UNICOM DESTINATIONS AND DIRECTIONS 1999
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TO ALL EMPLOYEES,
In Unicom Directions, we laid out six objectives essential
to becoming "one of the nation's most effective operators of
regulated energy delivery systems, one of its most effective
operators of nuclear power plants and the Midwest's leading
retail supplier of electricity, natural gas and energy
services." We have refined this vision to reflect the
increasingly rapid changes within our industry as well as
our employees' desire for a more complete picture of where
we are trying to go. Unicom Destinations and Directions 1999
describes Unicom Corporation as four distinct business
groups: Distribution Group, Transmission Group, Nuclear
Generation Group and Unicom Enterprises Group.
Why should we define ourselves this way? Because the
traditional functions of our business are being separated as
both the Federal Energy Regulatory Commission and our state
proceed with industry restructuring. Generation and
marketing are becoming competitive, while transmission and
distribution are becoming regulated in new ways.
Restructuring has eliminated many of the advantages of
operating all of the groups in a closely integrated fashion.
As we move into the future, each group will have its own
obligations, challenges and growth opportunities. By
developing each of the four business groups, we will be
better positioned to pursue new opportunities as they arise.
Let me be clear, however: our business groups remain
interdependent in a variety of ways. We do not have a plan
to spin off each one as a separate company. We simply intend
to manage each group to achieve the highest possible value.
All four business groups will be supported by our corporate
service functions. Our corporate services must also attain
the same type of top-quartile performance that is required
of our business groups. Competitive pressures may force our
business groups to consider their options, including buying
support services from outside suppliers, if our corporate
services cannot meet their requirements.
Unicom Destinations is our vision for the future. It is also
the foundation for Unicom Directions 1999, which - like its
predecessor - will serve as a clear statement of direction,
a concise record of accomplishments and a basis for holding
everyone accountable for future performance. This packet
includes specific goals for each of our four business
groups, the milestones we have achieved since we first
announced Unicom Directions and the Unicom Values. Our
values must be present in each of our goals and in every
employee's efforts. Although they are most easily found
within our culture change objective, each of these values
supports our overall strategy. Regardless of where you work
within our company, you and I must uphold our commitment to
accountability, teamwork, customer focus, integrity, trust,
diversity, leading change and continuous performance
improvement.
Unicom Destinations and Directions 1999 will be reviewed
regularly and modified as required to address developments
in the marketplace and regulatory systems in which we
operate.
John W. Rowe
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John W. Rowe
Chairman and Chief Executive Officer
Unicom Corporation
UNICOM DESTINATIONS
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Unicom intends to earn a place as a world-class operator of
energy production and delivery systems and a successful
competitive supplier of energy and related services, meeting
the increasing expectations of customers through
continuously improving employee performance in four
principal business groups:
A DISTRIBUTION GROUP, WHICH
- - Serves an increasing number of customers in Illinois and
other Midwestern states;
- - Delivers electricity and potentially gas, water or related
services;
- - Meets the demands of customers and the expectations of
government with reliability, responsiveness and creativity;
and
- - Earns consistent, superior returns for doing so.
A TRANSMISSION GROUP, WHICH
- - Serves an increasing portion of this region;
- - Leads the industry in solving the problems of open access,
congestion and bulk power supply; and
- - Earns superior returns for doing so.
A NUCLEAR GENERATION GROUP, WHICH
- - Operates as a competitive, potentially independent
business;
- - Sustains a safe, durable, and demonstrably world-class
operating record;
- - Has adequate funds available for decommissioning;
- - Pursues prudent growth opportunities; and
- - Has a balance sheet consistent with its earnings
potential.
A UNICOM ENTERPRISES GROUP, WHICH
- - Identifies creative, technology-based solutions for the
energy needs of a changing economy and society;
- - Offers its customers a portfolio of energy products and
services; and
- - Provides consistent growth opportunities and superior
returns to our investors.
RELIABILITY
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OBJECTIVE 1:We will provide a reliable supply of electricity
as the competitive marketplace evolves and improve the
efficiency, dependability and quality of our delivery
service.
Providing reliable service - in both supply and delivery -
continues to be our highest priority. Last summer, stormy,
hot weather and the limited availability of our nuclear
fleet pushed our system to its limits. Although we never
resorted to controlled service interruptions, or "rolling
blackouts," we came far too close and left our customers
frustrated and doubtful of our ability to serve.
As we enter the summer of 1999, we are in a far stronger
position, with all 10 of our nuclear units available. We
will continue to own, operate and maintain high availability
levels at our fossil plants throughout this summer.
Supplementing our nuclear and fossil generating capacity, we
have extensive purchase power agreements and aggressive
demand side management programs. If necessary, we will
purchase power on the spot market to maintain reliability
throughout this summer and beyond.
Even after the supply of power becomes fully competitive,
our customers will continue to look to ComEd for reliable
delivery service. We must meet their expectations - and to
do so will require us to reach top-quartile performance in
minimizing both the frequency and duration of outages. We
have taken steps to detect and solve our customers' delivery
problems on a town-by-town basis through use of our
Greenboard process. Using our Greenboard, we assign "red"
(significant issues), "yellow" (concerns being addressed) or
"green" status (no unresolved issues) to every municipality
and Chicago ward and attempt to resolve all outstanding
issues. Our Reliability Milestones Ahead, many of which are
new for 1999, focus heavily on enhancing and reinforcing
both our transmission and distribution systems and
responding to service interruptions.
CORPORATE MILESTONES AHEAD
1.We must improve our ranking on the Customer Satisfaction
Index from 68 to 86 by 2001. NEW FOR '99
2.We must keep the lights and air conditioners on. We must
avoid asking customers to implement voluntary load
reductions during peak usage periods except when they are
compensated for such actions. We must do everything possible
to prevent firm service interruptions due to capacity
limitations. REVISED FROM '98
3.We must achieve top-quartile operating performance as
measured by outage frequency (System Average Interruption
Frequency Index, SAIFI) and minimize outage duration
(Customer Average Interruption Duration Index, CAIDI) by
2001. NEW FOR '99
4.We must invest in our transmission and distribution
systems to improve our ability to access and deliver
power. NEW FOR '99
5.We must eliminate the "red" towns on our Greenboard. NEW
FOR '99
NUCLEAR PERFORMANCE
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OBJECTIVE 2: We will become a top-quartile operator of
competitive nuclear plants by insisting that each plant
produce power safely and economically.
The Nuclear Generation Group (NGG) has demonstrated a
passionate commitment to attaining world-class performance.
For the first time in nine years, all 10 of our nuclear
units are off the Nuclear Regulatory Commission (NRC) "watch
list." Today, our entire fleet falls under the "routine
oversight" category. Despite the beginnings of a turnaround,
we still have much work to do. We need all 10 of our nuclear
units consistently available during this summer and beyond
to meet customer demand and to bolster our credibility as a
company that can deliver on its promises.
About $9.5 billion of our original investment in these
plants remains on our books. We will recover only a portion
of it through the transition charges provided by the
Illinois Restructuring Act, the funds from last December's
securitization transaction and the proceeds from the pending
fossil sale. We must run our plants safely and competitively
to help recover our remaining investment and to provide
opportunities for our workforce.
CORPORATE MILESTONES AHEAD
1.We must achieve top-quartile safety and operational
performance as measured by the INPO index. ORIGINAL FROM '98
2.We must continue to build regulatory credibility with the
NRC and maintain all of our plants in the NRC's newly
defined category for safety performance - acceptable with
routine baseline oversight. REVISED FROM '98
3.We must operate our nuclear plants safely at production
costs below the average market price of electricity, or shut
them down. ORIGINAL FROM '98
FOSSIL SALE
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OBJECTIVE 3: We will consummate the sales agreement with
Edison Mission Energy for the purchase of our fossil
generating fleet by the end of 1999 while continuing to
ensure availability.
We have rewritten this objective to reflect the pending sale
of our fossil fleet to Edison Mission Energy, a subsidiary
of Edison International. Upon approval by the Illinois
Commerce Commission, after the summer of 1999, we will
complete the sale and begin the official transition to
Edison Mission Energy. After the sale and pursuant to a five-
year agreement, we will have rights and options to purchase
the 9,772 MW output from Edison Mission Energy. This
arrangement will ensure a reliable supply of power to those
customers who choose to remain on traditional tariffs and
limit our exposure to an increasingly volatile energy
market. Should the onset of customer choice diminish our
demand for power, the five-year agreement will provide the
flexibility we need to adjust our purchase requirements.
CORPORATE MILESTONES AHEAD
1.We must complete the fossil sale transaction by the end of
1999. REVISED FROM '98
2.We must maintain over 80% equivalent availability during
the summer of 1999 and develop a positive partnership with
Edison Mission Energy to ensure availability in the
future. NEW FOR '99
3.We must assist our employees' job transition through
implementation of our agreement with International
Brotherhood of Electrical Workers Local 15 and similar
efforts for management. NEW FOR '99
FINANCIAL RESTRUCTURING
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OBJECTIVE 4: We will deliver competitive earnings while
restructuring the balance sheet to reflect the realities of
the marketplace and the duration of our transition charges.
The onset of competition and the sale of our fossil plants
will have a substantial impact on Unicom's future financial
performance. First, rate reductions, which started in 1998,
and customer choice, which begins in October 1999, will
reduce revenues. These reductions create potentially
stranded investments and intensify the need to cut costs and
improve operations in order to sustain earnings.
Second, when the sale of the fossil plants to Edison Mission
Energy is finished, it will provide Unicom with a book gain
and substantial cash. We can write down a portion of our
nuclear-related assets, invest in our Distribution,
Transmission and Nuclear business groups and pursue growth
through mergers and acquisitions. We will continue to
restructure our balance sheet and recover potentially
stranded investments by improving performance, cutting
costs, growing new businesses and collecting the competitive
transition charge (CTC).
Substantial growth for Unicom will be attained through
mergers or acquisitions. Our goal is to acquire companies in
the energy delivery business. We must also grow our existing
unregulated businesses through both the acquisition of
energy-related businesses as well as the continued
development of our existing businesses to provide a
substantial earnings boost prior to the end of the CTC.
CORPORATE MILESTONES AHEAD
1.We must complete one or more acquisitions that furthers
our goal of becoming a world-class operator of energy
delivery systems. This acquisition must create value,
enhance the competitiveness of our companies, provide
additional value to our customers and establish a platform
for future growth. NEW FOR '99
2.We must eliminate potentially stranded investments by the
end of 2006, which is the end of the period for recovering
transition charges under the Illinois Restructuring Act. NEW
FOR '99
3.We must continue growth of our earnings per share to more
than $3.00 by 2000 while maintaining our dividend at
$1.60. REVISED FROM '98
4.We must decrease our O&M expenses by over $200 million to
reach $1.850 billion by 2001. REVISED FROM '98
5.We must lower capital expenses by over $100 million to
$790 million by 2001. REVISED FROM '98
UNICOM ENTERPRISES GROUP
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OBJECTIVE 5: We will market a diverse portfolio of products
and services to become the Midwest's leading retail supplier
of electricity, natural gas and energy services.
Unicom's unregulated enterprises group, Unicom Enterprises,
Inc. (UEI), will deliver superior returns by providing a
portfolio of energy products, services and new technologies
to deliver energy solutions to business customers in the
Midwest and select national and international markets. UEI's
strategy has four key components:
1. Geographic Focus: We intend to capitalize on our
regional strength in the Midwest.
2. Customer Value Focus: We will tailor energy solutions to
our customers' unique needs.
3. Market Focus: We will target commercial and industrial
customers.
4. Product Focus: We will maintain a balance of products
between commodity and service-oriented products and
capitalize on new, energy-related technologies.
To become Unicom Corporation's growth platform, UEI has
established a foundation in four areas: energy services,
distributed generation, commodity gas and electricity, and
energy information management.
In the future, UEI will grow through acquisition. We plan to
acquire companies with the management know-how and scale to
capture market and industry attention. We will achieve
maximum synergies through add-on acquisitions.
CORPORATE MILESTONES AHEAD
1.We must achieve over $0.20 earnings per share by 2001. NEW
FOR '99
2.We must achieve a return on equity of 15% based on after-
tax cash flows. NEW FOR '99
3.We must achieve a return on investment of 8% based on
after-tax cash flows. NEW FOR '99
4.We must manage risks in order to receive a payback period
of less than 15 years on capital-intensive businesses and
less than 10 years on all other businesses. NEW FOR '99
5.We must measure progress at key stage-gates through 2001,
to aid in making hold/divest decisions. NEW FOR '99
CULTURE CHANGE
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OBJECTIVE 6: We will transform the culture of the Unicom
Companies to achieve continuous performance improvement,
increased accountability, superior customer focus and
greater diversity.
As we move into a more dynamic competitive environment, we
must place more emphasis on the business agenda, including
winning the customers' loyalty, improving efficiency and
increasing shareholder value. To succeed in tomorrow's
marketplace, we must work every day to make our business
more successful by living up to the high standards found in
Unicom Values.
The values listed in this objective are only four of our
eight Unicom Values - accountability, teamwork, customer
focus, integrity, trust, diversity, leading change and
continuous performance improvement. The Unicom Values focus
on how we must work together to achieve the level of results
that customers expect and the competitive marketplace
requires. They indicate the type of environment in which
Unicom employees want to work - where employees conduct
themselves with integrity, trust their co-workers, embrace
diversity and lead change. To ensure that Unicom is making
progress and living by these values, management will
continue to strive for change by upholding the values in
their own jobs, by holding our employees accountable, and by
monitoring our progress through the Speak-Up! Employee
Survey.
CORPORATE MILESTONES AHEAD
1.We must foster accountability by rewarding employees based
on bottom-line results and by placing greater emphasis on
the pay-for-performance or pay-at-risk component of our
compensation system. NEW FOR '99
2.We must continue our progress toward attaining
benchmarked, top-quartile performance goals by providing
employees with the information and tools they need to drive
inefficiencies out of our systems. REVISED FROM '98
3.We must secure the commitment of all employees in driving
top-quartile performance and ensuring success in the
competitive marketplace. REVISED FROM '98
4.We must increase our efforts to recruit and retain
qualified minorities and women at senior levels in the
company. REVISED FROM '98
5.We must build credibility by honoring commitments
internally and externally and developing an exemplary record
of compliance with the open access, code of conduct,
reliability and affiliate transaction rules established by
the FERC and the Illinois Commerce Commission. ORIGINAL FROM
'98
6.We must experiment with new methods of reducing the
environmental burdens of the electricity business,
particularly those methods that enhance the efficient use of
electricity. ORIGINAL FROM '98
The Distribution Group
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Business Goals
We will become one of the nation's most effective operators
of regulated energy delivery systems by developing a
standard of service that earns the loyalty of customers and
the respect of regulators, while producing a return on
investment that gains the confidence of shareholders. We
will improve the reliability of our system and increase
responsiveness to customers through improved maintenance,
more rapid storm response and the innovative use of
distributed resources and electrical and information
technologies. Ultimately, the Distribution Group will
include the Energy Services and Customer Services
organizations in order to provide top-quartile service to
our distribution customers. This new Distribution Group will
focus on keeping the energy flowing, anticipating customer
needs and providing cost-effective delivery services.
Realizing our vision depends on:
- - IMPROVING RELIABILITY by automating, upgrading and
reinforcing the distribution system, targeting improvements
for customers experiencing excessive outages and
accelerating our tree-trimming program;
- - PROVIDING PREMIER CUSTOMER SERVICE and improving
perceptions of our ability to serve our customers;
- - REDUCING AND MANAGING COSTS of operating our energy
delivery systems, while enhancing reliability and customer
service.
THE DISTRIBUTION GROUP - MILESTONES AHEAD
We must achieve the following milestones over the next three
years.
Strategic Actual Goals First
Objective Milestones 1997 1998 1999 2000 2001 Quartile
- --------- -------------- ---- ---- ---- ---- ---- --------
Improving Frequency of outages
Reliability (SAIFI) 1.08 2.21 1.13 1.02 0.83 0.91
Outage duration
in minutes (CAIDI) 178 273 141 116 100* 86
Customer Distribution-specific
Service residential customer 76 65 80 85 87 87
satisfaction index
(Core Relationship Attributes)
* The current Distribution plan indicates top-quartile
performance in 2002 based on improvements from planned
initiatives.
1.We must automate our 34kV line system by the end of
2001. NEW FOR '99
2.We must complete the installation of supervisory control
and data acquisition (SCADA) technology at all 741 ComEd
substations by 2001. NEW FOR '99
3.We must attain a four-year tree trimming cycle by
2001. NEW FOR '99
4.We must improve our ability to respond to customers'
questions regarding service interruptions and power
quality. ORIGINAL FROM '98
5.We must increase participation in curtailment rates to 895
MW by the end of 1999 and establish additional programs that
provide customers with incentives to reduce load during peak
periods. REVISED FROM '98
THE TRANSMISSION GROUP
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Business Goals
The Transmission Group may ultimately serve much of the
Midwest and must lead the industry in solving the problems
of open access, congestion and bulk power supply. As one of
the founding members of the Midwest Independent System
Operator (MISO), we have taken a significant step in leading
the industry. However, we continue to explore the
development of an Independent Transmission Company (ITC)
that works with the MISO. An ITC would combine ownership
with operation of wires but would be separate from large-
scale generation. In order to develop an ITC, we must create
a rate plan that is acceptable to the FERC and will provide
competitive returns on our transmission assets. Whatever
the ultimate vehicle, we must create mechanisms to reduce
transmission constraints, improve reliability and
economically manage congestion.
Realizing our vision depends on:
- - IMPROVING RELIABILITY to assure a strong transmission
system;
- - ENHANCING CUSTOMER SATISFACTION;
- - MINIMIZING LOSS of revenue-generating transactions on our
system;
- - REDUCING AND MANAGING THE COSTS of delivering electricity.
THE TRANSMISSION GROUP - MILESTONES AHEAD
We must achieve the following milestones over the next three
years.
Strategic Actual Goals First
Objective Milestones 1998 1999 2000 2001 Quartile
- --------- ----------- ------ ---- ---- ----- --------
Reliabil- System Average
ity Transmission Line
Availability Index 99.97 99.980 99.990 99.998 99.99
Asset Transmission weighted
Utilizat- average % system
ion utilization Emerging Measure
Customer Transmission service
Values request acceptance index Emerging Measure
Market Loss of potential
Opportun- Transmission revenue
ity due to rejected service
requests ($M) Emerging Measure
1.We must complete the program of replacing targeted
overhead and underground transmission lines by 2001. NEW
FOR' 99
2.We must reduce the number of TLRs (Transmission Loading
Relief) that disrupt wholesale transactions. NEW FOR '99
3.Before the end of the summer of 1999, we must connect a
minimum of 850 MW ofnew generation from Independent Power
Producers (IPP). REVISED FROM '98
4.We must implement the Midwest Independent System Operator,
which will enhance reliability by providing control of
transmission operations across the Midwest region. REVISED
FROM '98
5.We must complete installation of the
Lockport-Lombard-Plano 345kv transmission line to improve
power transfer capability within the ComEd system. ORIGINAL
FROM '98
6.We must actively and aggressively explore opportunities
with third parties to develop a Midwest (preferably Chicago-
based) real-time cash electricity exchange. ORIGINAL FROM
'98
THE NUCLEAR GENERATION GROUP
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Business Goals
We will become the leading nuclear business by safely
operating top-quartile, economically competitive plants. We
have made tangible progress over the last year: capacity
factors vastly improved, all 10 nuclear units are available
for the summer of 1999 and all plants have been removed from
the "watch list" and are under routine oversight by the NRC.
However, much work remains to reach top-quartile
performance by 2001. In addition, these improvements must be
sustained in order to establish credibility with regulators,
investors and customers.
Realizing our vision depends on:
- - ACHIEVING OPERATIONAL EXCELLENCE by improving performance
in all safety and operational facets of nuclear plant
operations;
- - INCREASING PRODUCTION by attaining high capacity factors
and reliable production through improved material condition,
sound operating practices, effective and short outage
execution, and improved human performance;
- - REDUCING AND MANAGING OPERATING COSTS through process
improvement, economies of scale, rigorous financial
management and control of capital spending to ensure a
competitive asset base to support a market-competitive cost
of power;
- - IMPROVING WORKFORCE EFFECTIVENESS through focused
training, open communication, increased productivity and
engagement of employees;
- - MANAGING ASSETS through sound investments in existing
assets in order to maximize generation.
The Nuclear Generation Group - Milestones Ahead
We must achieve the following milestones over the next three
years.
Strategic Actual Actual Goals First
Objective Performance Indicator 1998 1999 2000 2001 Quartile
- --------- ----------------------- ----- ---- ----- ----- --------
Operational INPO Performance Index 81 81 88 91* 93
Excellence
Production Capacity factor 66% 74% 81% 86%* 91%
*The current NGG plan indicates top-quartile performance in
2003 based on forecasted movement of the top-quartile
figure.
1.We must continue to demonstrate consistent improvement in
the operations and material condition of our plants and
continue to increase regulatory credibility with the
NRC. NEW FOR '99
2.We must achieve capacity factors at each of our 10 nuclear
units of 80% or greater by 2001. ORIGINAL FROM '98
3.We must increase generation capacity through power uprates
and thermal performance improvement. NEW FOR '99
4.We must extend productive life of plants through long-term
material condition improvement and, if economically
justified, license renewal. NEW FOR '99
THE UNICOM ENTERPRISES GROUP
- ----------------------------
Business Goals
To be successful in the competitive market, Unicom's
unregulated enterprises group, Unicom Enterprises, Inc.
(UEI), will focus on capturing a greater share of customers'
energy dollars through a portfolio of energy products,
services and new technologies targeted to commercial and
industrial customers. To become
a growth platform for Unicom Corporation, UEI has
established a foundation in four areas: distributed
generation, energy information management, commodity gas and
electricity and energy services.
We will nurture and develop a competitive and action-
oriented business culture by:
- - FOCUSING on the Midwest market for energy services,
distributed generation, commodity gas and electricity and
energy information management;
- - LEVERAGING our portfolio of energy and energy-related
products to provide customers with solutions tailored to
their unique needs;
- - TARGETING commercial and industrial customers;
- - MAINTAINING a balance between commodity and service-
oriented products.
WHAT IS UNICOM ENTERPRISES?
MARKET SEGMENT BUSINESSES
- --------------- ---------------------------------------
Distributed Distributed Energy capitalizes on its
Generation strategic alliance with AlliedSignal to
market, install and finance its Parallon 75T
microturbine system throughout the 12-state
Midwest region as well as Ontario and Puerto
Rico.
Energy Active Energy Management offers a suite of
Information consultative products and services aimed
Management at giving customers information about and
control over their energy usage. This suite
includes eQuatorT, an energy information
technology delivered via the Internet.
Commodity Unicom Energy markets and delivers gas and
Gas and electricity (when market opens) to commercial
Electricity and industrial customers.
Energy Unicom Energy Solutions provides customers
Services turnkey energy and operational solutions
Existing that improve their facility assets
while reducing energy and operating costs.
Unicom Thermal operates district cooling in
Chicago, with projects under development in
Boston, Houston, Las Vegas and Windsor,
Ontario.
Energy Unicom Power Holdings will develop, sell and
Services operate industrial based merchant cogeneration
Proposed projects.
Mechanical Services will provide design,
build and service capabilities for commercial
and industrial customers' heating, cooling,
ventilation and industrial process needs.
The Unicom Enterprises Group
- -----------------------------
Business Goals
The Unicom Enterprises Group - Milestones Ahead
We must achieve the following milestones over the next three
years.
Goals
Milestone 1999 2000 2001
- ----------------- ----- ------ ------
Earnings per share $(0.04) $0.09 $0.20
1.We must selectively acquire businesses in energy services,
especially mechanical service companies, following the
strategy in our 2000 and 2001 business plan. NEW IN '99
2.We must successfully launch eQuatorT, Unicom's web-based
energy information product, this year and develop versions
while investigating other technologies. NEW IN '99
3.We must complete our beta program and successfully launch
the commercial sales and distribution of the AlliedSignal
Parallon 75T microturbine and other distributed generation
products by the end of 1999. NEW IN '99
4.We must selectively grow our Unicom Thermal ice storage
capacity in Chicago and nationally. NEW IN '99
5.We must pursue profitable cogeneration projects in the
Midwest, which align Unicom with high-quality industrial
hosts. NEW IN '99
UNICOM DIRECTIONS 1998
- ----------------------
MILESTONES ACHIEVED
OBJECTIVE 1 - RELIABILITY
We will provide a reliable supply of electricity as the
competitive marketplace evolves and improve the efficiency,
dependability and quality of our delivery service.
- - Budgeted additional $307 million for T&D capital
improvements.
- - Achieved 100% Y2k readiness by June 30.
- - Reached settlement of franchise agreement with City of
Chicago.
- - Increased participation in curtailment rates by 100
megawatts.
- - Gained FERC approval of the Midwest ISO.
OBJECTIVE 2 - NUCLEAR OPERATIONS
We will become a top-quartile operator of competitive
nuclear plants by insisting that each plant produce power
safely and economically.
- - Removed Dresden and LaSalle from NRC watch list.
- - Returned LaSalle 1 and 2, Quad Cities 1 and 2 to
service.
- - Increased production output by 16% while reducing
production costs by 18%.
- - Set world record for Braidwood steam generator
replacement outage.
- - Set refueling outage records for Byron, Quad Cities and
Dresden.
OBJECTIVE 3 - FOSSIL SALE
We will refocus ComEd's generation business by offering to
sell a substantial portion of our fossil generation with
safeguards to assure continued availability.
- - Reached sale agreement with Edison Mission Energy.
- - Established transition period incentive plans.
- - Arranged post-sale power purchase agreements.
- - Developed severance and early retirement plans for
employees not continuing employment with Edison Mission
Energy.
OBJECTIVE 4 - FINANCIAL RESTRUCTURING
We will deliver competitive earnings while restructuring the
balance sheet to reflect the realities of the marketplace
and the duration of our transition charges.
- - Reduced O&M costs by $200 million.
- - Issued $3.4 billion in asset-backed securities.
- - Incorporated Shareholder Value Added goals into all
business units' performance reports and compensation plans.
OBJECTIVE 5 - COMPETITIVE OPERATIONS
We will market a diverse portfolio of product and services
to become the Midwest's leading retail supplier of
electricity, natural gas and energy services.
- - Restructured into three customer units: residential,
mid-market and large commercial & industrial.
- - Began operations for UT Holdings' Northwind Windsor
plant.
- - Installed first-ever commercial TurboGenerator Power
System.
- - Doubled Unicom Energy Solutions' Illinois business and
opened offices throughout the Midwest.
- - Signed 1,000 commercial & industrial customers in
Unicom Gas Services' first year of operation.
OBJECTIVE 6 - CULTURE
We will transform the culture of Unicom Companies to achieve
higher performance, increased accountability, superior
customer focus and greater diversity.
- - Corporate officers' equity holdings subject to formal
stock ownership guidelines.
- - ComEd, IBEW Local 15 agreed on 1999-2001 bargaining
unit incentive plan.
- - Established incentive plan for senior managers that is
significantly influenced by customer satisfaction.
PLEASE NOTE: Except for historical information, the
information in this document constitutes forward-looking
statements. Forward-looking statements are inherently
uncertain, subject to risks and should be viewed with
caution. Actual results or experience could differ
materially from the forward-looking statements found in this
document as a result of many factors. Please refer to the
Company's Periodic Report on Form 8-K filed May 27, 1999 for
a discussion of factors that could affect the actual results
or experience.
UNICOM VALUES
- --------------
Embracing Unicom Values will be the key to our long-term
success in a future filled with aggressive competition. We
must remain true to these values in order to overcome the
challenges that we will confront on a daily basis.
CUSTOMER FOCUS
- - Keeps commitments to customers (no matter who made them).
- - Builds trust and a spirit of teamwork with customers.
- - Understands and values customer needs.
- - Is flexible, innovative and satisfies the customer.
LEADING CHANGE
- - Is flexible and promotes an environment that is open to
new ideas and different ways of doing things.
- - Has the courage and willingness to re-think existing ideas
and create new opportunities.
- - Has a "can do" attitude and a "sense of urgency."
CONTINUOUS PERFORMANCE IMPROVEMENT
- - Is better than yesterday, better than others.
- - Does it right the first time.
- - Uses clear goals and measures to improve performance.
- - Recognizes and rewards performance that gets the desired
results.
- - Learns from the experience of other companies.
- - Learns more about our company's business and how it
operates.
TEAMWORK
- - Acts for the benefit of the company regardless of business
unit or self interest.
- - Recognizes that all business units are part of the same
team.
ACCOUNTABILITY
- - Accepts responsibility for decisions and results.
- - Encourages prudent risk taking and sees mistakes as
learning opportunities.
DIVERSITY
- - Values and respects the widest array of diverse ideas and
individuals consistent with our ethical standards and
performance requirements.
- - Assesses performance in a fair, unbiased and culturally
sensitive manner.
- - Provides equal opportunity for advancement.
TRUST
- - Communicates and interacts in an open, direct and positive
manner.
- - Listens openly and seeks to understand the ideas and
feedback of others.
- - Promotes and respects the value of diverse thoughts, ideas
and individuals.
INTEGRITY
- - Demonstrates the highest professional and ethical
standards.
- - Follows through on commitments and promises.
- - Shows consistency between words and actions.
- - Treats others with respect and dignity.
UNICOM CORPORATION
One First National Plaza
P.O. Box A-3005
Chicago, Illinois 60690-3005
www.ucm.com