivables from and payables to affiliates, net(10)Receivables from and payables to affiliates, net(6)(10)
InventoriesInventories(2)Inventories(11)(6)
Accounts payable and accrued expensesAccounts payable and accrued expenses(2)Accounts payable and accrued expenses(4)(10)
Collateral received, net137 — 
Collateral (paid) received, netCollateral (paid) received, net(45)70 
Income taxesIncome taxesIncome taxes
Regulatory assets and liabilities, netRegulatory assets and liabilities, net(11)18 Regulatory assets and liabilities, net(28)(6)
Pension and non-pension postretirement benefit contributionsPension and non-pension postretirement benefit contributions(7)(3)Pension and non-pension postretirement benefit contributions(1)(7)
Other assets and liabilitiesOther assets and liabilities(63)(43)Other assets and liabilities(80)(54)
Net cash flows provided by operating activitiesNet cash flows provided by operating activities221 70 Net cash flows provided by operating activities102 292 
Cash flows from investing activitiesCash flows from investing activitiesCash flows from investing activities
Capital expendituresCapital expenditures(179)(239)Capital expenditures(376)(284)
Other investing activitiesOther investing activities— 
Net cash flows used in investing activitiesNet cash flows used in investing activities(179)(239)Net cash flows used in investing activities(376)(283)
Cash flows from financing activitiesCash flows from financing activitiesCash flows from financing activities
Changes in short-term borrowingsChanges in short-term borrowings(144)(9)Changes in short-term borrowings173 (144)
Issuance of long-term debtIssuance of long-term debt175 350 Issuance of long-term debt75 175 
Retirement of long-term debt— (249)
Changes in PHI intercompany money poolChanges in PHI intercompany money pool17 — 
Dividends paid on common stockDividends paid on common stock(38)(229)Dividends paid on common stock(111)(128)
Contributions from parentContributions from parent173 303 Contributions from parent65 175 
Other financing activitiesOther financing activities(4)(4)Other financing activities(3)(4)
Net cash flows provided by financing activitiesNet cash flows provided by financing activities162 162 Net cash flows provided by financing activities216 74 
Increase (decrease) in cash, restricted cash, and cash equivalents204 (7)
Cash, restricted cash, and cash equivalents at beginning of period29 30 
Cash, restricted cash, and cash equivalents at end of period$233 $23 
(Decrease) increase in cash and cash equivalents(Decrease) increase in cash and cash equivalents(58)83 
Cash and cash equivalents at beginning of periodCash and cash equivalents at beginning of period72 29 
Cash and cash equivalents at end of periodCash and cash equivalents at end of period$14 $112 
Supplemental cash flow informationSupplemental cash flow informationSupplemental cash flow information
Decrease in capital expenditures not paidDecrease in capital expenditures not paid$(19)$(13)Decrease in capital expenditures not paid$(56)$(12)
See the Combined Notes to Consolidated Financial Statements
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ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
ASSETSASSETSASSETS
Current assetsCurrent assetsCurrent assets
Cash and cash equivalentsCash and cash equivalents$233 $29 Cash and cash equivalents$14 $72 
Accounts receivableAccounts receivableAccounts receivable
Customer accounts receivableCustomer accounts receivable194190Customer accounts receivable235179
Customer allowance for credit lossesCustomer allowance for credit losses(45)(49)Customer allowance for credit losses(39)(41)
Customer accounts receivable, netCustomer accounts receivable, net149 141 Customer accounts receivable, net196 138 
Other accounts receivableOther accounts receivable7076Other accounts receivable8470
Other allowance for credit lossesOther allowance for credit losses(14)(15)Other allowance for credit losses(13)(14)
Other accounts receivable, netOther accounts receivable, net56 61 Other accounts receivable, net71 56 
Receivables from affiliatesReceivables from affiliatesReceivables from affiliates
Inventories, netInventories, net38 36 Inventories, net54 43 
Prepaid utility taxesPrepaid utility taxes40 — Prepaid utility taxes15 — 
Regulatory assetsRegulatory assets135 61 Regulatory assets113 130 
OtherOtherOther
Total current assetsTotal current assets659 333 Total current assets471 443 
Property, plant, and equipment (net of accumulated depreciation and amortization of $1,491 and $1,420 as of June 30, 2022 and December 31, 2021, respectively)3,798 3,729 
Property, plant, and equipment (net of accumulated depreciation and amortization of $1,651 and $1,551 as of September 30, 2023 and December 31, 2022, respectively)Property, plant, and equipment (net of accumulated depreciation and amortization of $1,651 and $1,551 as of September 30, 2023 and December 31, 2022, respectively)4,155 3,990 
Deferred debits and other assetsDeferred debits and other assetsDeferred debits and other assets
Regulatory assetsRegulatory assets535 430 Regulatory assets490 494 
Prepaid pension assetPrepaid pension asset26 27 Prepaid pension asset18 
OtherOther34 37 Other32 34 
Total deferred debits and other assetsTotal deferred debits and other assets595 494 Total deferred debits and other assets529 546 
Total assetsTotal assets$5,052 $4,556 Total assets$5,155 $4,979 
See the Combined Notes to Consolidated Financial Statements
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ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)(In millions)June 30, 2022December 31, 2021(In millions)September 30, 2023December 31, 2022
LIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITYLIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilitiesCurrent liabilitiesCurrent liabilities
Short-term borrowingsShort-term borrowings$— $144 Short-term borrowings$173 $— 
Long-term debt due within one yearLong-term debt due within one yearLong-term debt due within one year153 
Accounts payableAccounts payable157 165 Accounts payable149 206 
Accrued expensesAccrued expenses43 44 Accrued expenses51 47 
Payables to affiliatesPayables to affiliates20 31 Payables to affiliates22 26 
Borrowings from PHI intercompany money poolBorrowings from PHI intercompany money pool17 — 
Customer depositsCustomer deposits18 18 Customer deposits23 21 
Regulatory liabilitiesRegulatory liabilities29 28 Regulatory liabilities26 
PPA termination obligationPPA termination obligation87 — PPA termination obligation61 87 
OtherOther149 12 Other15 58 
Total current liabilitiesTotal current liabilities506 445 Total current liabilities673 474 
Long-term debtLong-term debt1,754 1,579 Long-term debt1,680 1,754 
Deferred credits and other liabilitiesDeferred credits and other liabilitiesDeferred credits and other liabilities
Deferred income taxes and unamortized investment tax creditsDeferred income taxes and unamortized investment tax credits695 682 Deferred income taxes and unamortized investment tax credits766 734 
Regulatory liabilitiesRegulatory liabilities197 214 Regulatory liabilities144 156 
Non-pension postretirement benefit obligationsNon-pension postretirement benefit obligations10 12 Non-pension postretirement benefit obligations
OtherOther143 49 Other57 100 
Total deferred credits and other liabilitiesTotal deferred credits and other liabilities1,045 957 Total deferred credits and other liabilities973 998 
Total liabilitiesTotal liabilities3,305 2,981 Total liabilities3,326 3,226 
Commitments and contingenciesCommitments and contingencies00Commitments and contingencies
Shareholder's equityShareholder's equityShareholder's equity
Common stockCommon stock1,763 1,590 Common stock1,830 1,765 
Retained deficitRetained deficit(16)(15)Retained deficit(1)(12)
Total shareholder's equityTotal shareholder's equity1,747 1,575 Total shareholder's equity1,829 1,753 
Total liabilities and shareholder's equityTotal liabilities and shareholder's equity$5,052 $4,556 Total liabilities and shareholder's equity$5,155 $4,979 

See the Combined Notes to Consolidated Financial Statements
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ATLANTIC CITY ELECTRIC COMPANY AND SUBSIDIARY COMPANY
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
(Unaudited)
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
(In millions)(In millions)Common StockRetained DeficitTotal Shareholder's Equity(In millions)Common StockRetained (Deficit) EarningsTotal Shareholder's Equity
Balance, December 31, 2021$1,590 $(15)$1,575 
Balance at December 31, 2022Balance at December 31, 2022$1,765 $(12)$1,753 
Net incomeNet income— 26 26 Net income— 33 33 
Common stock dividendsCommon stock dividends— (19)(19)Common stock dividends— (21)(21)
Contributions from parentContributions from parent173 — 173 Contributions from parent63 — 63 
Balance, March 31, 2022$1,763 $(8)$1,755 
Balance at March 31, 2023Balance at March 31, 2023$1,828 $— $1,828 
Net incomeNet income— 11 11 Net income— 18 18 
Common stock dividendsCommon stock dividends— (19)(19)Common stock dividends— (15)(15)
Balance, June 30, 2022$1,763 $(16)$1,747 
Balance at June 30, 2023Balance at June 30, 2023$1,828 $$1,831 
Net incomeNet income— 71 71 
Common stock dividendsCommon stock dividends— (75)(75)
Contributions from parentContributions from parent— 
Balance at September 30, 2023Balance at September 30, 2023$1,830 $(1)$1,829 

Six Months Ended June 30, 2021Nine Months Ended September 30, 2022
(In millions)(In millions)Common StockRetained Earnings (Deficit)Total Shareholder's Equity(In millions)Common StockRetained DeficitTotal Shareholder's Equity
Balance, December 31, 2020$1,271 $127 $1,398 
Balance at December 31, 2021Balance at December 31, 2021$1,590 $(15)$1,575 
Net incomeNet income— 14 14 Net income— 26 26 
Common stock dividendsCommon stock dividends— (14)(14)Common stock dividends— (19)(19)
Contributions from parentContributions from parent303 — 303 Contributions from parent173 — 173 
Balance, March 31, 2021$1,574 $127 $1,701 
Balance at March 31, 2022Balance at March 31, 2022$1,763 $(8)$1,755 
Net incomeNet income— 37 37 Net income— 11 11 
Common stock dividendsCommon stock dividends— (215)(215)Common stock dividends— (19)(19)
Balance, June 30, 2021$1,574 $(51)$1,523 
Balance at June 30, 2022Balance at June 30, 2022$1,763 $(16)$1,747 
Net incomeNet income— 94 94 
Common stock dividendsCommon stock dividends— (90)(90)
Contributions from parentContributions from parent— 
Balance, September 30, 2022Balance, September 30, 2022$1,765 $(12)$1,753 

See the Combined Notes to Consolidated Financial Statements
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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 distributiontransmission and transmissiondistribution 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,finance, 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 June 30, 2022 and for the three and six months ended June 30, 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
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per share data, unless otherwise noted)

Note 1 — Significant Accounting Policies
The accompanying consolidated financial statements as of September 30, 2023 and for the three and nine months ended September 30, 2023 and 2022 are unaudited but, in the opinion of each Registrant's management, the Registrants 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 December 31, 20212022 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, 2022.2023. 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, meetsmet 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.the nine months ended September 30, 2022. See Note 2 — Discontinued Operations for additional information.
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.
2022. 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.
separation, 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 102Debt and Credit AgreementsDiscontinued Operations of the 2022 Form 10-K 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.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
Transition Services Agreement (TSA) – governs the terms and conditions of the services that Exelon will provideprovides to Constellation and Constellation will provideprovides 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 three and nine months ended JuneSeptember 30, 2023, the amounts Exelon billed Constellation and Constellation billed Exelon for these services were $33 million and $127 million recorded in Other income, net and $4 million and $13 million recorded in Operating and maintenance expense, respectively. For the three months ended September 30, 2022, the amounts Exelon billed Constellation and Constellation billed Exelon for these services were $69$68 million recorded in Other income, net and $11$12 million recorded in Operating and maintenance expense, respectively. Additionally, for the period from February 1, 2022 to JuneSeptember 30, 2022, the amounts Exelon billed Constellation and Constellation billed Exelon for these services were $125$193 million recorded in Other income, net and $20$32 million recorded in Operating and maintenance expense, respectively.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
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 7.7 — Income Taxes for additional information.
In addition, the Utility Registrants will continue to incur expenses from transactions with GenerationConstellation 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 GenerationConstellation to provide a portion of ComEd’s electric supply requirements. ComEd also purchased RECs and ZECs from Generation.Constellation.
PECO received electric supply from GenerationConstellation under contracts executed through PECO’s competitive procurement process. In addition, PECO had a ten-year agreement with GenerationConstellation to sell solar AECs.
BGE received a portion of its energy requirements from GenerationConstellation under its MDPSC-approved market-based SOS and gas commodity programs.
Pepco received electric supply from GenerationConstellation under contracts executed through Pepco’s competitive procurement process approved by the MDPSC and DCPSC.
DPL received a portion of its energy requirements from GenerationConstellation under its MDPSC and DEPSC approved market-based SOS commodity programs.
ACE received electric supply from GenerationConstellation 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 NDTConstellation for estimated excess funds are greater than the underlying ARO at the end of decommissioning the Regulatory Agreement Units, such amounts are due back to ComEd and PECO, as applicable, for payment to their respective customers. See Note 93Asset Retirement Obligations of the Combined Notes to Consolidated Financial Statements of the 2021 Recast Form 10-KRegulatory Matters and Note 1523 — Related Party Transactions of the 2022 Form 10-K for additional information.
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.
There were no results from discontinued operations for the three and nine months ended September 30, 2023 and the three months ended September 30, 2022. 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 and sixnine months ended JuneSeptember 30, 2022 and June 30, 2021.2022.
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
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
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
June 30,
Six Months Ended
June 30,
202120222021
Operating revenues
Competitive business revenues$3,900 $1,855 $9,165 
Competitive business revenues from affiliates255 161 549 
Total operating revenues4,155 2,016 9,714 
Operating expenses
Competitive businesses purchased power and fuel1,947 1,138 6,557 
Operating and maintenance(a)
1,382 371 2,287 
Depreciation and amortization930 94 1,869 
Taxes other than income taxes118 44 239 
Total operating expenses4,377 1,647 10,952 
Gain on sales of assets and businesses10 79 
Operating income (loss)(214)379 (1,159)
Other income and (deductions)
Interest expense, net(72)(20)(140)
Other, net508 (281)675 
Total other income and (deductions)436 (301)535 
Income (loss) before income taxes222 78 (624)
Income taxes71 (40)13 
Equity in losses of unconsolidated affiliates(1)(1)(3)
Net income (loss)150 117 (640)
Net income attributable to noncontrolling interests75 99 
Net income (loss) from discontinued operations$75 $116 $(739)
__________
(a)Includes transaction and transition costs related to the separation of $52 million for the six months ended June 30, 2022 and $4 million and $7 million for the three and six months ended June 30, 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 June 30, 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 six months ended June 30, 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:
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
Nine Months Ended
September 30,
December 31, 20212022
ASSETSOperating revenues
Current assetsCompetitive business revenues
Cash and cash equivalents$5101,855 
Restricted cash and cash equivalents72 
Accounts receivableCompetitive business revenues from affiliates
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 sale13 
Other993161 
Total current assets of discontinued operationsoperating revenues7,8352,016 
Property, plant, and equipment (net of accumulated depreciation and amortization of $15,888)19,661 Operating expenses
Deferred debits and other assets
Nuclear decommissioning trust fundsCompetitive businesses purchased power and fuel15,938 
Investments1931,138 
Operating and maintenance(a)
371 
Mark-to-market derivative assetsDepreciation and amortization94994 
Taxes other than income taxes44 
Total operating expenses1,647 
Gain on sales of assets and businesses10 
Operating income379 
Other income and (deductions)
1,768 Interest expense, net(20)
Other, net(281)
Total property, plant,other income and equipment, deferred debits, and other assets of discontinued operations(deductions)38,509 (301)
Total assetsIncome before income taxes78 
Income taxes(40)
Equity in losses of unconsolidated affiliates(1)
Net income117 
Net income attributable to noncontrolling interests
Net income from discontinued operations$46,344116 
54__________

(a)
Includes transaction and transition costs related to the separation of $52 million for the nine months ended September 30, 2022.
There were no assets or liabilities of discontinued operations included in Exelon's Consolidated Balance Sheet as of September 30, 2023 and December 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 year ended December 31, 2022. Refer to the Distribution of Constellation line in Exelon's Consolidated Statement of Changes in Shareholders' Equity for further information.
There were no discontinued operations included within Exelon’s Consolidated Statements of Cash Flows for the nine months ended September 30, 2023. 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 nine months ended September 30, 2022.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 2 — Discontinued Operations
Nine Months Ended
September 30,
December 31, 20212022
LIABILITIES AND SHAREHOLDERS’ EQUITYNon-cash items included in net income from discontinued operations:
Current liabilitiesDepreciation, amortization, and accretion, including nuclear fuel and energy contract amortization
Short-term borrowings$2,082 
Long-term debt due within one year1,220 
Accounts payable1,757 
Accrued expenses818 
Mark-to-market derivative liabilities981207 
Renewable energy credit obligationLoss on sales of assets and businesses7799 
Liabilities held for sale
Other300 
Total current liabilities of discontinued operations7,940 
Long-term debt4,575 
Deferred credits and other liabilities
Deferred income taxes and unamortizedamortization of investment tax credits3,583 (143)
Asset retirement obligationsNet fair value changes related to derivatives12,819 (59)
Pension obligationsNet realized and unrealized losses on NDT fund investments939205 
Non-pension postretirement benefit obligationsNet unrealized losses on equity investments87616 
Spent nuclear fuel obligationOther decommissioning-related activity1,21036 
Mark-to-market derivative liabilitiesCash flows from investing activities:
513Capital expenditures(227)
Collection of DPP169 
Supplemental cash flow information:
Decrease in capital expenditures not paid(128)
Increase in DPP348 
Increase in PP&E related to ARO update335 
Other1,161 
Total long-term debt, deferred credits, and other liabilities of discontinued operations25,676 
Total liabilities of discontinued operations$33,616 
3. Regulatory Matters (All Registrants)
As discussed in Note 3 — Regulatory Mattersof the 2022 Form 10-K, the Registrants are involved in rate and regulatory proceedings at FERC and their state commissions. The following discusses developments in 2023 and updates to the 2022 Form 10-K.
Distribution Base Rate Case Proceedings
The following table presents selected financial information regarding cash flows oftables show the discontinued operations that are included within Exelon’s Consolidated Statements of Cash Flows for the six months ended June 30, 2022completed and June 30, 2021.pending distribution base rate case proceedings in 2023.
Six Months Ended
June 30,
20222021
Non-cash items included in net income (loss) from discontinued operations:
Depreciation, amortization, and accretion, including nuclear fuel and energy contract amortization$207 $2,686 
Asset impairments— 493 
Gain on sales of assets and businesses(79)
Deferred income taxes and amortization of investment tax credits(143)(268)
Net fair value changes related to derivatives(59)(490)
Net realized and unrealized losses (gains) on NDT fund investments205 (376)
Net unrealized losses (gains) on equity investments16 (96)
Other decommissioning-related activity36 (636)
Cash flows from investing activities:
Capital expenditures(227)(731)
Collection of DPP169 2,209 
Supplemental cash flow information:
Decrease in capital expenditures not paid(128)(66)
Increase in DPP348 1,958 
Increase in PP&E related to ARO update335 — 
55Completed Distribution Base Rate Case Proceedings

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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 2021 Recast 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 Recast 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/JurisdictionRegistrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseApproved Revenue Requirement IncreaseApproved ROEApproval DateRate Effective DateRegistrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseApproved Revenue Requirement IncreaseApproved ROEApproval DateRate Effective Date
ComEd - Illinois(a)
ComEd - Illinois(a)
April 16, 2021Electric$51 $46 7.36 %December 1, 2021January 1, 2022
ComEd - Illinois(a)
April 15, 2022Electric$199 $199 7.85 %November 17, 2022January 1, 2023
PECO - PennsylvaniaPECO - PennsylvaniaMarch 30, 2021Electric246 132 
N/A(b)
November 18, 2021January 1, 2022PECO - PennsylvaniaMarch 31, 2022Natural Gas82 55 
N/A(b)
October 27, 2022January 1, 2023
BGE - Maryland(c)
BGE - Maryland(c)
May 15, 2020 (amended September 11, 2020)Electric203 140 9.50 %December 16, 2020January 1, 2021
BGE - Maryland(c)
May 15, 2020 (amended September 11, 2020)Electric203 140 9.50 %December 16, 2020January 1, 2021
Natural Gas108 74 9.65 %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)(d)
Pepco - Maryland(e)(d)
October 26, 2020 (amended March 31, 2021)Electric104 52 9.55 %June 28, 2021June 28, 2021
Pepco - Maryland(e)(d)
October 26, 2020 (amended March 31, 2021)Electric104 52 9.55 %June 28, 2021June 28, 2021
DPL - Maryland(f)(e)
DPL - Maryland(f)(e)
September 1, 2021 (amended December 23, 2021)Electric27 13 9.60 %March 2, 2022March 2, 2022
DPL - Maryland(f)(e)
May 19, 2022Electric38 29 9.60 %December 14, 2022January 1, 2023
ACE - New Jersey(g)
December 9, 2020 (amended February 26, 2021)Electric67 41 9.60 %July 14, 2021January 1, 2022
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(a)ComEd's 20222023 approved revenue requirement above reflects an increase of $37$144 million for the initial year revenue requirement for 20222023 and an increase of $9$55 million related to the annual reconciliation for 2020.2021. The revenue requirement for 20222023 provides for a weighted average debt and equity return on distribution rate base of 5.72%5.94%, inclusive of an allowed ROE of 7.36%7.85%, reflecting the monthly average yields for 30-year treasury bonds plus 580 basis points. The reconciliation revenue requirement for 20202021 provides for a weighted average debt and equity return on distribution rate base of 5.69%5.91%, inclusive of an allowed ROE of 7.29%7.78%, reflecting the monthly yields on 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 established under EIMA. See discussion of CEJA below for details on the transition away from the electric distribution formula rate.
(b)The PECO electricnatural gas 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. BGE proposed to use certain tax benefits to fully offset the increases in 2021 and 2022 and partially offset the increase in 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. WhetherIn 2021, the MDPSC deferred a decision on whether to use certain tax benefits willto offset the revenue requirement increases in 2023 and directed BGE to make another proposal at the end of 2022. In September 2022, BGE proposed that tax benefits not be used to offset the customer rate increases in 2023 hasrevenue requirement increases. On October 26, 2022, the MDPSC accepted BGE's recommendation to not been decided, and BGE cannot predictuse tax benefits to offset the outcome.2023 revenue requirement increases.
(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.
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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. WhetherIn 2021, the MDPSC deferred a decision on whether to use certain tax benefits will be used to offset the customer raterevenue requirement increases for the 12-month period ending March 31, 2024 has2024. In December 2022 Pepco proposed that tax benefits not been decided, and Pepco cannot predictbe used to offset the outcome.revenue requirement increases for this period. On January 25, 2023, the MDPSC accepted Pepco’s recommendations not to use tax benefits to offset revenue requirement increases for the 12-month period ending March 31, 2024.
(f)(e)Reflects a three-year cumulative multi-year plan for January 1, 2023 through December 31, 2025. The approved settlement reflects a 9.60% ROE, which is solelyMDPSC awarded DPL electric incremental revenue requirement increases of $17 million, $6 million, and $6 million for the purposes of calculating AFUDC2023, 2024, and regulatory asset carrying costs.2025, respectively.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 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 (Continued)
(Dollars 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.millions, except per share data, unless otherwise noted)

Note 3 — Regulatory Matters
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
DPL - Maryland(c)
May 19, 2022Electric38 10.25 %Fourth quarter of 2022
Registrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseRequested ROEExpected Approval Timing
ComEd - Illinois(a)
January 17, 2023Electric$1,487 10.50% to 10.65%Fourth quarter of 2023
ComEd - Illinois(b)
April 21, 2023Electric247 8.91%Fourth quarter of 2023
BGE - Maryland(c)
February 17, 2023Electric313 10.40%Fourth quarter of 2023
Natural Gas289 10.40%
Pepco - District of Columbia(d)
April 13, 2023Electric191 10.50%Second quarter of 2024
Pepco - Maryland(e)
May 16, 2023Electric214 10.50%Second quarter of 2024
DPL - Delaware(f)
December 15, 2022 (amended September 29, 2023)Electric39 10.50%Second quarter of 2024
ACE - New Jersey(g)
February 15, 2023 (amended August 21, 2023)Electric92 10.50%Fourth quarter of 2023
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(a)ComEd'sOn September 27, 2023, ComEd filed its reply brief supporting its proposed multi-year rate and grid plans, as adjusted or modified by ComEd as of the evidentiary hearing on August 22, 2023. The rate plan covers the period from January 1, 2024 to December 31, 2027 and includes total requested revenue requirement reflects an increaseincreases of $144$968 million foreffective January 1, 2024, $181 million effective January 1, 2025, $163 million effective January 1, 2026, and $175 million effective January 1, 2027, based on forecasted revenue requirements. If approved, 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 provideswill provide for a weighted average debt and equity return on distribution rate base of 5.94%,7.40% in 2024, 7.47% in 2025, 7.58% in 2026, and 7.65% in 2027, inclusive of an allowed ROE of 7.85%, reflecting the average monthly yields for 30-year treasury bonds plus 580 basis points.10.50% in 2024, 10.55% in 2025, 10.60% in 2026, and 10.65% in 2027. The reconciliationrequested revenue requirement for 2021 provides forrequirements are based on capital structures that reflect between 50.58% and 51.19% common equity. ComEd’s MRP also includes a weighted average debt and equity return on distributionproposed three-tranche 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 resultphase-in to defer approximately $339 million, of the law authorizing the rate setting process sunsetting at the end of 2022. See Note 3 - Regulatory Matters$968 million year-over-year revenue increase for 2024 from 2024 to 2026, approximately $52 million, of the 2021 Recast Form 10-K$520 million year-over-year revenue increase for additional information on ComEd's transition away2025 from 2025 to 2027, and approximately $75 million of the electric distribution formula rate.$215 million year-over-year revenue increase for 2026 from 2026 to 2028.
(b)On April 21, 2023, ComEd filed its proposed Delivery Reconciliation Amount of $247 million under Rider Delivery Service Pricing Reconciliation (Rider DSPR) which allows for the reconciliation of the revenue requirement in effect in the final years in which formula rates are determined and until such time as new rates are established under ComEd’s approved MRP. The 2023 filing reconciles the delivery service rates in effect in 2022 with the actual delivery service costs incurred in 2022. Final order is expected by December 2023, and the reconciliation amount will go into effect on August 14, 2022, subject to refund.be in customer rates beginning January 1, 2024.
(c)Reflects a three-year cumulative multi-year plan for January 1, 2023 to2024 through December 31, 2026 submitted to the MDPSC. Inclusive of the proposed acceleration of remaining electric tax benefits in 2024 and 2025, and remaining gas tax benefits in 2024, BGE requested total requestedelectric revenue requirement increases before offsets, of $23$85 million, effective January 1, 2023, $8$103 million, effective January 1,and $125 million in 2024, 2025, and $72026, respectively, and natural gas revenue requirement increases of $158 million, effective January 1,$77 million, and $54 million in 2024, 2025, and 2026, respectively. Requested revenue requirement increases will be used to recover capital investments made indesigned to increase the resilience of the electric and gas distribution systems and support Maryland’s climate and regulatory initiatives. The 2021 and planned2022 reconciliation amounts are not included in the requested revenue requirement increase, as BGE is proposing that these amounts be recovered through the separate electric and gas riders in 2024. The 2021 reconciliation amounts are $11 million and $7 million for electric and gas, respectively, and the 2022 reconciliation amounts are $44 million and $15 million for electric and gas, respectively. The requested electric revenue requirement includes approximately $25 million for a Customer Electrification Plan that the MDPSC struck from BGE's case in August 2023.
(d)Reflects a three-year cumulative multi-year plan for January 1, 2024 through December 31, 2026 submitted to the DCPSC. Pepco requested total electric revenue requirement increases of $117 million, $37 million, and $37 million in 2024, 2025, and 2026, respectively. Requested revenue requirement increases will be used to recover capital investments designed to advance system-readiness and support the District of Columbia’s climate and clean energy goals.
(e)Reflects a three-year cumulative multi-year plan for April 1, 2024 through March 31, 2027 submitted to the endMDPSC. Pepco requested total electric revenue requirement increases of 2025. DPL is proposing the acceleration of refunds for certain tax benefits to partially offset the customer rate increases by $12$74 million, $60 million and $8$60 million effective April 1,
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Note 3 — Regulatory Matters
2024, April 1, 2025, and April 1, 2026, respectively. The plan contains a proposed nine-month extension period with a requested revenue requirement increase of $20 million effective April 1, 2027 through December 31, 2027. Requested revenue requirement increases will be used to recover capital investments designed to advance system-readiness and support Maryland's climate and clean energy goals. On August 7, 2023, the MDPSC issued an order approving a settlement agreement which allows Pepco to establish a revenue deferral mechanism to recover its full Commission-authorized year 1 increase between July 1, 2024 through March 31, 2025 and 2024, respectively.extend the procedural schedule to address intervenor resource constraints.
(f)The rates went into effect on July 15, 2023, subject to refund.
(g)Requested increases are before New Jersey sales and use tax. ACE’s procedural schedule was suspended on September 6, 2023. On October 21, 2023, ACE filed a stipulation of settlement with the NJBPU. Subsequently, on October 24, 2023, the administrative law judge presiding over the case recommended the settlement with all parties be approved. ACE is awaiting final approval of the settlement from the NJBPU and it is expected during the fourth quarter of 2023.
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 PECO is based on prior year actual costs and current year projected capital additions, accumulated depreciation, and accumulated deferred income taxes. The annual update for BGE, Pepco, DPL, and ACE 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 PECO, BGE, Pepco, DPL, and ACE also reconciles any differences between the actual costs and actual revenues for the calendar year (annual reconciliation).
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Note 3 — Regulatory Matters
For 2022,2023, the following total increases/(decreases) were included in the Utility Registrants' electric transmission formula rate update:updates:
Registrant(a)
Registrant(a)
Initial Revenue Requirement IncreaseAnnual Reconciliation (Decrease) IncreaseTotal Revenue Requirement Increase
Allowed Return on Rate Base(b)
Allowed ROE(c)
Registrant(a)
Initial Revenue Requirement IncreaseAnnual Reconciliation Increase (Decrease)Total Revenue Requirement Increase
Allowed Return on Rate Base(b)
Allowed ROE(c)
ComEdComEd$24 $(24)$— 8.11 %11.50 %ComEd$20 $63 $83 8.09 %11.50 %
PECOPECO23 16 39 7.30 %10.35 %PECO24 23 47 7.41 %10.35 %
BGEBGE25 (4)16 (d)7.30 %10.50 %BGE19 (12)(d)7.34 %10.50 %
PepcoPepco16 15 31 7.60 %10.50 %Pepco37 (5)32 7.57 %10.50 %
DPLDPL11 7.09 %10.50 %DPL32 (3)29 7.08 %10.50 %
ACEACE21 13 34 7.18 %10.50 %ACE41 (12)29 7.08 %10.50 %
__________
(a)All rates are effective June 1, 20222023 - May 31, 2023,2024, subject to review by interested parties pursuant to review protocols of each Utility Registrants' tariff.tariffs.
(b)Represents the weighted average debt and equity return on transmission rate bases. For ComEd and PECO, the common equity component of the ratio used to calculate the weighted average debt and equity return on the transmission formula rate base is currently capped at 55% and 55.75%, respectively.
(c)The rate of return on common equity for each Utility Registrant includes a 50-basis-point incentive adder for being a member of a RTO.
(d)The increase in BGE's transmission revenue requirement includes a $5$3 million reduction related to a FERC-approved dedicated facilities charge to recover the costs of providing transmission service to specifically designated load by BGE.
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 planMRP 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
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Note 3 — Regulatory Matters
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")(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 ComEd and 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.
ComEd Electric Distribution Rates
ComEd filed, and received approval for, its last performance-based electric distribution formula rate update filing under EIMA in 2022; those rates are in effect throughout 2023.
On February 3, 2022, the ICC approved a tariff that establishes the process under which ComEd will reconcile its 2022 and 2023 rate year revenue requirements with actual costs. Those reconciliation amounts will be determined using the same process as were used for prior reconciliations under the performance-based electric distribution formula rate. Using that process, for the rate years 2022 and 2023 ComEd will ultimately collect revenues from customers reflecting each year’s actual recoverable costs, year-end rate base, and a weighted average debt and equity return on distribution rate base, with the ROE component based on the annual average of the monthly yields of the 30-year U.S. Treasury bonds plus 580 basis points. In April 2023, ComEd filed its first petition with the ICC to reconcile its 2022 actual costs with the approved revenue requirement that was in effect in 2022; the final order is expected by December 2023, for rates beginning January 2024. The rate year 2023 reconciliation will be filed in 2024.
Beginning in 2024, ComEd will recover from retail customers, subject to certain exceptions, the costs it incurs to provide electric delivery services either through its electric distribution rate or other recovery mechanisms authorized by CEJA. On January 17, 2023, ComEd filed a petition with the ICC seeking approval of a MRP for 2024-2027. The MRP supports a multi-year grid plan (Grid Plan), also filed on January 17, covering planned investments on the electric distribution system within ComEd’s service area through 2027. Costs incurred during each year of the MRP are subject to ICC review and the plan’s revenue requirement for each year will be reconciled with the actual costs that the ICC determines are prudently and reasonably incurred for that year. The reconciliation is subject to adjustment for certain costs, including a limitation on recovery of costs that are more than 105% of certain costs in the previously approved MRP revenue requirement, absent a modification of the rate plan itself. Thus, for example, the rate adjustments necessary to reconcile 2024 revenues to ComEd’s actual 2024 costs incurred would take effect in January 2026 after the ICC’s review during 2025. On May 22, 2023, direct testimony was filed by ICC staff and more than a dozen intervenors and intervenor groups. The testimonies addressed a wide variety of topics, including rate of return on equity, capital structure, grid planning, various distribution grid and information technology investments, and affordability and customer service. ComEd filed rebuttal testimony in June, which provided, among other things, defense of ComEd’s planned 2024-2027 capital investment and proposed cost of equity. ComEd also made voluntary adjustments and, per the ICC’s final beneficial electrification order requiring ComEd to recover beneficial electrification costs through the MRP, increased its total revenue requirement request from $1.472 billion to $1.545 billion. On July 27, 2023, ICC staff and intervenors filed rebuttal testimony, which showed little to no movement on the key issues, including ROE and large capital projects. On August 14, 2023, ComEd filed surrebuttal testimony. On August 22, 2023, evidentiary hearings were held, during which testimony and other evidence was admitted and the evidentiary phase of the hearing process was closed. ComEd filed its reply brief on September 27, 2023, to adjust its total requested revenue requirement increase to $1.487 billion. On October 23, 2023 the administrative law judges (ALJs) issued a proposed order in ComEd's MRP proceeding recommending a $317 million reduction to ComEd's requested revenue requirement increase of $1.487 billion. Significant differences between the ALJ’s proposed order and ComEd’s final position relate to the proposed return on equity and the disallowance of any return on ComEd’s pension asset. The ALJs proposed order is not final, and briefs on exception will be filed in November 2023. The Commission may also hear oral arguments prior to making its final decision. The ICC must issue its decision on both the MRP and Grid Plan by mid-December 2023, for rates to begin with the January 2024 billing cycle.
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In January 2022, ComEd filed a request with the ICC proposing performance metrics that would be used in determining ROE incentives and penalties in the event ComEd filed a MRP in January 2023. On September 27, 2022, the ICC issued a final order approving seven performance metrics that provide symmetrical performance adjustments of 32 total basis points to ComEd’s rate of return on common equity based on the extent to which ComEd achieves the annual performance goals. On November 10, 2022, the ICC granted ComEd's application for rehearing, in part. On April 5, 2023, the ICC issued its final order on rehearing for the performance and tracking metrics proceeding, in which the ICC declined to adopt ComEd’s proposed modifications to the reliability and peak load reduction performance metrics. Efforts are underway to implement the performance metrics, which take effect on January 1, 2024. ComEd will make its initial filing in 2025 to assess performance achieved under the metrics in 2024, and to determine any ROE adjustment, which would take effect in 2026.
Carbon Mitigation Credit
CEJA establishes decarbonization requirements for Illinois as well as programs to support the retention and development of emissions-free sources of electricity. ComEd is required to purchase CMCs from participating nuclear-powered generating facilities between June 1, 2022 and May 31, 2027 and all its costs of doing so will be recovered through a new rider.2027. The price to be paid for each CMC was established through a competitive bidding process that included consumer-protection measures that capped the maximum acceptable bid amount and a formula that reduces CMC prices by an energy price index, the base residual auction capacity price in the ComEd zone of PJM, and the monetized value of any federal tax credit or other subsidy if applicable. The consumer protection measures contained in CEJA will result in net payments to ComEd ratepayers if the energy index, the capacity price and applicable federal tax credits or subsidy exceed the CMC contract price. In the June 2022 billing period, ComEd began issuing credits to its retail customers under its new CMC rider in the June 2022 billing period and recorded arider. A regulatory asset of $255 million as of June 30, 2022is recorded for the difference between customer credits issued and the credit to be received from the participating nuclear plants.nuclear-powered generating facilities. The balance as of September 30, 2023 is $862 million.
Under CEJA, the costs of procuring CMCs, including carrying costs, are recovered through a rider, the Rider Carbon-Free Resource Adjustment (Rider CFRA). As originally approved by the ICC, Rider CFRA provides for an annual reconciliation and true-up to actual costs incurred or credits received by ComEd to purchase CMCs, with any difference to be credited to or collected from ComEd’s retail customers in subsequent periods. The difference between the net payments to (or receivables from) ComEd ratepayers and the credits received by ComEd to purchase CMCs is recorded to Purchased Power expense with an offset to the regulatory asset (or regulatory liability). On December 21, 2022, ComEd filed an amendment to Rider CFRA proposing that it recover costs or provide credits faster than the tariff allows, implement monthly reconciliations, and allow ComEd to adjust Rider CFRA rates based not only on anticipated differences but also past payments or credits, and implement monthly reconciliations beginning the June 2023 delivery period. The ICC approved the proposal on January 19, 2023.In addition, on March 24, 2023, ComEd submitted revisions to Rider CFRA which clarified the methodology for calculating interest to be included in the annual reconciliation associated with the June 2022 through May 2023 delivery year. The ICC approved the proposal on April 20, 2023.
Beneficial Electrification Plan
On March 23, 2023, the ICC issued its final order approving the beneficial electrification plan for ComEd. The ICC rejected ComEd’s request to treat a large portion of beneficial electrification costs as a regulatory asset and ordered ComEd to seek cost recovery through the multi-year rate plan filing for 2024 and 2025, and the final formula rate reconciliation docket for 2023, rather than through a separate charge. The order also authorized an overall annual budget of $77 million per year for the three year plan period (2023 through 2025), with flexibility to roll forward unused funds to future years within the same plan period. On April 18, 2023, ComEd filed an application for rehearing in the beneficial electrification plan docket. The Chicago Transit Authority and City of Chicago, jointly, and the Office of the Illinois Attorney General (ILAG) also filed applications for rehearing. On April 27, 2023, ICC staff filed a motion for clarification, seeking clarification from the ICC on the precise budget described in the final order. On May 8, 2023, the ICC denied all applications for rehearing, and entered an amendatory order regarding the annual beneficial electrification plan budgets. ComEd has been directed to use good faith efforts to spend $77 million annually. ComEd subsequently filed its compliance filing in May 2023, detailing project related spending, clarifying the procedure that will be used to seek stakeholder feedback related to beneficial electrification pilot programs, and including the timeline for tariff changes required to implement the programs. ComEd and the ILAG both filed appeals of the ICC’s interim order that addressed the permissible scope of utility beneficial electrification programs outside of transportation and the rate impact cap. The ILAG also filed an appeal seeking reversal of portions of the ICC’s final decision. The final order partly mooted
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Note 3 — Regulatory Matters
Excess Deferred Income Taxes
ComEd’s appeal of the interim order and ComEd has decided not to pursue the other issues. As such, ComEd recently moved to voluntarily dismiss its appeal and the appellate court granted that request. The ICC initiated a docket to accelerate and fully credit to customers TCJA unprotected property-related EDIT no later than December 31, 2025. On July 7, 2022, the ICC issued a final orderILAG consolidated their appeals. Any ruling on the schedule forappeals, even a negative ruling removing programs from the acceleration of EDIT amortization, adoptingBE Plan or lowering the proposal as submitted by several parties, including ComEd, ICC Staff, the Illinois Attorney General's Office, and the Citizens Utility Board. EDIT amortization will be credited to customers through a new rider from January 1, 2023 through December 31, 2025.
Beneficial Electrification Plan
On July 1, 2022, ComEd filed a proposed plan to promote beneficial electrification efforts in its Northern Illinois service area with the ICC as required by CEJA. ComEd's plan is designed to meaningfully reduce barriers to beneficial electrification, including those related to electric vehicles, such as upfront technology adoption costs, charging costs, and charging availability; promote equity and environmental justice; reduce carbon emissions and surface-level pollutants; and support customer education and awareness of electrification options. As proposed, ComEd could expend approximately $300 million over the three-year period 2023 through 2025. The beneficial electrification plan requests recovery of all those costs through a rider mechanism, under which certainoverall budget of the costs would be amortized over ten years with a return on the unrecovered balance. An order is expected to be issued by the ICC no later than the first quarter of 2023. At this time, ComEd cannot predict the outcome of these proceedings.
See Note 3 — Regulatory Matters of the 2021 Recast Form 10-K for additional information on CEJA (referred to as Clean Energy Law).BE Plan, will only impact forward-looking costs.
Energy Efficiency Formula Rate (Exelon and ComEd). ComEd filed its annual energy efficiency formula rate update with the ICC on May 25, 2022.26, 2023. The filing establishes the revenue requirement used to set the rates that will take effect in January 20232024 after the ICC's review and approval. The requested revenue requirement update is based on a reconciliation of the 20212022 actual costs plus projected 20232024 expenditures.
Initial Revenue Requirement IncreaseInitial Revenue Requirement IncreaseAnnual Reconciliation DecreaseTotal Revenue Requirement Increase
Requested Return on Rate Base(a)
Requested ROEInitial Revenue Requirement IncreaseAnnual Reconciliation IncreaseTotal Revenue Requirement Increase
Requested Return on Rate Base(a)
Requested ROE
$66 $(16)$50 5.94 %7.85 %87 $31 $118 6.48 %8.91 %
__________
(a)The requested revenue requirement increase provides for a weighted average debt and equity return on the energy efficiency regulatory asset and rate base of 5.94%6.48% inclusive of an allowed ROE of 7.85%8.91%, reflecting the monthly average yields for 30-year treasury bonds plus 580 basis points. For the 20212022 reconciliation year, the requested revenue requirement provides for a weighted average debt and equity return on the energy efficiency regulatory asset and rate base of 5.52%7.48% inclusive of an allowed ROE of 6.99%10.91%, which includes a downwardan upward performance adjustment that decreasedincreased the ROE. The performance adjustment can either increase or decrease the ROE based upon the achievement of energy efficiency savings goals.
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 JuneSeptember 30, 2022,2023, the $180$71 million liability for the contract termination fee consists of $87$61 million and $93$10 million included in Other current liabilities and Other deferred credits and other liabilities, respectively, in Exelon's Consolidated Balance Sheet. The current and noncurrent liability isliabilities are included in PPA termination obligation and Other deferred credits and other liabilities, respectively, in PHI's and ACE's Consolidated Balance Sheets. For the sixnine months ended JuneSeptember 30, 2023 and 2022, ACE has respectively paid $23$65 million and $45 million of the liability, which is recorded in Changes in Other assets and liabilities in Exelon's, PHI's, and ACE's Consolidated Statements of Cash Flows.
ACE Infrastructure Investment Program “Powering the Future” Filing (Exelon, PHI, and ACE).On October 31, 2022, ACE filed with the NJBPU a second IIP, called “Powering the Future”, proposing to seek recovery through a new component of ACE’s rider mechanism, totaling $379 million, over the four-year period of July 1, 2023, to June 30, 2027. The new IIP will allow ACE to invest in projects that are designed to enhance the reliability, resiliency, and safety of the service ACE provides to its customers. On June 15, 2023, ACE entered into a settlement agreement with other parties, which allows for a recovery totaling $93 million of reliability related capital investments from July 1, 2023, through June 30, 2027. ACE will have the option of seeking approval from the NJBPU to extend the end date of the IIP beyond June 30, 2027, if ACE determines an extension is necessary. On June 29, 2023, the NJBPU adopted the settlement agreement and issued an order approving the program.
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(Dollars in millions, except per share data, unless otherwise noted)

Note 3 — Regulatory Matters
Other Federal Regulatory Matters
FERC Audit (Exelon and ComEd). The Utility Registrants are subject to periodic audits by FERC. FERC’s Division of Audits and Accounting initiated a nonpublic audit of ComEd in April 2021 evaluating ComEd’s compliance with (1) approved terms, rates, and conditions of its federally regulated service; (2) accounting requirements of the Uniform System of Accounts; (3) reporting requirements of the FERC Form 1; and (4) the requirements for record retention. The audit period extends back to January 1, 2017. During the first quarter of 2023, ComEd was provided with information from FERC about several potential findings, including ComEd's methodology regarding the allocation of certain overhead costs to capital under FERC regulations. Based on the preliminary findings and discussions with FERC staff, ComEd determined that a loss was probable and recorded a regulatory liability to reflect its best estimate of that loss as of March 31, 2023.
On July 27, 2023, FERC issued a final audit report which included, among other things, findings and recommendations related to ComEd's methodology regarding the allocation of certain overhead costs to capitalized construction costs under FERC regulations. On August 28, 2023, ComEd filed a formal notice of the issues it will contest. The final outcome and resolution of any contested audit issues as well as a reasonable estimate of potential future losses cannot be accurately estimated at this stage; however, the final resolution of these matters could result in recognition of future losses, above the amounts currently accrued, that could be material to the Exelon and ComEd financial statements.
Regulatory Assets and Liabilities
The Utility Registrants' regulatory assets and liabilities have not changed materially since December 31, 2021,2022, unless noted below. See Note 3 — Regulatory Mattersof the 2021 Recast2022 Form 10-K for additional information on the specific regulatory assets and liabilities.
ComEdComEd. . Regulatory assets increased $254$733 million primarily due to increases of $392 million in the Electric distribution formula rate annual reconciliations regulatory asset, $171 million in the Energy efficiency costs, and $97 million in the ZEC regulatory asset.
PECO. Regulatory assets increased $150 million primarily due to an increase of $255$118 million in the CMCDeferred income taxes regulatory asset, as discussed in CEJA above, $89asset. Regulatory liabilities increased $6 million primarily due to increases of $49 million in the Electric Distribution Formula Rate Annual Reconciliationsenergy and natural gas costs regulatory asset, and $29 million in the Energy Efficiency Costs regulatory asset partiallyliability, offset by a decrease of $116$31 million in the Renewable EnergyDecommissioning the regulatory asset. agreement units regulatory liability.
BGE. Regulatory liabilitiesassets increased $114 million primarily due to an increase of $38 million and $35 million in the Removal costs and Under-recovered revenue decoupling regulatory assets, respectively.
Pepco. Regulatory assets decreased $617$63 million primarily due to a decrease of $788$35 million in the Decommissioning theElectric energy and natural gas costs regulatory asset. Regulatory Agreement Units regulatory liability and $45liabilities decreased $43 million primarily due to a decrease of $52 million in the Deferred Income Taxesincome taxes regulatory liability.
DPL. Regulatory assets decreased $17 million primarily due to a decrease of $26 million in the Electric energy and natural gas costs regulatory asset. Regulatory liabilities decreased $1 million primarily due to a decrease of $23 million in the Deferred income taxes regulatory liability, partially offset by an increase of $162$13 million in the Renewable Portfolio Standards Costs regulatory liabilityElectric energy and $33 million in the Removal Costsnatural gas costs regulatory liability.
PECO.ACE. Regulatory assets increased $103 million primarily due to an increase of $99 million in the Deferred Income Taxes regulatory asset. Regulatory liabilities decreased $325$21 million primarily due to a decrease of $305 million in the Decommissioning the Regulatory Agreement Units regulatory liability and $12$65 million in the Electric Energyenergy and Natural Gas Costs regulatory liability.
BGE. Regulatory assets decreased $49 million primarily due to a decrease of $20 million in the Under-recovered revenue decoupling regulatory asset, $14 million in the Electric Energy and Natural Gas Costs regulatory asset, and $13 million in the Energy Efficiency and Demand Response Programs regulatory asset.
Pepco. Regulatory assets decreased $47 million primarily due to a decrease of $20 million in the Under-recovered revenue decoupling regulatory asset, $17 million in the DC PLUG Charge regulatory asset, and $10 million in the Energy Efficiency and Demand Response Programs regulatory asset. Regulatory liabilities decreased $44 million primarily due to a decrease of $46 million in the Deferred Income Taxes regulatory liability.
ACE. Regulatory assets increased $179 million primarily due to an increase in the Electric Energy Costsnatural gas costs regulatory asset as a result of the PPA termination. Regulatory liabilities decreased $16$29 million primarily due to a decrease of $13$9 million in both the Deferred Income TaxesStranded costs regulatory liability and Over-recovered revenue decoupling 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. PECO had no related amounts at September 30, 2023 and December 31, 2022.
Exelon
ComEd(a)
PECO
BGE(b)
PHI
Pepco(c)
DPL(c)
ACE
June 30, 2022$49 $$— $32 $13 $11 $$— 
December 31, 202143 — 37 — 
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(Dollars in millions, except per share data, unless otherwise noted)

Note 3 — Regulatory Matters
Exelon
ComEd(a)
BGE(b)
PHI
Pepco(c)
DPL(c)
ACE(b)
September 30, 2023$81 $25 $21 $35 $27 $$
December 31, 202257 28 21 18 
__________
(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 and ACE's authorized amounts capitalized for ratemaking purposes primarily relate to earnings on shareholder's investment on itstheir respective 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.

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

Note 4 — Revenue from Contracts with Customers
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 2021 Recast2022 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 deferred credits and other 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.
The following table provides a rollforward of the contract liabilities reflected in Exelon's, PHI's, Pepco's, DPL's, and ACE's Consolidated Balance Sheets for the three and sixnine months ended JuneSeptember 30, 20222023 and 2021. As of June2022. At September 30, 20222023 and December 31, 2021,2022, ComEd's, PECO's, and BGE's contract liabilities were immaterial.
Exelon(a)
PHI(a)
Pepco(a)
DPL
ACE(a)
Balance as of December 31, 2021$109 $109 $87 $11 $11 
Revenues recognized(2)(2)(2)— — 
Balance as of March 31, 2022107 107 85 11 11 
Revenues recognized(2)(2)(1)— (1)
Balance as of June 30, 2022$105 $105 $84 $11 $10 
Exelon(a)
PHI(a)
Pepco(a)
DPL(a)
ACE(a)
Balance as of December 31, 2020$118 $118 $94 $12 $12 
Revenues recognized(2)(2)(2)— — 
Balance as of March 31, 2021116 116 92 12 12 
Revenues recognized(3)(3)(1)(1)(1)
Balance as of June 30, 2021$113 $113 $91 $11 $11 
Exelon(a)
PHI(a)
Pepco(a)
DPL
ACE(a)
Balance at December 31, 2022$101 $101 $81 $10 $10 
Revenues recognized(1)(1)(1)— — 
Balance at March 31, 2023100 100 80 10 10 
Revenues recognized(2)(2)(2)— — 
Balance at June 30, 2023$98 $98 $78 $10 $10 
Revenues recognized(2)(2)(1)— (1)
Balance as of September 30, 2023$96 $96 $77 $10 $
Exelon(a)
PHI(a)
Pepco(a)
DPL(a)
ACE(a)
Balance at December 31, 2021$109 $109 $87 $11 $11 
Revenues recognized(2)(2)(2)— — 
Balance at March 31, 2022107 107 85 11 11 
Revenues recognized(2)(2)(1)— (1)
Balance at June 30, 2022$105 $105 $84 $11 $10 
Revenues recognized(2)(2)(1)(1)— 
Balance as of September 30, 2022$103 $103 $83 $10 $10 
__________
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(Dollars in millions, except per share data, unless otherwise noted)

Note 4 — Revenue from Contracts with Customers
(a)Revenues recognized in the three and sixnine months ended JuneSeptember 30, 20222023 and 2021,2022, were included in the contract liabilities at December 31, 20212022 and 2020,2021, respectively.
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 JuneSeptember 30, 2022.2023. 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.
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(Dollars in millions, except per share data, unless otherwise noted)

Note 4 — Revenue from Contracts with Customers
20222023202420252026 and thereafterTotal
Exelon$$$$$82 $105 
PHI82 105 
Pepco65 84 
DPL— — 11 
ACE— — 10 
YearExelonPHIPepcoDPLACE
2023$$$$— $
2024— — 
2025— — 
2026— — 
2027 and thereafter78 78 60 10 
Total$96 $96 $77 $10 $
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'sRegistrants' 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 6six reportable segments, which include ComEd, PECO, BGE, and PHI's 3three 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 ACEthe segments 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 and sixnine months ended JuneSeptember 30, 20222023 and 20212022 is as follows:
















Three Months Ended September 30, 2023 and 2022
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
Three Months Ended June 30, 2022 and 2021
ComEdPECOBGEPHI
Other(a)
Intersegment
Eliminations
ExelonComEdPECOBGEPHI
Other(a)
Intersegment
Eliminations
Exelon
Operating revenues(b):
Operating revenues(b):
Operating revenues(b):
20232023
Electric revenuesElectric revenues$2,268 $970 $836 $1,747 $— $(28)$5,793 
Natural gas revenuesNatural gas revenues— 67 96 24 — — 187 
Shared service and other revenuesShared service and other revenues— — — 445 (447)— 
Total operating revenuesTotal operating revenues$2,268 $1,037 $932 $1,773 $445 $(475)$5,980 
202220222022
Electric revenuesElectric revenues$1,425 $708 $629 $1,182 $— $(6)$3,938 Electric revenues$1,378 $941 $757 $1,557 $— $(12)$4,621 
Natural gas revenuesNatural gas revenues— 108 157 37 — (1)301 Natural gas revenues— 73 113 38 — — 224 
Shared service and other revenuesShared service and other revenues— — — 384 (386)— Shared service and other revenues— — — 381 (384)— 
Total operating revenuesTotal operating revenues$1,425 $816 $786 $1,221 $384 $(393)$4,239 Total operating revenues$1,378 $1,014 $870 $1,598 $381 $(396)$4,845 
2021
Electric revenues$1,517 $610 $558 $1,113 $— $(9)$3,789 
Natural gas revenues— 83 124 24 — — 231 
Shared service and other revenues— — — 524 (527)— 
Total operating revenues$1,517 $693 $682 $1,140 $524 $(536)$4,020 
Intersegment revenues(c):
Intersegment revenues(c):
Intersegment revenues(c):
20232023$$$$$443 $(458)$— 
20222022$$$$$384 $(393)$— 2022378 (393)— 
2021522 (535)
Depreciation and amortization:Depreciation and amortization:Depreciation and amortization:
20232023$357 $100 $161 $257 $15 $— $890 
20222022$328 $93 $152 $240 $16 $$830 2022333 92 148 238 14 — 825 
2021296 87 141 194 18 — 736 
Operating expenses:Operating expenses:Operating expenses:
20232023$1,738 $847 $835 $1,440 $475 $(478)$4,857 
20222022$1,039 $639 $717 $1,066 $460 $(378)$3,543 2022913 798 810 1,254 439 (380)3,834 
20211,196 552 620 955 495 (374)3,444 
Interest expense, net:Interest expense, net:Interest expense, net:
20232023$119 $52 $47 $80 $139 $— $437 
20222022$104 $43 $36 $73 $101 $$358 2022104 45 39 72 105 — 365 
202198 42 34 67 83 — 324 
Income (loss) from continuing operations before income taxes:Income (loss) from continuing operations before income taxes:Income (loss) from continuing operations before income taxes:
20232023$427 $149 $56 $281 $(130)$(16)$767 
20222022$293 $142 $38 $101 $(62)$(1)$511 2022375 179 26 291 (103)— 768 
2021238 106 37 138 (46)(144)329 
Income Taxes:Income Taxes:Income Taxes:
20232023$94 $$11 $49 $(90)$— $67 
20222022$66 $$$$(31)$— $46 202284 44 (7)(31)— 92 
202146 (8)(3)(27)(7)
Net income (loss) from continuing operations:Net income (loss) from continuing operations:Net income (loss) from continuing operations:
20232023$333 $146 $45 $232 $(41)$(15)$700 
20222022$227 $133 $37 $100 $(31)$(1)$465 2022291 135 33 289 (71)(1)676 
2021192 104 45 141 (19)(137)326 
Capital Expenditures:Capital Expenditures:Capital Expenditures:
20232023$664 $361 $330 $488 $12 $— $1,855 
20222022$591 $314 $275 $367 $38 $— $1,585 2022593 333 340 398 — 1,672 
2021549 282 284 433 15 — 1,563 
__________
(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 expensesTaxes other than income taxes in the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 1415 — Supplemental Financial Information for additional information on total utility taxes.
(c)See Note 1516 — Related Party Transactions for additional information on intersegment revenues.

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

Note 5 — Segment Information
PHI:PHI:
PepcoDPLACE
Other(a)
Intersegment
Eliminations
PHIPepcoDPLACE
Other(a)
Intersegment
Eliminations
PHI
Operating revenues(b):
Operating revenues(b):
Operating revenues(b):
20232023
Electric revenuesElectric revenues$822 $426 $502 $— $(3)$1,747 
Natural gas revenuesNatural gas revenues— 24 — — — 24 
Shared service and other revenuesShared service and other revenues— — — 103 (101)
Total operating revenuesTotal operating revenues$822 $450 $502 $103 $(104)$1,773 
202220222022
Electric revenuesElectric revenues$581 $295 $309 $— $(3)$1,182 Electric revenues$724 $374 $462 $— $(3)$1,557 
Natural gas revenuesNatural gas revenues— 37 — — — 37 Natural gas revenues— 38 — — — 38 
Shared service and other revenuesShared service and other revenues— — — 98 (96)Shared service and other revenues— — — 94 (91)
Total operating revenuesTotal operating revenues$581 $332 $309 $98 $(99)$1,221 Total operating revenues$724 $412 $462 $94 $(94)$1,598 
2021
Electric revenues$523 $274 $319 $— $(3)$1,113 
Natural gas revenues— 24 — — — 24 
Shared service and other revenues— — — 95 (92)
Total operating revenues$523 $298 $319 $95 $(95)$1,140 
Intersegment revenues(c):
Intersegment revenues(c):
Intersegment revenues(c):
20232023$$$— $103 $(104)$
20222022$$$$98 $(101)$2022— 94 (94)
202195 (95)
Depreciation and amortization:Depreciation and amortization:Depreciation and amortization:
20232023$112 $62 $77 $$— $257 
20222022$105 $56 $72 $$— $240 202299 59 74 — 238 
202196 51 40 — 194 
Operating expenses:Operating expenses:Operating expenses:
20232023$658 $386 $394 $105 $(103)$1,440 
20222022$487 $296 $283 $99 $(99)$1,066 2022555 345 353 96 (95)1,254 
2021429 255 269 97 (95)955 
Interest expense, net:Interest expense, net:Interest expense, net:
20232023$41 $18 $19 $$(1)$80 
20222022$38 $17 $17 $$— $73 202237 16 17 72 
202135 16 14 — 67 
Income (loss) before income taxes:Income (loss) before income taxes:Income (loss) before income taxes:
20232023$141 $51 $94 $(4)$(1)$281 
20222022$69 $23 $11 $(2)$— $101 2022146 54 95 (4)— 291 
202172 31 36 (1)— 138 
Income Taxes:Income Taxes:Income Taxes:
20232023$21 $$23 $(3)$— $49 
20222022$(1)$$— $— $— $2022(2)— 
2021(3)(1)— — (3)
Net income (loss):Net income (loss):Net income (loss):
20232023$120 $43 $71 $(2)$— $232 
20222022$70 $21 $11 $(2)$— $100 2022145 52 94 (2)— 289 
202175 30 37 (1)— 141 
Capital Expenditures:Capital Expenditures:Capital Expenditures:
20232023$227 $158 $101 $$— $488 
20222022$184 $91 $92 $— $— $367 2022193 100 105 — — 398 
2021219 99 116 (1)— 433 
___________________
(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 expensesTaxes other than income taxes in the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 1415 — Supplemental Financial Information for additional information on total utility taxes.
(c)Includes intersegment revenues with ComEd, BGE, and PECO, which are eliminated at Exelon.





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(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information

Electric and Gas Revenue by Customer Class (Utility Registrants):
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 September 30, 2023
Revenues from contracts with customersComEdPECOBGEPHIPepcoDPLACE
Electric revenues
Residential$1,047 $654 $512 $959 $405 $255 $299 
Small commercial & industrial540 148 86 199 54 70 75 
Large commercial & industrial263 67 144 386 303 32 51 
Public authorities & electric railroads11 16 
Other(a)
265 80 104 201 67 67 68 
Total electric revenues(b)
$2,126 $956 $853 $1,761 $838 $427 $497 
Natural gas revenues
Residential$— $43 $57 $12 $— $12 $— 
Small commercial & industrial— 16 10 — — 
Large commercial & industrial— — 25 — — 
Transportation— — — — 
Other(c)
— — — 
Total natural gas revenues(d)
$— $67 $96 $24 $— $24 $— 
Total revenues from contracts with customers$2,126 $1,023 $949 $1,785 $838 $451 $497 
Other revenues
Revenues from alternative revenue programs$135 $11 $(22)$(15)$(18)$(2)$
Other electric revenues(e)
— 
Other natural gas revenues(e)
— — — — — — 
Total other revenues$142 $14 $(17)$(12)$(16)$(1)$
Total revenues for reportable segments$2,268 $1,037 $932 $1,773 $822 $450 $502 
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
Three Months Ended June 30, 2022Three Months Ended September 30, 2022
Revenues from contracts with customersRevenues from contracts with customersComEdPECOBGEPHIPepcoDPLACERevenues from contracts with customersComEdPECOBGEPHIPepcoDPLACE
Electric revenuesElectric revenuesElectric revenues
ResidentialResidential$819 $431 $334 $548 $234 $155 $159 Residential$935 $620 $406 $808 $318 $207 $283 
Small commercial & industrialSmall commercial & industrial312 126 70 140 35 51 54 Small commercial & industrial217 149 88 179 44 65 70 
Large commercial & industrialLarge commercial & industrial11 72 129 332 250 30 52 Large commercial & industrial(117)93 158 401 303 43 55 
Public authorities & electric railroadsPublic authorities & electric railroads15 Public authorities & electric railroads16 
Other(a)
Other(a)
234 68 99 164 54 57 55 
Other(a)
246 71 101 166 57 55 54 
Total electric revenues(b)
Total electric revenues(b)
$1,381 $704 $639 $1,199 $581 $296 $324 
Total electric revenues(b)
$1,284 $941 $760 $1,570 $731 $374 $465 
Natural gas revenuesNatural gas revenuesNatural gas revenues
ResidentialResidential$— $71 $96 $17 $— $17 $— Residential$— $46 $70 $10 $— $10 $— 
Small commercial & industrialSmall commercial & industrial— 29 18 — — Small commercial & industrial— 20 13 — — 
Large commercial & industrialLarge commercial & industrial— — 35 — — Large commercial & industrial— — 28 — — 
TransportationTransportation— — — — Transportation— — — — 
Other(c)
Other(c)
— 12 — — 
Other(c)
— 16 — 16 — 
Total Natural gas revenues(d)
$— $108 $161 $37 $— $37 $— 
Total natural gas revenues(d)
Total natural gas revenues(d)
$— $73 $113 $38 $— $38 $— 
Total revenues from contracts with customersTotal revenues from contracts with customers$1,381 $812 $800 $1,236 $581 $333 $324 Total revenues from contracts with customers$1,284 $1,014 $873 $1,608 $731 $412 $465 
Other revenuesOther revenuesOther revenues
Revenues from alternative revenue programsRevenues from alternative revenue programs$35 $— $(20)$(17)$(1)$(2)$(15)Revenues from alternative revenue programs$88 $(5)$(8)$(11)$(8)$— $(3)
Other electric revenues(e)
Other electric revenues(e)
— 
Other electric revenues(e)
— — 
Other natural gas revenues(e)
Other natural gas revenues(e)
— — — — — — 
Other natural gas revenues(e)
— — — — — — 
Total other revenuesTotal other revenues$44 $$(14)$(15)$— $(1)$(15)Total other revenues$94 $— $(3)$(10)$(7)$— $(3)
Total revenues for reportable segmentsTotal revenues for reportable segments$1,425 $816 $786 $1,221 $581 $332 $309 Total revenues for reportable segments$1,378 $1,014 $870 $1,598 $724 $412 $462 
__________
(a)Includes revenues from transmission revenue from PJM, wholesale electric revenue and mutual assistance revenue.
65(b)Includes operating revenues from affiliates in 2023 and 2022 respectively of:
$9 million, $6 million at ComEd
$2 million, $3 million at PECO
$1 million, $2 million at BGE
$2 million, $3 million at PHI
$1 million, $2 million at Pepco
$2 million, $1 million at DPL
less than $1 million, less than $1 million at ACE
(c)Includes revenues from off-system natural gas sales.
(d)Includes operating revenues from affiliates in 2023 and 2022 of:
less than $1 million at PECO
$1 million at BGE
(e)Includes late payment charge revenues.











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

Note 5 — Segment Information
Three Months Ended June 30, 2021
Revenues from contracts with customersComEdPECOBGEPHIPepcoDPLACE
Electric revenues
Residential$759 $383 $299 $537 $223 $147 $167 
Small commercial & industrial377 99 60 124 32 46 46 
Large commercial & industrial138 59 108 257 188 22 47 
Public authorities & electric railroads11 17 10 
Other(a)
214 54 87 139 50 46 43 
Total electric revenues(b)
$1,499 $603 $561 $1,074 $503 $264 $307 
Natural gas revenues
Residential$— $55 $81 $12 $— $12 $— 
Small commercial & industrial— 22 13 — — 
Large commercial & industrial— — 27 — — 
Transportation— — — — 
Other(c)
— — — 
Total natural gas revenues(d)
$— $83 $127 $24 $— $24 $— 
Total revenues from contracts with customers$1,499 $686 $688 $1,098 $503 $288 $307 
Other revenues
Revenues from alternative revenue programs$$$(10)$41 $19 $10 $12 
Other electric revenues(e)
— — — 
Other natural gas revenues(e)
— — — — — — 
Total other revenues$18 $$(6)$42 $20 $10 $12 
Total revenues for reportable segments$1,517 $693 $682 $1,140 $523 $298 $319 
__________
(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:
$3 million, $5 million at ComEd
$1 million, $1 million at PECO
$2 million, $4 million at BGE
$2 million, $4 million at PHI
$2 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
$1 million, $3 million at BGE
(e)Includes late payment charge revenues.

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

Note 5 — Segment Information
SixNine Months Ended JuneSeptember 30, 20222023 and 20212022
ComEdPECOBGEPHI
Other(a)
Intersegment
Eliminations
ExelonComEdPECOBGEPHI
Other(a)
Intersegment
Eliminations
Exelon
Operating revenues(b):
Operating revenues(b):
Operating revenues(b):
2022
20232023
Electric revenuesElectric revenues$3,158 $1,449 $1,366 $2,501 $— $(14)$8,460 Electric revenues$5,836 $2,484 $2,322 $4,459 $— $(45)$15,056 
Natural gas revenuesNatural gas revenues— 414 574 120 — (2)1,106 Natural gas revenues— 493 664 150 — (3)1,304 
Shared service and other revenuesShared service and other revenues— — — 961 (966)— Shared service and other revenues— — — 1,316 (1,322)— 
Total operating revenuesTotal operating revenues$3,158 $1,863 $1,940 $2,626 $961 $(982)$9,566 Total operating revenues$5,836 $2,977 $2,986 $4,615 $1,316 $(1,370)$16,360 
2021
20222022
Electric revenuesElectric revenues$3,052 $1,271 $1,190 $2,283 $— $(16)$7,780 Electric revenues$4,536 $2,390 $2,122 $4,058 $— $(24)$13,082 
Natural gas revenuesNatural gas revenues— 311 466 95 — — 872 Natural gas revenues— 487 688 157 — (2)1,330 
Shared service and other revenuesShared service and other revenues— — — 1,013 (1,019)— Shared service and other revenues— — — 1,342 (1,350)— 
Total operating revenuesTotal operating revenues$3,052 $1,582 $1,656 $2,384 $1,013 $(1,035)$8,652 Total operating revenues$4,536 $2,877 $2,810 $4,223 $1,342 $(1,376)$14,412 
Intersegment revenues(c):
Intersegment revenues(c):
Intersegment revenues(c):
20232023$14 $$$$1,310 $(1,343)$— 
20222022$$$10 $$961 $(981)$202214 13 1,342 (1,377)
202111 13 1,010 (1,033)12 
Depreciation and amortization:Depreciation and amortization:Depreciation and amortization:
20232023$1,045 $297 $487 $741 $46 $— $2,616 
20222022$649 $185 $322 $459 $32 $— $1,647 2022982 277 470 697 46 — 2,472 
2021589 173 293 404 35 — 1,494 
Operating expenses:Operating expenses:Operating expenses:
20232023$4,472 $2,436 $2,503 $3,864 $1,521 $(1,367)$13,429 
20222022$2,444 $1,432 $1,636 $2,282 $1,086 $(909)$7,971 20223,357 2,230 2,446 3,535 1,524 (1,288)11,804 
20212,406 1,231 1,372 2,013 943 (713)7,252 
Interest expense, net:Interest expense, net:Interest expense, net:
20232023$357 $149 $135 $238 $402 $(4)$1,277 
20222022$204 $84 $71 $143 $195 $— $697 2022308 129 110 216 300 — 1,063 
2021193 80 67 134 169 — 643 
Income (loss) from continuing operations before income taxes:Income (loss) from continuing operations before income taxes:Income (loss) from continuing operations before income taxes:
20232023$1,057 $418 $362 $593 $(424)$(21)$1,985 
20222022$534 $363 $244 $238 $(125)$(45)$1,209 2022909 541 270 528 (228)(42)1,978 
2021475 283 233 273 (80)(292)892 
Income Taxes:
Income taxes:Income taxes:
20232023$235 $$76 $103 $(149)$$274 
20222022$119 $24 $10 $$114 $(12)$263 2022203 67 10 82 (9)356 
202185 12 (21)(19)(20)42 
Net income (loss) from continuing operations:Net income (loss) from continuing operations:Net income (loss) from continuing operations:
20232023$822 $410 $286 $490 $(275)$(22)$1,711 
20222022$415 $339 $234 $230 $(239)$(33)$946 2022706 474 267 518 (310)(33)1,622 
2021390 271 254 269 (61)(272)851 
Capital Expenditures:
Capital expenditures:Capital expenditures:
20232023$1,926 $1,068 $986 $1,510 $50 $— $5,540 
20222022$1,208 $658 $578 $776 $60 $— $3,280 20221,801 991 918 1,174 68 — 4,952 
20211,162 577 620 889 61 — 3,309 
Total assets:Total assets:Total assets:
June 30, 2022$37,194 $14,216 $13,093 $25,592 $6,345 $(4,145)$92,295 
December 31, 202136,470 13,824 12,324 24,744 7,626 (8,319)86,669 
September 30, 2023September 30, 2023$42,042 $15,259 $13,649 $26,656 $5,825 $(4,172)$99,259 
December 31, 2022December 31, 202239,661 14,502 13,350 26,082 6,014 (4,260)95,349 
__________
(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 expensesTaxes other than income taxes in the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 1415 — Supplemental Financial Information for additional information on total utility taxes.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
(c)See Note 1516 — Related Party Transactions for additional information on intersegment revenues.
PHI:
PepcoDPLACE
Other(a)
Intersegment
Eliminations
PHIPepcoDPLACE
Other(a)
Intersegment
Eliminations
PHI
Operating revenues(b):
Operating revenues(b):
Operating revenues(b):
20232023
Electric revenuesElectric revenues$2,174 $1,123 $1,172 $$(11)$4,459 
Natural gas revenuesNatural gas revenues— 150 — — — 150 
Shared service and other revenuesShared service and other revenues— — — 309 (303)
Total operating revenuesTotal operating revenues$2,174 $1,273 $1,172 $310 $(314)$4,615 
202220222022
Electric revenuesElectric revenues$1,195 $643 $658 $— $$2,501 Electric revenues$1,919 $1,019 $1,120 $— $— $4,058 
Natural gas revenuesNatural gas revenues— 120 — — — 120 Natural gas revenues— 157 — — — 157 
Shared service and other revenuesShared service and other revenues— — — 205 (200)Shared service and other revenues— — — 298 (290)
Total operating revenuesTotal operating revenues$1,195 $763 $658 $205 $(195)$2,626 Total operating revenues$1,919 $1,176 $1,120 $298 $(290)$4,223 
2021
Electric revenues$1,076 $585 $629 $— $(7)$2,283 
Natural gas revenues— 95 — — — 95 
Shared service and other revenues— — — 189 (183)
Total operating revenues$1,076 $680 $629 $189 $(190)$2,384 
Intersegment revenues(c):
Intersegment revenues(c):
Intersegment revenues(c):
20232023$$$$309 $(313)$
20222022$$$$195 $(196)$2022288 (290)
2021189 (190)
Depreciation and amortization:Depreciation and amortization:Depreciation and amortization:
20232023$329 $182 $212 $18 $— $741 
20222022$213 $113 $118 $15 $— $459 2022312 172 192 21 — 697 
2021199 104 87 14 — 404 
Operating expenses:Operating expenses:Operating expenses:
20232023$1,810 $1,079 $971 $318 $(314)$3,864 
20222022$1,034 $653 $593 $197 $(195)$2,282 20221,588 999 947 291 (290)3,535 
2021895 564 552 192 (190)2,013 
Interest expense, net:Interest expense, net:Interest expense, net:
20232023$122 $53 $52 $$$238 
20222022$74 $33 $32 $$(1)$143 2022111 48 49 216 
202169 30 29 — 134 
Income (loss) before income taxes:Income (loss) before income taxes:Income (loss) before income taxes:
20232023$292 $153 $162 $(14)$— $593 
20222022$113 $83 $38 $$— $238 2022259 138 133 (2)— 528 
2021137 92 50 (6)— 273 
Income Taxes:
Income taxes:Income taxes:
20232023$43 $25 $40 $(5)$— $103 
20222022$(3)$$$$— $2022(2)— 10 
2021(1)(3)— 
Net income (loss):Net income (loss):Net income (loss):
20232023$249 $128 $122 $(9)$— $490 
20222022$116 $77 $37 $— $— $230 2022261 130 131 (4)— 518 
2021134 86 51 (2)— 269 
Capital Expenditures:
Capital expenditures:Capital expenditures:
20232023$710 $416 $376 $$— $1,510 
20222022$402 $194 $179 $$— $776 2022595 294 284 — 1,174 
2021439 211 239 — — 889 
Total assets:Total assets:Total assets:
June 30, 2022$10,226 $5,742 $5,052 $4,775 $(203)$25,592 
December 31, 20219,903 5,412 4,556 4,933 (60)24,744 
September 30, 2023September 30, 2023$11,061 $5,870 $5,155 $4,644 $(74)$26,656 
December 31, 2022December 31, 202210,657 5,802 4,979 4,677 (33)26,082 
__________
(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 expensesTaxes other than income taxes in the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 1415 — Supplemental Financial Information for additional information on total utility taxes.
(c)Includes intersegment revenues with ComEd, BGE, and PECO, which are eliminated at Exelon.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
Electric and Gas Revenue by Customer Class (Utility Registrants):
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.
Six Months Ended June 30, 2022Nine Months Ended September 30, 2023
Revenues from contracts with customersRevenues from contracts with customersComEdPECOBGEPHIPepcoDPLACERevenues from contracts with customersComEdPECOBGEPHIPepcoDPLACE
Electric revenuesElectric revenuesElectric revenues
ResidentialResidential$1,675 $918 $752 $1,200 $509 $362 $329 Residential$2,744 $1,617 $1,308 $2,181 $954 $626 $601 
Small commercial & industrialSmall commercial & industrial736 237 151 281 73 107 101 Small commercial & industrial1,363 415 253 503 134 189 180 
Large commercial & industrialLarge commercial & industrial165 136 260 655 503 56 96 Large commercial & industrial553 196 412 1,099 838 98 163 
Public authorities & electric railroadsPublic authorities & electric railroads20 15 14 31 16 Public authorities & electric railroads33 23 22 49 25 11 13 
Other(a)
Other(a)
472 130 196 359 100 113 136 
Other(a)
716 219 303 563 187 186 194 
Total electric revenues(b)
Total electric revenues(b)
$3,068 $1,436 $1,373 $2,526 $1,201 $645 $670 
Total electric revenues(b)
$5,409 $2,470 $2,298 $4,395 $2,138 $1,110 $1,151 
Natural gas revenuesNatural gas revenuesNatural gas revenues
ResidentialResidential$— $289 $378 $68 $— $68 $— Residential$— $335 $406 $88 $— $88 $— 
Small commercial & industrialSmall commercial & industrial— 105 63 29 — 29 — Small commercial & industrial— 123 66 40 — 40 — 
Large commercial & industrialLarge commercial & industrial— — 100 — — Large commercial & industrial— 124 — — 
TransportationTransportation— 14 — — — Transportation— 20 — 11 — 11 — 
Other(c)
Other(c)
— 47 10 — 10 — 
Other(c)
— 12 28 — — 
Total natural gas revenues(d)
Total natural gas revenues(d)
$— $413 $588 $120 $— $120 $— 
Total natural gas revenues(d)
$— $491 $624 $150 $— $150 $— 
Total revenues from contracts with customersTotal revenues from contracts with customers$3,068 $1,849 $1,961 $2,646 $1,201 $765 $670 Total revenues from contracts with customers$5,409 $2,961 $2,922 $4,545 $2,138 $1,260 $1,151 
Other revenuesOther revenuesOther revenues
Revenues from alternative revenue programsRevenues from alternative revenue programs$75 $$(32)$(22)$(7)$(3)$(12)Revenues from alternative revenue programs$405 $$47 $59 $28 $10 $21 
Other electric revenues(e)
Other electric revenues(e)
15 — 
Other electric revenues(e)
22 13 12 11 — 
Other natural gas revenues(e)
Other natural gas revenues(e)
— — — — — 
Other natural gas revenues(e)
— — — — — 
Total other revenuesTotal other revenues$90 $14 $(21)$(20)$(6)$(2)$(12)Total other revenues$427 $16 $64 $70 $36 $13 $21 
Total revenues for reportable segmentsTotal revenues for reportable segments$3,158 $1,863 $1,940 $2,626 $1,195 $763 $658 Total revenues for reportable segments$5,836 $2,977 $2,986 $4,615 $2,174 $1,273 $1,172 
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 5 — Segment Information
Six Months Ended June 30, 2021Nine Months Ended September 30, 2022
Revenues from contracts with customersRevenues from contracts with customersComEdPECOBGEPHIPepcoDPLACERevenues from contracts with customersComEdPECOBGEPHIPepcoDPLACE
Electric revenuesElectric revenuesElectric revenues
ResidentialResidential$1,502 $816 $662 $1,142 $476 $337 $329 Residential$2,610 $1,538 $1,158 $2,007 $826 $570 $611 
Small commercial & industrialSmall commercial & industrial744 199 129 242 65 92 85 Small commercial & industrial953 386 239 461 117 173 171 
Large commercial & industrialLarge commercial & industrial271 116 213 505 372 43 90 Large commercial & industrial48 229 418 1,056 806 99 151 
Public authorities & electric railroadsPublic authorities & electric railroads22 17 13 30 16 Public authorities & electric railroads22 23 20 47 25 11 11 
Other(a)
Other(a)
433 106 165 283 101 87 95 
Other(a)
718 202 297 524 157 168 190 
Total electric revenues(b)
Total electric revenues(b)
$2,972 $1,254 $1,182 $2,202 $1,030 $566 $606 
Total electric revenues(b)
$4,351 $2,378 $2,132 $4,095 $1,931 $1,021 $1,134 
Natural gas revenuesNatural gas revenuesNatural gas revenues
ResidentialResidential$— $215 $297 $57 $— $57 $— Residential$— $335 $448 $77 $— $77 $— 
Small commercial & industrialSmall commercial & industrial— 81 48 24 — 24 — Small commercial & industrial— 125 77 35 — 35 — 
Large commercial & industrialLarge commercial & industrial— — 81 — — Large commercial & industrial— — 128 — — 
TransportationTransportation— 12 — — — Transportation— 19 — 11 — 11 — 
Other(c)
Other(c)
— 36 — — 
Other(c)
— 50 25 — 25 — 
Total natural gas revenues(d)
Total natural gas revenues(d)
$— $311 $462 $94 $— $95 $— 
Total natural gas revenues(d)
$— $486 $703 $157 $— $157 $— 
Total revenues from contracts with customersTotal revenues from contracts with customers$2,972 $1,565 $1,644 $2,296 $1,030 $661 $606 Total revenues from contracts with customers$4,351 $2,864 $2,835 $4,252 $1,931 $1,178 $1,134 
Other revenuesOther revenuesOther revenues
Revenues from alternative revenue programsRevenues from alternative revenue programs$64 $17 $$88 $46 $19 $23 Revenues from alternative revenue programs$163 $$(40)$(33)$(15)$(3)$(14)
Other electric revenues(e)
Other electric revenues(e)
16 — — — — — 
Other electric revenues(e)
22 11 11 — 
Other natural gas revenues(e)
Other natural gas revenues(e)
— — — — — — 
Other natural gas revenues(e)
— — — — — 
Total other revenuesTotal other revenues$80 $17 $12 $88 $46 $19 $23 Total other revenues$185 $13 $(25)$(29)$(12)$(2)$(14)
Total revenues for reportable segmentsTotal revenues for reportable segments$3,052 $1,582 $1,656 $2,384 $1,076 $680 $629 Total revenues for reportable segments$4,536 $2,877 $2,810 $4,223 $1,919 $1,176 $1,120 
__________
(a)Includes revenues from transmission revenue from PJM, wholesale electric revenue and mutual assistance revenue.
(b)Includes operating revenues from affiliates in 20222023 and 20212022 respectively of:
$814 million, $11$14 million at ComEd
$25 million, $3$5 million at PECO
$34 million, $5 million at BGE
$67 million, $7$9 million at PHI
$25 million, $3$4 million at Pepco
$35 million, $4$5 million at DPL
$21 million, $1$2 million at ACE
(c)Includes revenues from off-system natural gas sales.
(d)Includes operating revenues from affiliates in 20222023 and 20212022 respectively of:
less than $1$1 million, $1 million at PECO
$72 million, $7 million at BGE
(e)Includes late payment charge revenues.

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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 June 30, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of March 31, 2022$389 $92 $125 $59 $113 $40 $24 $49 
Plus: Current period (benefit) provision for expected credit losses(9)(5)(10)— (1)
Less: Write-offs, net of recoveries(a)
26 
Balance as of June 30, 2022$354 $81 $107 $57 $109 $42 $22 $45 
Three Months Ended June 30, 2021
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of March 31, 2021$377 $103 $130 $43 $101 $41 $25 $35 
Plus: Current period (benefit) provision for expected credit losses(42)(9)(14)(14)(5)(1)(5)
Less: Write-offs, net of recoveries(a)
15 — 
Balance as of June 30, 2021$320 $89 $111 $27 $93 $38 $19 $36 
Six Months Ended June 30, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of December 31, 2021$320 $73 $105 $38 $104 $37 $18 $49 
Plus: Current period provision for expected credit losses(b)
101 21 21 28 31 16 
Less: Write-offs, net of recoveries(a)(c)
67 13 19 26 11 12 
Balance as of June 30, 2022$354 $81 $107 $57 $109 $42 $22 $45 
Six Months Ended June 30, 2021
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of December 31, 2020$334 $97 $116 $35 $86 $32 $22 $32 
Plus: Current period provision (benefit) for expected credit losses28 12 (5)15 10 
Less: Write-offs, net of recoveries(a)
42 20 11 — 
Balance as of June 30, 2021$320 $89 $111 $27 $93 $38 $19 $36 
Three Months Ended September 30, 2023
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at June 30, 2023$323 $67 $101 $50 $105 $50 $21 $34 
Plus: Current period provision for expected credit losses(a)
72 24 13 26 11 
Less: Write-offs, net of recoveries(b)
54 15 19 13 
Balance at September 30, 2023$341 $76 $95 $52 $118 $56 $23 $39 
Three Months Ended September 30, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at June 30, 2022$354 $81 $107 $57 $109 $42 $22 $45 
Plus: Current period provision for expected credit losses38 10 12 14 
Less: Write-offs, net of recoveries51 17 16 12 
Balance at September 30, 2022$341 $74 $103 $54 $111 $44 $20 $47 
Nine Months Ended September 30, 2023
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at December 31, 2022$327 $59 $105 $54 $109 $47 $21 $41 
Plus: Current period provision for expected credit losses(c)(d)
144 45 32 23 44 24 10 10 
Less: Write-offs, net(e)(f)(g)of recoveries(b)
130 28 42 25 35 15 12 
Balance at September 30, 2023$341 $76 $95 $52 $118 $56 $23 $39 
Nine Months Ended September 30, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at December 31, 2021$320 $73 $105 $38 $104 $37 $18 $49 
Plus: Current period provision for expected credit losses141 31 33 30 47 23 16 
Less: Write-offs, net of recoveries120 30 35 14 40 16 18 
Balance at September 30, 2022$341 $74 $103 $54 $111 $44 $20 $47 
__________
(a)For ComEd, BGE, PHI, Pepco, DPL and ACE, the change in current period provision for expected credit losses is primarily a result of increased receivable balances.
(b)Recoveries were not material to the Registrants.
(b)(c)For BGE, Pepco,ComEd and ACE,DPL, the increasechange in current period provision for expected credit losses is primarily as a result of increased receivable balances due to the increased aging of receivables.balances.
(c)(d)For BGE and ACE, the change in current period provision for expected credit losses is primarily a result of changes in customer risk profile.
(e)For PECO and BGE, the change in write-offs is primarily a result of increased disconnection activities.
(f)For DPL, the change in write-offs is primarily attributable to unfavorable customer payment behavior.
(g)For ACE, the increasechange in 2022write-offs is primarily relatedattributable to the termination of the moratorium in New Jersey, which beginning in March 2020, prevented customer disconnections for non-payment. With disconnectionDisconnection activities restartingresumed in January 2022, driving the change in write-offs of aging accounts receivable increased throughoutfor the year.nine months ended September 20, 2023.



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

Note 6 — Accounts Receivable

The following tables present the rollforward of Allowance for Credit Losses on Other Accounts Receivable.
Three Months Ended June 30, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of March 31, 2022$81 $20 $$11 $41 $18 $$14 
Plus: Current period provision (benefit) for expected credit losses(2)(1)— 
Less: Write-offs, net of recoveries(a)
— — — — — 
Balance as of June 30, 2022$81 $18 $10 $11 $42 $20 $$14 
Three Months Ended June 30, 2021
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of March 31, 2021$79 $22 $11 $$37 $15 $10 $12 
Plus: Current period (benefit) provision for expected credit losses(5)(3)(3)— (1)
Less: Write-offs, net of recoveries(a)
— — — — 
Balance as of June 30, 2021$71 $18 $$$38 $16 $$13 
Six Months Ended June 30, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of December 31, 2021$72 $17 $$$39 $16 $$15 
Plus: Current period provision for expected credit losses15 — 
Less: Write-offs, net of recoveries(a)
— — 
Balance as of June 30, 2022$81 $18 $10 $11 $42 $20 $$14 
Six Months Ended June 30, 2021
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance as of December 31, 2020$71 $21 $$$33 $13 $$11 
Plus: Current period provision (benefit) for expected credit losses(2)— 
Less: Write-offs, net of recoveries(a)
— — — — 
Balance as of June 30, 2021$71 $18 $$$38 $16 $$13 
Three Months Ended September 30, 2023
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at June 30, 2023$87 $18 $$$53 $31 $$13 
Plus: Current period provision (benefit) for expected credit losses(2)(2)— — 
Less: Write-offs, net of recoveries(a)
— — — — 
Balance at September 30, 2023$88 $20 $$$51 $29 $$13 
Three Months Ended September 30, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at June 30, 2022$81 $18 $10 $11 $42 $20 $$14 
Plus: Current period provision (benefit) for expected credit losses(1)
Less: Write-offs, net of recoveries— — 
Balance at September 30, 2022$84 $18 $11 $12 $43 $22 $$14 
Nine Months Ended September 30, 2023
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at December 31, 2022$82 $17 $$10 $46 $25 $$14 
Plus: Current period provision for expected credit losses21 
Less: Write-offs, net of recoveries(a)
15 — — 
Balance at September 30, 2023$88 $20 $$$51 $29 $$13 
Nine Months Ended September 30, 2022
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at December 31, 2021$72 $17 $$$39 $16 $$15 
Plus: Current period provision (benefit) for expected credit losses24 (1)
Less: Write-offs, net of recoveries12 — — 
Balance at September 30, 2022$84 $18 $11 $12 $43 $22 $$14 
__________
(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 June 30, 2022 and December 31, 2021.
Unbilled customer revenues(a)
ExelonComEdPECOBGEPHIPepcoDPLACE
June 30, 2022$636 $191 $138 $123 $184 $94 $41 $49 
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.









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

Note 6 — Accounts Receivable

Unbilled Customer Revenue
The following table provides additional information about unbilled customer revenues recorded in the Registrants' Consolidated Balance Sheets at September 30, 2023 and December 31, 2022.
Unbilled customer revenues(a)
ExelonComEdPECOBGEPHIPepcoDPLACE
September 30, 2023$740 $279 $135 $118 $208 $100 $44 $64 
December 31, 2022912 223 219 247 223 103 74 46 
__________
(a)Unbilled customer revenues are classified in Customer accounts receivable, 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 table presents the total receivables purchased.
Total receivables purchased
Exelon(a)
ComEdPECO
BGE(a)
PHIPepcoDPLACE
Six months ended June 30, 2022$1,911 $456 $518 $391 $546 $342 $104 $100 
Six months ended June 30, 20211,838 485 507 343 503 310 103 90 
Total receivables purchased
ExelonComEdPECOBGEPHIPepcoDPLACE
Nine months ended September 30, 2023$3,124 $726 $843 $628 $927 $600 $174 $153 
Nine months ended September 30, 20223,088 (a)753 832 607 (a)896 559 168 169 
__________
(a)Includes $4 million of receivables purchased from Generation prior to the separation on February 1, 2022 for the sixnine months ended JuneSeptember 30, 2022 and $15 million of receivables purchased from Generation for the six months ended June 30, 2021.2022.
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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 June 30, 2022(a)
Three Months Ended September 30, 2023(a)
ExelonComEd
PECO(b)
BGE(b)
PHI
Pepco(b)
DPL
ACE(b)
ExelonComEd
PECO(b)
BGEPHIPepcoDPLACE
U.S. Federal statutory rateU.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %U.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %
Increase (decrease) due to:Increase (decrease) due to:Increase (decrease) due to:
State income taxes, net of Federal income tax benefit(c)
(5.4)7.9 (0.6)2.1 1.5 (3.4)7.2 6.7 
State income taxes, net of federal income tax benefit(c)
State income taxes, net of federal income tax benefit(c)
(2.7)7.8 (1.2)6.6 6.2 5.5 6.1 7.0 
Plant basis differencesPlant basis differences(3.3)(0.5)(11.0)(1.3)(1.7)(2.4)(0.7)(1.0)Plant basis differences(4.4)(0.4)(15.6)(0.2)(1.5)(2.4)(0.9)(0.5)
Excess deferred tax amortizationExcess deferred tax amortization(10.5)(5.5)(3.1)(19.0)(19.2)(15.7)(20.0)(24.5)Excess deferred tax amortization(6.4)(5.3)(2.4)(5.4)(8.0)(9.2)(10.0)(3.1)
Amortization of investment tax credit, including deferred taxes on basis differenceAmortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.2)(0.2)Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.1)(0.1)
Tax creditsTax credits(0.4)(0.3)— (1.5)(0.4)(0.4)(0.4)(0.4)Tax credits(0.5)(1.2)— (2.0)(0.5)(0.6)(0.4)(0.3)
Other(d)
7.7 — — 1.4 (0.1)(0.5)1.8 (1.6)
OtherOther1.8 0.2 0.2 (0.3)0.3 0.6 — 0.5 
Effective income tax rateEffective income tax rate9.0 %22.5 %6.3 %2.6 %1.0 %(1.4)%8.7 %— %Effective income tax rate8.7 %22.0 %2.0 %19.6 %17.4 %14.9 %15.7 %24.5 %
Three Months Ended June 30, 2021(a)
Three Months Ended September 30, 2022(a)
ExelonComEd
PECO(e)
BGE(e)
PHI
Pepco(e)
DPL
ACE(e)
ExelonComEd
PECO(d)
BGE(d)
PHI(d)
Pepco(d)
DPL(d)
ACE(d)
U.S. Federal statutory rateU.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %U.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %
Increase (decrease) due to:Increase (decrease) due to:Increase (decrease) due to:
State income taxes, net of Federal income tax benefit1.1 8.0 (2.9)(12.5)2.4 (2.1)7.0 8.1 
State income taxes, net of federal income tax benefitState income taxes, net of federal income tax benefit9.0 8.0 20.7 6.8 1.4 (2.7)6.5 7.0 
Plant basis differencesPlant basis differences(4.0)(0.7)(12.5)(2.3)(1.1)(1.5)(0.7)(0.6)Plant basis differences(5.3)(0.4)(14.2)(2.6)(1.7)(2.3)(0.8)(1.0)
Excess deferred tax amortizationExcess deferred tax amortization(13.4)(7.0)(3.3)(17.5)(22.3)(19.0)(21.9)(28.2)Excess deferred tax amortization(11.6)(5.6)(3.2)(47.3)(19.3)(14.6)(21.7)(25.5)
Amortization of investment tax credit, including deferred taxes on basis differenceAmortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.2)(0.2)Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.2)(0.1)— (0.2)(0.2)
Tax creditsTax credits(1.0)(0.8)— (3.6)(0.8)(0.7)(0.9)(0.6)Tax credits(0.6)(0.4)— (1.9)(0.9)(0.8)(1.3)(0.7)
OtherOther(2.7)(1.1)(0.4)(6.6)(1.3)(1.9)(1.1)(2.3)Other(0.4)(0.1)0.3 (2.7)0.3 0.1 0.2 0.5 
Effective income tax rateEffective income tax rate0.9 %19.3 %1.9 %(21.6)%(2.2)%(4.2)%3.2 %(2.8)%Effective income tax rate12.0 %22.4 %24.6 %(26.9)%0.7 %0.7 %3.7 %1.1 %
__________
(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 lower state income taxes, net of federal income tax benefit,expense, is primarily due to the long-term marginal state income tax rate change of $54 million.
(d)For PECO, the higher effective tax rate is related to a one-time impact associated with a state income expense, net of federal income tax benefit, of $43$38 million and indemnification adjustments pursuantattributable to the Tax Matters Agreement of $5 million as a result ofchange in the separation.
(d)For Exelon, primarily related to indemnification adjustments pursuant to the Tax Matters Agreement of $48 million.
(e)For PECO, the lower effectivePennsylvania corporate income tax rate is primarily related topartially offset by 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 certain income tax benefits. ForPHI, Pepco, the income tax benefit is primarily due to the Maryland multi-year plan which resulted in the acceleration of certain income tax benefits. ForDPL, and ACE, the lower effective tax rate is primarily duerelated to the acceleration of certain income tax benefits due to distribution and transmission rate case settlements.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 7 — Income Taxes

Six Months Ended June 30, 2022(a)
Nine Months Ended September 30, 2023(a)
ExelonComEd
PECO(b)
BGE(b)
PHI
Pepco(b)
DPL
ACE(b)
ExelonComEd
PECO(b)
BGEPHIPepcoDPLACE
U.S. Federal statutory rateU.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %U.S. Federal statutory rate21.0%21.0%21.0%21.0%21.0%21.0%21.0%21.0%
Increase (decrease) due to:Increase (decrease) due to:Increase (decrease) due to:
State income taxes, net of Federal income tax benefit(c)
9.9 7.9 (0.3)2.3 2.8 (3.8)6.5 6.7 
State income taxes, net of federal income tax benefit(c)
State income taxes, net of federal income tax benefit(c)
2.87.8(1.3)6.56.15.56.26.9
Plant basis differencesPlant basis differences(3.5)(0.5)(11.2)(1.0)(1.7)(2.5)(0.7)(1.2)Plant basis differences(4.3)(0.4)(15.5)(0.5)(1.6)(2.5)(1.0)(0.5)
Excess deferred tax amortizationExcess deferred tax amortization(11.0)(5.8)(3.2)(17.8)(18.3)(16.3)(19.5)(22.9)Excess deferred tax amortization(6.6)(5.5)(2.4)(5.4)(7.7)(9.2)(9.4)(2.6)
Amortization of investment tax credit, including deferred taxes on basis differenceAmortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.2)(0.2)Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)(0.1)(0.1)(0.1)(0.1)
Tax credits(d)
Tax credits(d)
0.8 (0.3)— (0.6)(0.4)(0.4)(0.3)(0.3)
Tax credits(d)
(0.5)(0.7)(0.7)(0.6)(0.7)(0.4)(0.3)
Other(e)
Other(e)
4.7 0.1 0.3 0.3 0.1 (0.7)0.4 (0.5)
Other(e)
1.50.10.10.20.30.60.3
Effective income tax rateEffective income tax rate21.8 %22.3 %6.6 %4.1 %3.4 %(2.7)%7.2 %2.6 %Effective income tax rate13.8%22.2%1.9%21.0%17.4%14.7%16.3%24.7%

Six Months Ended June 30, 2021(a)
Nine Months Ended September 30, 2022(a)
ExelonComEd
PECO(f)
BGE(f)
PHI
Pepco(f)
DPL
ACE(f)
ExelonComEd
PECO(d)
BGE(d)
PHI(d)
Pepco(d)
DPL(d)
ACE(d)
U.S. Federal statutory rateU.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %U.S. Federal statutory rate21.0%21.0%21.0%21.0%21.0%21.0%21.0%21.0%
Increase (decrease) due to:Increase (decrease) due to:Increase (decrease) due to:
State income taxes, net of Federal income tax benefit2.0 7.4 (2.1)(10.5)4.2 1.5 6.6 7.8 
State income taxes, net of federal income tax benefit(e)
State income taxes, net of federal income tax benefit(e)
9.57.96.62.82.0(3.2)6.56.9
Plant basis differencesPlant basis differences(3.6)(0.6)(11.3)(1.6)(1.3)(1.8)(0.7)(0.7)Plant basis differences(4.2)(0.5)(12.2)(1.1)(1.7)(2.4)(0.7)(1.1)
Excess deferred tax amortizationExcess deferred tax amortization(12.5)(7.0)(3.3)(15.9)(20.8)(17.2)(19.7)(28.3)Excess deferred tax amortization(11.3)(5.7)(3.2)(20.7)(18.8)(15.4)(20.4)(24.7)
Amortization of investment tax credit, including deferred taxes on basis differenceAmortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.2)(0.2)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(f)Tax credits(f)(0.5)(0.5)— (0.9)(0.5)(0.5)(0.4)(0.5)Tax credits(f)0.3(0.3)(0.7)(0.7)(0.6)(0.7)(0.6)
Other(g)Other(g)(1.6)(2.3)(0.1)(1.0)(0.7)(0.8)(0.1)(1.1)Other(g)2.80.2(0.1)0.2(0.2)0.30.2
Effective income tax rateEffective income tax rate4.7 %17.9 %4.2 %(9.0)%1.8 %2.2 %6.5 %(2.0)%Effective income tax rate18.0%22.3%12.4%1.1%1.9%(0.8)%5.8%1.5%
__________
(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.
(c)For BGE,Exelon, the lower state income taxes, net of federal income tax expense, is primarily due to the long-term marginal state income tax rate change of $54 million.
(d)For PECO, the lower effective tax rate is primarily duerelated to the Maryland multi-year plan which resulted in the accelerationplant basis differences attributable to tax repair deductions partially offset by higher state income taxes, net of certain income tax benefits. For Pepco, thefederal income tax benefit, is primarily duerelated to a one-time expense of $38 million attributable to the Maryland and Washington, D.C. multi-year plans which resultedchange in the acceleration of certainPennsylvania corporate income tax benefits.rate. For BGE, PHI, Pepco, DPL and ACE, the lower effective tax rate is primarily duerelated to the acceleration of certain income tax benefits due to distribution and transmission rate case settlements.
(c)(e)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, partially offset by a one-time impact associated with a state tax benefit of $43 million and indemnification adjustments pursuant to the Tax Matters Agreement of $4 million as a result of the separation. For PECO, the higher state income taxes, net of federal income tax benefit, related to a one-time expense of $38 million attributable to the change in the Pennsylvania corporate income tax rate.
(d)(f)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)(g)For Exelon, primarily reflects the nondeductible transaction costs of approximately $19 million arising as part of the separation and indemnification adjustments pursuant to the Tax Matters Agreement of $48$40 million.
(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 certain income tax benefits. For Pepco, the income tax benefit is primarily due to the Maryland multi-year plan 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.


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

Note 7 — Income Taxes
Unrecognized Tax Benefits
Exelon, PHI and ACE have the following unrecognized tax benefits as of Juneat September 30, 20222023 and December 31, 2021.2022. ComEd's, PECO's, BGE's, Pepco's, and DPL's amounts are not material.
Exelon(a)
PHIACE
June 30, 2022$147 $58 $16 
December 31, 2021143 56 16 
Exelon(a)
PHIACE
September 30, 2023$138 $56 $16 
December 31, 2022148 59 17 
__________
(a)As of JuneAt September 30, 2023 and December 31, 2022, Exelon recordedreflected a receivable of $50 million in NoncurrentOther deferred debits and 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 datedate.
As of JuneSeptember 30, 2022,2023, ACE has $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 the first quarter of 2022, in connection with the separation, Exelon recorded an income tax expense related to continuing operations of $148 million primarily due to the long-term marginal state income tax rate change of $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 $17 million, and nondeductible transaction costs for federal and state taxes of $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 a result,of September 30, 2023, Exelon recorded a receivablepayable of $55$15 million in Current other assets in the Consolidated Balance Sheet for Constellation’s share of taxes for periods priorOther current liabilities that is due to the separation, as of March 31, 2022. As of June 30, 2022, the remaining amount of the receivable is $31 million.Constellation.
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,September 30, 2023, Exelon recorded a payable of $11$22 million and $484$509 million in Current otherOther current liabilities and NoncurrentOther deferred credits and other liabilities, respectively, in the Consolidated Balance Sheet for tax creditattribute carryforwards that are expected to be utilized and reimbursed to Constellation. As of June 30,
Corporate Alternative Minimum Tax (All Registrants)
On August 16, 2022, the currentIRA was signed into law and noncurrent payable amountsimplements a new corporate alternative minimum tax (CAMT) that imposes a 15.0% tax on modified GAAP net income. Corporations are $0 millionentitled to a tax credit (minimum tax credit) to the extent the CAMT liability exceeds the regular tax liability. This amount can be carried forward indefinitely and $480 million, respectively.used in future years when regular tax exceeds the CAMT.

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(Dollars in millions, except per share data, unless otherwise noted)

Note 7 — Income Taxes
Beginning in 2023, based on the existing statue, Exelon and each of the Utility Registrants will be subject to and will report the CAMT on a separate Registrant basis in the Consolidated Statements of Operations and Comprehensive Income and the Consolidated Balance Sheets. The deferred tax asset related to the minimum tax credit carryforward will be realized to the extent Exelon’s consolidated deferred tax liabilities exceed the minimum tax credit carryforward. Exelon’s deferred tax liabilities are expected to exceed the minimum tax credit carryforward for the foreseeable future and thus no valuation allowance is required. Exelon is continuing to assess the financial statement impacts of the IRA and will update estimates based on future guidance issued by the U.S. Treasury.

Long-Term Marginal State Income Tax Rate (All Registrants)(Exelon)

In the firstthird quarter of 2022,2023, Exelon updated its marginal state income tax rates for changes in state apportionment due toapportionment. The changes in marginal rates in the separation, whichthird quarter of 2023 resulted in an increasea decrease of $67$54 million to the deferred tax liability at Exelon, and a corresponding adjustment to income tax expense, net of federal taxes.
Pennsylvania Corporate Income
Allocation of Tax Rate Change (ExelonBenefits (All Registrants)

The Utility Registrants are party to an agreement with Exelon that provides for the allocation of consolidated tax liabilities and PECO)
On July 8, 2022, Pennsylvania enacted House Bill 1342, which will permanently reduce the corporate income tax rate from 9.99% to 4.99%benefits (Tax Sharing Agreement). The Tax Sharing Agreement provides that each party is allocated an amount of tax rate willsimilar to that which would be reducedowed had the party been separately subject to 8.99%tax. In addition, any net benefit attributable to Exelon is reallocated to the Utility Registrants. That allocation is treated as a contribution to capital from Exelon to the party receiving the benefit.

The following table presents the allocation of tax benefits from Exelon under the Tax Sharing Agreement, for the three and nine months ended September 30, 2023, tax year. Starting with the 2024 tax year, the rate is reduced by 0.50% annually until it reaches 4.99% in 2031. As a result of the rate change, in the third quarter of 2022, Exelon and PECO will record an estimated one-time decrease to deferred income taxes of $390 million with a corresponding decrease to the deferred income taxes regulatory asset of $428 million for the amounts that are expected to be settled through future customer rates and an increase to income tax expense of $38 million (net of federal taxes). The tax rate decrease is not expected to have a material ongoing impact to Exelon’s and PECO’s financial statements.2022.
ComEdPECOBGEPHIPepcoDPLACE
September 30, 2023$13 $19 $— $10 $$— $
September 30, 2022$$47 $— $28 23 $

8. Retirement Benefits (All Registrants)
Defined Benefit Pension and OPEB
Effective February 1, 2022, in connection withThe majority of the separation,2023 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 5.53%. The majority of the 2023 OPEB cost is calculated using an expected long-term rate of return on plan assets of 6.50% for funded plans and a discount rate of 5.51%.
During the first quarter of 2023, Exelon received an updated valuation of its pension and OPEB obligationsto reflect actual census data as of January 1, 2023. This valuation resulted in an increase to the pension obligation of $27 million and an increase to the OPEB obligation of $2 million. Additionally, AOCI increased by $10 million (after-tax) and regulatory assets for current and former employeesliabilities increased by $18 million and $1 million, respectively.
A portion of the Constellation business and certain other former employees of Exelon and its subsidiaries transferred to pension and OPEBnet periodic benefit cost for all 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.is capitalized within the Consolidated Balance Sheets. 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, andtable presents the Nine Mile Point Nuclear Station, LLC Medical Care and Prescription Drug Plan for Retired Employees.
As a resultcomponents 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 plansExelon's net periodic benefit costs, prior to capitalization, for the separation now participate in the EPP. The merging of the plans did not change the benefits offered to the plan participantsthree and thus, had no impact on Exelon's pension obligations.nine months ended September 30, 2023 and 2022.
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(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 June 30, 2022:
Operating Company(a)
Name of Plan:ComEdPECOBGEPHIPepcoDPLACE
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 PlanXXX
Exelon Corporation Supplemental Management Retirement PlanXXXXX
Constellation Energy Group, Inc. Senior Executive Supplemental PlanXX
Constellation Energy Group, Inc. Supplemental Pension PlanXX
Constellation Energy Group, Inc. Benefits Restoration PlanXXX
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
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Note 8 — Retirement Benefits
Operating Company(a)
Name of Plan:ComEdPECOBGEPHIPepcoDPLACE
OPEB Plans:
PECO Energy Company Retiree Medical PlanXXXXXXX
Exelon Corporation Health Care ProgramXXXXXXX
Exelon Corporation Employees’ Life Insurance PlanXXX
Exelon Corporation Health Reimbursement Arrangement PlanXXX
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 and six months ended June 30, 2022 and 2021.

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(Dollars in millions, except per share data, unless otherwise noted)

Note 8 — Retirement Benefits
Pension BenefitsOPEBPension BenefitsOPEB
Three Months Ended June 30,Three Months Ended June 30,Three Months Ended September 30,Three Months Ended September 30,
20222021202220212023202220232022
Components of net periodic benefit cost:
Components of net periodic benefit costComponents of net periodic benefit cost
Service costService cost$58 $75 $10 $13 Service cost$39 $58 $$10 
Interest costInterest cost110 101 19 17 Interest cost145 110 25 19 
Expected return on assetsExpected return on assets(205)(210)(25)(25)Expected return on assets(189)(205)(21)(25)
Amortization of:Amortization of:Amortization of:
Prior service cost (credit)Prior service cost (credit)— (5)(7)Prior service cost (credit)(2)(5)
Actuarial lossActuarial loss73 99 Actuarial loss41 73 — 
Settlement chargesSettlement charges18 — — — 
Net periodic benefit costNet periodic benefit cost$37 $65 $$Net periodic benefit cost$55 $37 $$
Pension BenefitsOPEBPension BenefitsOPEB
Six Months Ended June 30,Six Months Ended June 30,Nine Months Ended September 30,Nine Months Ended September 30,
20222021202220212023202220232022
Components of net periodic benefit cost:
Components of net periodic benefit costComponents of net periodic benefit cost
Service costService cost$119 $148 $20 $26 Service cost$116 $177 $18 $30 
Interest costInterest cost220 202 38 35 Interest cost434 330 76 57 
Expected return on assetsExpected return on assets(414)(421)(50)(50)Expected return on assets(566)(619)(63)(75)
Amortization of:Amortization of:Amortization of:
Prior service cost (credit)Prior service cost (credit)(10)(13)Prior service cost (credit)(7)(15)
Actuarial loss149 199 14 
Curtailment benefits— — — (1)
Actuarial loss (gain)Actuarial loss (gain)125 222 (1)12 
Settlement chargesSettlement charges18 — — — 
Net periodic benefit costNet periodic benefit cost$76 $129 $$11 Net periodic benefit cost$129 $113 $23 $
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, which apply multi-employer accounting, 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.
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(Dollars in millions, except per share data, unless otherwise noted)

Note 8 — Retirement Benefits
Three Months Ended June 30,Six Months Ended June 30, Three Months Ended September 30,Nine Months Ended September 30,
Pension and OPEB Costs (Benefit)Pension and OPEB Costs (Benefit)2022202120222021Pension and OPEB Costs (Benefit)2023202220232022
ExelonExelon$40 $71 $82 $140 Exelon$63 $40 $152 $122 
ComEdComEd14 32 30 64 ComEd15 19 45 
PECOPECO(2)(4)PECO(3)(2)(10)(6)
BGEBGE11 16 22 31 BGE14 11 42 33 
PHIPHI13 12 26 24 PHI25 13 74 39 
PepcoPepcoPepco26 
DPLDPLDPL13 
ACEACEACE10 
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 allowallows 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 employer contributions and employer matching contributions to the savings plan for the three and sixnine months ended JuneSeptember 30, 20222023 and 2021, respectively.2022.
Three Months Ended June 30,Six Months Ended June 30,Three Months Ended September 30,Nine Months Ended September 30,
Savings Plan Matching Contributions2022202120222021
Savings Plan Employer ContributionsSavings Plan Employer Contributions2023202220232022
ExelonExelon$23 $23 $43 $43 Exelon$27 $23 $74 $66 
ComEdComEd10 10 18 18 ComEd12 11 31 29 
PECOPECOPECO10 
BGEBGEBGE
PHIPHIPHI13 11 
PepcoPepcoPepco
DPLDPLDPL
ACEACEACE
9. Derivative Financial Instruments (All Registrants)
The Registrants use derivative instruments to manage commodity price risk and interest rate risk related to ongoing business operations. The Registrants do not execute derivatives for speculative or proprietary trading purposes.
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. At Exelon, derivative economic hedges related to interest rates are recorded at fair value and offsets are recorded to Electric operating revenues or Interest expense based on the activity the transaction is economically hedging. 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. At Exelon, derivative hedges that qualify and are designated as cash flow hedges are recorded at fair value and offsets are recorded to AOCI.
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 meetmeets certain qualifications.
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(Dollars in millions, except per share data, unless otherwise noted)

Note 9 — Derivative Financial Instruments
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
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Note 9 — Derivative Financial Instruments
gas price volatility and have no direct earnings impact as the costs are fully recovered from customers through 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.
Gas
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 Recast2022 Form 10-K for additional information.
(b)The fair value of the DPL economic hedge is not material as of Juneat September 30, 20222023 and December 31, 2021.

2022.
The fair value of derivative economic hedges is presented in Other current assets and current and noncurrent Mark-to-market derivative liabilities in Exelon's and ComEd's Consolidated Balance Sheets. The Mark-to-market derivative assets included
Interest Rate and Other Risk (Exelon)
Exelon Corporate uses a combination of fixed-rate and variable-rate debt to manage interest rate exposure. Exelon Corporate may utilize interest rate derivatives to lock in Other current assetsrate levels in Exelon’santicipation of future financings, which are typically designated as cash flow hedges. In addition, Exelon Corporate may also utilize interest rate swaps to manage interest rate exposure and ComEd’s Consolidated Balance Sheets were $15 million and nonemanage potential fluctuations in Electric operating revenues at the corporate level in consolidation, which are directly correlated to yields on U.S. Treasury bonds under ComEd's distribution formula rate. These interest rate swaps are accounted for as economic hedges. A hypothetical 50
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Note 9 — Derivative Financial Instruments
basis point change in the interest rates associated with Exelon's interest rate swaps as of JuneSeptember 30, 2023 would result in an immaterial impact to Exelon's Consolidated Net Income.
Below is a summary of the interest rate hedge balances at September 30, 2023 and December 31, 2022.
September 30, 2023
Derivatives Designated
as Hedging Instruments
Economic HedgesTotal
Other current assets$— $$
Other deferred debits (noncurrent assets)41 — 41 
Total derivative assets41 44 
Mark-to-market derivative liabilities (current liabilities)— (23)(23)
Total mark-to-market derivative liabilities— (23)(23)
Total mark-to-market derivative net assets (liabilities)$41 $(20)$21 
December 31, 2022
Derivatives Designated
as Hedging Instruments
Economic HedgesTotal
Other deferred debits (noncurrent assets)$$$11 
Total derivative assets11 
Mark-to-market derivative liabilities (current liabilities)— (3)(3)
Mark-to-market derivative liabilities (noncurrent liabilities)(4)— (4)
Total mark-to-market derivative liabilities(4)(3)(7)
Total mark-to-market derivative net assets$$$
Cash Flow Hedges (Interest Rate Risk)
For derivative instruments that qualify and are designated as cash flow hedges, the changes in fair value each period are initially recorded in AOCI and reclassified into earnings when the underlying transaction affects earnings. In January 2023, Exelon Corporate entered into $115 million notional of 5-year maturity floating-to-fixed swaps and $115 million notional of 10-year maturity floating-to-fixed swaps, for a total of $230 million designated as cash flow hedges. In February 2023, Exelon terminated the previously issued floating-to-fixed swaps with a total notional of $1.5 billion upon issuance of $2.5 billion of debt. See Note 10 – Debt and Credit Agreements for additional information on the debt issuance. Prior to the termination, the AOCI derivative gain was $7 million (net of tax). The settlements resulted in a cash receipt of $10 million, which is being amortized into Interest expense in Exelon's Consolidated Statement of Operations and Comprehensive Income over the 5-year and 10-year terms of the swaps.
Since the termination in February 2023, Exelon has entered into additional floating-to-fixed swaps. The following table provides the notional amounts outstanding held by Exelon at September 30, 2023 and December 31, 2021, respectively.2022.
September 30, 2023December 31, 2022
5-year maturity floating-to-fixed swaps$390 $635 
10-year maturity floating-to-fixed swaps390 635 
Total$780 $1,270 
The related AOCI derivative gain for the three and nine months ended as of September 30, 2023 was $22 million and $31 million (net of tax). See Note 14 – Changes in Accumulated Other Comprehensive Income (Loss) for additional information.
Economic Hedges (Interest Rate and Other Risk)
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Note 9 — Derivative Financial Instruments
Exelon Corporate executes derivative instruments to mitigate exposure to fluctuations in interest rates but for which the fair value or cash flow hedge elections were not made. For derivatives intended to serve as economic hedges, fair value is recorded on the balance sheet and changes in fair value each period are recognized in earnings or as a regulatory asset or liability, if regulatory requirements are met, each period.
Exelon Corporate enters into floating-to-fixed interest rate cap swaps to manage a portion of interest rate exposure in connection with existing borrowings. In the fourth quarter of 2022, Exelon Corporate entered into $1 billion notional of 18-month maturity floating-to-fixed interest rate cap swaps and $850 million notional of 6-month maturity floating-to-fixed interest rate cap swaps, for a total of $1.85 billion notional of floating-to-fixed interest rate cap swaps as of December 31, 2022. The 6-month maturity floating-to-fixed interest rate cap swaps of $850 million notional matured in March 2023. Exelon receives payments on the interest rate cap when the floating rate exceeds the fixed rate. Settlements received are immaterial as of September 30, 2023.
Additionally, to manage potential fluctuations in Electric operating revenues related to ComEd's distribution formula rate, Exelon Corporate enters into 30-year constant maturity treasury interest rate (Corporate 30-year treasury) swaps.
The following table provides the notional amounts outstanding held by Exelon at September 30, 2023 and December 31, 2022.
Hedging InstrumentSeptember 30, 2023December 31, 2022
Interest rate cap swaps$1,000 $1,850 
Constant maturity treasury interest rate swaps4,875 500 
Total$5,875 $2,350 
For the three and nine months ended September 30, 2023, Exelon Corporate recognized the following net pre-tax mark-to-market (losses) which are also recognized in Net fair value changes related to derivatives in Exelon's Consolidated Statements of Cash Flows. Exelon had no swaps for the three and nine months ended September 30, 2022.
Three Months Ended September 30, 2023Nine Months Ended September 30, 2023
Income Statement Location(Loss) Gain(Loss) Gain
Electric operating revenues$(16)$(21)
Interest expense— 
Total$(16)$(20)
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 June 30, 2022, the amount of cash collateral held with external counterparties by Exelon, ComEd, BGE, PHI, Pepco, DPL, and ACE was $781 million, $133 million, $194 million, $452 million, $87 million, $224 million, and $141 million, respectively, which is recorded in Other current liabilities in Exelon's, ComEd's, BGE's, PHI's, Pepco's, DPL's, and ACE's Consolidated Balance Sheets. The amount of cash collateral received from external counterparties decreased as of September 30, 2023 due to decreasing energy prices. The following table reflects the Registrants' cash collateral held from external counterparties, which is recorded in Other current liabilities on their respective Consolidated Balance Sheets, at September 30, 2023 and December 31, 2022:
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Note 9 — Derivative Financial Instruments
increased as of June
September 30, 2023December 31, 2022
Exelon$112 $297 
ComEd105 77 
PECO(a)
— — 
BGE23 
PHI197 
Pepco(b)
— 26 
DPL121 
ACE50 
__________
(a)PECO had less than one million in cash collateral held with external parties at September 30, 2022 due to rising energy prices. The amount for PECO was not material as of June 30, 2022. As of2023 and December 31, 2021, the amounts for ComEd and DPL were $412022.
(b)Pepco had less than one million and $43 million, respectively. The amounts for Exelon, PECO, BGE, PHI, Pepco, and ACE were not material as of December 31, 2021.in cash collateral held with external parties at September 30, 2023.
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 JuneSeptember 30, 2022,2023, 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 JuneSeptember 30, 2022,2023, they could have been required to post collateral to their counterparties of $37$20 million, $75$30 million, and $15$9 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 theirits 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 Junesupported by the revolving credit agreements at September 30, 20222023 and December 31, 2021. ComEd had no commercial paper borrowings as of June 30, 2022 and December 31, 2021.2022.
Outstanding Commercial
Paper as of
Average Interest Rate on
Commercial Paper Borrowings as of
Commercial Paper IssuerJune 30, 2022December 31, 2021June 30, 2022December 31, 2021
Exelon(a)
$353 $599 1.86 %0.35 %
PECO210 — 1.86 %— %
BGE— 130 — %0.37 %
PHI(b)
43 469 1.85 %0.35 %
Pepco43 175 1.85 %0.33 %
DPL— 149 — %0.36 %
ACE— 145 — %0.35 %
__________
(a)Exelon Corporate had $100 million of outstanding commercial paper borrowings at June 30, 2022 and no outstanding commercial paper borrowings as of December 31, 2021.
(b)Represents the consolidated amounts of Pepco, DPL, and ACE.

Outstanding Commercial
Paper at
Average Interest Rate on
Commercial Paper Borrowings at
Commercial Paper IssuerSeptember 30, 2023December 31, 2022September 30, 2023December 31, 2022
Exelon(a)
$820 $1,938 5.44 %4.77 %
ComEd277 427 5.42 %4.71 %
PECO— 239 — %4.71 %
BGE59 409 5.43 %4.81 %
PHI(b)
173 414 5.47 %4.78 %
Pepco— 299 — %4.79 %
DPL— 115 — %4.76 %
ACE173 — 5.47 %— %
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Note 10 — Debt and Credit Agreements
__________
(a)Exelon Corporate had $311 million and $449 million in outstanding commercial paper borrowings at September 30, 2023 and December 31, 2022, respectively.
(b)Represents the consolidated amounts of Pepco, DPL, and ACE.
Revolving Credit Agreements
On February 1, 2022, Exelon Corporate and the Utility Registrants'Registrants each entered intohave 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 Corporate$900 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 %
Exelon Corporate and the Utility Registrants had no outstanding amounts on the revolving credit facilities as of September 30, 2023.
The Utility Registrants have credit facility agreements, arranged at minority and community banks, which are solely utilized to issue letters of credit. The facility agreements have aggregate commitments of $40 million, $40 million, $15 million, $15 million, $15 million, and $15 million, at ComEd, PECO, BGE, Pepco, DPL, and ACE, respectively. These facilities expire on October 4, 2024.
See Note 1516 — Debt and Credit Agreements of the 2021 Recast2022 Form 10-K for additional information on the Registrants' credit facilities.
Short-Term Loan Agreements
On March 23, 2017, Exelon Corporate entered into a term loan agreement for $500 million. The loan agreement was renewed in the first quarter of 2023 and was bifurcated into two tranches of $300 million on March 14, 20222023 and $200 million on March 24, 2023. The agreements will expire on March 16, 2023.14, 2024 and March 22, 2024, respectively. Pursuant to the loan agreement,agreements, loans made thereunder bear interest at a variable rate equal to SOFR plus 0.65%0.90% 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 CorporateOctober 4, 2022, ComEd entered into a 364-day term loan agreement for $150 million with a variable interest rate of LIBORequal to SOFR plus 0.65%0.75% and an expiration date of March 30, 2022. Exelon CorporateOctober 3, 2023. The proceeds from this loan were used to repay outstanding commercial paper obligations. The balance of the loan was repaid the term loan on March 30, 2022.
In connectionJanuary 13, 2023 in conjunction with the separation,$400 million and $575 million First Mortgage Bond agreements that were entered into on January 24, 2022, Exelon Corporate3, 2023. Refer to the Issuance of Long-Term Debt table below for further information.
On May 9, 2023, ComEd 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$400 million with a variable rate equal to SOFR plus 0.75% with a 22.5 basis point increase which commenced on July 24, 2022. All indebtedness pursuant1.00% and an expiration date of May 7, 2024. The proceeds from this loan were used to therepay outstanding commercial paper obligations and for general corporate purposes. The loan agreement is unsecured.


















reflected in Exelon's and ComEd's Consolidated Balance Sheets within Short-term borrowings.
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(Dollars in millions, except per share data, unless otherwise noted)

Note 10 — Debt and Credit Agreements
Long-Term Debt
Issuance of Long-Term Debt
During the sixnine months ended JuneSeptember 30, 2022,2023, the following long-term debt was issued:
CompanyCompanyTypeInterest RateMaturityAmountUse of ProceedsCompanyTypeInterest 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.
ExelonExelon
Notes(b)
2.75%March 15, 2027650Repay existing indebtedness and for general corporate purposes.ExelonNotes5.15%March 15, 2028$1,000Repay existing indebtedness and for general corporate purposes.
ExelonExelon
Notes(b)
3.35%March 15, 2032650Repay existing indebtedness and for general corporate purposes.ExelonNotes5.30%March 15, 2033850Repay existing indebtedness and for general corporate purposes.
ExelonExelon
Notes(b)
4.10%March 15, 2052700Repay existing indebtedness and for general corporate purposes.ExelonNotes5.60%March 15, 2053650Repay existing indebtedness and for general corporate purposes.
ComEdComEdFirst Mortgage Bonds, Series 1323.15%March 15, 2032300Repay outstanding commercial paper obligations and to fund other general corporate purposes.ComEdFirst Mortgage Bonds, Series 1344.90%February 1, 2033400Repay outstanding commercial paper obligations and to fund other general corporate purposes.
ComEdComEdFirst Mortgage Bonds, Series 1333.85%March 15, 2052450Repay outstanding commercial paper obligations and to fund other general corporate purposes.ComEdFirst Mortgage Bonds Series 1355.30%February 1, 2053575Repay outstanding commercial paper obligations and to fund other general corporate purposes.
PECOPECOFirst and Refunding Mortgage Bonds4.60%May 15, 2052350Refinance existing indebtedness and for general corporate purposes.PECOFirst and Refunding Mortgage Bonds4.90%June 15, 2033575Refinance existing indebtedness, refinance outstanding commercial paper obligations, and for general corporate purposes.
BGEBGENotes4.55%June 1, 2052500Repay outstanding commercial paper obligations, repay existing indebtedness, and for general corporate purposes.BGENotes5.40%June 1, 2053700Repay outstanding commercial paper obligations, repay existing indebtedness, and for general corporate purposes.
Pepco(a)
First Mortgage Bonds3.97%March 24, 2052400Repay existing indebtedness and for general corporate purposes.
PepcoPepcoFirst Mortgage Bonds5.30%March 15, 203385Repay existing indebtedness and for general corporate purposes.
PepcoPepcoFirst Mortgage Bonds5.40%March 15, 203840Repay existing indebtedness and for general corporate purposes.
PepcoPepcoFirst Mortgage Bonds5.57%March 15, 2053125Repay existing indebtedness and for general corporate purposes.
PepcoPepcoFirst Mortgage Bonds5.35%September 13, 2033100Repay existing indebtedness and for general corporate purposes.
DPL(a)
DPL(a)
First Mortgage Bonds5.30%March 15, 203360Repay existing indebtedness and for general corporate purposes.
DPLDPLFirst Mortgage Bonds3.06%February 15, 2052125Repay existing indebtedness and for general corporate purposes.DPLFirst Mortgage Bonds5.57%March 15, 205365Repay existing indebtedness and for general corporate purposes.
ACEACEFirst Mortgage Bonds2.27%February 15, 203225Repay existing indebtedness and for general corporate purposes.ACEFirst Mortgage Bonds5.57%March 15, 205375Repay 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, Pepco15, 2023, DPL entered into a purchase agreement of First Mortgage Bonds of $225$340 million, $75 million, and $110 million at 3.35%5.45%, 5.55% and 5.72% due on September 15, 2032.November 8, 2033, November 8, 2038, and November 8, 2053, respectively. The closing date of the issuance is expected to occur in September 2022.November 2023.
(b)In connection with the issuance and sale of the Notes, Exelon entered into a Registration Rights Agreement with the representatives of the initial purchasers of the Notes and other parties. Pursuant to the Registration Rights Agreement, Exelon will be obligated to file a registration statement with respect to an offer to exchange the Notes for substantially similar notes of Exelon that are registered under the Securities Act or, in certain circumstances, register the resale of the Notes. The registered exchange notes, if and when issued, will have terms identical in all material respects to the Notes, except that their issuance will have been registered under the Securities Act.
Long-Term Debt to Affiliates
As of December 31, 2021, Exelon Corporate had $319 million recorded to intercompany notes receivable from Generation. See Note 15 — Debt and Credit Agreements of the 2021 Recast 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 JuneSeptember 30, 2022,2023, the Registrants are in compliance with debt covenants.
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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.
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 17 — Fair Value of Financial Assets and Liabilities of the 2022 Form 10-K.
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 JuneSeptember 30, 20222023 and December 31, 2021.2022. The Registrants have no financial liabilities classified as Level 1.measured using the NAV practical expedient.
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.
June 30, 2022December 31, 2021September 30, 2023December 31, 2022
Carrying AmountFair ValueCarrying AmountFair ValueCarrying AmountFair ValueCarrying AmountFair Value
Level 2Level 3TotalLevel 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Long-Term Debt, including amounts due within one year(a)
Long-Term Debt, including amounts due within one year(a)
Long-Term Debt, including amounts due within one year(a)
ExelonExelon$36,294 $30,960 $2,315 $33,275 $32,902 $34,897 $2,217 $37,114 Exelon$41,085 $— $31,584 $2,675 $34,259 $37,074 $— $29,902 $2,327 $32,229 
ComEdComEd10,516 9,609 — 9,609 9,773 11,305 — 11,305 ComEd11,484 — 9,343 — 9,343 10,518 — 9,006 — 9,006 
PECOPECO4,192 3,772 50 3,822 4,197 4,740 50 4,790 PECO5,133 — 4,110 — 4,110 4,612 — 3,864 50 3,914 
BGEBGE4,456 4,096 — 4,096 3,961 4,406 — 4,406 BGE4,601 — 3,735 — 3,735 4,207 — 3,613 — 3,613 
PHIPHI8,027 4,853 2,265 7,118 7,547 5,970 2,167 8,137 PHI8,637 — 4,352 2,675 7,027 8,120 — 4,507 2,277 6,784 
PepcoPepco3,642 2,465 1,104 3,569 3,445 3,201 975 4,176 Pepco4,095 — 2,129 1,473 3,602 3,751 — 2,229 1,205 3,434 
DPLDPL1,938 1,210 503 1,713 1,810 1,426 552 1,978 DPL2,060 — 1,126 543 1,669 1,938 — 1,164 458 1,622 
ACEACE1,757 954 658 1,612 1,582 1,091 641 1,732 ACE1,833 — 893 659 1,552 1,757 — 909 614 1,523 
Long-Term Debt to Financing TrustsLong-Term Debt to Financing TrustsLong-Term Debt to Financing Trusts
ExelonExelon$390 $— $398 $398 $390 $— $470 $470 Exelon$390 $— $— $384 $384 $390 $— $— $384 $384 
ComEdComEd205 — 209 209 205 — 248 248 ComEd205 — — 206 206 205 — — 204 204 
PECOPECO184 — 189 189 184 — 222 222 PECO184 — — 179 179 184 — — 180 180 
__________
(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 15 -16 — Debt and Credit Agreements of the 2021 Recast2022 Form 10-K for unamortized debt issuance costs, unamortized debt discount and premium, net, and purchase accounting fair value adjustments and Note 10 - Leases of the 2021 Recast2022 Form 10-K for finance lease liabilities.

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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 Juneat September 30, 20222023 and December 31, 2021:2022. The Registrants have no financial assets or liabilities measured using the NAV practical expedient:
Exelon
As of June 30, 2022As of December 31, 2021At September 30, 2023At December 31, 2022
Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
AssetsAssetsAssets
Cash equivalents(a)
Cash equivalents(a)
$1,319 $— $— $1,319 $524 $— $— $524 
Cash equivalents(a)
$649 $— $— $649 $664 $— $— $664 
Rabbi trust investmentsRabbi trust investmentsRabbi trust investments
Cash equivalentsCash equivalents63 — — 63 60 — — 60 Cash equivalents66 — — 66 62 — — 62 
Mutual fundsMutual funds52 — — 52 60 — — 60 Mutual funds53 — — 53 49 — — 49 
Fixed incomeFixed income— — — 10 — 10 Fixed income— — — — 
Life insurance contractsLife insurance contracts— 59 38 97 — 61 37 98 Life insurance contracts— 60 42 102 — 58 40 98 
Rabbi trust investments subtotalRabbi trust investments subtotal115 67 38 220 120 71 37 228 Rabbi trust investments subtotal119 67 42 228 111 65 40 216 
Mark-to-market derivative assets— — 15 15 — — — — 
Interest rate derivative assetsInterest rate derivative assets
Derivatives designated as hedging instrumentsDerivatives designated as hedging instruments— 41 — 41 — — 
Economic hedgesEconomic hedges— — — — 
Interest rate derivative assets subtotalInterest rate derivative assets subtotal— 44 — 44 — 11 — 11 
Total assetsTotal assets1,434 67 53 1,554 644 71 37 752 Total assets768 111 42 921 775 76 40 891 
LiabilitiesLiabilitiesLiabilities
Mark-to-market derivative liabilities— — (103)(103)— — (219)(219)
Commodity derivative liabilitiesCommodity derivative liabilities— — (134)(134)— — (84)(84)
Interest rate derivative liabilitiesInterest rate derivative liabilities
Derivatives designated as hedging instrumentsDerivatives designated as hedging instruments— — — — — (4)— (4)
Economic hedgesEconomic hedges— (23)— (23)— (3)— (3)
Interest rate derivative liabilities subtotalInterest rate derivative liabilities subtotal— (23)— (23)— (7)— (7)
Deferred compensation obligationDeferred compensation obligation— (73)— (73)— (131)— (131)Deferred compensation obligation— (69)— (69)— (75)— (75)
Total liabilitiesTotal liabilities— (73)(103)(176)— (131)(219)(350)Total liabilities— (92)(134)(226)— (82)(84)(166)
Total net assets (liabilities)Total net assets (liabilities)$1,434 $(6)$(50)$1,378 $644 $(60)$(182)$402 Total net assets (liabilities)$768 $19 $(92)$695 $775 $(6)$(44)$725 
__________    
(a)Exelon excludes cash of $177$188 million and $464$345 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively, and restricted cash of $340$110 million and $49$81 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively, and includes long-term restricted cash of $59$212 million and $44$117 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively, which is reported in Other deferred debits and other assets in the Consolidated Balance Sheets.

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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
ComEdPECOBGEComEdPECOBGE
As of June 30, 2022Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
At September 30, 2023At September 30, 2023Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
AssetsAssetsAssets
Cash equivalents(a)
Cash equivalents(a)
$409 $— $— $409 $11 $— $— $11 $318 $— $— $318 
Cash equivalents(a)
$491 $— $— $491 $29 $— $— $29 $$— $— $
Rabbi trust investmentsRabbi trust investmentsRabbi trust investments
Mutual fundsMutual funds— — — — — — — — Mutual funds— — — — — — — — 
Life insurance contractsLife insurance contracts— — — — — 16 — 16 — — — — Life insurance contracts— — — — — 17 — 17 — — — — 
Rabbi trust investments subtotalRabbi trust investments subtotal— — — — 16 — 25 — — Rabbi trust investments subtotal— — — — 17 — 26 — — 
Mark-to-market derivative assets(b)
— — 15 15 — — — — — — — — 
Total assetsTotal assets409 — 15 424 20 16 — 36 325 — — 325 Total assets491 — — 491 38 17 — 55 11 — — 11 
LiabilitiesLiabilitiesLiabilities
Mark-to-market derivative liabilities(b)
— — (103)(103)— — — — — — — — 
Commodity derivative liabilities(b)
Commodity derivative liabilities(b)
— — (134)(134)— — — — — — — — 
Deferred compensation obligationDeferred compensation obligation— (8)— (8)— (7)— (7)— (4)— (4)Deferred compensation obligation— (7)— (7)— (8)— (8)— (4)— (4)
Total liabilitiesTotal liabilities— (8)(103)(111)— (7)— (7)— (4)— (4)Total liabilities— (7)(134)(141)— (8)— (8)— (4)— (4)
Total net assets (liabilities)Total net assets (liabilities)$409 $(8)$(88)$313 $20 $$— $29 $325 $(4)$— $321 Total net assets (liabilities)$491 $(7)$(134)$350 $38 $$— $47 $11 $(4)$— $
ComEdPECOBGEComEdPECOBGE
As of December 31, 2021Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
At December 31, 2022At December 31, 2022Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
AssetsAssetsAssets
Cash equivalents(a)
Cash equivalents(a)
$237 $— $— $237 $$— $— $$— $— $— $— 
Cash equivalents(a)
$392 $— $— $392 $10 $— $— $10 $23 $— $— $23 
Rabbi trust investmentsRabbi trust investmentsRabbi trust investments
Mutual fundsMutual funds— — — — 11 — — 11 14 — — 14 Mutual funds— — — — — — — — 
Life insurance contractsLife insurance contracts— — — — — 16 — 16 — — — — Life insurance contracts— — — — — 15 — 15 — — — — 
Rabbi trust investments subtotalRabbi trust investments subtotal— — — — 11 16 — 27 14 — — 14 Rabbi trust investments subtotal— — — — 15 — 22 — — 
Total assetsTotal assets237 — — 237 20 16 — 36 14 — — 14 Total assets392 — — 392 17 15 — 32 30 — — 30 
LiabilitiesLiabilitiesLiabilities
Mark-to-market derivative liabilities(b)
— — (219)(219)— — — — — — — — 
Commodity derivative liabilities(b)
Commodity derivative liabilities(b)
— — (84)(84)— — — — — — — — 
Deferred compensation obligationDeferred compensation obligation— (10)— (10)— (9)— (9)— (7)— (7)Deferred compensation obligation— (8)— (8)— (7)— (7)— (4)— (4)
Total liabilitiesTotal liabilities— (10)(219)(229)— (9)— (9)— (7)— (7)Total liabilities— (8)(84)(92)— (7)— (7)— (4)— (4)
Total net assets (liabilities)Total net assets (liabilities)$237 $(10)$(219)$$20 $$— $27 $14 $(7)$— $Total net assets (liabilities)$392 $(8)$(84)$300 $17 $$— $25 $30 $(4)$— $26 
__________
(a)ComEd excludes cash of $21$55 million and $105$42 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively, and restricted cash of $133$105 million and $42$77 million as of Juneat September 30, 20222023 and December 31, 2021, respectively, and2022, respectively. Additionally, ComEd includes long-term restricted cash of $59$212 million and $43$117 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively, which is reported in Other deferred debits and other assets in the Consolidated Balance Sheets. PECO excludes cash of $21$23 million and $35$58 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively. BGE excludes cash of $36$13 million and $51$43 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively, and restricted cash of $205$1 million and $4$1 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively.
(b)The Level 3 balance consists of the current asset of $15 million and current and noncurrent liability of none$21 million and $103$113 million, respectively, as of Juneat September 30, 20222023 and none, $18$5 million and $201$79 million, respectively, as ofat December 31, 20212022 related to floating-to-fixed energy swap contracts with unaffiliated suppliers.

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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 June 30, 2022As of December 31, 2021At September 30, 2023At December 31, 2022
PHIPHILevel 1Level 2Level 3TotalLevel 1Level 2Level 3TotalPHILevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
AssetsAssetsAssets
Cash equivalents(a)
Cash equivalents(a)
$557 $— $— $557 $110 $— $— $110 
Cash equivalents(a)
$83 $— $— $83 $205 $— $— $205 
Rabbi trust investmentsRabbi trust investmentsRabbi trust investments
Cash equivalentsCash equivalents60 — — 60 59 — — 59 Cash equivalents63 — — 63 59 — — 59 
Mutual fundsMutual funds11 — — 11 14 — — 14 Mutual funds10 — — 10 11 — — 11 
Fixed incomeFixed income— — — 10 — 10 Fixed income— — — — 
Life insurance contractsLife insurance contracts— 22 37 59 — 27 35 62 Life insurance contracts— 21 40 61 — 22 39 61 
Rabbi trust investments subtotalRabbi trust investments subtotal71 30��37 138 73 37 35 145 Rabbi trust investments subtotal73 28 40 141 70 29 39 138 
Total assetsTotal assets628 30 37 695 183 37 35 255 Total assets156 28 40 224 275 29 39 343 
LiabilitiesLiabilitiesLiabilities
Deferred compensation obligationDeferred compensation obligation— (14)— (14)— (18)— (18)Deferred compensation obligation— (13)— (13)— (14)— (14)
Total liabilitiesTotal liabilities— (14)— (14)— (18)— (18)Total liabilities— (13)— (13)— (14)— (14)
Total net assetsTotal net assets$628 $16 $37 $681 $183 $19 $35 $237 Total net assets$156 $15 $40 $211 $275 $15 $39 $329 
PepcoDPLACEPepcoDPLACE
As of June 30, 2022Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
At September 30, 2023At September 30, 2023Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
AssetsAssetsAssets
Cash equivalents(a)
Cash equivalents(a)
$115 $— $— $115 $223 $— $— $223 $218 $— $— $218 
Cash equivalents(a)
$22 $— $— $22 $$— $— $$$— $— $
Rabbi trust investmentsRabbi trust investmentsRabbi trust investments
Cash equivalentsCash equivalents59 — — 59 — — — — — — — — Cash equivalents62 — — 62 — — — — — — — — 
Life insurance contractsLife insurance contracts— 22 37 59 — — — — — — — — Life insurance contracts— 21 40 61 — — — — — — — — 
Rabbi trust investments subtotalRabbi trust investments subtotal59 22 37 118 — — — — — — — — Rabbi trust investments subtotal62 21 40 123 — — — — — — — — 
Total assetsTotal assets174 22 37 233 223 — — 223 218 — — 218 Total assets84 21 40 145 — — — — 
LiabilitiesLiabilitiesLiabilities
Deferred compensation obligationDeferred compensation obligation— (1)— (1)— — — — — — — — Deferred compensation obligation— (1)— (1)— — — — — — — — 
Total liabilitiesTotal liabilities— (1)— (1)— — — — — — — — Total liabilities— (1)— (1)— — — — — — — — 
Total net assetsTotal net assets$174 $21 $37 $232 $223 $— $— $223 $218 $— $— $218 Total net assets$84 $20 $40 $144 $$— $— $$$— $— $
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(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
PepcoDPLACEPepcoDPLACE
As of December 31, 2021Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
At December 31, 2022At December 31, 2022Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
AssetsAssetsAssets
Cash equivalents(a)
Cash equivalents(a)
$31 $— $— $31 $43 $— $— $43 $— $— $— $— 
Cash equivalents(a)
$51 $— $— $51 $121 $— $— $121 $$— $— $
Rabbi trust investmentsRabbi trust investmentsRabbi trust investments
Cash equivalentsCash equivalents58 — — 58 — — — — — — — — Cash equivalents59 — — 59 — — — — — — — — 
Life insurance contractsLife insurance contracts— 27 35 62 — — — — — — — — Life insurance contracts— 22 38 60 — — — — — — — — 
Rabbi trust investments subtotalRabbi trust investments subtotal58 27 35 120 — — — — — — — — Rabbi trust investments subtotal59 22 38 119 — — — — — — — — 
Total assetsTotal assets89 27 35 151 43 — — 43 — — — — Total assets110 22 38 170 121 — — 121 — — 
LiabilitiesLiabilitiesLiabilities
Deferred compensation obligationDeferred compensation obligation— (2)— (2)— — — — — — — — Deferred compensation obligation— (1)— (1)— — — — — — — — 
Total liabilitiesTotal liabilities— (2)— (2)— — — — — — — — Total liabilities— (1)— (1)— — — — — — — — 
Total net assetsTotal net assets$89 $25 $35 $149 $43 $— $— $43 $— $— $— $— Total net assets$110 $21 $38 $169 $121 $— $— $121 $$— $— $
__________
(a)PHI excludes cash of $60 million and $100$165 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively, and restricted cash of $2$3 million and $3 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively. Pepco excludes cash of $14$31 million and $34$45 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively, and restricted cash of $2$3 million and $3 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively. DPL excludes cash of $26$5 million and $28$31 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively. ACE excludes cash of $15$13 million and $29$71 million as of Juneat September 30, 20222023 and December 31, 2021,2022, respectively.

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(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 and sixnine months ended JuneSeptember 30, 20222023 and 2021:
ExelonComEdPHI and Pepco
Three Months Ended June 30, 2022TotalMark-to-Market
Derivatives
Life Insurance Contracts
Balance as of April 1, 2022$(107)$(144)$36 
Total realized / unrealized gains
Included in net income(a)
— 
Included in regulatory assets/liabilities56 56 (b)— 
Balance at June 30, 2022$(50)$(88)(c)$37 
The amount of total gains included in income attributed to the change in unrealized gains related to assets and liabilities as of June 30, 2022$$— $
2022:
ExelonComEdPHI and Pepco
Three Months Ended September 30, 2023TotalCommodity
Derivatives
Life Insurance Contracts
Balance at June 30, 2023$(91)$(133)$42 
Total realized / unrealized gains (losses)
Included in net income(a)
— — (2)
Included in regulatory assets/liabilities(1)(1)(b)— 
Balance at September 30, 2023$(92)$(134)(c)$40 
The amount of total gains included in income attributed to the change in unrealized gains related to assets and liabilities at September 30, 2023$— $— $(2)
ExelonComEdPHI and Pepco
Three Months Ended September 30, 2022TotalCommodity
Derivatives
Life Insurance Contracts
Balance at June 30, 2022$(50)$(88)$37 
Total realized / unrealized gains (losses)
Included in net income(a)
— 
Included in regulatory assets/liabilities45 45 (b)— 
Balance at September 30, 2022$(4)$(43)(c)$38 
The amount of total gains included in income attributed to the change in unrealized gains related to assets and liabilities at September 30, 2022$$— $
90
ExelonComEdPHI and Pepco
Nine Months Ended September 30, 2023TotalCommodity
Derivatives
Life Insurance Contracts
Balance at December 31, 2022$(44)$(84)$40 
Total realized / unrealized gains (losses)
Included in net income(a)
— — 
Included in regulatory assets/liabilities(50)(50)(b)— 
Balance at September 30, 2023$(92)$(134)(c)$40 
The amount of total gains included in income attributed to the change in unrealized gains related to assets and liabilities at September 30, 2023$$— $— 

ExelonComEdPHI and Pepco
Nine Months Ended September 30, 2022TotalCommodity
Derivatives
Life Insurance Contracts
Balance at December 31, 2021$(182)$(219)$35 
Total realized / unrealized gains (losses)
Included in net income(a)
— 
Included in regulatory assets/liabilities176 176 (b)— 
Transfers out of Level 3(1)— — 
Balance at September 30, 2022$(4)$(43)(c)$38 
The amount of total gains included in income attributed to the change in unrealized gain related to assets and liabilities at September 30, 2022$$— $
__________
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(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
ExelonComEdPHI and Pepco
Three Months Ended June 30, 2021TotalMark-to-Market
Derivatives
Life Insurance Contracts
Balance as of April 1, 2021$(260)$(295)$35 
Total realized / unrealized gains
Included in net income(a)
— 
Included in regulatory assets30 30 (b)— 
Purchases, sales, and settlements
Settlements(2)— (2)
Balance as of June 30, 2021$(231)$(265)$34 
The amount of total gains included in income attributed to the change in unrealized gains related to assets and liabilities as of June 30, 2021$$— $
ExelonComEdPHI and Pepco
Six months ended June 30, 2022TotalMark-to-Market
Derivatives
Life Insurance Contracts
Balance as of January 1, 2022$(182)$(219)$35 
Total realized / unrealized gains
Included in net income(a)
— 
Included in regulatory assets/liabilities131 131 (b)— 
Transfers out of Level 3(1)— — 
Balance as of June 30, 2022$(50)$(88)(c)$37 
The amount of total gains included in income attributed to the change in unrealized gains related to assets and liabilities as of June 30, 2022$$— $

ExelonComEdPHI and Pepco
Six Months Ended June 30, 2021TotalMark-to-Market
Derivatives
Life Insurance Contracts
Balance as of January 1, 2021$(267)$(301)$34 
Total realized / unrealized gains
Included in net income(a)
— 
Included in regulatory assets36 36 (b)— 
Purchases, sales, and settlements
Settlements(2)— (2)
Balance as of June 30, 2021$(231)$(265)$34 
The amount of total gains included in income attributed to the change in unrealized gain related to assets and liabilities as of June 30, 2021$$— $
__________
(a)Classified in Operating and maintenance expense in the Consolidated Statements of Operations and Comprehensive Income.
(b)Includes $59$5 million of decreases in fair value and an increase for realized gains due to settlements of $4 million recorded in Purchased power expense associated with floating-to-fixed energy swap contracts with unaffiliated suppliers for the three months ended September 30, 2023. Includes $51 million of increases in fair value and a decrease for realized gains due to settlements of $3$6 million recorded in purchasedPurchased power expense associated with floating-to-fixed energy swap contracts with unaffiliated suppliers for the three months ended JuneSeptember 30, 2022. Includes $25$73 million of increasesdecreases in fair value and an increase for realized lossesgains due to settlements of $5$23 million recorded in purchasedPurchased power expense associated with floating-to-fixed energy swap contracts with unaffiliated suppliers for the threenine months ended JuneSeptember 30, 2021.2023. Includes $128$179 million of increases in fair value and an increasea decrease for realized losses due to settlements of $3 million recorded in purchasePurchased power expense associated with floating-to-fixed energy swap contracts with unaffiliated suppliers for the sixnine months ended JuneSeptember 30, 2022. Includes $23 million of increases in fair value and an increase for realized losses due to settlements of $13 million recorded in purchased power expense associated with floating-to-fixed energy swap contracts with unaffiliated suppliers for the six months ended June 30, 2021.
(c)The balance consists of $15a current and noncurrent liability of $21 million and $113 million, respectively, at September 30, 2023. The balance consists of $24 million of current assets and current and noncurrent liability of none and $103$67 million, respectively as of Juneat September 30, 2022.

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(Dollars in millions, except per share data, unless otherwise noted)

Note 11 — Fair Value of Financial Assets and Liabilities
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 16 — Fair Value of Financial Assets and Liabilities of the 2021 Recast Form 10-K.
Mark-to-MarketCommodity Derivatives (Exelon and ComEd)
The table below discloses the significant unobservable inputs to the forward curve used to value mark-to-market derivatives.
Type of tradeType of tradeFair Value as of June 30, 2022Fair Value as of December 31, 2021Valuation
Technique
Unobservable
Input
2022 Range & Arithmetic Average2021 Range & Arithmetic AverageType of tradeFair Value at September 30, 2023Fair Value at December 31, 2022Valuation
Technique
Unobservable
Input
2023 Range & Arithmetic Average2022 Range & Arithmetic Average
Mark-to-market derivatives$(88)$(219)Discounted
Cash Flow
Forward power price(a)
$30.54-$89.78$46.33$28.65-$47.10$33.96
Commodity derivativesCommodity derivatives$(134)$(84)Discounted
Cash Flow
Forward power price(a)
$30.13-$72.72$42.77$34.78-$75.71$48.44
________
(a)An increase to the forward power price would increase the fair value.

12. Commitments and Contingencies (All Registrants)
The following is an update to the current status of commitments and contingencies set forth in Note 1718 — Commitments and Contingencies of the 2021 Recast2022 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 Juneat September 30, 2022:2023:
DescriptionDescriptionExelonPHIPepcoDPLACEDescriptionExelonPHIPepcoDPLACE
Total commitmentsTotal commitments$513 $320 $120 $89 $111 Total commitments$513 $320 $120 $89 $111 
Remaining commitments(a)
Remaining commitments(a)
61 53 44 
Remaining commitments(a)
42 39 34 
__________
(a)Remaining commitments extend through 2026 and include escrow funds, charitable contributions, and rate credits, energy efficiency programs and delivery system modernization.credits.
In addition, 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 is under way and bids will be evaluated in the third quarter of 2022, with a potential award in the fourth quarter of 2022.

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Note 12 — Commitments and Contingencies
Commercial Commitments (All Registrants). The Registrants’ commercial commitments as of Juneat September 30, 2022,2023, representing commitments potentially triggered by future events were as follows:
Expiration withinExpiration within
Total202220232024202520262027 and beyondTotal202320242025202620272028 and beyond
ExelonExelonExelon
Letters of creditLetters of credit$17 $$$— $— $— $— Letters of credit$20 $$11 $— $— $— $— 
Surety bonds(a)
Surety bonds(a)
185 144 39 — — — 
Surety bonds(a)
207 85 122 — — — — 
Financing trust guaranteesFinancing trust guarantees378 — — — — — 378 Financing trust guarantees378 — — — — — 378 
Guaranteed lease residual values(b)
Guaranteed lease residual values(b)
30 — 11 
Guaranteed lease residual values(b)
29 — 10 
Total commercial commitmentsTotal commercial commitments$610 $152 $50 $$$$389 Total commercial commitments$634 $94 $137 $$$$388 
ComEdComEdComEd
Letters of creditLetters of credit$10 $$$— $— $— $— Letters of credit$12 $$$— $— $— $— 
Surety bonds(a)
Surety bonds(a)
16 — — — 
Surety bonds(a)
46 41 — — — — 
Financing trust guaranteesFinancing trust guarantees200 — — — — — 200 Financing trust guarantees200 — — — — — 200 
Total commercial commitmentsTotal commercial commitments$226 $13 $11 $$— $— $200 Total commercial commitments$258 $11 $47 $— $— $— $200 
PECOPECOPECO
Letters of creditLetters of credit$$— $$— $— $— $— Letters of credit$$— $$— $— $— $— 
Surety bonds(a)
Surety bonds(a)
— — — — 
Surety bonds(a)
— — — — — 
Financing trust guaranteesFinancing trust guarantees178 — — — — — 178 Financing trust guarantees178 — — — — — 178 
Total commercial commitmentsTotal commercial commitments$182 $$$— $— $— $178 Total commercial commitments$181 $— $$— $— $— $178 
BGEBGEBGE
Letters of creditLetters of credit$$$— $— $— $— $— Letters of credit$$$$— $— $— $— 
Surety bonds(a)
Surety bonds(a)
— — — — 
Surety bonds(a)
— — — — 
Total commercial commitmentsTotal commercial commitments$$$$— $— $— $— Total commercial commitments$$$$— $— $— $— 
PHIPHIPHI
Surety bonds(a)
Surety bonds(a)
$95 $76 $19 $— $— $— $— 
Surety bonds(a)
$97 $75 $22 $— $— $— $— 
Guaranteed lease residual values(b)
Guaranteed lease residual values(b)
30 — 11 
Guaranteed lease residual values(b)
29 — 10 
Total commercial commitmentsTotal commercial commitments$125 $76 $21 $$$$11 Total commercial commitments$126 $75 $26 $$$$10 
PepcoPepcoPepco
Surety bonds(a)
Surety bonds(a)
$84 $71 $13 $— $— $— $— 
Surety bonds(a)
$85 $71 $14 $— $— $— $— 
Guaranteed lease residual values(b)
Guaranteed lease residual values(b)
10 — 
Guaranteed lease residual values(b)
10 — 
Total commercial commitmentsTotal commercial commitments$94 $71 $14 $$$$Total commercial commitments$95 $71 $15 $$$$
DPLDPLDPL
Surety bonds(a)
Surety bonds(a)
$$$$— $— $— $— 
Surety bonds(a)
$$$$— $— $— $— 
Guaranteed lease residual values(b)
Guaranteed lease residual values(b)
13 — — 
Guaranteed lease residual values(b)
12 — 
Total commercial commitmentsTotal commercial commitments$20 $$$$$$Total commercial commitments$19 $$$$$$
ACEACEACE
Surety bonds(a)
Surety bonds(a)
$$$$— $— $— $— 
Surety bonds(a)
$$$$— $— $— $— 
Guaranteed lease residual values(b)
Guaranteed lease residual values(b)
— 
Guaranteed lease residual values(b)
— 
Total commercial commitmentsTotal commercial commitments$11 $$$$$$Total commercial commitments$12 $$$$$$
__________
(a)Surety bonds — Guarantees issued related to contract and commercial agreements, excluding bid bonds.
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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 89 years. The maximum potential obligation at the end of the minimum lease term would be $74$66 million guaranteed by Exelon and PHI, of which $24$22 million, $31$26 million, and $19$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 thesesome sites, there are additional PRPs that may share responsibility for the ultimate remediation of each location.
ComEd has 2119 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 2023.2025.
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 2023.2025.
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.
During the third quarter of 2023, ComEd and PECO completed an annual study of their future estimated MGP remediation requirements. The study resulted in a $25 million increase to the environmental liability and related regulatory asset for ComEd. The increase was primarily due to increased costs resulting from inflation and changes in remediation plans. The study did not result in a material change to the environmental liability for PECO.
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(Dollars in millions, except per share data, unless otherwise noted)

Note 12 — Commitments and Contingencies
As of JuneAt September 30, 20222023 and December 31, 2021,2022, the Registrants had accrued the following undiscounted amounts for environmental liabilities in Accrued expenses, Other current liabilities, and Other deferred credits and other liabilities in their respective Consolidated Balance Sheets:
June 30, 2022December 31, 2021September 30, 2023December 31, 2022
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
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
ExelonExelon$347 $299 $352 $303 Exelon$434 $345 $409 $355 
ComEdComEd274 273 279 279 ComEd312 311 325 324 
PECOPECO21 20 22 20 PECO28 26 25 23 
BGEBGEBGE
PHIPHI42 — 42 — PHI82 — 46 — 
PepcoPepco40 — 40 — Pepco80 — 44 — 
DPLDPL— — DPL— — 
ACEACE— — ACE— — 
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 (PES), 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 developingcompleting a FS to evaluate possible remedial alternatives for submission to DOEE. The Court has established aIn October 2022, DOEE approved dividing the work to complete the landside portion of the FS from the waterside portion to expedite the overall schedule for completion of the project. It is currently anticipated that the landside FS will be complete and approvalapproved by DOEE by the end of the first quarter of 2024 and the waterside FS will be complete and approved by DOEE by September 16, 2022. Afterthe end of the fourth quarter of 2024. Following the completion and approval of theeach FS, DOEE will prepareissue a Proposed Plan for public comment and then issue a Record of Decision (ROD) identifying any further responsethe remedial actions determined to be necessary. necessary for the area in question. On October 3, 2023, DOEE and Pepco entered into an addendum to the Benning Consent Decree pursuant to which Pepco has agreed to fund or perform the remedial actions to be selected by DOEE for the landslide and water areas. This addendum to the Benning Consent Decree has been lodged with the court.Following a 30-day public comment period, DOEE will request that the court approve this addendum to the Consent Decree, which will become effective upon the court’s approval.
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)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
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Note 12 — Commitments and Contingencies
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.
On September 30, 2020, DOEE released its Interim ROD.ROD for the Anacostia River sediments. The Interim ROD reflects an adaptive management 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
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Note 12 — Commitments and Contingencies
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.
On July 15, 2022, Pepco received a letter from the District of Columbia's Office of the Attorney General (District)(D.C. OAG) on behalf of DOEE conveying a settlement offer to resolve all PRPs' liability to the District.District of Columbia (District) for their past costs and their anticipated future costs to complete the work for the Interim ROD. Pepco responded on July 27, 2022 to enter into settlement discussions. On October 3, 2023, Pepco and the District entered into another consent decree (the “Anacostia River Consent Decree”) pursuant to which Pepco agreed to pay $47 million to resolve its liability to the District for all past costs to perform the river-wide RI/FS and all future costs to complete the work required by the Interim ROD. This amount will be paid in four equal annual installments beginning a year after the effective date of the Anacostia River Consent Decree. The funds will be deposited into the DOEE’s Clean Land Fund for the District’s costs of the Interim ROD work. The Anacostia River Consent Decree caps Pepco’s liability for these costs and provides Pepco with the right to seek contribution from other potentially responsible parties. The Anacostia River Consent Decree has been filed with the U.S. District Court for the District of Columbia. Following a 30-day public comment period, the District will ask the court to approve the Anacostia River Consent Decree, which will become effective upon the court’s approval. Exelon, PHI, and Pepco have determined that it is probable that costs for remediation will be incurred and have accrued a liability for Pepco’s payment obligations under the Anacostia Consent Decree and management's best estimate of its share of theany other future Anacostia River response costs. Pepco has 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.
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)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 assessmentNRD 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.
Buzzard Point Site (Exelon, PHI, and Pepco). On December 8, 2022, Pepco received a letter from the D.C. OAG, alleging wholly past violations of the District's stormwater discharge and waste disposal requirements related to operations at the Buzzard Point facility, a 9-acre parcel of waterfront property in Washington, D.C. occupied by an active substation and former steam plant building. The letter also alleged wholly past violations by Pepco of stormwater discharge requirements related to its district-wide system of underground vaults. On October 3, 2023, Pepco entered into a Consent Order with the District of Columbia to resolve the alleged violations without any admission of liability. The Consent Order requires Pepco to pay a civil penalty of $10 million. In addition, Pepco has agreed to assess the environmental conditions at its Buzzard Point facility and conduct any remedial actions deemed necessary as a result of the assessment, and also to assess potential environmental impacts associated with the operation of its underground vaults. The Consent Order has been filed with the District of Columbia Superior Court. Following a 30-day public comment period regarding the environmental assessment work required by the Consent Order, the District will ask the court to approve the Consent Order, which will be become effective upon the court’s approval. Exelon, PHI, and Pepco have accrued
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a liability for the penalty payments and for the projected costs for the required environmental assessments and remediation. Pepco has concluded that incremental exposure is reasonably possible, but the range of loss cannot be reasonably estimated beyond the amounts included in the table above.
Litigation and Regulatory Matters
Deferred Prosecution Agreement (DPA)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 DPADeferred Prosecution Agreement (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 former 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 providesprovided that the USAO willwould 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 a 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’sthree-year term of the DPA ended on July 17, 2023, and on that same date the court granted the USAO’s motion to dismiss the pending charge against ComEd that had been deferred by the DPA.
On September 28, 2023, Exelon and ComEd reached a settlement with the SEC, concluding and resolving in its entirety the SEC investigation, remains ongoingwhich related to the conduct identified in the DPA that was entered into by ComEd in July 2020 and successfully exited in July 2023. Under the terms of the settlement, Exelon has agreed to pay a civil penalty of $46.2 million and Exelon and ComEd have cooperated fullyagreed to cease and intend to continue to cooperate fully with the SEC. Exelondesist from committing or causing any violations and ComEd cannot predict the outcomeany future violations of specified provisions of the SEC investigation. No loss contingency has beenfederal securities laws and rules promulgated thereunder. Exelon recorded an accrual for the full amount of the penalty in the second quarter of 2023, which was reflected in Operating and maintenance expense within Exelon's Consolidated Statements of Operations and ComEd's consolidated financial statements with respect toComprehensive Income and in Accrued expenses on the SEC investigation, as this contingency is neither probable nor reasonably estimable at this time.Consolidated Balance Sheets. Exelon paid the civil penalty in full on October 4, 2023.
Subsequent to Exelon announcing the receipt of the USAO 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 on October 22, 2020 which was granted on December 23, 2020. On December 2, 2020, the court
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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 inOn August 22, 2022, the Seventh Circuit was filed on January 14, 2022. Exelonaffirmed the dismissal of the consolidated federal cases in their entirety. The time to further appeal has passed and ComEd filed their response brief on March 7, 2022, and plaintiffs filed their reply brief on April 6, 2022. Oral argument was held on May 17, 2022.the Seventh Circuit’s decision is final.
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
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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'On September 8, 2023, the Illinois Appellate Court affirmed the dismissal. Plaintiffs may ask the Illinois Supreme Court to grant them leave to further appeal, but such appeal is not allowed as a matter of right.
On November 3, 2022, a plaintiff filed a putative class action complaint in Lake County, Illinois Circuit Court against ComEd and Exelon for unjust enrichment and deceptive business practices in connection with the conduct giving rise to the DPA. Plaintiff seeks an accounting and disgorgement of any benefits ComEd allegedly obtained from said conduct. Plaintiff served initial discovery requests on ComEd in December 2022, to which ComEd has responded. ComEd and Exelon filed a motion to dismiss the Complaint on February 3, 2023. On June 16, 2023, the court granted Exelon and ComEd's motion to dismiss the action with prejudice. Plaintiff filed its notice of appeal of that dismissal on July 17, 2023. Plaintiff's opening appellate briefs are currently due August 5, 2022.brief was filed on October 19, 2023.
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. That2021, and 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. The court further amended the protective order on October 17, 2022 and extended it until May 15, 2023. Following mediation, the parties reached a settlement of the lawsuit, under which defendants agreed to pay plaintiffs $173 million. On February 10, 2022,May 26, 2023, plaintiffs filed a motion for preliminary approval of the settlement, which the court granted an extension of the amendment to the protective order, at the U.S. government's request.on June 9, 2023. The court granted a further extension of the amendment to the protective orderfinal settlement approval on September 7, 2023. The settlement was fully covered by insurance and narrowed its scope, at the U.S. government's request, on May 14, 2022. On July 14, 2022, the court further extended the protective order amendment to September 30, 2022 and reset the next court status for August 15, 2022.
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full.
Note 12 — Commitments and Contingencies
Several shareholders have sent letters to the Exelon Board of Directors fromsince 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. The stay has been extended several times. The parties participated in a mediation in February 2023, but the matter did not resolve at that time. On February 3,April 26 and May 1, 2023, two additional demand letter shareholders each filed a separate derivative lawsuit against current and former Exelon and ComEd officers and directors, and certain third parties, and against Exelon as nominal defendant, asserting claims similar to those made in their respective demand letters. On May 25, 2023, certain demand letter shareholders (Settling
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Shareholders) filed a separate derivative lawsuit against current and former Exelon and ComEd officers and directors, and against Exelon as nominal defendant, asserting claims similar to those made in their respective demand letters. The then pending derivative lawsuits were subsequently consolidated. On May 26, 2023, prior to lawsuit consolidation, the SLC filed a Notice of Determination and Intent to Seek Court Approval of Settlement (Notice of Determination). The Notice of Determination stated that, through mediation efforts, a settlement of the derivative claims had been approved by the SLC, the Independent Review Committee of the Board (which had been formed in the third quarter of 2022, to ensure the Board’s consideration of any SLC recommendations would be independent and objective), the Board, and the Settling Shareholders (the Settling Parties). The Notice of Determination further specified the process by which the Settling Parties would seek court approval of the proposed settlement and resolution and dismissal of all derivative claims and lawsuits, including any lawsuits or actions brought by demand letter shareholders who are not participating in the proposed settlement. In furtherance of the proposed settlement, on June 16, 2023, the SLC filed a motion for preliminary approval of the settlement, attaching the Stipulation and Agreement of Settlement (Stipulation), which contains the terms of the proposed settlement. The proposed settlement terms include but are not limited to: a payment of $40 million to Exelon by Exelon’s insurers of which $10 million constitutes the attorneys’ fee award to be paid to the Settling Shareholders’ counsel; various compliance and disclosure-related reforms; and certain changes in Board and Committee composition. On June 13, 2023, the non-settling derivative shareholders filed a motion asking the court granted an extension of the stay for another 120 days and directed the parties to fileset a status report on June 1, 2022.conference to discuss lifting the discovery stay. On June 1, 2022,29, 2023, an additional shareholder filed a separate derivative lawsuit against current and former Exelon and ComEd officers and directors, and against Exelon as nominal defendant, asserting claims similar to those made in its demand letter. On June 30, 2023, the parties requested a further extension ofnon-settling shareholders’ motion for status and the stay until September 14, 2022,SLC’s motion for preliminary approval was heard by the court, during which the court granted.set a briefing schedule on the appropriate standard for evaluating the settlement and the proper scope of requested discovery. Following briefing and a hearing, the court allowed the non-settling shareholders to seek certain, limited discovery, which the SLC, Independent Review Committee, and Exelon responded to on October 5. On October 11, 2023, an additional non-settling shareholder filed a separate derivative lawsuit against current and former Exelon and ComEd officers and directors, and against Exelon as a nominal defendant, asserting claims similar to those made in its demand letter. Plaintiff has informed Exelon that he will move to consolidate this matter with the other pending derivative matters. The SLC filed its renewed motion for preliminary approval on October 26, with supporting submissions filed by the Independent Review Committee, Exelon, and the settling shareholders on that same day. The non-settling plaintiffs have until November 29 to file their response to the renewed motion for preliminary approval, and the SLC has until December 21 to file its reply.
Two separate shareholderSeveral shareholders have sent requests seeking review of certain Exelon books and records were received insince August 2021 and January 2022.2021. Exelon has responded to both requests and both shareholders have since sent formal shareholder demands toeach request.
In August 2022, 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 anconcluded its investigation initiated on August 12, 2021 into rate impacts of conduct admitted in the DPA, initiated on August 12, 2021. On December 16, 2021, ComEd filed direct testimony addressingincluding the costs recovered from customers related to the DPA and Exelon's funding of the fine paid by ComEd. InOn August 17, 2022, the ICC issued its final order accepting ComEd's voluntary customer refund offer of approximately $38 million (of which about $31 million is ICC jurisdictional; the remaining balance is FERC jurisdictional) that testimony, ComEd proposed to voluntarilyresolves the question of whether customer funds were used for DPA related activities. The customer refund to customers compensation costsincludes the cost 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 specificallyevery individual or entity that was either (i) identified in the DPA as well as individuals and entities who were referred toor (ii) identified by ComEd as partan associate of the conduct describedformer Speaker of the Illinois House of Representatives in the ICC proceeding. The ICC’s DPA and who failed,investigation is now closed. The ICC jurisdictional refund was made to customers during their tenure at ComEd, to perform work to management expectations.the April 2023 billing cycle, as required by the ICC. The testimony supports the calculationFERC jurisdictional refund was included in ComEd's transmission formula rate update proceeding, filed on May 12, 2023. The filed transmission rate, inclusive 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, including ICC and FERC jurisdictional amounts and estimated interest, to resolveDPA refund, will appear on ComEd retail customers' bills for the issue of the potential expenditure of customer monies on activities identifiedJune 2023 through May 2024 monthly billing periods, in the DPA in this matter. An accrual for the amount of the voluntary customer refund has been recorded in Other current liabilities and Other deferred credits and other liabilities in Exelon’s and ComEd’s Consolidated Balance Sheetsline designated as of June 30, 2022."Transmission Services Charge." 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 onAn accrual for the remaining contested issue was held on April 28, 2022. On June 13, 2022,amount of the ICC Administrate Law Judge issued a proposed order, which accepts ComEd's voluntary customer refund has been recorded in Regulatory assets in Exelon’s and ComEd’s Consolidated Balance Sheets as of $38 million and rejects alternative proposals for other larger adjustments to rates. A final order is expected by September 9, 2022.30, 2023.
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
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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. On September 22, 2022, the court granted Exelon’s motion to dismiss without prejudice. The court granted plaintiffs leave until October 31, 2022 to file an amended complaint, which was later extended to November 30, 2022. Plaintiffs filed their amended complaint on November 30, 2022. Defendants filed their motion to dismiss the amended complaint on January 20, 2023. On September 29, 2023, the court again granted Exelon's motion to dismiss but granted plaintiffs leave until October 20, 2023 to file a second amended complaint. Plaintiffs did not file an amended complaint by the deadline. On October 25, the parties filed a joint Stipulation of Dismissal, which provides that plaintiffs agreed that they will not initiate an appeal from the dismissal of this matter, and the parties agree that each side shall bear their own costs and attorneys’ fees. Plaintiffs also acknowledge in the Stipulation that defendants have neither paid nor agreed to pay or provide any monetary or equitable remedy in connection with the dismissal of this action. On October 27, the court entered final judgment dismissing the matter with prejudice. 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.
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matter.
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 Registrants are also from time to time subject to audits and investigations by the FERC and other regulators. 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 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 Shareholders' Equity (Exelon)
The following tables present changes in Exelon's AOCI, netAt-the-Market Program
On August 4, 2022, Exelon executed an equity distribution agreement (“Equity Distribution Agreement”), with certain sales agents and forward sellers and certain forward purchasers, establishing an ATM equity distribution program under which it may offer and sell shares of tax, by component:
Three Months Ended June 30, 2022 Cash Flow Hedges
Pension and
Non-Pension
Postretirement
Benefit Plan
Items(a)
Foreign
Currency
Items
Total
Balance at March 31, 2022$— $(713)$— $(713)
OCI before reclassifications— — 
Amounts reclassified from AOCI— 10 — 10 
Net current-period OCI— 12 — 12 
Balance at June 30, 2022$— $(701)$— $(701)
Three Months Ended June 30, 2021Cash Flow Hedges
Pension and
Non-Pension
Postretirement
Benefit Plan
Items(a)
Foreign
Currency
Items
Total
Balance at March 31, 2021$(5)$(3,319)$(22)$(3,346)
OCI before reclassifications— — 
Amounts reclassified from AOCI— 55 — 55 
Net current-period OCI— 55 57 
Balance at June 30, 2021$(5)$(3,264)$(20)$(3,289)
Six Months Ended June 30, 2022 Cash Flow Hedges
Pension and
Non-Pension
Postretirement
Benefit Plan
Items(a)
Foreign
Currency
Items
Total
Balance at December 31, 2021$(6)$(2,721)$(23)$(2,750)
Separation of Constellation1,994 23 2,023 
OCI before reclassifications— — 
Amounts reclassified from AOCI— 24 — 24 
Net current-period OCI— 26 — 26 
Balance at June 30, 2022$— $(701)$— $(701)
its Common stock, having an aggregate gross sales price of up to $1.0 billion. Exelon has no obligation to offer or sell any shares of Common stock under the Equity Distribution Agreement and may, at any time, suspend or terminate offers and sales under the Equity Distribution Agreement. As of September 30, 2023, Exelon has not issued any shares of Common stock under the ATM program and has not entered into any forward sale agreements.
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Note 1314 — Changes in Accumulated Other Comprehensive Income
14. Changes in Accumulated Other Comprehensive Income (Loss) (Exelon)
The following tables present changes in Exelon's AOCI, net of tax, by component:
Nine Months Ended September 30, 2023 Cash Flow Hedges
Pension and
Non-Pension
Postretirement
Benefit Plan
Items(a)
Foreign
Currency
Items
Total
Balance at December 31, 2022$$(640)$— $(638)
OCI before reclassifications(10)— (4)
Amounts reclassified from AOCI— — 
Net current-period OCI(7)— (1)
Balance at March 31, 2023(647)— (639)
OCI before reclassifications(3)— 
Amounts reclassified from AOCI— — 
Net current-period OCI— — 
Balance at June 30, 202317 (647)— (630)
OCI before reclassifications22 (3)— 19 
Amounts reclassified from AOCI(1)16 — 15 
Net current-period OCI21 13 — 34 
Balance at September 30, 2023$38 $(634)$— $(596)

Six Months Ended June 30, 2021Cash 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)
Amounts reclassified from AOCI— 110 — 110 
Net current-period OCI— 108 111 
Balance at June 30, 2021$(5)$(3,264)$(20)$(3,289)
Nine Months Ended September 30, 2022Cash 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 Constellation1,994 23 2,023 
Amounts reclassified from AOCI— 14 — 14 
Net current-period OCI— 14 — 14 
Balance at March 31, 2022— (713)— (713)
OCI before reclassifications— — 
Amounts reclassified from AOCI— 10 — 10 
Net current-period OCI— 12 — 12 
Balance at June 30, 2022— (701)— (701)
Amounts reclassified from AOCI— — 
Net current-period OCI— — 
Balance at September 30, 2022$— $(692)$— $(692)
__________
(a)This AOCI component is included in the computation of net periodic pension and OPEB cost. Additionally, as of February 1, 2022, in connection with the separation, Exelon's pension and OPEB plans were remeasured. See Note 14 — Retirement Benefits of the 2022 Form 10-K and Note 8 — Retirement Benefits for additional information. See Exelon's Statements of Operations and Comprehensive Income for individual components of AOCI.
The following table presents income tax benefit (expense) allocated to each component of Exelon's other comprehensive income (loss):
Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
Pension and non-pension postretirement benefit plans:
Prior service benefit reclassified to periodic benefit cost$— $$— $
Actuarial loss reclassified to periodic benefit cost(3)(19)(8)(38)
Pension and non-pension postretirement benefit plans valuation adjustment(1)(1)— (1)
14. Supplemental Financial Information (All Registrants)
Supplemental Statement of Operations Information
The following tables provide additional information about material items recorded in the Registrants' Consolidated Statements of Operations and Comprehensive Income:
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Note 14 — Changes in Accumulated Other Comprehensive Income
The following table presents Income tax benefit (expense) allocated to each component of Exelon's Other comprehensive income (loss):
Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
Pension and non-pension postretirement benefit plans:
Actuarial losses reclassified to periodic benefit cost$(5)$(3)$(7)$(11)
Pension and non-pension postretirement benefit plans valuation adjustments— — 
Unrealized gains on cash flow hedges(7)— (11)— 
15. Supplemental Financial Information
(All Registrants)
Taxes other than income taxes
ExelonComEdPECOBGEPHIPepcoDPLACE
Three Months Ended June 30, 2022
Utility taxes(a)
$203 $71 $39 $20 $73 $67 $$
Property94 10 46 33 23 10 — 
Payroll28 
Three Months Ended June 30, 2021
Utility taxes(a)
$184 $61 $32 $20 $71 $65 $$— 
Property86 43 31 20 10 
Payroll32 
Six Months Ended June 30, 2022
Utility taxes(a)
$424 $149 $77 $47 $151 $137 $12 $
Property188 20 92 67 46 20 
Payroll64 13 14 
Six Months Ended June 30, 2021
Utility taxes(a)
$377 $121 $66 $45 $145 $132 $11 $
Property173 16 85 63 42 19 
Payroll64 13 14 
Supplemental Statement of Operations Information
The following tables provide additional information about material items recorded in the Registrants' Consolidated Statements of Operations and Comprehensive Income:
Taxes other than income taxes
ExelonComEdPECOBGEPHIPepcoDPLACE
Three Months Ended September 30, 2023
Utility taxes(a)
$244 $82 $50 $23 $89 $82 $$
Property104 53 38 25 12 
Payroll31 
Three Months Ended September 30, 2022
Utility taxes(a)
$244 $84 $51 $22 $87 $79 $$
Property99 10 50 35 23 11 
Payroll28 — 
Nine Months Ended September 30, 2023
Utility taxes(a)
$665 $228 $128 $73 $236 $213 $20 $
Property300 27 12 153 108 73 34 
Payroll93 22 13 14 22 
Nine Months Ended September 30, 2022
Utility taxes(a)
$667 $233 $126 $70 $238 $216 $19 $
Property287 30 12 142 103 70 31 
Payroll92 21 14 13 21 
_________
(a)The Registrants' utility taxes represent municipal and state utility taxes and gross receipts taxes related to their operating revenues. The offsetting collection of utility taxes from customers is recorded in revenues in the Registrants’ Consolidated Statements of Operations and Comprehensive Income.
Other, Net
ExelonComEdPECOBGE PHIPepcoDPLACE
Three Months Ended June 30, 2022
AFUDC — Equity$38 $$$$15 $11 $$
Non-service net periodic benefit cost16 — — — — — — — 
Three Months Ended June 30, 2021
AFUDC — Equity$34 $$$$12 $10 $$
Non-service net periodic benefit cost26 — — — — — — — 
Six Months Ended June 30, 2022
AFUDC — Equity$74 $17 $15 $12 $30 $22 $$
Non-service net periodic benefit cost33 — — — — — — — 
Six Months Ended June 30, 2021
AFUDC — Equity$64 $13 $12 $14 $25 $20 $$
Non-service net periodic benefit cost46 — — — — — — — 
Supplemental Cash Flow Information
The following tables provide additional information about material items recorded in the Registrants' Consolidated Statements of Cash Flows.
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(Dollars in millions, except per share data, unless otherwise noted)

Note 1415 — Supplemental Financial Information
Depreciation and amortization
Exelon(a)
ComEdPECOBGEPHIPepcoDPLACE
Six Months Ended June 30, 2022
Property, plant, and equipment(b)
$1,376 $511 $177 $235 $335 $145 $92 $83 
Amortization of regulatory assets(b)
357 138 87 124 68 21 35 
Amortization of intangible assets, net(b)
— — — — — — — 
Amortization of energy contract assets and liabilities(c)
— — — — — — — 
Nuclear fuel(d)
66 — — — — — — — 
ARO accretion(e)
44 — — — — — — — 
Total depreciation, amortization, and accretion$1,854 $649 $185 $322 $459 $213 $113 $118 
Six Months Ended June 30, 2021
Property, plant, and equipment(b)
$3,043 $480 $165 $215 $309 $135 $84 $76 
Amortization of regulatory assets(b)
291 109 78 95 64 20 11 
Amortization of intangible assets, net(b)
29 — — — — — — — 
Amortization of energy contract assets and liabilities(c)
13 — — — — — — — 
Nuclear fuel(d)
549 — — — — — — — 
ARO accretion(e)
255 — — — — — — — 
Total depreciation, amortization, and accretion$4,180 $589 $173 $293 $404 $199 $104 $87 
Other, Net
ExelonComEdPECOBGE PHIPepcoDPLACE
Three Months Ended September 30, 2023
AFUDC — Equity$40 $$10 $$19 $15 $$
Non-service net periodic benefit cost(18)— — — — — — — 
Three Months Ended September 30, 2022
AFUDC — Equity$38 $10 $$$16 $12 $$
Non-service net periodic benefit cost16 — — — — — — — 
Nine Months Ended September 30, 2023
AFUDC — Equity$113 $25 $22 $11 $55 $42 $$
Non-service net periodic benefit cost(18)— — — — — — — 
Nine Months Ended September 30, 2022
AFUDC — Equity$112 $28 $22 $17 $45 $35 $$
Non-service net periodic benefit cost48 — — — — — — — 
Supplemental Cash Flow Information
The following tables provide additional information about material items recorded in the Registrants' Consolidated Statements of Cash Flows.
Depreciation, amortization, and accretion
Exelon(a)
ComEdPECOBGEPHIPepcoDPLACE
Nine Months Ended September 30, 2023
Property, plant, and equipment(b)
$2,073 $815 $287 $381 $550 $232 $155 $145 
Amortization of regulatory assets(b)
537 230 10 106 191 97 27 67 
Amortization of intangible assets, net(b)
— — — — — — — 
Total depreciation and amortization$2,616 $1,045 $297 $487 $741 $329 $182 $212 
Nine Months Ended September 30, 2022
Property, plant, and equipment(b)
$2,024 $770 $267 $355 $502 $214 $141 $126 
Amortization of regulatory assets(b)
532 212 10 115 195 98 31 66 
Amortization of intangible assets, net(b)
10 — — — — — — — 
Amortization of energy contract assets and liabilities(c)
— — — — — — — 
Nuclear fuel(d)
66 — — — — — — — 
ARO accretion(e)
44 — — — — — — — 
Total depreciation, amortization, and accretion$2,679 $982 $277 $470 $697 $312 $172 $192 
__________
(a)Exelon's 2022 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 OperatingElectric operating revenues or Purchased power and fuel expense in Exelon’s 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.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 1415 — Supplemental Financial Information
Other non-cash operating activities
Exelon(a)
ComEdPECOBGEPHIPepcoDPLACE
Six Months Ended June 30, 2022
Pension and non-pension postretirement benefit costs$86 $30 $(4)$22 $26 $$$
Allowance for credit losses96 29 21 18 29 16 
Other decommissioning-related activity36 — — — — — — — 
Energy-related options60 — — — — — — — 
True-up adjustments to decoupling mechanisms and formula rates(b)
(27)(75)(6)32 22 12 
Long-term incentive plan40 — — — — — — — 
Amortization of operating ROU asset38 — 14 14 
AFUDC — Equity(74)(17)(15)(12)(30)(22)(4)(4)
Six Months Ended June 30, 2021
Pension and non-pension postretirement benefit costs$196 $64 $$29 $24 $$$
Allowance for credit losses100 24 17 
Other decommissioning-related activity(636)— — — — — — — 
Energy-related options20 — — — — — — — 
True-up adjustments to decoupling mechanisms and formula rates(b)
(176)(64)(17)(8)(88)(46)(19)(23)
Long-term incentive plan62 — — — — — — — 
Amortization of operating ROU asset83 — 15 14 
AFUDC — Equity(64)(13)(12)(14)(25)(20)(3)(2)
(d)Included in Purchased fuel expense in Exelon's Consolidated Statement of Operations and Comprehensive Income.
(e)Included in Operating and maintenance expense in Exelon's Consolidated Statement of Operations and Comprehensive Income.
Other non-cash operating activities
Exelon(a)
ComEdPECOBGEPHIPepcoDPLACE
Nine Months Ended September 30, 2023
Pension and OPEB costs (benefit)$152 $19 $(10)$41 $74 $26 $13 $10 
Allowance for credit losses86 31 47 27 11 
True-up adjustments to decoupling mechanisms and formula rates(b)
(522)(405)(1)(47)(69)(28)(15)(26)
Amortization of operating ROU asset29 — 21 
Change in environmental liabilities37 — — — 37 37 — — 
AFUDC — Equity(113)(25)(22)(11)(55)(42)(7)(6)
Nine Months Ended September 30, 2022
Pension and OPEB costs (benefit)$124 $45 $(6)$34 $39 $$$
Allowance for credit losses130 40 32 18 42 21 12 
Other decommissioning-related activity36 — — — — — — — 
Energy-related options60 — — — — — — — 
True-up adjustments to decoupling mechanisms and formula rates(b)
(92)(163)(1)40 33 15 14 
Long-term incentive plan35 — — — — — — — 
Amortization of operating ROU asset47 — 14 21 
AFUDC — Equity(112)(28)(22)(17)(45)(35)(5)(5)
__________
(a)Exelon's 2022 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 PECO, reflects the change in regulatory assets and liabilities associated with its 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 2021 Recast2022 Form 10-K for additional information.

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

Note 1415 — 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
June 30, 2022
Cash and cash equivalents$816 $120 $23 $354 $278 $14 $26 $233 
Restricted cash and cash equivalents961 384 205 341 117 223 — 
Restricted cash included in other long-term assets59 59 — — — — — — 
Total cash, restricted cash, and cash equivalents$1,836 $563 $32 $559 $619 $131 $249 $233 
December 31, 2021
Cash and cash equivalents$672 $131 $36 $51 $136 $34 $28 $29 
Restricted cash and cash equivalents321 210 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 
June 30, 2021
Cash and cash equivalents$1,578 $71 $376 $368 $61 $17 $17 $11 
Restricted cash and cash equivalents379 240 42 33 
Restricted cash included in other long-term assets52 43 — — — — 
Total cash, restricted cash, and cash equivalents(a)
$2,009 $354 $384 $371 $112 $50 $22 $23 
December 31, 2020
Cash and cash equivalents$432 $83 $19 $144 $111 $30 $15 $17 
Restricted cash and cash equivalents349 279 39 35 — 
Restricted cash included in other long-term assets53 43 — — 10 — — 10 
Cash, restricted cash, and cash equivalents from discontinued operations332 — — — — — — — 
Total cash, restricted cash, and cash equivalents$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.
Cash, cash equivalents, and restricted cash
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at September 30, 2023
Cash and cash equivalents$300 $79 $43 $15 $121 $31 $$14 
Restricted cash and cash equivalents435 360 25 25 — 
Restricted cash included in Other deferred debits and other assets212 212 — — — — — — 
Total cash, restricted cash, and cash equivalents$947 $651 $52 $16 $146 $56 $$14 
Balance at December 31, 2022
Cash and cash equivalents$407 $67 $59 $43 $198 $45 $31 $72 
Restricted cash and cash equivalents566 327 24 175 54 121 — 
Restricted cash included in Other deferred debits and other assets117 117 — — — — — — 
Total cash, restricted cash, and cash equivalents$1,090 $511 $68 $67 $373 $99 $152 $72 
Balance at September 30, 2022
Cash and cash equivalents$446 $63 $94 $20 $219 $21 $49 $112 
Restricted cash and cash equivalents744 342 130 234 77 157 — 
Restricted cash included in Other deferred debits and other assets83 83 — — — — — — 
Total cash, restricted cash, and cash equivalents$1,273 $488 $103 $150 $453 $98 $206 $112 
Balance at December 31, 2021
Cash and cash equivalents$672 $131 $36 $51 $136 $34 $28 $29 
Restricted cash and cash equivalents321 210 77 34 43 — 
Restricted cash included in Other deferred debits and other 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 
For additional information on restricted cash see Note 1 — Significant Accounting Policies of the 2021 Recast2022 Form 10-K.
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(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
June 30, 2022
Compensation-related accruals(a)
$428 $109 $57 $54 $82 $26 $16 $13 
Taxes accrued243 94 60 31 84 57 12 11 
Interest accrued331 124 40 44 59 31 14 
December 31, 2021
Compensation-related accruals(a)
$596 $155 $77 $78 $113 $35 $20 $17 
Taxes accrued253 94 14 53 96 88 11 
Interest accrued297 116 41 44 52 28 11 
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 15 — Supplemental Financial Information
Accrued expenses
ExelonComEdPECOBGEPHIPepcoDPLACE
Balance at September 30, 2023
Compensation-related accruals(a)
$548 $162 $67 $63 $99 $27 $17 $14 
Taxes accrued255 148 61 100 120 88 19 13 
Interest accrued391 78 52 59 81 38 24 17 
Balance at December 31, 2022
Compensation-related accruals(a)
$613 $179 $81 $79 $104 $29 $20 $16 
Taxes accrued211 92 10 34 70 52 12 
Interest accrued338 124 47 42 61 32 14 
__________
(a)Primarily includes accrued payroll, bonuses and other incentives, vacation, and benefits.

15.16. 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 affiliatesaffiliate and an immaterial amount recorded as Operating and maintenance expense from affiliates at the Utility Registrants:Registrants. Effective February 1, 2022, Generation is no longer considered a related party.
 Three Months Ended June 30,Six Months Ended June 30,
 2022202120222021
ComEd(a)
$— $78 $59 $163 
PECO(b)
— 41 33 83 
BGE(c)
— 58 18 130 
PHI— 77 51 176 
Pepco(d)
— 55 39 130 
DPL(e)
— 17 10 37 
ACE(f)
— 
Nine Months Ended September 30,
2022
ComEd(a)
$59 
PECO(b)
33 
BGE(c)
18 
PHI51 
Pepco(d)
39 
DPL(e)
10 
ACE(f)
__________
(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.
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 1516 — 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 costsOperating and maintenance from affiliatesCapitalized costs
Three Months Ended June 30,Six Months Ended June 30,Three Months Ended June 30,Six Months Ended June 30,Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021202220212022202120232022202320222023202220232022
ExelonExelonExelon
BSC BSC$139 $114 $344 $249  BSC$162 $156 $502 $500 
PHISCO PHISCO21 17 40 36  PHISCO25 20 74 60 
ComEdComEdComEd
BSC BSC$80 $72 $165 $143 67 45 152 102  BSC$92 $69 $263 $234 71 70 230 222 
PECOPECOPECO
BSC BSC47 40 96 80 20 17 56 44  BSC55 44 160 140 29 24 89 80 
BGEBGEBGE
BSC BSC51 45 102 88 22 20 60 43  BSC58 46 166 148 23 26 69 86 
PHIPHIPHI
BSC BSC46 37 96 76 30 32 76 60  BSC50 39 135 135 39 36 114 112 
PHISCO PHISCO— — — — 21 17 40 36  PHISCO— — — — 24 20 73 60 
PepcoPepcoPepco
BSC BSC27 23 56 45 11 13 28 25  BSC30 24 85 80 13 13 41 41 
PHISCO PHISCO29 28 58 57 16 15  PHISCO31 28 91 86 30 24 
DPLDPLDPL
BSC BSC17 15 35 29 10 23 19  BSC19 16 54 51 12 11 32 34 
PHISCO PHISCO25 24 49 49 13 11  PHISCO24 24 73 73 22 20 
ACEACEACE
BSC BSC14 12 29 24 10 25 15  BSC16 13 45 42 13 12 39 37 
PHISCO PHISCO22 21 43 43 11 10  PHISCO23 20 67 63 20 16 
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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in millions, except per share data, unless otherwise noted)

Note 1516 — Related Party Transactions

Current Receivables from/Payables to affiliates
The following tables present current receivablesReceivables from affiliates and current payablesPayables to affiliates:
JuneSeptember 30, 20222023
Receivables from affiliates:Receivables from affiliates:
Payables to affiliates:ComEdPECOBGEPepcoDPLACEBSCPHISCOOtherTotalPayables to affiliates:ComEdPECOBGEPepcoDPLACEBSCPHISCOOtherTotal
ComEdComEd$— $— $— $— $— $57 $— $$65 ComEd$— $— $— $— $— $57 $— $$62 
PECOPECO$— — — — — 25 — 29 PECO$— — — — — 31 — 37 
BGEBGE— — — — — 28 — 30 BGE— — — — — 31 — 33 
PHIPHI— — — — — — — 10 15 PHI— — — — — — — 11 17 
PepcoPepco— — — — 14 13 29 Pepco— — — — — 16 15 32 
DPLDPL— — — — 10 29 DPL— — — — 13 11 — 25 
ACEACE— — — — — 10 20 ACE— — — — — 11 10 22 
OtherOther— — — — — — — Other— — — — (1)
TotalTotal$$— $— $$— $$147 $33 $27 $220 Total$$$— $— $— $$164 $37 $26 $234 
December 31, 20212022
Receivables from affiliates:Receivables from affiliates:
Payables to affiliates:ComEdPECOBGEPepcoDPLACEGenerationBSCPHISCOOtherTotalPayables to affiliates:ComEdPECOBGEPepcoDPLACEBSCPHISCOOtherTotal
ComEdComEd$— $— $— $— $— $41 $71 $— $$121 ComEd$— $— $— $— $— $66 $— $$74 
PECOPECO$— — — — — 30 36 — 70 PECO$— — — — — 39 — 42 
BGEBGE— — — — — 41 — 48 BGE— — — — — 38 — 39 
PHIPHI— — — — — — 16 PHI— — — — — — — 10 14 
PepcoPepco— — 20 21 12 59 Pepco— — — — — 20 13 34 
DPLDPL— — — — — 17 11 33 DPL— — — — 12 — 22 
ACEACE— — — — — 13 31 ACE— — — — 14 26 
Generation13 — — — — — 102 — 16 131 
OtherOther— — — — — 11 — — 14 Other— — — — — — 
TotalTotal$16 $$$— $$$117 $306 $32 $47 $523 Total$$$— $— $— $$193 $30 $24 $255 
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 intercompany 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 June 30, 2022 and in noncurrent Receivables from affiliates as of December 31, 2021. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements of the 2021 Recast Form 10-K for additional information.
Long-term debt to financing trusts
The following table presents Long-term debt to financing trusts:
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(Dollars in millions, except per share data, unless otherwise noted)

Note 15 — Related Party Transactions

June 30, 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 

September 30, 2023December 31, 2022
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 
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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 distributiontransmission and transmissiondistribution businesses through ComEd, PECO, BGE, Pepco, DPL, and ACE.
Exelon hasit's six reportable segments consisting ofsegments: 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 incomeby Registrant for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021.2022. For additional information regarding the financial results for the three and sixnine months ended JuneSeptember 30, 20222023 and 20212022, see the discussions of Results of Operations by Registrant.
Three Months Ended June 30,Favorable (Unfavorable) VarianceSix Months Ended June 30,Favorable (Unfavorable) VarianceThree Months Ended September 30,Favorable (Unfavorable) VarianceNine Months Ended September 30,Favorable (Unfavorable) Variance
20222021202220212023202220232022
ExelonExelon$465 $326 $139 $946 $851 $95 Exelon$700 $676 $24 $1,711 $1,622 $89 
ComEdComEd227 192 35 415 390 25 ComEd333 291 42 822 706 116 
PECOPECO133 104 29 339 271 68 PECO146 135 11 410 474 (64)
BGEBGE37 45 (8)234 254 (20)BGE45 33 12 286 267 19 
PHIPHI100 141 (41)230 269 (39)PHI232 289 (57)490 518 (28)
PepcoPepco70 75 (5)116 134 (18)Pepco120 145 (25)249 261 (12)
DPLDPL21 30 (9)77 86 (9)DPL43 52 (9)128 130 (2)
ACEACE11 37 (26)37 51 (14)ACE71 94 (23)122 131 (9)
Other(a)
Other(a)
(32)(156)124 (272)(333)61 
Other(a)
(56)(72)16 (297)(343)46 
__________
(a)PrimarilyOther primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities, and other financing and investinginvestment 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.the three and nine months ended September 30, 2022 presented in the table above. See Note 1 — Significant Accounting Policies and Note 2 — Discontinued Operations for additional information.
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 Juneabove and were $28 million on a pre-tax basis, for the nine months ended September 30, 2022 Compared to Three Months Ended June 30, 2021. Net income attributable to common shareholders from2022. There were no such costs included in Exelon's continuing operations increased by $139 million and diluted for the three months ended September 30, 2022.
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Three Months Ended September 30, 2023 Compared to Three Months Ended September 30, 2022. Net income attributable to common shareholders from continuing operations increased by $24 million and diluted earnings per average common share from continuing operations increased to $0.47$0.70 in 2023 from $0.68 in 2022 from $0.33 in 2021 primarily due to:
Higher electric distribution formula rate earnings from higher allowed electric distribution ROE due to an increase in U.S. treasury rates and impacts of higher rate base at ComEd;

Favorable impacts of rate increases at PECO, BGE, and PHI; and
Carrying costs related to the CMC regulatory assets at ComEd.
The increases were partially offset by:
Higher operating expense as a result of higher storm costs at PECO, BGE and PHI;
Higher interest expense at BGE and Exelon Corporate;
Unfavorable weather at PECO; and
Higher depreciation expense at BGE and PHI.
Nine Months Ended September 30, 2023 Compared to Nine Months Ended September 30, 2022. Net income attributable to common shareholders from continuing operations increased by $89 million and diluted earnings per average common share from continuing operations increased to $1.72 in 2023 from $1.65 in 2022 primarily due to:
Higher electric distribution formula rate earnings from higher allowed ROE due to an increase in U.S. treasury rates and impacts of higher rate base at ComEd;
The favorable impacts of rate increases at PECO, BGE, and PHI; and
Lower BSCCarrying costs which were previously allocatedrelated to Generation but do not qualify as expenses of the discontinued operations per the accounting rules. Such costs, on a pre-tax basis, were $99 million for the three months ended June 30, 2021.
The increases were partially offset by:
The absence of favorable weather and volume as a result of the CIP at ACE;
Higher depreciation expense at BGE and PHI;
Higher credit loss expense at PHI; and
Higher interest expense at Exelon Corporate.
Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021. Net income attributable to common shareholders from continuing operations increased by $95 million and diluted earnings per average common share from continuing operations increased to $0.96 in 2022 from $0.87 in 2021 primarily due to:
Higher electric distribution earnings from higher allowed electric distribution ROE due to an increase in treasury rates and higher rate baseCMC regulatory assets at ComEd;

The favorable impacts of rate increases at PECO, BGE, and PHI;
Lower BSC costs presented in Exelon’s continuing operations, which were previously allocated to Generation but dodid not qualify as expenses of the discontinued operation expenses 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 $206 million for the six months ended June 30, 2021.
The increases were partially offset by:
An income taxHigher interest 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,at PECO, BGE, PHI and nondeductible transaction costs partially offset by a one-time impact associated with a state tax benefit;Exelon Corporate;
The absence of favorableUnfavorable weather at PECO and volume as a result of the CIP at ACE;PHI;
Higher depreciation expense at PECO, BGE and PHI;
Higher credit loss expense at BGE and PHI;
Higher storm costs at PHI; and
Higher interestoperating expense as a result of higher storm costs at PHIPECO and Exelon Corporate.BGE.
Adjusted (non-GAAP) Operating Earnings.operating earnings. In addition to netNet 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-yearyear-over-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
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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.
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The following tables provide a reconciliation between netNet income attributable to common shareholders from continuing operations as determined in accordance with GAAP and adjustedAdjusted (non-GAAP) operating earnings for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same periodperiods in 2021.2022:
Three Months Ended June 30,
20222021
(In millions, except per share data)Earnings per
Diluted Share
Earnings per
Diluted Share
Net Income Attributable to Common Shareholders from Continuing Operations$465 $0.47 $326 $0.33 
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $1)— — — 
Cost Management Program (net of taxes of $0)— — — 
COVID-19 Direct Costs (net of taxes of $1)(a)
— — — 
Acquisition Related Costs (net of taxes of $1)(b)
— — — 
ERP System Implementation Costs (net of taxes $1)(c)
— — — 
Separation Costs (net of taxes of $4 and $6, respectively)(d)
10 0.01 10 0.01 
Income Tax-Related Adjustments (entire amount represents tax expense)(e)
(43)(0.04)— — 
Adjusted (non-GAAP) Operating Earnings$433 $0.44 $348 $0.36 
Three Months Ended September 30,
20232022
(In millions, except per share data)Earnings per
Diluted Share
Earnings per
Diluted Share
Net income attributable to common shareholders from continuing operations$700 $0.70 $676 $0.68 
Mark-to-market impact of economic hedging activities (net of taxes of $4)12 0.01 — — 
Asset retirement obligation (net of taxes of $1 and $2, respectively)(1)— (4)— 
Asset impairments (net of taxes of $10)(a)
— — 37 0.04 
Separation costs (net of taxes of $5 and $1, respectively)(b)
14 0.01 (3)— 
Income tax-related adjustments (entire amount represents tax expense)(c)
(54)(0.05)38 0.04 
Adjusted (non-GAAP) operating earnings$671 $0.67 $745 $0.75 
Six Months Ended June 30,
20222021
(In millions, except per share data)Earnings per
Diluted Share
Earnings per
Diluted Share
Net Income Attributable to Common Shareholders from Continuing Operations$946 $0.96 $851 $0.87 
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $1)— — — 
Cost Program Management (net of taxes of $0)— — — 
COVID-19 Direct Costs (net of taxes of $3) (a)
— — 0.01 
Acquisition Related Costs (net of taxes of $3)(b)
— — 0.01 
ERP System Implementation Costs (net of taxes of $0 and $1, respectively)(c)
— 0.01 
Separation Costs (net of taxes of $11 and $6, respectively)(d)
27 0.03 15 0.02 
Income Tax-Related Adjustments (entire amount represents tax expense)(f)
92 0.09 (2)— 
Adjusted (non-GAAP) Operating Earnings$1,065 $1.08 $887 $0.91 
Nine Months Ended September 30,
20232022
(In millions, except per share data)Earnings per
Diluted Share
Earnings per
Diluted Share
Net income attributable to common shareholders from continuing operations$1,711 $1.72 $1,622 $1.65 
Mark-to-market impact of economic hedging activities (net of taxes of $4)14 0.01 — — 
Change in environmental liabilities (net of taxes of $8)29 0.03 — — 
ERP system implementation costs (net of taxes of $0)(d)
— — — 
Asset retirement obligation (net of taxes of $1 and $2, respectively)(1)— (4)— 
SEC matter loss contingency (net of taxes of $0)46 0.05 — — 
Asset impairments (net of taxes of $10)(a)
— — 37 0.04 
Separation costs (net of taxes of $7 and $10, respectively)(b)
19 0.02 25 0.03 
Change in FERC audit liability (net of taxes of $4)11 0.01 — — 
Income tax-related adjustments (entire amount represents tax expense)(e)
(54)(0.05)130 0.13 
Adjusted (non-GAAP) operating earnings$1,774 $1.78 $1,811 $1.84 
__________
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 Operationsincome and Adjusted (non-GAAP) Operating Earningsoperating 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 20222023 and 20212022 ranged from 24.0% to 29.0%.

(a)Represents directReflects costs related to COVID-19 consisting primarilythe impairment 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,an office building at BGE, 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 Constellation Energy Generation, LLC
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(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 and Other, net.
(c)In 2022, reflects an adjustment to exclude one-time non-cash impacts associated with the remeasurement of deferred income taxes as a result of the reduction in Pennsylvania corporate income tax rate. In 2023, reflects the adjustment to state deferred income taxes due to changes in forecasted apportionment.
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(d)Reflects costs related to a multi-year ERP system implementation, which are recorded in Operating and maintenance expense.
(e)In connection2022, for PECO, reflects an adjustment to exclude one-time non-cash impacts associated with the separation, Exelon recordedremeasurement of deferred income taxes as a one-time impact associated with a stateresult of the reduction in Pennsylvania corporate income tax benefit.
(f)Inrate. For Corporate, 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 partially offset by a one-time impact associated with a state tax benefit.

In 2023, reflects the adjustment to state deferred income taxes dues to changes in forecasted apportionment.
Significant 20222023 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 meetsmet 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.
In connection with the separation, Exelon incurred separation costscosts/(benefit) impacting continuing operations of $14$19 million and $16$(2) million on a pre-tax basis for the three months ended JuneSeptember 30, 20222023 and 2021,2022, respectively, and $38$26 million and $21$35 million on a pre-tax basis for the sixnine months ended JuneSeptember 30, 20222023 and 2021,2022, respectively, which are recorded in Operating and maintenance expense. Total separation costs impacting continuing operations for the remainder of 20222023 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 2022.2023. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information.
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Completed Distribution Base Rate Case Proceedings
Registrant/JurisdictionRegistrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseApproved Revenue Requirement IncreaseApproved ROEApproval DateRate Effective DateRegistrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseApproved Revenue Requirement IncreaseApproved ROEApproval DateRate Effective Date
ComEd - IllinoisComEd - IllinoisApril 16, 2021Electric$51 $46 7.36 %December 1, 2021January 1, 2022ComEd - IllinoisApril 15, 2022Electric$199 $199 7.85 %November 17, 2022January 1, 2023
PECO - PennsylvaniaPECO - PennsylvaniaMarch 30, 2021Electric246 132 N/ANovember 18, 2021January 1, 2022PECO - PennsylvaniaMarch 31, 2022Natural Gas82 55 N/AOctober 27, 2022January 1, 2023
BGE - MarylandBGE - MarylandMay 15, 2020 (amended September 11, 2020)Electric203 140 9.50 %December 16, 2020January 1, 2021BGE - MarylandMay 15, 2020 (amended September 11, 2020)Electric203 140 9.50 %December 16, 2020January 1, 2021
Natural Gas108 74 9.65 %Natural Gas108 74 9.65 %
Pepco - District of ColumbiaMay 30, 2019 (amended June 1, 2020)Electric136 109 9.275 %June 8, 2021July 1, 2021
Pepco - MarylandPepco - MarylandOctober 26, 2020 (amended March 31, 2021)Electric104 52 9.55 %June 28, 2021June 28, 2021Pepco - MarylandOctober 26, 2020 (amended March 31, 2021)Electric104 52 9.55 %June 28, 2021June 28, 2021
DPL - MarylandDPL - MarylandSeptember 1, 2021 (amended December 23, 2021)Electric27 13 9.60 %March 2, 2022March 2, 2022DPL - MarylandMay 19, 2022Electric38 29 9.60 %December 14, 2022January 1, 2023
ACE - New JerseyDecember 9, 2020 (amended February 26, 2021)Electric67 41 9.60 %July 14, 2021January 1, 2022
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Pending Distribution Base Rate Case Proceedings
Registrant/JurisdictionRegistrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseRequested ROEExpected Approval TimingRegistrant/JurisdictionFiling DateServiceRequested Revenue Requirement IncreaseRequested ROEExpected Approval Timing
ComEd - IllinoisComEd - IllinoisApril 15, 2022Electric$199 7.85 %Fourth quarter of 2022ComEd - IllinoisJanuary 17, 2023Electric$1,487 10.50% to 10.65%Fourth quarter of 2023
PECO - PennsylvaniaMarch 31, 2022Natural Gas82 10.95 %Fourth quarter of 2022
ComEd - IllinoisComEd - IllinoisApril 21, 2023Electric247 8.91 %Fourth quarter of 2023
BGE - MarylandBGE - MarylandFebruary 17, 2023Electric313 10.40 %Fourth quarter of 2023
Natural Gas289 10.40 %
Pepco - District of ColumbiaPepco - District of ColumbiaApril 13, 2023Electric191 10.50 %Second quarter of 2024
Pepco - MarylandPepco - MarylandMay 16, 2023Electric214 10.50 %Second quarter of 2024
DPL - DelawareDPL - DelawareJanuary 14, 2022 (amended February 28, 2022)Natural Gas15 10.30 %First quarter of 2023DPL - DelawareDecember 15, 2022 (amended September 29, 2023)Electric39 10.50 %Second quarter of 2024
DPL - MarylandMay 19, 2022Electric38 10.25 %Fourth quarter of 2022
ACE - New JerseyACE - New JerseyFebruary 15, 2023 (amended August 21, 2023)Electric92 10.50 %Fourth quarter of 2023
Transmission Formula Rates
For 2022,2023, the following total increases/(decreases) were included in the Utility Registrants' electric transmission formula rate updates. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information.
RegistrantRegistrantInitial Revenue Requirement IncreaseAnnual Reconciliation (Decrease) IncreaseTotal Revenue Requirement IncreaseAllowed Return on Rate BaseAllowed ROERegistrantInitial Revenue Requirement IncreaseAnnual Reconciliation Increase (Decrease)Total Revenue Requirement IncreaseAllowed Return on Rate BaseAllowed ROE
ComEdComEd$24 $(24)$— 8.11 %11.50 %ComEd$20 $63 $83 8.09 %11.50 %
PECOPECO23 16 39 7.30 %10.35 %PECO24 23 47 7.41 %10.35 %
BGEBGE25 (4)16 7.30 %10.50 %BGE19 (12)7.34 %10.50 %
PepcoPepco16 15 31 7.60 %10.50 %Pepco37 (5)32 7.57 %10.50 %
DPLDPL11 7.09 %10.50 %DPL32 (3)29 7.08 %10.50 %
ACEACE21 13 34 7.18 %10.50 %ACE41 (12)29 7.08 %10.50 %

ComEd's FERC Audit
Pennsylvania Corporate Income Tax Rate Change

The Utility Registrants are subject to periodic audits by FERC. FERC’s Division of Audits and Accounting initiated a nonpublic audit of ComEd in April 2021 evaluating ComEd’s compliance with (1) approved terms, rates, and conditions of its federally regulated service; (2) accounting requirements of the Uniform System of Accounts; (3) reporting requirements of the FERC Form 1; and (4) the requirements for record retention. The audit period extends back to January 1, 2017. During the first quarter of 2023, ComEd was provided with information from FERC about several potential findings, including ComEd's methodology regarding the allocation of certain overhead costs to capital under FERC regulations. Based on the preliminary findings and discussions with FERC staff, ComEd determined that a loss was probable and recorded a regulatory liability to reflect its best estimate of that loss as of March 31, 2023.
On July 8, 2022, Pennsylvania enacted House Bill 1342,27, 2023, FERC issued a final audit report which will permanently reduceincluded, among other things, findings and recommendations related to ComEd's methodology regarding the corporate income tax rate from 9.99%allocation of certain overhead costs to 4.99%. The tax rate will be reduced to 8.99% for the 2023 tax year. Starting with the 2024 tax year, the rate is reduced by 0.5% annually until it reaches 4.99% in 2031. As a result of the rate change, in the third quarter of 2022, Exelon and PECO will record an estimated one-time decrease to deferred income taxes of $390 million with a corresponding decrease to the deferred income taxes regulatory asset of $428 million for the amounts that are expected to be settled through future customer rates and an increase to income tax expense of $38 million (net of federal taxes), which will be excluded from Adjusted (non-GAAP) Operating Earnings. See Note 7 — Income Taxes of the Combined Notes to Consolidated Financial Statements for additional information.
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capitalized construction costs under FERC regulations. On August 28, 2023, ComEd filed a formal notice of the issues it will contest. The final outcome and resolution of any contested audit issues as well as a reasonable estimate of potential future losses cannot be accurately estimated at this stage; however, the final resolution of these matters could result in recognition of future losses, above the amounts currently accrued, that could be material to the Exelon and ComEd financial statements.
Other Key Business Drivers and Management Strategies
The following discussion of other key business drivers 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 in the 20212022 Form 10-K,, ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations — Other Key Business Drivers and Management Strategies in the 2021 Recast2022 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
City of Chicago Franchise Agreement
The current ComEd Franchise Agreement with the City of Chicago (the City) has been in force since 1992. The Franchise Agreement grants rights to use the public right of way to install, maintain, and operate the wires, poles, and other infrastructure required to deliver electricity to residents and businesses across the City. The Franchise Agreement became terminable on one year notice as of December 31, 2020. It now continues in effect indefinitely unless and until either party issues a notice of termination, effective one year later, or it is replaced by mutual agreement with a new franchise agreement between ComEd and the City. If either party terminates and no new agreement is reached between the parties, the parties could continue with ComEd providing electric services within the City with no franchise agreement in place. The City also has an option to terminate and purchase the ComEd system (“municipalize”), which also requires one year notice. Neither party has issued a notice of termination at this time, the City has not exercised its municipalization option, and no new agreement has become effective. Accordingly, the 1992 Franchise Agreement remains in effect at this time. In April 2021, the City invited interested parties to respond to a Request for Information (RFI) regarding the franchise for electricity delivery. Final responses to the RFI were due on July 30, 2021, however, on July 29, 2021, the City chose to extend the final submission deadline to September 30, 2021. ComEd submitted its response to the RFI by the due date. However, the City did not proceed to issue an RFP. Since that time, ComEd and the City continued to negotiate and have arrived at a proposed Chicago Franchise Agreement (CFA) and an Energy and Equity Agreement (EEA). These agreements together are intended t o grant ComEd the right to continue providing electric utility services using public ways within the City of Chicago, and to create a new non-profit entity to advance energy and energy-related equity projects. On February 1, 2023, the proposed CFA and EEA were introduced to the City Council. The proposed CFA and EEA remain subject to approval by the City Council and the Exelon Board.
While Exelon and ComEd cannot predict the ultimate outcome of these processes, fundamental changes in the agreements or other adverse actions affecting ComEd’s business in the City would require changes in their business planning models and operations and could have a material adverse impact on Exelon’s and ComEd’s consolidated financial statements. If the City were to disconnect from the ComEd system, ComEd would seek full compensation for the business and its associated property taken by the City, as well as for all damages resulting to ComEd and its system. ComEd would also seek appropriate compensation for stranded costs with FERC.
Infrastructure Investment and Jobs Act
On November 15, 2021, President Biden signed the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA)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 analyzingcontinue to evaluate programs under the legislation and consideringconsider possible opportunities to apply
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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.
Inflation Reduction ActIn September 2022, ComEd and BGE applied for the MMG, which establishes and funds construction, improvement, or acquisition of middle mile broadband infrastructure which creates high-speed internet services. The MMG addresses inequitable broadband access by expansion and extension of the middle mile infrastructure in underserved communities. In June 2023, the National Telecommunications and Information Administration (NTIA) announced it selected two of the applications submitted by BGE and ComEd; awarding ComEd and BGE $14.5 million and $15.4 million respectively. The applications selected by NTIA for BGE and ComEd proposed projects designed to enhance electric grid reliability and resiliency while leading and advancing shared local, state, and national goals to increase broadband connectivity, redundancy, affordability, and equity.

In March 2023, Exelon, ComEd, and PHI submitted three applications related to the Smart Grid Grants program under section 40107 of IIJA. These applications are focused on replacing existing Advanced Distribution Management Systems (ADMS) in support of distributed energy resources (DERs) and grid-edged technologies, strengthening interoperability and data architecture of systems in support of two-way power flows and accelerating advanced metering deployment in disadvantaged communities. In October 2023, ComEd’s project, Deployment of a Community-Oriented Interoperable Control Framework for Aggregating and Integrating Distributed Energy Resources and Other Grid-Edge Devices, was recommended by the Grid Deployment Office (GDO) for negotiation of a final award up to $50 million. This project will enable ComEd and its local partners to deploy the next generation of grid technologies that support the growth of solar and electric vehicles (EVs), while piloting new local workforce training initiatives to support job creation connected to the clean energy transition. The GDO has indicated the award negotiation process can take approximately 120 days.

In April 2023, ComEd, PECO, BGE, and PHI submitted seven applications related to the Grid Resilience Grants program under section 40101(c) of IIJA. These applications are broadly focused on improving grid resilience with an emphasis on disadvantaged communities, relief of capacity constraints and modernizing infrastructure, deployment of DER and microgrid technologies and providing improved resilience through storm hardening projects. In October 2023, PECO’s project, Creating a Resilient, Equitable, and Accessible Transformation in Energy for Greater Philadelphia (CREATE), was recommended by the GDO for negotiation of a final award up to $100 million. This project will support critical electric infrastructure investments to help reduce the impact of extreme weather and historic flooding on the company's electric distribution system. The GDO has indicated the award negotiation process can take approximately 120 days.

The Registrants are supporting three different Regional Clean Hydrogen Hub opportunities, covering all five states that Exelon operates in plus Washington D.C. under a program that will create networks of hydrogen producers, consumers, and local connective infrastructure to accelerate the use of hydrogen as a clean energy carrier that can deliver or store energy. Applications for the three opportunities under this program were submitted in April 2023. In October 2023 the DOE announced it selected two of the projects for further negotiation: (1) the Mid-Atlantic Clean Hydrogen Hub (MACH2), which is being supported by PECO and PHI, and (2) the Midwest Alliance for Clean Hydrogen (MachH2), which is being supported by ComEd.
PJM Regional Transmission Expansion
On July 27, 2022, the Inflation Reduction ActApril 6, 2023, PJM received a deactivation notice for Brandon Shores, a 1,282 MW coal generation plant located in BGE service territory. The deactivation was introduced in the U.S. Senate. The bill extends tax benefitsrequested for renewable technologies like solarJune 1, 2025 and wind and it creates new tax benefits for alternative clean energy sources like nuclear and hydrogen and it focuses on energy efficiency, electrification, and equity. However, the bill also implements a new 15% corporate minimum tax based on modified GAAP net income. Exelon estimates the bill couldwill result in an increasenumerous reliability issues across the region. In June 2023, PJM assigned a portion of transmission system upgrades to mitigate these reliability impacts to PECO, BGE, and Pepco. In July 2023, PJM Board of Managers approved assigning Exelon transmission system upgrades to mitigate these reliability impacts to PECO, BGE, and Pepco. The most recent projected capital expenditures associated with these upgrades are approximately $80 million, $650 million, and $80 million for PECO, BGE, and Pepco, respectively. These amounts include a scope reduction estimated by PJM for PECO of $60 million associated with a transmission proposal window, as disclosed at a Transmission Expansion Advisory Committee meeting on October 31, 2023. The upgrades are expected to be completed by the end of 2028.
Separately, PJM held a competitive transmission proposal window from February 24, 2023 through May 31, 2023 to address reliability issues driven by significant load increases in cash taxes for Exelon of approximately $300 million per year starting in 2023 if enacted as proposed. Exelon is continuing to assess the impactsnorthern Virginia. PECO, BGE, and Pepco submitted four solution proposals. At a meeting of the billTransmission Expansion Advisory Committee on the financial statements. Exelon is working with legislatorsOctober 31, 2023, PJM recommended that PECO, BGE, Pepco, and cannot predict the outcomeDPL be awarded a portion of the work for the
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proposed legislation.solution. Initial estimated costs for these upgrades, as posted by PJM on its website on October 27, 2023, are approximately $55 million, $700 million, $80 million, and $5 million for PECO, BGE, Pepco, and DPL, respectively. The PJM Board of Managers is scheduled to approve the solution in December 2023 and the upgrades are expected to be completed by the end of 2030.
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 JuneAs of September 30, 2022,2023, the Registrants’ critical accounting policies and estimates had not changed significantly from December 31, 2021.2022. See ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS — Critical Accounting Policies and Estimates in the 2021 Recast2022 Form 10-K for further information.
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Results of Operations by Registrant
Results of Operations — ComEd
Three Months Ended
June 30,
Favorable
(Unfavorable)
Variance
Six Months Ended
June 30,
Favorable
(Unfavorable)
Variance
Three Months Ended
September 30,
Favorable (Unfavorable) VarianceNine Months Ended
September 30,
Favorable (Unfavorable) Variance
20222021202220212023202220232022
Operating revenuesOperating revenues$1,425 $1,517 $(92)$3,158 $3,052 $106 Operating revenues$2,268 $1,378 $890 $5,836 $4,536 $1,300 
Operating expensesOperating expensesOperating expenses
Purchased powerPurchased power283 500 217 921 1,025 104 Purchased power896 121 (775)2,068 1,041 (1,027)
Operating and maintenanceOperating and maintenance338 323 (15)689 639 (50)Operating and maintenance385 355 (30)1,077 1,045 (32)
Depreciation and amortizationDepreciation and amortization328 296 (32)649 589 (60)Depreciation and amortization357 333 (24)1,045 982 (63)
Taxes other than income taxesTaxes other than income taxes90 77 (13)185 153 (32)Taxes other than income taxes100 104 282 289 
Total operating expensesTotal operating expenses1,039 1,196 157 2,444 2,406 (38)Total operating expenses1,738 913 (825)4,472 3,357 (1,115)
Loss on sales of assetsLoss on sales of assets(2)— (2)(2)— (2)Loss on sales of assets— — — — (2)
Operating incomeOperating income384 321 63 712 646 66 Operating income530 465 65 1,364 1,177 187 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(104)(98)(6)(204)(193)(11)Interest expense, net(119)(104)(15)(357)(308)(49)
Other, netOther, net13 15 (2)26 22 Other, net16 14 50 40 10 
Total other income and (deductions)Total other income and (deductions)(91)(83)(8)(178)(171)(7)Total other income and (deductions)(103)(90)(13)(307)(268)(39)
Income before income taxesIncome before income taxes293 238 55 534 475 59 Income before income taxes427 375 52 1,057 909 148 
Income taxesIncome taxes66 46 (20)119 85 (34)Income taxes94 84 (10)235 203 (32)
Net incomeNet income$227 $192 $35 $415 $390 $25 Net income$333 $291 $42 $822 $706 $116 
Three Months Ended JuneSeptember 30, 20222023 Compared to Three Months Ended JuneSeptember 30, 2021.2022. Net income increased by $35$42 million as compared to the same period in 2021,2022, primarily due to increases in electric distribution formula rate earnings (reflecting higher allowed electric distribution ROE due to an increase in treasuryU.S. Treasury rates and the impacts of higher rate base). and carrying costs related to the CMC regulatory assets.
SixNine Months Ended JuneSeptember 30, 20222023 Compared to SixNine Months Ended JuneSeptember 30, 2021.2022. Net income increased by $25$116 million as compared to the same period in 2021,2022, primarily due to increases in electric distribution formula rate earnings (reflecting higher allowed electric distribution ROE due to an increase in treasuryU.S. Treasury rates and the impacts of higher rate base) partially offset by the voluntary customer refundand carrying costs 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.CMC regulatory assets.
The changes in Operating revenues consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
Increase (Decrease)Increase (Decrease)IncreaseIncrease (Decrease)
DistributionDistribution$65 $110 Distribution$103 $277 
TransmissionTransmission17 38 Transmission(4)
Energy efficiencyEnergy efficiency14 20 Energy efficiency17 55 
OtherOther— Other11 
131 339 
96 171 
Regulatory required programsRegulatory required programs(188)(65)Regulatory required programs759 961 
Total increaseTotal increase$(92)$106 Total increase$890 $1,300 
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.
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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
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in the underlying costs, (e.g., severe weather and storm restoration), investments being recovered, and allowed ROE. Electric distribution revenue increased for the three and sixnine months ended JuneSeptember 30, 20222023 as compared to the same period in 2021,2022, due to higher allowed ROE due to an increase in treasuryU.S. Treasury rates, the impact of a higher rate base, 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 and six months ended June 30, 2022 as compared to the same period 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 and sixnine months ended JuneSeptember 30, 20222023 as compared to the same period in 2021,2022, 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 sameincreased for the three and sixnine months ended JuneSeptember 30, 20222023 as compared to the same period in 2021.2022, which primarily reflects mutual assistance revenues associated with storm restoration efforts.
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"),ETAC, and costs related to electricity, ZEC, CMC, and REC procurement. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information regarding CMCs. 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, CMC, 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, CMCs, and RECs.
See Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for the presentation of ComEd's revenue disaggregation.
The decreaseincrease of $217$775 million and $104$1,027 million for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021,2022, in Purchased power expense is primarily due to the CMCs from the participating nuclear-powered generating facilities including the deferral of any associated carrying costs. This increase is primarily offset by an increase in Operating revenues as part of regulatory required programs. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information regarding CMCs.

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The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
(Decrease) Increase(Decrease) IncreaseIncrease (Decrease)Increase (Decrease)
Labor, other benefits, contracting and materialsLabor, other benefits, contracting and materials$10 $36 
Storm-related costsStorm-related costs$(1)$— Storm-related costs(4)
BSC costsBSC costs23 28 
Pension and non-pension postretirement benefits expensePension and non-pension postretirement benefits expense(7)(14)Pension and non-pension postretirement benefits expense(3)(11)
Labor, other benefits, contracting and materials11 
BSC costs22 
Other(a)
Other(a)
26 
Other(a)
27 25 
14 45 53 82 
Regulatory required programs(b)(a)
Regulatory required programs(b)(a)
Regulatory required programs(b)(a)
(23)(50)
Total increaseTotal increase$15 $50 Total increase$30 $32 
__________
(a)For the six months ended June 30, 2022, 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 Contingenciesof 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
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
IncreaseIncreaseIncreaseIncrease
Depreciation and amortization(a)
Depreciation and amortization(a)
$19 $33 
Depreciation and amortization(a)
$16 $45 
Regulatory asset amortization(b)
Regulatory asset amortization(b)
13 27 
Regulatory asset amortization(b)
18 
Total increaseTotal increase$32 $60 Total increase$24 $63 
__________
(a)Reflects ongoing capital expenditures.expenditures and higher depreciation rates effective January 2023.
(b)Includes amortization of ComEd's energy efficiency formula rate regulatory asset.
Taxes other than income taxesInterest expense, net increased by $13$15 million and by $32$49 million for the three and sixnine months ended JuneSeptember 30, 2022, respectively,2023, compared to the same period in 2021,2022, primarily due to taxes related to ETAC, which is recovered through Operating revenues.an increase in interest rates and the issuance of debt during the year.
Effective income tax rates were 22.5%22.0% and 19.3%22.4% for the three months ended JuneSeptember 30, 20222023 and 2021,2022, respectively, and 22.3%22.2% and 17.9%22.3% for the sixnine months ended JuneSeptember 30, 20222023 and 2021,2022, 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.
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Results of Operations — PECO
Three Months Ended
June 30,
Favorable
(Unfavorable)
Variance
Six Months Ended
June 30,
Favorable
(Unfavorable)
Variance
Three Months Ended
September 30,
Favorable (Unfavorable) VarianceNine Months Ended
September 30,
Favorable (Unfavorable) Variance
20222021202220212023202220232022
Operating revenuesOperating revenues$816 $693 $123 $1,863 $1,582 $281 Operating revenues$1,037 $1,014 $23 $2,977 $2,877 $100 
Operating expensesOperating expensesOperating expenses
Purchased power and fuelPurchased power and fuel283 207 (76)689 523 (166)Purchased power and fuel411 403 (8)1,197 1,093 (104)
Operating and maintenanceOperating and maintenance215 209 (6)463 443 (20)Operating and maintenance277 243 (34)786 705 (81)
Depreciation and amortizationDepreciation and amortization93 87 (6)185 173 (12)Depreciation and amortization100 92 (8)297 277 (20)
Taxes other than income taxesTaxes other than income taxes48 49 95 92 (3)Taxes other than income taxes59 60 156 155 (1)
Total operating expensesTotal operating expenses639 552 (87)1,432 1,231 (201)Total operating expenses847 798 (49)2,436 2,230 (206)
Operating incomeOperating income177 141 36 431 351 80 Operating income190 216 (26)541 647 (106)
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(43)(42)(1)(84)(80)(4)Interest expense, net(52)(45)(7)(149)(129)(20)
Other, netOther, net16 12 Other, net11 26 23 
Total other income and (deductions)Total other income and (deductions)(35)(35)— (68)(68)— Total other income and (deductions)(41)(37)(4)(123)(106)(17)
Income before income taxesIncome before income taxes142 106 36 363 283 80 Income before income taxes149 179 (30)418 541 (123)
Income taxesIncome taxes(7)24 12 (12)Income taxes44 41 67 59 
Net incomeNet income$133 $104 $29 $339 $271 $68 Net income$146 $135 $11 $410 $474 $(64)
Three Months Ended JuneSeptember 30, 20222023 Compared to Three Months Ended JuneSeptember 30, 2021.2022. Net incomeincreased by $29$11 million as compared to the same period in 2022, primarily due to Pennsylvania corporate income tax legislation passed in July 2022 driving a one-time non-cash decrease to net income for 2022, partially offset by an increase in operating expense as a result of higher storm costs.
Nine Months Ended September 30, 2023 Compared to Nine Months Ended September 30, 2022. Net income decreased by $64 million as compared to the same period in 2022, primarily due to increases in electricoperating expenses as a result of higher storm costs, depreciation and gas distribution rates.
Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021. Net income increased by $68 million, primarily due to increases in electricamortization expense, and gas distribution rates.interest expense.
The changes in Operating revenues consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
(Decrease) Increase(Decrease) Increase(Decrease) Increase(Decrease) Increase
ElectricGasTotalElectricGasTotalElectricGasTotalElectricGasTotal
WeatherWeather$(1)$(1)$(2)$(5)$(5)$(10)Weather$(38)$— $(38)$(96)$(27)$(123)
VolumeVolume(2)10 14 Volume15 — 15 — 
PricingPricing32 38 65 23 88 Pricing20 35 55 
TransmissionTransmission— — Transmission23 — 23 24 — 24 
OtherOther11 15 Other(3)— (3)(4)
38 10 48 83 32 115 (1)(51)14 (37)
Regulatory required programsRegulatory required programs58 17 75 95 71 166 Regulatory required programs28 (10)18 145 (8)137 
Total increaseTotal increase$96 $27 $123 $178 $103 $281 Total increase$27 $(4)$23 $94 $$100 
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 and nine months ended JuneSeptember 30, 20222023 compared to the same period in 2021, Operating revenues related to weather remained relatively consistent. During the six months ended June 30, 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.
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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
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PECO’s service territory for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 20212022 and normal weather consisted of the following:
Three Months Ended June 30,% ChangeThree Months Ended September 30,% Change
PECO Service TerritoryPECO Service Territory20222021Normal2022 vs. 20212022 vs. NormalPECO Service Territory20232022Normal2023 vs. 20222023 vs. Normal
Heating Degree-DaysHeating Degree-Days385404424(4.7)%(9.2)%Heating Degree-Days181922(5.3)%(18.2)%
Cooling Degree-DaysCooling Degree-Days4344183913.8 %11.0 %Cooling Degree-Days1,0641,2901,022(17.5)%4.1 %
Six Months Ended June 30,% ChangeNine Months Ended September 30,% Change
20222021Normal2022 vs. 20212022 vs. Normal20232022Normal2023 vs. 20222023 vs. Normal
Heating Degree-DaysHeating Degree-Days2,613 2,7062,840(3.4)%(8.0)%Heating Degree-Days2,236 2,6322,866(15.0)%(22.0)%
Cooling Degree-DaysCooling Degree-Days435 4233922.8 %11.0 %Cooling Degree-Days1,297 1,7251,408(24.8)%(7.9)%
Volume. Electric volume, exclusive of the effects of weather, for the three and sixnine months ended JuneSeptember 30, 2022,2023 compared to the same period in 2021, remained relatively consistent.2022, increased due to customer mix and load growth. Natural gas volume for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021, increased due to retail load growth.2022, remained relatively consistent.
Electric Retail Deliveries to Customers (in GWhs)Electric Retail Deliveries to Customers (in GWhs)Three Months Ended
June 30,
% Change
Weather -
Normal
% Change(b)
Six Months Ended June 30,% Change
Weather -
Normal
% Change(b)
Electric Retail Deliveries to Customers (in GWhs)Three Months Ended
September 30,
% Change
Weather -
Normal
% Change(b)
Nine Months Ended September 30,% Change
Weather -
Normal
% Change(b)
20222021202220212023202220232022
ResidentialResidential3,0603,116(1.8)%(1.1)%6,8186,883(0.9)%0.1 %Residential4,1344,386(5.7)%4.9 %10,18611,204(9.1)%0.7 %
Small commercial & industrialSmall commercial & industrial1,8131,7583.1 %3.0 %3,7503,6393.1 %3.2 %Small commercial & industrial2,0702,139(3.2)%0.8 %5,6165,889(4.6)%— %
Large commercial & industrialLarge commercial & industrial3,4163,475(1.7)%(1.8)%6,7486,747— %— %Large commercial & industrial3,8303,943(2.9)%(0.4)%10,39810,691(2.7)%(0.3)%
Public authorities & electric railroadsPublic authorities & electric railroads13512111.6 %11.9 %31727017.4 %17.7 %Public authorities & electric railroads152172(11.6)%(10.8)%464489(5.1)%(5.0)%
Total electric retail deliveries(a)
Total electric retail deliveries(a)
8,4248,470(0.5)%(0.4)%17,63317,5390.5 %1.0 %
Total electric retail deliveries(a)
10,18610,640(4.3)%1.7 %26,66428,273(5.7)%0.1 %
As of June 30,At September 30,
Number of Electric CustomersNumber of Electric Customers20222021Number of Electric Customers20232022
ResidentialResidential1,521,7281,513,456Residential1,531,1681,523,269
Small commercial & industrialSmall commercial & industrial155,484154,842Small commercial & industrial155,932155,516
Large commercial & industrialLarge commercial & industrial3,1143,108Large commercial & industrial3,1113,120
Public authorities & electric railroadsPublic authorities & electric railroads10,38610,285Public authorities & electric railroads10,41610,393
TotalTotal1,690,7121,681,691Total1,700,6271,692,298
__________
(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)Natural Gas Deliveries to Customers (in mmcf)Three Months Ended
June 30,
% Change
Weather -
Normal
% Change(b)
Six Months Ended
June 30,
% Change
Weather -
Normal
% Change(b)
Natural Gas Deliveries to Customers (in mmcf)Three Months Ended
September 30,
% Change
Weather -
Normal
% Change(b)
Nine Months Ended
September 30,
% Change
Weather -
Normal
% Change(b)
20222021202220212023202220232022
ResidentialResidential5,2065,0273.6 %4.9 %26,04325,7011.3 %4.4 %Residential2,1342,197(2.9)%(5.4)%23,69728,240(16.1)%(3.9)%
Small commercial & industrialSmall commercial & industrial3,6383,12116.6 %17.2 %14,18413,2916.7 %8.4 %Small commercial & industrial1,9392,054(5.6)%(8.1)%14,38116,238(11.4)%(1.8)%
Large commercial & industrialLarge commercial & industrial42100.0 %12.6 %14955.6 %11.4 %Large commercial & industrial46(33.3)%(7.1)%392095.0 %3.6 %
TransportationTransportation5,7075,4684.4 %5.7 %13,34613,1181.7 %2.7 %Transportation5,2785,1622.2 %8.3 %17,48218,508(5.5)%(2.3)%
Total natural gas retail deliveries(a)
Total natural gas retail deliveries(a)
14,55513,6186.9 %8.0 %53,58752,1192.8 %5.0 %
Total natural gas retail deliveries(a)
9,3559,419(0.7)%1.1 %55,59963,006(11.8)%(2.9)%
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As of June 30, At September 30,
Number of Natural Gas CustomersNumber of Natural Gas Customers20222021Number of Natural Gas Customers20232022
ResidentialResidential499,678494,895Residential505,370500,934
Small commercial & industrialSmall commercial & industrial44,72644,450Small commercial & industrial44,74346,074
Large commercial & industrialLarge commercial & industrial106Large commercial & industrial99
TransportationTransportation659677Transportation629656
TotalTotal545,073540,028Total550,751547,673
__________
(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.
Pricing for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 20212022 increased primarily due to increasesan increase in electric and gas distribution rates charged to customers.
Transmission Revenue. Under a FERC approvedFERC-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 revenue for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021 increased primarily due to revenue related to late payment charges.2022 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 $76$104 million and $166$8 million for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021, respectively,2022, inPurchased power and fuelexpense is offset in Operating revenues as part of regulatory required programs.
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PECO
The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended
June 30, 2022
Increase (Decrease)Increase (Decrease)
BSC costs$$16 
Credit loss expense
Storm-related costs
Pension and non-pension post retirement benefit expense(3)(4)
Labor, other benefits, contracting and materials(6)(8)
Other
15 
Regulatory required programs
Total increase$$20 

Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
Increase (Decrease)Increase (Decrease)
Storm-related costs$26 $28 
BSC costs11 19 
Labor, other benefits, contracting and materials(7)15 
Pension and non-pension postretirement benefit expense— (3)
Credit loss expense(1)
Other(6)(5)
25 53 
Regulatory required programs28 
Total increase$34 $81 
The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended June 30, 2022Six Months Ended
June 30, 2022
Three Months Ended September 30, 2023Nine Months Ended
September 30, 2023
IncreaseIncreaseIncreaseIncrease
Depreciation and amortization(a)
Depreciation and amortization(a)
$$12 
Depreciation and amortization(a)
$$20 
Regulatory asset amortizationRegulatory asset amortization— — Regulatory asset amortization— 
Total increaseTotal increase$$12 Total increase$$20 
__________
(a)Depreciation and amortization increased primarily due to ongoing capital expenditures.


Interest expense, net increased $1$7 million and $4$20 million for the three and sixnine months ended JuneSeptember 30, 20222023, compared to the same period in 2021,2022, primarily due to an increase in interest rates and the issuance of debt in 20212022 and 2022.2023.
Effective income tax rates were 6.3%2.0% and 1.9%24.6% for the three months ended JuneSeptember 30, 20222023 and 20212022, respectively, and 6.6%1.9% and 4.2%12.4% for the for the sixnine months ended JuneSeptember 30, 20222023 and 2021,2022, 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.
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BGE

Results of Operations — BGE
Three Months Ended
June 30,
Favorable
(Unfavorable)
Variance
Six Months Ended
June 30,
Favorable
(Unfavorable)
Variance
Three Months Ended
September 30,
Favorable (Unfavorable) VarianceNine Months Ended
September 30,
Favorable (Unfavorable) Variance
20222021202220212023202220232022
Operating revenuesOperating revenues$786 $682 $104 $1,940 $1,656 $284 Operating revenues$932 $870 $62 $2,986 $2,810 $176 
Operating expensesOperating expensesOperating expenses
Purchased power and fuelPurchased power and fuel289 219 (70)743 550 (193)Purchased power and fuel380 350 (30)1,145 1,093 (52)
Operating and maintenanceOperating and maintenance205 193 (12)423 390 (33)Operating and maintenance214 235 21 632 658 26 
Depreciation and amortizationDepreciation and amortization152 141 (11)322 293 (29)Depreciation and amortization161 148 (13)487 470 (17)
Taxes other than income taxesTaxes other than income taxes71 67 (4)148 139 (9)Taxes other than income taxes80 77 (3)239 225 (14)
Total operating expensesTotal operating expenses717 620 (97)1,636 1,372 (264)Total operating expenses835 810 (25)2,503 2,446 (57)
Operating incomeOperating income69 62 304 284 20 Operating income97 60 37 483 364 119 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(36)(34)(2)(71)(67)(4)Interest expense, net(47)(39)(8)(135)(110)(25)
Other, netOther, net(4)11 16 (5)Other, net14 16 (2)
Total other income and (deductions)Total other income and (deductions)(31)(25)(6)(60)(51)(9)Total other income and (deductions)(41)(34)(7)(121)(94)(27)
Income before income taxesIncome before income taxes38 37 244 233 11 Income before income taxes56 26 30 362 270 92 
Income taxesIncome taxes(8)(9)10 (21)(31)Income taxes11 (7)(18)76 (73)
Net incomeNet income$37 $45 $(8)$234 $254 $(20)Net income$45 $33 $12 $286 $267 $19 
Three Months Ended JuneSeptember 30, 20222023 Compared to Three Months Ended JuneSeptember 30, 2021.2022. Net income decreased $8increased $12 million primarily due to an increase in depreciation expense, partially offset by favorable impacts of the multi-year plans.plans, partially offset by an increase in storm costs, an increase in depreciation and amortization, and an increase in interest expense. 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.
SixNine Months Ended JuneSeptember 30, 20222023 Compared to SixNine Months Ended JuneSeptember 30, 2021.2022. Net incomeIncome decreased $20increased $19 million primarily due to an increase in depreciation expense and credit loss expense, partially offset by favorable impacts of the multi-year plans.plans, partially offset by an increase in storm costs, an increase in depreciation and amortization, and an increase in interest expense. 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
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
IncreaseIncreaseIncrease (Decrease)Increase (Decrease)
ElectricGasTotalElectricGasTotalElectricGasTotalElectricGasTotal
DistributionDistribution$17 $$22 $31 $15 $46 Distribution$19 $$23 $61 $33 $94 
TransmissionTransmission— — Transmission— 34 — 34 
OtherOther10 15 Other— (1)
22 29 48 20 68 23 28 94 36 130 
Regulatory required programsRegulatory required programs50 25 75 128 88 216 Regulatory required programs56 (22)34 106 (60)46 
Total increase$72 $32 $104 $176 $108 $284 
Total increase (decrease)Total increase (decrease)$79 $(17)$62 $200 $(24)$176 
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.
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BGE

As of June 30, At September 30,
Number of Electric CustomersNumber of Electric Customers20222021Number of Electric Customers20232022
ResidentialResidential1,200,397 1,192,135 Residential1,208,230 1,200,786 
Small commercial & industrialSmall commercial & industrial115,769 114,682 Small commercial & industrial115,557 115,778 
Large commercial & industrialLarge commercial & industrial12,721 12,528 Large commercial & industrial13,007 12,774 
Public authorities & electric railroadsPublic authorities & electric railroads267 267 Public authorities & electric railroads264 266 
TotalTotal1,329,154 1,319,612 Total1,337,058 1,329,604 
As of June 30,At September 30,
Number of Natural Gas CustomersNumber of Natural Gas Customers20222021Number of Natural Gas Customers20232022
ResidentialResidential653,409 647,534 Residential655,753 653,413 
Small commercial & industrialSmall commercial & industrial38,227 38,223 Small commercial & industrial37,950 38,128 
Large commercial & industrialLarge commercial & industrial6,211 6,132 Large commercial & industrial6,289 6,222 
TotalTotal697,847 691,889 Total699,992 697,763 
Distribution Revenue increased for the three and sixnine months ended JuneSeptember 30, 2022,2023, compared to the same period in 2021,2022, 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 and sixnine months ended JuneSeptember 30, 2022,2023, compared to the same period in 2021,2022, primarily due to increases in underlying costs and capital investments.
Other Revenueincludes revenue related to late payment, charges, mutual assistance, off-system sales, and service application fees. Other revenue increasedRevenue remained relatively the same for the three and sixnine months ended JuneSeptember 30, 2022,2023 compared to the same period in 2021, primarily due to an increase in late fees charged to customers.2022.
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 $70$30 million and $193$52 million for thethe three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021,2022, in Purchased power and fuel expense is fully offset in Operating revenues as part of regulatory required programs.

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BGE

The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
Increase (Decrease) Increase (Decrease) Increase (Decrease)Increase (Decrease)
Labor, other benefits, contracting, and materialsLabor, other benefits, contracting, and materials$$Labor, other benefits, contracting, and materials$$15 
Storm-related costsStorm-related costs(2)(1)Storm-related costs12 12 
Pension and non-pension postretirement benefits expensePension and non-pension postretirement benefits expense(3)(6)Pension and non-pension postretirement benefits expense
BSC costsBSC costs14 BSC costs12 18 
Credit loss expenseCredit loss expense— 14 Credit loss expense(14)
Other
Other(a)
Other(a)
(51)(62)
11 30 (21)(27)
Regulatory required programsRegulatory required programsRegulatory required programs— 
Total increase$12 $33 
Total decreaseTotal decrease$(21)$(26)
__________
(a)Primarily relates to the prior year asset impairment of $46 million. See Note 11 - Asset Impairments of the 2022 Form 10-K for additional information.
The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
IncreaseIncreaseIncreaseIncrease (Decrease)
Depreciation and amortization(a)
Depreciation and amortization(a)
$$19 
Depreciation and amortization(a)
$$22 
Regulatory required programsRegulatory required programsRegulatory required programs(4)
Regulatory asset amortizationRegulatory asset amortizationRegulatory asset amortization— (1)
Total increaseTotal increase$11 $29 Total increase$13 $17 
__________
(a)Depreciation and amortizatiaonmortization increased primarily due to ongoing capital expenditures.
Taxes other than income taxes
Interest expense, net increased by $4 million and $9$25 million for the three and sixnine months ended JuneSeptember 30, 2022,2023, respectively compared to the same period in 2021,2022, primarily due to an increase in interest rates and the issuance of debt in 2023 and 2022.
Taxes other than income taxes increased by $14 million for the nine months ended September 30, 2023, respectively, compared to the same period in 2022, primarily due to increased property taxes.
Effective income tax rates were 2.6%19.6% and (21.6)(26.9)% for the three months ended JuneSeptember 30, 20222023 and 2021,2022 respectively, and 4.1%21.0% and (9.0)%1.1% for the sixnine months ended JuneSeptember 30, 2023 and 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.
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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 and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021.2022. See the Results of Operations for Pepco, DPL, and ACE for additional information.
Three Months Ended
June 30,
(Unfavorable) VarianceSix Months Ended June 30,(Unfavorable) Favorable VarianceThree Months Ended
September 30,
Unfavorable VarianceNine Months Ended September 30,Unfavorable Variance
20222021202220212023202220232022
PHIPHI$100 $141 $(41)$230 $269 $(39)PHI$232 $289 $(57)$490 $518 $(28)
PepcoPepco70 75 (5)116 134 (18)Pepco120 145 (25)249 261 (12)
DPLDPL21 30 (9)77 86 (9)DPL43 52 (9)128 130 (2)
ACEACE11 37 (26)37 51 (14)ACE71 94 (23)122 131 (9)
Other(a)
Other(a)
(2)(1)(1)— (2)
Other(a)
(2)(2)— (9)(4)(5)
__________
(a)Primarily includes eliminating and consolidating adjustments, PHI's corporate operations, shared service entities, and other financing and investinginvestment activities.

Three Months Ended JuneSeptember 30, 20222023 Compared to Three Months Ended JuneSeptember 30, 2021.2022. Net Income decreased by $41$57 million primarily due to the absence of favorable weather and volume as a result of the CIP at ACE, an increase in credit lossdepreciation expense, at Pepco, higher contracting costs partially due to timing of maintenance projects, an increase in credit loss expense at Pepco, depreciation and amortization expense, andhigher storm costs at DPL, timing of decoupling revenues in the District of Columbia, timing of excess deferred tax amortization at DPL and ACE, and an increase in various operating expenses, partially offset by favorable impacts as a result of Pepco's Maryland and District of Columbia multi-year plans and higher electrictransmission rates, higher distribution rates at DPL Delaware, and ACE.favorable impacts of the Pepco Maryland and DPL Maryland multi-year plans.
SixNine Months Ended JuneSeptember 30, 20222023 Compared to SixNine Months Ended JuneSeptember 30, 2021.2022. Net Incomedecreased by $39$28 millionprimarily due to the absence of favorable weather and volume as a result of the CIP at ACE, an increase in storm costsenvironmental liabilities at Pepco, and DPL, credit lossan increase in depreciation expense, at Pepco and DPL, higher contracting costs partially due to timing of maintenance projects at Pepco, depreciation and amortization expense,an increase in interest expense, unfavorable weather at DPL Delaware electric and timing of excess deferred tax amortization at Pepconatural gas service territories, and ACE,an increase in various operating expenses, partially offset by higher transmission rates, higher distribution rates at DPL Delaware, and favorable impacts as a result of Pepco'sthe Pepco Maryland and District of ColumbiaDPL Maryland multi-year plans and higher electric distribution rate at DPL and ACE.plans.

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Pepco

Results of Operations — Pepco
Three Months Ended June 30, Favorable (Unfavorable) VarianceSix Months Ended June 30,Favorable (Unfavorable) Variance
2022202120222021
Operating revenues$581 $523 $58 $1,195 $1,076 $119 
Operating expenses
Purchased power162 133 (29)375 298 (77)
Operating and maintenance128 113 (15)260 221 (39)
Depreciation and amortization105 96 (9)213 199 (14)
Taxes other than income taxes92 87 (5)186 177 (9)
Total operating expenses487 429 (58)1,034 895 (139)
Operating income94 94 — 161 181 (20)
Other income and (deductions)
Interest expense, net(38)(35)(3)(74)(69)(5)
Other, net13 13 — 26 25 
Total other income and (deductions)(25)(22)(3)(48)(44)(4)
Income before income taxes69 72 (3)113 137 (24)
Income taxes(1)(3)(2)(3)
Net income$70 $75 $(5)$116 $134 $(18)

Three Months Ended September 30,Favorable (Unfavorable) VarianceNine Months Ended September 30,Favorable (Unfavorable) Variance
2023202220232022
Operating revenues$822 $724 $98 $2,174 $1,919 $255 
Operating expenses
Purchased power288 230 (58)750 605 (145)
Operating and maintenance149 121 (28)440 380 (60)
Depreciation and amortization112 99 (13)329 312 (17)
Taxes other than income taxes109 105 (4)291 291 — 
Total operating expenses658 555 (103)1,810 1,588 (222)
Operating income164 169 (5)364 331 33 
Other income and (deductions)
Interest expense, net(41)(37)(4)(122)(111)(11)
Other, net18 14 50 39 11 
Total other income and (deductions)(23)(23)— (72)(72)— 
Income before income taxes141 146 (5)292 259 33 
Income taxes21 (20)43 (2)(45)
Net income$120 $145 $(25)$249 $261 $(12)
Three Months Ended JuneSeptember 30, 20222023 Compared to Three Months Ended JuneSeptember 30, 2021.2022. Net Income decreased by $525 million primarily due to an increasethe timing of decoupling revenues in depreciation expense, credit loss expense, andthe District of Columbia, higher contracting costs partially due to timing of maintenance projects, partially offset by the favorable impacts of the Maryland and District of Columbia multi-year plans.
Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021.Net income decreased by $18 million primarily due to an increase in depreciation expense, credit loss expense, storm costs, higher contracting costs partially due to timing of maintenance projects,interest expense, and timing of excess deferred tax amortization,various operating expenses, partially offset by the favorable impacts of the Maryland multi-year plan and Districthigher transmission rates.
Nine Months Ended September 30, 2023 Compared to Nine Months Ended September 30, 2022. Net Income decreased by$12 million primarily due to an increase in environmental liabilities, depreciation expense, interest expense, and various operating expenses, partially offset by favorable impacts of Columbiathe Maryland multi-year plans.plan, higher transmission rates, and customer growth.
The changes in Operating revenues consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended June 30, 2022Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
IncreaseIncreaseIncrease (Decrease)Increase
DistributionDistribution$20 $26 Distribution$17 $69 
TransmissionTransmissionTransmission16 44 
OtherOther— Other(1)
29 34 32 115 
Regulatory required programsRegulatory required programs29 85 Regulatory required programs66 140 
Total increaseTotal increase$58 $119 Total increase$98 $255 
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)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.
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Pepco

As of June 30,At September 30,
Number of Electric CustomersNumber of Electric Customers20222021Number of Electric Customers20232022
ResidentialResidential850,569 837,744 Residential862,321 853,873 
Small commercial & industrialSmall commercial & industrial54,349 53,669 Small commercial & industrial54,082 54,423 
Large commercial & industrialLarge commercial & industrial22,771 22,579 Large commercial & industrial22,952 22,789 
Public authorities & electric railroadsPublic authorities & electric railroads194 178 Public authorities & electric railroads205 196 
TotalTotal927,883 914,170 Total939,560 931,281 
Distribution Revenue increased for the three and six months ended JuneSeptember 30, 20222023 compared to the same period in 20212022 primarily due to higher rates due to the expiration of customer offsets and favorable impacts of the Maryland andmulti-year plan, partially offset by the timing of decoupling revenues in the District of ColumbiaColumbia. Distribution revenue increased for the nine months ended September 30, 2023 compared to the same period in 2022 primarily due to higher rates due to the expiration of customer offsets, favorable impacts of the Maryland multi-year plans.plan, and customer growth.
Transmission RevenueRevenue. 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 both the three and sixnine months ended JuneSeptember 30, 2022,2023, compared to the same period in 2021,2022, primarily due to increases in underlying costs and capital investment and underlying costs.investment.
Other Revenueincludes 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 $29$58 million and $77$145 million for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021,2022, 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
June 30, 2022
Six Months Ended June 30, 2022
Increase (Decrease)Increase
BSC and PHISCO Costs$$11 
Labor, other benefits, contracting and materials(a)
Credit loss expense
Storm-related costs— 
Other(5)
13 37 
Regulatory required programs
Total increase$15 $39 
__________
(a) Primarily reflects higher contracting costs partially due to timing of maintenance projects.
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Pepco

The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
Increase (Decrease)Increase (Decrease)
BSC and PHISCO costs$$10 
Labor, other benefits, contracting and materials(a)
29 
Credit Loss expense— 
Pension and non-pension postretirement benefits expense
Storm-related costs(2)(7)
Other12 
25 52 
Regulatory required programs
Total increase$28 $60 
__________
(a)Primarily reflects an increase in environmental liabilities for the nine months ended September 30, 2023.

The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended June 30, 2022Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
IncreaseIncrease (Decrease)IncreaseIncrease (Decrease)
Depreciation and amortization(a)
Depreciation and amortization(a)
$$11 
Depreciation and amortization(a)
$10 $17 
Regulatory asset amortizationRegulatory asset amortization(3)Regulatory asset amortization10 
Regulatory required programsRegulatory required programsRegulatory required programs— (10)
Total increaseTotal increase$$14 Total increase$13 $17 
__________
(a)Depreciation and amortization increased primarily due to ongoing capital expenditures.

Interest expense, net
increased by $4 million and $11 million for the three and nine months ended September 30, 2023 compared to the same period in 2022, respectively, primarily due to an increase in interest rates and the issuance of debt in 2022 and 2023.
Other, net increased by $4 million and $11 million for the three and nine months ended September 30, 2023 compared to the same period in 2022, respectively, primarily due to higher AFUDC equity.
Effective income tax rates were (1.4)%14.9% and (4.2)%0.7% for the three months ended JuneSeptember 30, 20222023 and 2021,2022, respectively, and (2.7)%14.7% and 2.2%(0.8)% for the sixnine months ended JuneSeptember 30, 2023 and 2022, and 2021, respectively. The three months ended June 30, 2022 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. The six months ended June 30, 2022 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, partially offset with the timing of excess deferred tax amortization. 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.
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DPL

Results of Operations — DPL
Three Months Ended June 30,Favorable (Unfavorable) VarianceSix Months Ended June 30,Favorable (Unfavorable) VarianceThree Months Ended September 30,Favorable (Unfavorable) VarianceNine Months Ended September 30,Favorable (Unfavorable) Variance
20222021202220212023202220232022
Operating revenuesOperating revenues$332 $298 $34 $763 $680 $83 Operating revenues$450 $412 $38 $1,273 $1,176 $97 
Operating expensesOperating expensesOperating expenses
Purchased power and fuelPurchased power and fuel135 108 (27)324 263 (61)Purchased power and fuel201 183 (18)562 507 (55)
Operating and maintenanceOperating and maintenance88 80 (8)181 164 (17)Operating and maintenance104 84 (20)278 266 (12)
Depreciation and amortizationDepreciation and amortization56 51 (5)113 104 (9)Depreciation and amortization62 59 (3)182 172 (10)
Taxes other than income taxesTaxes other than income taxes17 16 (1)35 33 (2)Taxes other than income taxes19 19 — 57 54 (3)
Total operating expensesTotal operating expenses296 255 (41)653 564 (89)Total operating expenses386 345 (41)1,079 999 (80)
Operating incomeOperating income36 43 (7)110 116 (6)Operating income64 67 (3)194 177 17 
Other income and (deductions)Other income and (deductions)Other income and (deductions)
Interest expense, netInterest expense, net(17)(16)(1)(33)(30)(3)Interest expense, net(18)(16)(2)(53)(48)(5)
Other, netOther, net— — Other, net12 
Total other income and (deductions)Total other income and (deductions)(13)(12)(1)(27)(24)(3)Total other income and (deductions)(13)(13)— (41)(39)(2)
Income before income taxesIncome before income taxes23 31 (8)83 92 (9)Income before income taxes51 54 (3)153 138 15 
Income taxesIncome taxes(1)— Income taxes(6)25 (17)
Net incomeNet income$21 $30 $(9)$77 $86 $(9)Net income$43 $52 $(9)$128 $130 $(2)

Three Months Ended JuneSeptember 30, 20222023 Compared to Three Months Ended JuneSeptember 30, 2021.2022. Net income decreased $9 million primarily due to an increase in storm costs, depreciation expense, and various operating expenses, and the timing of excess deferred tax amortization, partially offset by favorable impacts of the Maryland multi-year plan, higher Delaware electric and natural gas distribution rates, and higher transmission rates.
SixNine Months Ended JuneSeptember 30, 20222023 Compared to SixNine Months Ended JuneSeptember 30, 2021.2022. Net incomedecreased $9$2 million primarily due to unfavorable weather conditions at Delaware electric and natural gas service territories, an increase in credit loss expense, depreciation expense, and various operating expenses,interest expense, partially offset by favorable impacts of the Maryland multi-year plan, higher Delaware electric and natural gas distribution rates, and higher transmission rates.
The changes in Operating revenues consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
(Decrease) Increase(Decrease) Increase(Decrease) Increase(Decrease) Increase
ElectricGasTotalElectricGasTotalElectricGasTotalElectricGasTotal
WeatherWeather$(1)$— $(1)$(1)$— $(1)Weather$(1)$— $(1)$(11)$(5)$(16)
VolumeVolume(1)Volume(1)— (1)(3)(3)(6)
DistributionDistribution10 13 Distribution26 32 
TransmissionTransmission(1)— (1)— Transmission12 — 12 25 — 25 
OtherOther— 
14 20 19 20 41 (1)40 
Regulatory required programsRegulatory required programs18 11 29 43 20 63 Regulatory required programs33 (15)18 64 (7)57 
Total increase$20 $14 $34 $57 $26 $83 
Total increase (decrease)Total increase (decrease)$52 $(14)$38 $105 $(8)$97 
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)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.
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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
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demand. During the three and six months ended JuneSeptember 30, 20222023, compared to the same period in 2021,2022, Operating revenues related to weather remained relatively consistent. During the nine months ended September 30, 2023, compared to the same period in 2022, Operating revenues related to weather decreased due to unfavorable weather conditions in Delaware electric and natural gas service territories.
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'sthe Delaware electric service territory and a 30-year period in DPL'sthe Delaware natural gas service territory. The changes in heating and cooling degree days in DPL’sthe Delaware service territory for the three and sixnine months ended JuneSeptember 30, 20222023 compared to same period in 20212022 and normal weather consisted of the following:
Three Months Ended June 30,% ChangeThree Months Ended September 30,% Change
Delaware Electric Service TerritoryDelaware Electric Service Territory20222021Normal2022 vs. 20212022 vs. NormalDelaware Electric Service Territory20232022Normal2023 vs. 20222023 vs. Normal
Heating Degree-DaysHeating Degree-Days441 480 471 (8.1)%(6.4)%Heating Degree-Days37 32 27 15.6 %37.0 %
Cooling Degree-DaysCooling Degree-Days328 361 336 (9.1)%(2.4)%Cooling Degree-Days996 1,043 911 (4.5)%9.3 %
Six Months Ended June 30,% ChangeNine Months Ended September 30,% Change
20222021Normal2022 vs. 20212022 vs. Normal
Delaware Electric Service TerritoryDelaware Electric Service Territory20232022Normal2023 vs. 20222023 vs. Normal
Heating Degree-DaysHeating Degree-Days2,796 2,838 2,951 (1.5)%(5.3)%Heating Degree-Days2,306 2,828 2,984 (18.5)%(22.7)%
Cooling Degree-DaysCooling Degree-Days331 364 336 (9.1)%(1.5)%Cooling Degree-Days1,249 1,374 1,248 (9.1)%0.1 %
Three Months Ended June 30,% ChangeThree Months Ended September 30,% Change
Delaware Natural Gas Service TerritoryDelaware Natural Gas Service Territory20222021Normal2022 vs. 20212022 vs. NormalDelaware Natural Gas Service Territory20232022Normal2023 vs. 20222023 vs. Normal
Heating Degree-DaysHeating Degree-Days441 480 492 (8.1)%(10.4)%Heating Degree-Days37 32 35 15.6 %5.7 %
Six Months Ended June 30,% ChangeNine Months Ended September 30,% Change
20222021Normal2022 vs. 20212022 vs. Normal
Delaware Natural Gas Service TerritoryDelaware Natural Gas Service Territory20232022Normal2023 vs. 20222023 vs. Normal
Heating Degree-DaysHeating Degree-Days2,796 2,838 2,993 (1.5)%(6.6)%Heating Degree-Days2,306 2,828 3,020 (18.5)%(23.6)%
Volume, exclusive of the effects of weather, remained relatively consistent for the three months ended JuneSeptember 30, 20222023 compared to the same period in 20212022 and increaseddecreased for the sixnine months ended JuneSeptember 30, 20222023 compared to the same period in2021 2022 primarily due to customer growth and usage.usage, partially offset by customer growth.
Electric Retail Deliveries to Delaware Customers (in GWhs)Electric Retail Deliveries to Delaware Customers (in GWhs)Three Months Ended
June 30,
% Change
Weather - Normal
% Change(b)
Six Months Ended
June 30,
% Change
Weather - Normal
% Change(b)
Electric Retail Deliveries to Delaware Customers (in GWhs)Three Months Ended
September 30,
% Change
Weather - Normal
% Change(b)
Nine Months Ended
September 30,
% Change
Weather - Normal
% Change(b)
20222021202220212023202220232022
ResidentialResidential675 703 (4.0)%(1.7)%1,570 1,557 0.8 %1.6 %Residential995 978 1.7 %0.6 %2,403 2,548 (5.7)%(0.2)%
Small commercial & industrialSmall commercial & industrial337 357 (5.6)%(4.8)%706 699 1.0 %1.4 %Small commercial & industrial405 400 1.3 %0.6 %1,081 1,107 (2.3)%(0.1)%
Large commercial & industrialLarge commercial & industrial773 810 (4.6)%(4.2)%1,538 1,499 2.6 %2.8 %Large commercial & industrial849 856 (0.8)%(0.2)%2,349 2,394 (1.9)%(0.7)%
Public authorities & electric railroadsPublic authorities & electric railroads10 (20.0)%(19.9)%17 19 (10.5)%(7.9)%Public authorities & electric railroads— %(5.8)%23 24 (4.2)%(4.3)%
Total electric retail deliveries(a)
Total electric retail deliveries(a)
1,793 1,880 (4.6)%(3.5)%3,831 3,774 1.5 %2.0 %
Total electric retail deliveries(a)
2,256 2,241 0.7 %0.3 %5,856 6,073 (3.6)%(0.4)%
As of June 30,
Number of Total Electric Customers (Maryland and Delaware)20222021
Residential479,728 475,061 
Small commercial & industrial63,574 62,880 
Large commercial & industrial1,222 1,213 
Public authorities & electric railroads598 607 
Total545,122 539,761 
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At September 30,
Number of Total Electric Customers (Maryland and Delaware)20232022
Residential484,425 480,779 
Small commercial & industrial64,101 63,685 
Large commercial & industrial1,245 1,230 
Public authorities & electric railroads593 597 
Total550,364 546,291 
__________
(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.
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Natural Gas Retail Deliveries to Delaware Customers (in mmcf)Three Months Ended
September 30,
% Change
Weather - Normal
% Change(b)
Nine Months Ended
September 30,
% Change
Weather - Normal
% Change(b)
2023202220232022
Residential414 374 10.7 %8.3 %4,781 5,810 (17.7)%(4.9)%
Small commercial & industrial350 331 5.7 %4.4 %2,494 2,882 (13.5)%(0.3)%
Large commercial & industrial381 397 (4.0)%(4.0)%1,166 1,259 (7.4)%(7.2)%
Transportation1,119 1,284 (12.9)%(13.0)%4,350 4,934 (11.8)%(7.9)%
Total natural gas deliveries(a)
2,264 2,386 (5.1)%(5.7)%12,791 14,885 (14.1)%(5.2)%





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Natural Gas Retail Deliveries to Delaware Customers (in mmcf)Three Months Ended
June 30,
% Change
Weather - Normal
% Change(b)
Six Months Ended
June 30,
% Change
Weather - Normal
% Change(b)
2022202120222021
Residential983 713 37.9 %44.6 %5,436 5,107 6.4 %6.3 %
Small commercial & industrial570 430 32.6 %39.2 %2,550 2,295 11.1 %12.0 %
Large commercial & industrial402 393 2.3 %2.3 %863 853 1.2 %1.1 %
Transportation1,444 1,470 (1.8)%(0.7)%3,650 3,694 (1.2)%(0.7)%
Total natural gas deliveries(a)
3,399 3,006 13.1 %16.3 %12,499 11,949 4.6 %4.9 %
As of June 30,At September 30,
Number of Delaware Natural Gas CustomersNumber of Delaware Natural Gas Customers20222021Number of Delaware Natural Gas Customers20232022
ResidentialResidential128,715 127,503 Residential129,436 129,005 
Small commercial & industrialSmall commercial & industrial10,068 9,953 Small commercial & industrial10,039 10,044 
Large commercial & industrialLarge commercial & industrial16 18 Large commercial & industrial14 16 
TransportationTransportation157 158 Transportation165 156 
TotalTotal138,956 137,632 Total139,654 139,221 
__________
(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 both the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 20212022 primarily due to favorable impacts of the 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 July 2023, favorable impacts of the Maryland multi-year plan that became effective in September 2021.January 2023, and higher natural gas distribution rates effective in August 2022.
Transmission Revenues.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 remained relatively consistent forDuring the three and nine months ended JuneSeptember 30, 20222023 compared to the same period in 2021. Transmission2022, transmission revenue increased for the six months ended June 30, 2022 compared to the same period in 2021,primarily due to increases in underlying costs.costs and capital investment.
Other Revenue includes rental revenue, revenue related to late payment charges,service connection fees, and mutual assistance revenues, and recoveries of other taxes.revenues.
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
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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.
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See Note 5 — Segment Information of the Combined Notes to Consolidated Financial Statements for the presentation of DPL's revenue disaggregation.
The increase of $27$18 million and $61$55 million for the three and sixnine months ended JuneSeptember 30, 2022,2023, compared to the same period in 2021,2022, respectively, in Purchased power and fuel 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
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
Increase (Decrease)IncreaseIncreaseIncrease (Decrease)
Storm-related CostsStorm-related Costs$$
BSC and PHISCO costsBSC and PHISCO costs$$BSC and PHISCO costs
Credit loss expense
Storm-related costs— 
Labor, other benefits, contracting and materials
Labor and contractingLabor and contracting(3)
Credit Loss ExpenseCredit Loss Expense— 
Pension and non-pension postretirement benefits expensePension and non-pension postretirement benefits expense
OtherOther(1)— Other
15 20 11 
Regulatory required programsRegulatory required programsRegulatory required programs— 
Total increaseTotal increase$$17 Total increase$20 $12 
The changes in Depreciation and amortization expense consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended
June 30, 2022
Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
IncreaseIncrease (Decrease)IncreaseIncrease (Decrease)
Depreciation and amortization(a)
Depreciation and amortization(a)
$$
Depreciation and amortization(a)
$$15 
Regulatory required programsRegulatory required programs— (4)
Regulatory asset amortizationRegulatory asset amortization— (1)Regulatory asset amortization— (1)
Regulatory required programs— 
Total increaseTotal increase$$Total increase$$10 
__________
(a)DepreciationFor the three months ended September 30, 2023, reflects ongoing capital expenditures and amortizationhigher transmission depreciation rates effective September 2022. For the nine months ended September 30, 2023, reflects ongoing capital expenditures, higher distribution depreciation rates in Maryland effective March 2022, and higher transmission depreciation rates effective September 2022.
Interest expense, net increased by $2 million and $5 million for the three and nine months ended September 30, 2023 compared to the same period in 2022, respectively, primarily due to ongoing capital expenditures.

an increase in interest rates and the issuance of debt in 2022 and 2023.
Effective income tax rates were 8.7%15.7% and 3.2%3.7% for the three months ended JuneSeptember 30, 20222023 and 2021,2022, respectively, and 7.2%16.3% and 6.5%5.8% for the sixnine months ended JuneSeptember 30, 20222023 and 2021,2022, 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.
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Results of Operations — ACE
Three Months Ended June 30,(Unfavorable)Favorable VarianceSix Months Ended June 30,Favorable (Unfavorable) Variance
2022202120222021
Operating revenues$309 $319 $(10)$658 $629 $29 
Operating expenses
Purchased power123 154 31 301 311 10 
Operating and maintenance86 73 (13)170 150 (20)
Depreciation and amortization72 40 (32)118 87 (31)
Taxes other than income taxes— — 
Total operating expenses283 269 (14)593 552 (41)
Operating income26 50 (24)65 77 (12)
Other income and (deductions)
Interest expense, net(17)(14)(3)(32)(29)(3)
Other, net— 
Total other income and (deductions)(15)(14)(1)(27)(27)— 
Income before income taxes11 36 (25)38 50 (12)
Income taxes— (1)(1)(1)(2)
Net income$11 $37 $(26)$37 $51 $(14)

Three Months Ended September 30,Favorable (Unfavorable) VarianceNine Months Ended September 30,Favorable (Unfavorable) Variance
2023202220232022
Operating revenues$502 $462 $40 $1,172 $1,120 $52 
Operating expenses
Purchased power221 197 (24)493 497 
Operating and maintenance94 80 (14)259 251 (8)
Depreciation and amortization77 74 (3)212 192 (20)
Taxes other than income taxes— — 
Total operating expenses394 353 (41)971 947 (24)
Operating income108 109 (1)201 173 28 
Other income and (deductions)
Interest expense, net(19)(17)(2)(52)(49)(3)
Other, net13 
Total other income and (deductions)(14)(14)— (39)(40)
Income before income taxes94 95 (1)162 133 29 
Income taxes23 (22)40 (38)
Net income$71 $94 $(23)$122 $131 $(9)
Three Months Ended JuneSeptember 30, 20222023 Compared to Three Months Ended JuneSeptember 30, 20212022. Net income decreased by $26$23 million primarily due to the absence of favorable weather and volume as a result of the CIP, an increase in depreciation expense, various operating expenses, and timing of excess deferred tax amortization partially offset by increases in distribution rates.
Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021. Net income decreased by $14 million primarily due to the absence of favorable weather and volume as a result of the CIP, an increase in depreciation expense and various operating expenses.
Nine Months Ended September 30, 2023 Compared to Nine Months Ended September 30, 2022. Net income decreased by $9 million primarily due to an increase in depreciation expense and various operating expenses, and timing of excess deferred tax amortization, partially offset by increases in distributionhigher transmission rates.
The changes in Operating revenues consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended June 30, 2022Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
(Decrease) Increase(Decrease) IncreaseIncrease (Decrease)Increase (Decrease)
Weather$(3)$(3)
Volume(13)(11)
DistributionDistribution20 Distribution$15 $27 
TransmissionTransmission(3)Transmission30 
(11)
OtherOther(1)(1)
19 56 
Regulatory required programsRegulatory required programs20 Regulatory required programs21 (4)
Total (decrease) increase$(10)$29 
Total increaseTotal increase$40 $52 
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 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.
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At September 30,
Number of Electric Customers20232022
Residential504,330 501,869 
Small commercial & industrial62,410 62,204 
Large commercial & industrial2,980 3,075 
Public authorities & electric railroads729 731 
Total570,449 567,879 
Weather. Distribution RevenuePrior to the third quarter of 2021, the demand increased 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. Duringboth the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021, Operating revenues related to weather decreased due to the absence of favorable impacts in the first and second quarter of 2022 as a result of the CIP.
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 and six months ended June 30, 2022 compared to same period in 2021 and normal weather consisted of the following:
Three Months Ended June 30,Normal% Change
Heating and Cooling Degree-Days202220212022 vs. 20212022 vs. Normal
Heating Degree-Days533 525 540 1.5 %(1.3)%
Cooling Degree-Days275 321 305 (14.3)%(9.8)%
Six Months Ended June 30,Normal% Change
Heating and Cooling Degree-Days202220212022 vs. 20212022 vs. Normal
Heating Degree-Days2,969 2,873 2,994 3.3 %(0.8)%
Cooling Degree-Days277 325 305 (14.8)%(9.2)%
Volume,exclusive of the effects of weather, decreased for the three and six months ended June 30, 2022 compared to the same period in 2021, due to the absence of favorable impacts in the first and second quarter of 2022 as a result of the CIP.
Electric Retail Deliveries to Customers (in GWhs)Three Months Ended
June 30,
% Change
Weather - Normal % Change(b)
Six Months Ended
June 30,
% Change
Weather - Normal % Change(b)
2022202120222021
Residential859 975 (11.9)%(9.7)%1,777 1,903 (6.6)%(6.0)%
Small commercial & industrial362 333 8.7 %9.7 %701 638 9.9 %9.7 %
Large commercial & industrial808 761 6.2 %6.7 %1,511 1,477 2.3 %2.3 %
Public authorities & electric railroads11 11 — %(5.8)%25 24 4.2 %0.6 %
Total electric retail deliveries(a)
2,040 2,080 (1.9)%(0.5)%4,014 4,042 (0.7)%(0.5)%

As of June 30,
Number of Electric Customers20222021
Residential501,494 499,436 
Small commercial & industrial62,291 61,836 
Large commercial & industrial3,085 3,243 
Public authorities & electric railroads726 707 
Total567,596 565,222 
__________
(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 and six months ended June 30, 2022 compared to the same period in 2021 due to higher distribution rates that became effective in January 2022.
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Tableprimarily due to the expiration of Contentscustomer credits related to the TCJA tax benefits.
ACE

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 decreasedincreased for both thethree and nine months ended JuneSeptember 30, 20222023 compared to the same period in 2021,2022, primarily due to decreasesincreases in underlying costs partially offset by increases in capital investment. Transmission revenue increased for the six months ended June 30, 2022 compared to the same period in 2021, primarily due to an increase inand capital investment.
Other Revenue includes rental revenue, service connection fees, andrevenue related to late payment charges, mutual assistance revenues.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, Societal Benefits Charge, Transition Bonds,Bond Charge, 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 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 $24 million and decrease of $31 million and $10$4 million for the three and sixnine months ended JuneSeptember 30, 20222023 compared to the same period in 2021,2022, respectively, in Purchased power expense is fully offset in Operating revenues as part of regulatory required programs.
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The changes in Operating and maintenance expense consisted of the following:
Three Months Ended
June 30, 2022
Six Months Ended June 30, 2022Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
IncreaseIncreaseIncreaseIncrease (Decrease)
Labor, other benefits, contracting and materials$$
BSC and PHISCO costsBSC and PHISCO costsBSC and PHISCO costs$$
Labor and contractingLabor and contracting
Storm-related costsStorm-related costsStorm-related costs— 
Credit loss expense— 
Pension and non-pension postretirement benefits expensePension and non-pension postretirement benefits expense— 
OtherOtherOther
10 13 14 10 
Regulatory required programs(a)
Regulatory required programs(a)
Regulatory required programs(a)
— (2)
Total increaseTotal increase$13 $20 Total increase$14 $
__________
(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
June 30, 2022
Six Months Ended June 30, 2022Three Months Ended
September 30, 2023
Nine Months Ended
September 30, 2023
IncreaseIncreaseIncrease (Decrease)Increase
Depreciation and amortization(a)
Depreciation and amortization(a)
$$
Depreciation and amortization(a)
$$19 
Regulatory asset amortization— 
Regulatory required programs(b)
Regulatory required programs(b)
28 23 
Regulatory required programs(b)
(3)
Total increaseTotal increase$32 $31 Total increase$$20 
__________
(a)Depreciation and amortization increased primarily due toReflects ongoing capital expenditures.expenditures and higher transmission depreciation rates effective September 2022.
(b)RegulatoryFor the nine months ended September 30, 2023, regulatory required programs increased primarily due to the regulatory asset amortization of the PPA termination obligation which is fully offset in Operating revenues.
Interest expense, net increased by $2 million and $3 million for the three and nine months ended September 30, 2023 compared to the same period in 2022, respectively, primarily due to an increase in interest rates and the issuance of debt in 2022 and 2023.
Effective income tax rates were 0.0%24.5% and (2.8)%1.1% for the three months ended JuneSeptember 30, 20222023 and 2021,2022, respectively, and 2.6%24.7% and (2.0)%1.5% for the sixnine months ended JuneSeptember 30, 2023 and 2022, and 2021, respectively. The three and six months ended June 30, 2022 changes primarily reflect the timing of excess deferred tax amortization. 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.
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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 ConstellationGeneration have not been presented as discontinued operations and are included in the Consolidated Statements of Cash Flows for all periods presented.only 2022. The Exelon Consolidated Statement of Cash Flows for the sixnine months ended JuneSeptember 30, 2022 includes one month of cash flows from Generation. The Exelon Consolidated Statement of Cash Flows for the six months ended June 30, 2021 includes six 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. Additionally, ComEd is required to purchase CMCs from participating nuclear-powered generating facilities for a five-year period that began in June 2022, and all of its costs of doing so will be recovered through a rider. The price to be paid for each CMC is established through a competitive bidding process. ComEd will provide net payments to, or collect net payments from, customers for the difference between customer credits issued and the credit to be received from the participating nuclear-powered generating facilities. ComEd’s cash flows are affected by the establishment of CMC prices and the timing of recovering costs through the CMC regulatory asset.
See Note 3 — Regulatory Matters of the 2021 Recast2022 Form 10-K and Notes 3 — Regulatory Matters and 12 — Commitments and Contingencies of the Combined Notes to Consolidated Financial Statements for additional information on regulatory and legal proceedings and proposed legislation.
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The following table provides a summary of the change in cash flows from operating activities for the sixnine months ended JuneSeptember 30, 20222023 and 20212022 by Registrant:
Increase (decrease) in cash flows from operating activitiesExelonComEdPECOBGE PHIPepcoDPLACE
(Decrease) increase in cash flows from operating activities(Decrease) increase in cash flows from operating activitiesExelonComEdPECOBGE PHIPepcoDPLACE
Net income (loss)Net income (loss)$852 $25 $68 $(20)$(39)$(18)$(9)$(14)Net income (loss)$(28)$116 $(64)$19 $(28)$(12)$(2)$(9)
Adjustments to reconcile net income to cash:Adjustments to reconcile net income to cash:Adjustments to reconcile net income to cash:
Non-cash operating activitiesNon-cash operating activities(714)(2)14 82 164 57 33 72 Non-cash operating activities(790)(268)(85)(90)58 62 (6)
Option premiums (paid), netOption premiums (paid), net(41)— — — — — — — Option premiums (paid), net39 — — — — — — — 
Collateral received, net732 58 — 188 403 85 180 137 
Collateral (paid) received, netCollateral (paid) received, net(1,639)(41)— (147)(421)(72)(234)(115)
Income taxesIncome taxes(167)15 25 — (1)(4)(8)Income taxes47 50 46 39 40 40 11 (1)
Pension and non-pension postretirement benefit contributionsPension and non-pension postretirement benefit contributions(26)(5)12 (30)— (1)(4)Pension and non-pension postretirement benefit contributions499 153 12 49 60 — 
Changes in regulatory assets and liabilities, net(100)(86)(10)25 (38)(29)
Regulatory assets and liabilities, netRegulatory assets and liabilities, net294 251 28 (38)80 37 56 (22)
Changes in working capital and other assets and liabilitiesChanges in working capital and other assets and liabilities1,566 25 (61)(46)(16)(7)(17)Changes in working capital and other assets and liabilities729 (118)184 276 48 77 20 (53)
Increase in cash flows from operating activities$2,102 $30 $38 $288 $413 $106 $190 $151 
(Decrease) increase in cash flows from operating activities(Decrease) increase in cash flows from operating activities$(849)$143 $121 $108 $(163)$132 $(154)$(190)
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 sixnine months ended JuneSeptember 30, 20222023 and 20212022 were as follows:
See Note 1415 — 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 Generationthe Registrant 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. Changes in collateral for the Registrants are dependent upon the credit exposure of procurement contracts that may require suppliers to post collateral. The amount of cash collateral received from external counterparties increaseddecreased due to risingdecreasing energy prices. See Note 9 Derivative Financial Instruments for additional information.
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 Pension and non-pension postretirement benefit contributions relate to Exelon's funding strategy and incremental contributions made in 2022 in connection with the separation. See Note 14 — Retirement Benefits of the 2022 Form 10-K for additional information.
Changes in regulatory assets and liabilities, net, are due to the timing of cash payments for costs recoverable, or cash receipts for costs recovered, under our regulatory mechanisms differs from the recovery period of those costs. Included within the changes is energy efficiency spend for ComEd of $428 million and $394 million for the nine months ended September 30, 2023 and 2022, respectively. Also included within the changes is energy efficiency and demand response programs spend for BGE, Pepco, DPL and ACE of $102 million, $49 million, $19 million, and $14 million for the nine months ended September 30, 2023 and $83 million, $50 million, $21 million, and $7 million for the nine months ended September 30, 2022, respectively. PECO had no energy efficiency and demand response programs spend recorded to the regulatory asset for the nine
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months ended September 30, 2023 and 2022. See Note 3 — Regulatory Matters of the Combined Notes to Consolidated Financial Statements for additional information on regulatory assets and liabilities.information.
Changes in working capital and other assets and liabilities for the Utility Registrants and Exelon Corporate total $(74)totaled $406 million and for Generation total $1,640$323 million. The change for Generation primarily relates to the revolving accounts receivable financing arrangement. See Note 6 — Accounts Receivablearrangement which was entered into in April 2020. The change in working capital and other noncurrent assets and liabilities for Exelon Corporate and the Utility Registrants is dependent upon the normal course of operations for all Registrants. For ComEd, it is also dependent upon whether the participating nuclear-powered generating facilities are owed money from ComEd as a result of the 2021 Form 10-Kestablished pricing for CMCs. For the nine months ended September 30, 2023, the established pricing resulted in ComEd owing payments to nuclear-powered generating facilities, which is reported within the cash flows from operations as a change in accounts payable and the Collection of DPP discussion below for additional information.accrued expense.
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Cash Flows from Investing Activities
The following table provides a summary of the change in cash flows from investing activities for the sixnine months ended JuneSeptember 30, 20222023 and 20212022 by Registrant:
Increase (decrease) in cash flows from investing activitiesExelonComEdPECOBGE PHIPepcoDPLACE
Decrease in cash flows from investing activitiesDecrease in cash flows from investing activitiesExelonComEdPECOBGE PHIPepcoDPLACE
Capital expendituresCapital expenditures$533 $(46)$(81)$42 $113 $37 $17 $60 Capital expenditures$(361)$(125)$(77)$(68)$(336)$(115)$(122)$(92)
Investment in NDT fund sales, netInvestment in NDT fund sales, net72 — — — — — — — Investment in NDT fund sales, net28 — — — — — — — 
Collection of DPPCollection of DPP(2,040)— — — — — — — Collection of DPP(169)— — — — — — — 
Proceeds from sales of assets and businessesProceeds from sales of assets and businesses(708)— — — — — — — Proceeds from sales of assets and businesses(16)— — — — — — — 
Changes in intercompany money poolChanges in intercompany money pool— — — — — — (64)— Changes in intercompany money pool— — (51)— — (7)15 — 
Other investing activitiesOther investing activities(13)(3)— Other investing activities(11)(13)(7)(1)(2)(1)
(Decrease) increase in cash flows from investing activities$(2,156)$(43)$(80)$39 $118 $41 $(46)$60 
Decrease in cash flows from investing activitiesDecrease in cash flows from investing activities$(529)$(138)$(135)$(69)$(333)$(116)$(109)$(93)
Significant investing cash flow impacts for the Registrants for sixnine months ended JuneSeptember 30, 20222023 and 20212022 were as follows:
VariancesChanges 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.spending for the Utility Registrants. 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 DPPrelates to theGeneration's revolving accounts receivable financing agreement which Generation entered into in April of 2020. See Note 6 — Accounts Receivable of the 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 2021 Form 10-K for additional information.
Changes in intercompany money pool are driven by short-term borrowing needs. Refer below forto more information regarding the intercompany money pool.pool below.
Cash Flows from Financing Activities
The following table provides a summary of the change in cash flows from financing activities for the sixnine months ended JuneSeptember 30, 20222023 and 20212022 by Registrant:
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Increase (decrease) in cash flows from financing activitiesIncrease (decrease) in cash flows from financing activitiesExelonComEdPECOBGE PHIPepcoDPLACEIncrease (decrease) in cash flows from financing activitiesExelonComEdPECOBGE PHIPepcoDPLACE
Changes in short-term borrowings, netChanges in short-term borrowings, net$369 $290 $210 $(130)$(389)$(251)$(3)$(135)Changes in short-term borrowings, net$(756)$(133)$(239)$(375)$227 $(124)$34 $317 
Long-term debt, netLong-term debt, net1,619 50 (375)(100)124 50 — 74 Long-term debt, net357 225 100 150 (65)35 — (100)
Changes in intercompany money poolChanges in intercompany money pool— — 40 — 29 64 — — Changes in intercompany money pool— — — — (18)(25)— 17 
Issuance of common stockIssuance of common stock(563)— — — — — — — 
Dividends paid on common stockDividends paid on common stock(75)(126)(4)(12)— 200 (2)17 
Dividends paid on common stock84 (36)(31)(4)— (177)191 
Distributions to memberDistributions to member— — — — 19 — — — Distributions to member— — — — 215 — — — 
Contributions from(to) parent/member— (60)(168)186 144 249 24 (130)
Contributions from parent/memberContributions from parent/member— 67 74 51 (312)(157)(48)(110)
Transfer of cash, restricted cash, and cash equivalents to ConstellationTransfer of cash, restricted cash, and cash equivalents to Constellation(2,594)— — — — — — — Transfer of cash, restricted cash, and cash equivalents to Constellation2,594 — — — — — — — 
Other financing activitiesOther financing activities(50)(1)(4)(1)(4)(4)(1)— Other financing activities24 (2)(18)(18)(2)
(Decrease) increase in cash flows from financing activities$(572)$243 $(328)$(49)$(77)$(69)$27 $— 
Increase (decrease) in cash flows from financing activitiesIncrease (decrease) in cash flows from financing activities$1,581 $31 $(61)$(185)$29 $(89)$(18)$142 
Significant financing cash flow impacts for the Registrants for the sixnine months ended JuneSeptember 30, 20222023 and 20212022 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 toSee 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 toSee 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 1718 — Commitments and Contingencies of the 2021 Recast2022 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 six months ended June 30, 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 sixnine months ended JuneSeptember 30, 2022,2023, the following long-term debt was retired and/or redeemed:
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Company(a)
TypeInterest RateMaturityAmount
ExelonJunior Subordinated Notes3.50 %May 2, 2022$1,150 
ExelonLong-Term Software License Agreement3.96 %May 1, 2024
PECOFirst Mortgage Bonds2.375 %September 15, 2022350 
PepcoFirst Mortgage Bonds3.05 %April 1, 2022200 
__________
(a)On July 5, 2022, BGE redeemed $250 million of 2.80% senior notes originally due on August 15, 2022.
CompanyTypeInterest RateMaturityAmount
ExelonSMBC Term Loan AgreementSOFR plus 0.65%July 21, 2023$300 
ExelonUS Bank Term Loan AgreementSOFR plus 0.65%July 21, 2023300 
ExelonPNC Term Loan AgreementSOFR plus 0.65%July 24, 2023250 
ExelonLong-Term Software License Agreement3.70 %August 9, 2025
ExelonLong-Term Software License Agreement3.95 %May 1, 2024
ExelonLong-Term Software License Agreement3.70 %August 9, 2025
PECOLoan Agreement2.00 %June 20, 202350 
BGENotes3.35 %July 1, 2023300 
Dividends
Quarterly dividends declared by the Exelon Board of Directors during the sixnine months ended JuneSeptember 30, 20222023 and for the thirdfourth quarter of 20222023 were as follows:
PeriodDeclaration DateShareholder of Record DateDividend Payable Date
Cash per Share(a)
First Quarter 20222023February 8, 202214, 2023February 25, 202227, 2023March 10, 20222023$0.33750.3600 
Second Quarter 20222023April 26, 202225, 2023May 13, 202215, 2023June 10, 20229, 2023$0.33750.3600 
Third Quarter 20222023July 26, 202225, 2023August 15, 20222023September 9, 20228, 2023$0.33750.3600 
Fourth Quarter 2023November 1, 2023November 15, 2023December 8, 2023$0.3600 
__________
(a)Exelon's Board of Directors approved an updated dividend policy for 2022.2023. The 20222023 quarterly dividend will be $0.3375$0.36 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 $3.6$3.2 billion was available to support additional commercial paper as of JuneSeptember 30, 2022,2023, and of which no financial institution has more than 6% 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 sixnine months ended JuneSeptember 30, 20222023 to fund their short-term liquidity needs, when necessary. On February 1, 2022, Exelon Corporate and the Utility Registrants each entered intohave 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 20212022 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.
On August 4, 2022, Exelon anticipates issuingexecuted an equity distribution agreement (“Equity Distribution Agreement”) with certain sales agents and forward sellers and certain forward purchasers establishing an ATM equity distribution program under which it may offer and sell shares of its common stock, having an aggregate gross sales price of up to $1.0 billion of registeredbillion. Exelon has no obligation to offer or sell any shares of common stock through 2025.under the Equity Distribution Agreement and may at any time suspend or terminate offers and sales under the Equity Distribution Agreement. As of September 30, 2023, Exelon plans to establish a $1.0 billion at-the-market (ATM) program, under which Exelon can issue registeredhas not issued any shares of common stock through designated broker-dealers at prevailing market prices. Exelon anticipates issuing $500 million in 2022 throughunder the ATM a one-time common equity offering, or a combinationprogram and has not entered into any forward sale agreements.
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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 JuneSeptember 30, 20222023 and available credit facility capacity prior to any incremental collateral at JuneSeptember 30, 2022:2023:
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PJM Credit Policy Collateral
Other Incremental Collateral Required(a)
Available Credit Facility Capacity Prior to Any Incremental CollateralPJM Credit Policy Collateral
Other Incremental Collateral Required(a)
Available Credit Facility Capacity Prior to Any Incremental Collateral
ComEdComEd$12 $— $995 ComEd$$— $718 
PECOPECO37 390 PECO20 600 
BGEBGE75 600 BGE30 539 
PepcoPepco— 257 Pepco— 300 
DPLDPL15 300 DPL300 
ACEACE— 300 ACE— 127 
__________
(a)Represents incremental collateral related to natural gas procurement contracts.
Capital Expenditure Spending
As of JuneSeptember 30, 2022,2023, the most recent estimates of capital expenditures for plant additions and improvements for 20222023 are as follows:        
(In millions)(In millions)TransmissionDistributionGasTotal(In millions)TransmissionDistributionGas
Total(a)
ExelonExelonN/AN/AN/A$6,900 ExelonN/AN/AN/A$7,300 
ComEdComEd475 2,000 N/A2,475 ComEd400 2,175 N/A2,575 
PECOPECO200 825 325 1,350 PECO175 925 325 1,425 
BGEBGE250 500 475 1,225 BGE225 625 500 1,350 
PHIPHI625 1,150 75 1,850 PHI550 1,275 100 1,925 
PepcoPepco275 625 N/A900 Pepco250 675 N/A925 
DPLDPL150 250 75 475 DPL175 300 100 575 
ACEACE200 275 N/A475 ACE125 300 N/A425 
__________
(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 PostretirementRetirement 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'sExelon’s estimated annual qualified pension contributions will be approximately $313$20 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.2023. 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).
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To the extent interest rates decline significantly or the pension and OPEB plans earn less than the expected asset returns, annual pension contribution requirements in future years could increase. Conversely, to the extent interest rates increase significantly or the pension and OPEB plans earn greater than the expected asset returns, annual pension and OPEB contribution requirements in future years could decrease. Additionally, expected contributions could change if Exelon changes its pension or OPEB funding strategy.
See Note 14 — Retirement Benefits of the Combined Notes to Consolidated Financial Statements of the 2022 Form 10-K for additional information on pension and OPEB contributions.
Credit Facilities
Exelon Corporate, ComEd, and BGE meet their short-term liquidity requirements primarily through the issuance of commercial paper. PECO meets its short-term liquidity requirements primarily through the issuance of
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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,Exelon Corporate, PECO, BGE, PHI, Pepco, DPL, and DPLACE did not change for the sixnine months ended JuneSeptember 30, 2022.2023. On January 14, 2022, Fitch lowered Exelon Corporate'sJuly 26, 2023, S&P raised ComEd's long-term and senior unsecured ratingsissuer credit rating from BBB+'BBB+' to BBB anda 'A-'. S&P also affirmed the current 'A' rating on ComEd's senior secured debt and 'A-2' short-term rating, of F2. In addition, Fitch upgraded Pepco, ACE,which influences long and PHI's long-term rating from BBB to BBB+ and upgraded Pepco and ACE's senior secured rating from A- to A.short-term borrowing cost.
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 JuneSeptember 30, 2022,2023, are presented in the following table. ACE had no activity within the PHI intercompany money pool during the six months ended June 30, 2022.table:
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During the Six Months Ended June 30, 2022As of June 30, 2022During the Nine Months Ended September 30, 2023At September 30, 2023
Exelon Intercompany Money PoolExelon Intercompany Money PoolMaximum
Contributed
Maximum
Borrowed
Contributed
(Borrowed)
Exelon Intercompany Money PoolMaximum
Contributed
Maximum
Borrowed
Contributed
(Borrowed)
Exelon CorporateExelon Corporate$396 $— $287 Exelon Corporate$510 $— $178 
PECOPECO60 (105)— PECO305 (238)51 
BSCBSC— (377)(308)BSC— (350)(212)
PHI CorporatePHI Corporate— (54)(24)PHI Corporate— (62)(62)
PCIPCI50 — 45 PCI45 — 45 
During the Six Months Ended June 30, 2022As of June 30, 2022During the Nine Months Ended September 30, 2023At September 30, 2023
PHI Intercompany Money PoolPHI Intercompany Money PoolMaximum
Contributed
Maximum
Borrowed
Contributed
(Borrowed)
PHI Intercompany Money PoolMaximum
Contributed
Maximum
Borrowed

(Borrowed)
Contributed
PepcoPepco$— $(85)$(73)Pepco$39 $(55)$
DPLDPL85 — 73 DPL111 — 10 
ACEACE— (95)(17)
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 2022.2025. The ability of each Registrant to sell securities off the 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 June 30, 2022At September 30, 2023
Short-term Financing AuthorityRemaining Long-term Financing Authority
Short-term Financing Authority (e)
Remaining Long-term Financing Authority
CommissionExpiration DateAmountCommissionExpiration DateAmountCommissionExpiration DateAmountCommissionExpiration DateAmount
ComEd(a)
ComEd(a)
FERCDecember 31, 2023$2,500 ICCJanuary 1, 2025$1,343 
ComEd(a)
FERCDecember 31, 2023$2,500 ICCJanuary 1, 2025$368 
PECO(b)
PECO(b)
FERCDecember 31, 20231,500 PAPUCDecember 31, 20241,550 
PECO(b)
FERCDecember 31, 20231,500 PAPUCDecember 31, 2024550 
BGE(b)BGE(b)FERCDecember 31, 2023700 MDPSCN/A— BGE(b)FERCDecember 31, 2023700 MDPSCN/A1,100 
Pepco(c)
Pepco(c)
FERCDecember 31, 2023500 MDPSC / DCPSC2022 & 20251,625 
Pepco(c)
FERCDecember 31, 2023500 MDPSC / DCPSCDecember 31, 20251,050 
DPL(c)DPL(c)FERCDecember 31, 2023500 MDPSC / DEPSCDecember 31, 202247 DPL(c)FERCDecember 31, 2023500 MDPSC / DEPSCDecember 31, 20251,075 
ACE(d)
ACE(d)
NJBPUDecember 31, 2023350 NJBPUDecember 31, 2022— 
ACE(d)
NJBPUDecember 31, 2023350 NJBPUDecember 31, 2024625 
__________
(a)On November 18, 2021,June 29, 2023, ComEd received approval from the ICCfiled an application for $2 billion in new money long-term debt financing authority with an effective date of January 1, 2022.from the ICC and expects approval by December 31, 2023.
(b)On December 2, 2021, PECO21, 2022, BGE received approval from the PAPUCMDPSC for $2.5$1.8 billion in new long-term debt financing authority with an effective date of January 1, 2022.4, 2023.
(c)As of June 30, 2022, Pepco had $225 million in long-termThe financing authority from thefiled with MDPSC and DCPSC, which hasdoes not have an expiration date, of December 31, 2022. On June 9, 2022 and June 30, 2022, Pepco received approval fromwhile the MDPSC and DCPSC, respectively, for $1.4 billion in new long-term financing authority. The long-term financing authority became effective on the date of respective approvalsfiled with DCPSC and hasDEPSC have an expiration date of December 31, 2025.
(d)On July 13, 2022,14, 2023, ACE received approval fromfiled an application with the NJBPU for $700 million in new long-term debtrenewal of their short-term financing authority through January 1, 2026. ACE expects approval of their application by December 31, 2023.
(e)On October 2, 2023, ComEd, PECO, BGE, Pepco, and DPL filed applications with an effective dateFERC for renewal of July 20, 2022.their short-term financing authority through December 31, 2025. ComEd, PECO, BGE, Pepco, and DPL expect approval of their applications by December 31, 2023.
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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 138 — Retirement Benefits of the 2021 Recast2022 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. In addition, Exelon may utilize interest rate derivatives to lock in rate levels in anticipation of future financings, which are typically designated as cash flow hedges, or to lock in rate levels on borrowings, which are typically designated as economic hedges. See Note 9 – Derivative Financial Instruments of the Combined Notes to Consolidated Financial Statements for additional information.

Electric operating revenues risk associated with ComEd's distribution formula rate. ComEd's ROE for its electric distribution service through 2023 is directly correlated to yields on U.S. Treasury bonds. Exelon Corporate may utilize interest rate derivatives to mitigate volatility and manage risk to Exelon, which are typically accounted for as economic hedges. See Note 9 – Derivative Financial Instruments 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. PECO, 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.
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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 net liabilities. These net liabilities are associated with ComEd’s floating-to-fixed energy swap
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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 net liabilities. Second, the table shows the maturity, by year, of Exelon's and ComEd's commodity contract net 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)$11 $(2)$(14)$(16)$(15)$(52)$(88)
Maturities WithinTotal Fair
Value
Commodity derivative contracts(a):
202320242025202620272028 and Beyond
Prices based on model or other valuation methods (Level 3)$(10)$(18)$(17)$(17)$(17)$(55)$(134)
_________
(a)Represents ComEd's net liabilities associated with the floating-to-fixed energy swap contracts with unaffiliated suppliers.
ITEM 4.    CONTROLS AND PROCEDURES
During the secondthird quarter of 2022,2023, 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 JuneSeptember 30, 2022,2023, 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 secondthird quarter of 20222023 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 the 20212022 Form 10-K, (b) Notes 3 — Regulatory Matters and 1718 — Commitments and Contingencies of the 2021 Recast2022 Form 10-K, and (c) 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.
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ITEM 1A.    RISK FACTORS
Risks Related to All Registrants
At JuneSeptember 30, 2022,2023, the Registrants' risk factors were consistent with the risk factors described in the 2021Registrants' combined 2022 Form 10-K in ITEM 1A. RISK FACTORS, except for the updates below.following risk factor, which was amended.
The Registrants are subjectactivities associated with the past Deferred Prosecution Agreement and the now resolved associated SEC investigation could have a material adverse effect on Exelon’s and ComEd’s reputation and relationship with legislators, regulators and customers that could affect their ability to physical securityachieve actions and cybersecurity risks (All Registrants)approvals (Exelon and ComEd).
On July 17, 2020, ComEd entered into a Deferred Prosecution Agreement with the U.S. Attorney’s Office for the Northern District of Illinois (USAO) to resolve the USAO’s investigation into Exelon’s and ComEd’s lobbying activities in the State of Illinois. Exelon was not made a party to the DPA and no charges were brought against Exelon. 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 provided that the USAO would 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, which expired, and the pending charge was dismissed in July 2023. In October 2019, the SEC notified Exelon and ComEd that it had opened an investigation into their lobbying activities in the state of Illinois. On September 28, 2023, Exelon and ComEd reached a settlement with the SEC to fully resolve the matter.
The Registrants face physical securityDPA and cybersecurity risks. Threat sources, including sophisticated nation-state actors, continue to seek to exploit potential vulnerabilities in the electricsettlement with the SEC could have a material adverse impact on Exelon’s and natural gas utility industry, grid infrastructure,ComEd’s reputation or relationships with regulatory and legislative authorities, customers, and other energy infrastructures,stakeholders. Those impacts could affect, or make more difficult, their efforts to achieve actions or approvals associated with operations. See Note 18 — Commitments and these attacksContingencies of the Combined Notes to Consolidated Financial Statements for more information regarding the DPA and disruptions, both physical and cyber, are becoming increasingly sophisticated and dynamic. Continued implementation of advanced digital technologies
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increases the potentially unfavorable impacts of such attacks. Additionally, the U.S. government has warned that the Ukraine conflict may increase the risks of attacks targeting critical infrastructure in the United States.
A security breach of the Registrants' physical assets or information systems or those of the Registrants competitors, vendors, business partners and interconnected entities in RTOs and ISOs, or regulators could impact the operation of the generation fleet and/or reliability of the transmission and distribution system or result in the theft or inappropriate release of certain types of information, including critical infrastructure information, sensitive customer, vendor, and employee data, trading or other confidential data. The risk of these system-related events and security breaches occurring continues to intensify, and while the Registrants have been, and will likely continue to be, subjected to physical and cyber-attacks, to date none have directly experienced a material breach or disruption to its network or information systems or our operations. However, as such attacks continue to increase in sophistication and frequency, the Registrants may be unable to prevent all such attacks in the future.
If a significant breach were to occur, the Registrants' reputation could be negatively affected, customer confidence in the Registrants or others in the industry could be diminished, or the Registrants could be subject to legal claims, loss of revenues, increased costs, or operations shutdown. Moreover, the amount and scope of insurance maintained against losses resulting from any such events or security breaches may not be sufficient to cover losses or otherwise adequately compensate for any disruptions to business that could result.
The Utility Registrants' deployment of smart meters throughout their service territories could increase the risk of damage from an intentional disruption of the system by third parties.
In addition, new or updated security regulations or unforeseen threat sources could require changes in current measures taken by the Registrants or their business operations and could adversely affect their consolidated financial statements.
ITEM 4.    MINE SAFETY DISCLOSURES
All Registrants
Not applicable to the Registrants.
ITEM 5.    OTHER INFORMATION
Amendments to Exelon Governing DocumentsAll Registrants
On August 3, 2022, Exelon adopted Amended and Restated Bylaws (the “Bylaws”), effective as of that date. Amendments contained in the Bylaws include the addition of language to amend Exelon's advance notice provisions to address the adoption by the Securities and Exchange Commission of universal proxy rules, reorganization of certain sections, and other minor edits to address certain administrative and other non-material matters.

None.
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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 relevantrelevant. Registrant agrees to furnish a copy of any such instrument to the Commission upon request.
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 September 30, 2023 filed by the following officers for the following companies:
Exelon Corporation
Exhibit No.Description
Commonwealth Edison Company and U.S. Bank , N.A., as trustee (File 001-16844, Form 8-K dated May 24, 2022,
Exhibit 4.1)No.Description
PECO Energy Company
Exhibit 4.2)No.Description
Baltimore Gas and Electric Company
Exhibit No.Description
Pepco Holdings LLC
Exhibit No.Description
Potomac Electric Power Company
Exhibit No.Description
Delmarva Power & Light Company
Exhibit No.Description
Atlantic City Electric Company
Exhibit No.Description
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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 September 30, 2023 filed by the following officers for the following companies:
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Exelon Corporation
Exhibit No.Description
Commonwealth Edison Company
Exhibit No.Description
PECO Energy Company
Exhibit No.Description
Baltimore Gas and Electric Company
Exhibit No.Description
Pepco Holdings LLC
Exhibit No.Description
Potomac Electric Power Company
Exhibit No.Description
Delmarva Power & Light Company
Exhibit No.Description
Atlantic City Electric Company
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.Document
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document.Document
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document.Document
101.LABInline XBRL Taxonomy Extension Labels Linkbase Document.Document
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document.Document
104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*Filed herewith
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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 June 30, 2022 filed by the following officers for the following companies:
Exhibit No.Description
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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 June 30, 2022 filed by the following officers for the following companies:
Exhibit No.Description
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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. CRANECALVIN G. BUTLER, JR./s/    JOSEPH NIGROJEANNE M. JONES
Christopher M. CraneCalvin G. Butler, Jr.Joseph NigroJeanne M. Jones
President, Chief Executive Officer
(Principal Executive Officer) and Director
Senior Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
/s/ JOSEPH R. TRPIKROBERT A. KLECZYNSKI
Joseph R. TrpikRobert A. Kleczynski
Senior Vice President, and Corporate Controller and Tax
(Principal Accounting Officer)
August 3, 2022November 2, 2023
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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. GRAHAMJOSHUA S. LEVIN
Gil C. QuinionesElisabeth J. GrahamJoshua S. Levin
Chief Executive Officer
(Principal Executive Officer) and Director
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/    STEVEN J. CICHOCKI
Steven J. Cichocki
Director, Accounting
(Principal Accounting Officer)
August 3, 2022November 2, 2023
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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. STEFANIMARISSA HUMPHREY
Michael A. InnocenzoRobert J. StefaniMarissa Humphrey
President, and Chief Executive Officer
(Principal Executive Officer) and Director
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/    CAROLINE FULGINITI
Caroline Fulginiti
Director, Accounting
(Principal Accounting Officer)
August 3, 2022November 2, 2023

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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
President, Chief Executive Officer
(Principal Executive Officer) and Director
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
 /s/ JASON T. JONES
Jason T. Jones
Director, Accounting
(Principal Accounting Officer)
August 3, 2022November 2, 2023

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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) and Director
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ JULIE E. GIESE
Julie E. Giese
Director, Accounting
(Principal Accounting Officer)
August 3, 2022November 2, 2023

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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) and Director
Senior Vice President, Chief Financial Officer, and Treasurer
(Principal Financial Officer) and Director
/s/ JULIE E. GIESE
Julie E. Giese
Director, Accounting
(Principal Accounting Officer)
August 3, 2022November 2, 2023

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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) and Director
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ JULIE E. GIESE
Julie E. Giese
Director, Accounting
(Principal Accounting Officer)
August 3, 2022November 2, 2023

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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) and Director
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ JULIE E. GIESE
Julie E. Giese
Director, Accounting
(Principal Accounting Officer)
August 3, 2022November 2, 2023
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