Sanford C. Bernstein Strategic Decisions Conference 2013 Christopher M. Crane Chief Executive Officer, Exelon Corporation May 30, 2013 Exhibit 99.1 |
Cautionary Statements Regarding Forward Looking Information Sanford C. Bernstein Strategic Decisions Conference 2013 1 This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. The factors that could cause actual results to differ materially from the forward-looking statements made by Exelon Corporation, Commonwealth Edison Company, PECO Energy Company, Baltimore Gas and Electric Company and Exelon Generation Company, LLC (Registrants) include those factors discussed herein, as well as the items discussed in (1) Exelon’s 2012 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note 19; (2) Exelon’s First Quarter 2013 Quarterly Report on Form 10-Q in (a) Part II, Other Information, ITEM 1A. Risk Factors; (b) Part 1, Financial Information, ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) Part I, Financial Information, ITEM 1. Financial Statements: Note 17; and (3) other factors discussed in filings with the SEC by the Registrants. Readers are cautioned not to place undue reliance on these forward- looking statements, which apply only as of the date of this presentation. 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 presentation. |
2 Exelon Overview Power Generation Constellation ComEd, PECO & BGE Competitive Business Regulated Business Exelon is one of the largest competitive integrated energy companies in the U.S. • One of the largest merchant fleets in the nation (~35 GW of capacity) • One of the largest and best managed nuclear fleets in the world (~19 GW) • Significant gas generation capacity (~10 GW) • Renewable portfolio (~1.5 GW), mostly contracted • Leading competitive energy provider in the U.S. • Customer-facing business, with ~1.1 M competitive customers and large wholesale business • Top-notch portfolio and risk management capabilities • Extensive suite of products including Load Response, RECs, Distributed Solar • One of the largest electric and gas distribution companies in the nation (~6.6 M customers) • Diversified across three utility jurisdictions – Illinois, Maryland and Pennsylvania • Significant investments in Smart Grid technologies • Transmission infrastructure improvement at utilities Exelon Generation Exelon Utilities Sanford C. Bernstein Strategic Decisions Conference 2013 |
National Presence Power Generation Constellation Exelon Utilities Operations in seven RTOs, with strong positions across PJM, ERCOT & New England Serves more than 2/3 rds of the Fortune 100 companies in the U.S. Large urban presence with operations in three states – IL, PA and MD 3 Sanford C. Bernstein Strategic Decisions Conference 2013 |
Substantial presence across the value chain Unique combination of scale and scope in the industry Exelon is one of the largest competitive integrated energy companies in the U.S. with a balanced national presence. This unique and metrics-focused platform enables us to invest and drive growth in both our competitive and regulated businesses Operational Excellence Regulatory Advocacy Disciplined Growth & Investment Financial Discipline We create value through our core competencies Sanford C. Bernstein Strategic Decisions Conference 2013 4 Scale: One of the largest competitive integrated energy companies in the U.S., with a balance sheet that affords us investment opportunities like few others in the sector Scope: Coast-to-coast presence with operations in 47 states, the District of Columbia and Canada gives us a unique platform to identify targeted investments |
• Invested $6 billion (1) over the last three years across the energy value chain via organic growth and M&A Provided returns in excess of cost of capital Accretive from a free cash flow, earnings and credit metrics perspective • On track to install 230 MW of solar by year end • Added 404 MW of wind in 2012, all of which were done under long-term PPAs • Expect 5%-6% utility rate base growth • Decision to resize dividend based on: Investment grade at all registrants 65% - 70% payout ratio at the Utilities Sustainable under various stress scenarios • Delay or cancel uneconomic capital programs • On track to achieve $550 million of merger synergies by 2014 • History of top quartile Nuclear operating performance: Best ever first quarter generation output and fourth best ever nuclear capacity factor of 96.4% in Q1 Trademarked management model recognized worldwide • Establishment of Exelon Utilities to exploit standardization, common platforms, and the sharing of best practices across the three utilities. Targeted goal of 1 st quartile operating performance by 2015. Exelon’s competencies drive value for the shareholder Sanford C. Bernstein Strategic Decisions Conference 2013 5 Operational Excellence Capitalize on reliability and efficiency in our operations as a competitive advantage Financial Discipline Committed to strong balance sheet and sustainable dividend Disciplined Growth & Investment Invest in projects that build on our existing platform and add shareholder value Current 5-year plan includes ~$16B of growth investments across the business; ~$13B at Utilities and ~$3B at ExGen (2) • Formula rate established at ComEd. Passage of Senate Bill 9 puts grid modernization plans on track in IL • Constructive outcome on latest BGE rate case • Promote competitive markets: Advocate for phasing out of subsidies for generation Expand customer choice Regulatory Advocacy Champion competitive energy markets to empower our customers and enhance value for our shareholders 1. Excludes Constellation merger 2. Exclusive of base capex and nuclear fuel |
6 Incremental growth drivers include operating efficiency, opportunistic investments and exposure to commodity upside Sanford C. Bernstein Strategic Decisions Conference 2013 On a fully open basis, $1/mmbtu move in natural gas results in $1B of gross margin 2015 ATC Price Change 2015 Heat Rate Change Intrinsic value creation Incremental balance sheet capacity deployed towards growth investments plus additional productivity improvements to provide earnings boost over current plan (1) $41.47 $39.17 $33.89 $31.87 $40 $38 $36 $34 $32 $30 6/1/13 5/1/13 4/1/13 3/1/13 2/1/13 1/1/13 $42 NiHub PJM-W 9.4 9.3 7.7 7.5 5/1/13 6/1/13 9.5 7.5 9.0 8.5 8.0 10.0 7.0 4/1/13 3/1/13 2/1/13 1/1/13 NiHub PJM-W • Continue to improve balance sheet strength Pursue project financing opportunities • Productivity improvements • Utilities • Exelon Generation • Scale and scope affords us access to and ability to execute across a wide range of opportunities • Look for value creating opportunities that will complement our existing portfolio Contracted generation assets both conventional and renewable Merchant generation in attractive markets Regulated Retail expansion Beyond the Meter (rooftop solar) Opportunistic Investments Drive costs down across the enterprise, incremental to synergy targets Improve ROE and drive efficiency model across the three utilities Nuclear uprates Investments in upstream gas and renewables 1. Balance sheet capacity grows over time through the next five years given forward energy and capacity prices and assumption that any cash surplus is used to pay down debt |
Our company and our value proposition Sanford C. Bernstein Strategic Decisions Conference 2013 7 • We believe in clean energy and competitive markets • Our management model for fleet operations is world renowned • With the Constellation merger, we have an industry leading retail and wholesale platform and portfolio management expertise • We have a proven track record of operational excellence and investments in growth • We are focused on value return to shareholders Sustainable dividend with opportunities for growth in the future Pursuing opportunities for earnings growth via driving business efficiencies, opportunistic growth and intrinsic investments Unparalleled upside to commodity price recovery |