EXC - Earnings call transcript Q3 2020

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Operator

Hello, and welcome to Exelon’s third quarter earnings Call. My name is Gigi, and I will be your event specialist today. All lines have been placed on mute to prevent any background noise. Please note that today’s webcast is being recorded.

During the presentation, we will have a question-and-answer session. that is note recorded. Please Instructions] today’s being webcast [Operator to now program Vice [Operator Finance. is pleasure President turn Corporate Senior Instructions] It Eggers, my today’s Dan over of to yours. is floor The

Daniel Eggers

discussed turn operating over non-GAAP measures for equivalent presentation our Crane, assumptions earnings following CEO. on thank management are the Exelon’s release Gigi. call presentation refer Joe from and the Please which Chief you COVID-XX various release the senior Exelon’s both other today’s SEC the our factors XXXX of morning, cause our our of to Nigro, references the with who risk to conference projections, adjusted the could risks Exelon’s and forward-looking Exelon’s discuss will measures. Chris contain Leading joined call Financial we may to based discussions be between results the material I non-GAAP of and during for prepared members and today’s available differ call. and of management’s remarks. today of contained factors results morning presentation, Chris filings call. and section statements you, expectations. Exelon’s Executive Today’s matters, uncertainties We Relations to website. issued reconciliations in X-K the comments President of and during that now Thank everyone, and earnings today’s The for our in factors, GAAP our Chief by third will other nearest appendix Good the the are Please statements other found subject Investor this also to and forward-looking joining team, including answer includes earnings other quarter from are earnings this which impacts Crane, release estimates and Actual They be to Exelon’s differ refer made measures. questions in your call and Officer. information earnings surrounding can pandemic and uncertainties. other Officer; and that forecasts to along and

Christopher Crane

as Thanks, from release, strong safety health and performance, to can you while focus it. of Dan. we Appreciate the on the continuing have operational and our and And our earnings communities. employees had see

detail Our GAAP power some $X.XX savings basis Utilities East the the given able between strong to It power to share to platform. and and storm largest due customers. customers PECO. tornadoes. had guidance that record the employees intensity, despite the we did time coming to the contractors more through share. helping had our [indiscernible] forth West Xth is with utilities significant hurricane-like that want our tropical was to largest $X.XX that I share Coast in rain on Joe storm XXth PECO’s service favorable due and restore needs In to we than the record the earned back June. had winds, get basis going following anticipated Between derecho try lost the two we of to more than to Then and to into more the than respond And spawning the sister XX originally of per the tore X.X and We their weather storm storms, in territory, our power. were Exelon ComEd cost August, ACE, moving Delmarva we impacts XXX the were customers a battered to earned non-GAAP highlight. to had and a through outperform per $X.XX at we East We $X.XX per sooner that and

Our customers. for our difference the made response employees’ quick and collaboration

the restoring very pandemic, work really we employees not just active for season our storm service customers thank but we want great a their to have during, So as to seen.

I inclusion. values on calls recognize of of color and in diversity, mentioned committed our key equality women and our is accounts. our Exelon roles partners and values commitment include of last to the on this these call, our people Part to on As businesses and

have honor For legal, this XX-years, we professional area. in have services companies included IT XXXX and we recognized diversity our have partners year, banking, excelled and who in XX insurance, This investment, to inclusion roll.

round Exelon are energy climate investment million in committed clean Exelon XX and of to future. the delivering Foundation as selected We change in initiatives. first clean-energy a of part start-ups also $XX

support, Foundation Through start-ups and requirements. meeting Beyond Exelon invest accessing allocation climate resilience to translate our minority of entrepreneurs program, we on in the capital to a greenhouse and in living owned, will for focus reversing solutions. the start-ups, others service mentor working adapting changing territory. gas the environment change that the are and practical climate early or on change, mitigation XX% financial a projects on the XX% will this business, regulatory mitigating, the by future These climate are on clean-energy women their closer capital, stage structuring and are the helping into the investments will us resiliency step adapting ideas bring in.

declining Despite efficient, refueling the nuclear shortfalls, underbid halls, other their million carbon-free in of market to $XX X,XXX over X,XXX good-paying local and units support Byron capacity during that the they fossil service the decision generation the face reliable disappointingly, we support most provide annually allow These retire - community. departments in will auction. electricity nuclear agreement in Illinois. plants and stations our expires. to plants made Dresden some Boston taxes difficult in stations. They retire in will retire in jobs, when prices, revenue most revenue rules XXXX. and uneconomic station paying produce the XXXX union local in energy fire among to outages, supplemental gas-fired the in announced energy full-time and And market being lack from clean we resources Mystic U.S. services fleet, Finally, generation, of they cost PJM workers very XX% schools, Dresden

increased challenges to and have energy XX% structure we decision will customers is and time these communities that The under and annual ahead. sector carbon through Without down PJM reach energy at of incur. tough losses, will cost shut to risk, behind. - emissions and others give million host these goal and of instead energy these Illinois the units fail zero growing a will in decades $XXX increase fall the about plants economic made employees electric by pay manage our the personal state’s auction the in to Given to clean

these work needed. is urgent but interested We parties the state with to best goals, to action achieve way continue on

bills, air irreplaceable dirtier the the from to loss our they and We from create. have these our from of protect our communities plants higher and power state that consumers jobs

capture generation. our the BGE, with at to first quarter. these Power the dispatch match led Dresden has almost for producing financial to as safety was on are operating remains The at nearly entirely I carbon top top PECO now very all emission-free the with zero service focused quartile XX.X% territories, and forced a even our Turning They utilities the at execution, of in The over achieved new operations, with, deal had electricity talked first at trouble is energy plants’ year able XX hottest The and record summer will of dates. and nation quartile delivering a strong XX.X%. simply performance of it production, hours business call heat ensuring Dresden in all a record. hard nuclear The through quarter. in of a about Byron on and plants turn is conditions, reliability renewable quarter for full update. storms ran the we excellent. in also for all and extreme the to XX% increase Joe their of targets across utilities Customer that our retirement performance plants across terawatt at was Byron power outage and Constellation through the duration Like result ComEd have the in and service ran at to Employees shame. pandemic frequency. and plants, retirement decile. the

Joseph Nigro

I on our full Thank quarter XXXX cover will will everyone. our an I good results, our disclosures. guidance. third quarterly you, and hedge also provide updates financial update Chris, Today, and year morning,

per $X.XX success and per our quarterly which on X. on $X.XX EPS range share both a basis, has performance We Turning $X.XX costs. for to exceeded $X.XX basis been in share and of second our share. key per quarters Slide to a guidance GAAP non-GAAP driver the in earned A third managing

the across As first our recall, may the with organization year to than announced million call, next our we phase hard until that earliest. reopen COVID. impacts organization, offset Since we expected X This then, savings At of help the change of our workers of anticipated. summer. of pushed expectations, remote-enabled higher to reopening late in offices in along have the for we you at would the work savings time, originally $XXX led quarter of on January

For tropical driven Coast achieved the to our Utilities summer combined taxes, where and the and $X.XX was per savings modestly hit delivered recognition of per share. were expectations bad were exceeded earning in holding to by expenses. third the debt by upside O&M, and was earnings offset partially regulatory East Isis, quarter, expectations, favorable than jurisdictions. lower company Utility ExGen expectations O&M which relative planned. largely quarter, for storm net The primarily related Exelon August. weather assets costs This sooner earlier higher $X.XX share targeted non-decoupled by driven a of in favorable our outperformed original

quarter was as growth earnings lower the earnings Additionally, as with O&M share XXXX. at with was from weather third by per transmission higher Slide earnings by up in X, storm were share rates share offset year, quarter-over-quarter our XXXX higher the and lower costs primarily of earnings and our per revenues. ExGen’s than favorable capacity per benefiting cost quarter walk. and PHI per we Utilities quarter favorable to of cases was year. associated margin. the Holdco $X.XX partially up compared compared last On third The PECO. and This completed of less relative Exelon show The $X.XX this benefited at year weather PECO. $X.XX distribution last share were driven gross $X.XX third higher to to rate well serve

Turning to Slide X.

$X.XX great the the of within range we our to $X the range $X share of our XXXX EPS revised per $X.XX business. a impacts $X.XX and original per from XXXX to on severity share the raising guidance are deal $X.XX first guidance comfortably call, per to to there on guidance are of about now quarter of our COVID share. uncertainty When length and was We

considers we cost performance management ExGen the to as guidance weather Our as in well the strong our saw the third updated date, favorable successful quarter.

confident our are year-end. at be We commitments, we our we within financial and are delivering range guidance will revised on

Moving to Slide XX.

slightly on infusions backward-looking, dipped the trailing last have continued quarters. Looking Utility at of we investments. returns couple with next poor range capital a of decline target XX impact The pre-COVID-XX primarily is lower quarter should our treasuries calculation to an better our as consolidated XX-month This X.X% is on due roll-off the at quarter. was on to see so to of first X% continue equity weather, ComEd. ROEs the This below summer burden ROE of basis and basis, from over the to to BGE quarters, ComEd due of support and some you consolidated pressure XX% simply storms third the quarter point

focused the growth into stronger utilities further Looking our we and returns targets. supporting delivering at remain the on future,

BGE considers from regulatory COVID-XX challenges their The to and two had while will to than managing highlights reliability Turning front. system, energy XX-years. economic Residential we are program XXXX include file distribution investments in plan, utility provide and Maryland, the in XXXX. multiyear Recovery electric year state Maryland environmental inclusion to The two and Pepco’s electric of to the lower the of and and mechanisms first first second costs service distribution that Slide on investments our assist benefit the in Since projected recovery will of May. support incentive emergency three. performance partially advanced customer major XXXX filed our in electric support rates Maryland, continue and filing investments a and the in guest the environment. made Pepco the focused its years of be system developments March the filing bills filing through planned investments they technologies of few modernize the and were for vehicle filed service, tools plan goals flat call, multiyear system first PECO use. timely to distribution XXXX Pepco investments to its in XX. in current filing the in customer with in during case reliability, distribution and planned cost allowing capital in was and first for on customers. offset the health customers XXXX. plan improve tracking A plan last

XXXX. an XXth, customer Pennsylvania the expect in is maintain increase with safety, for its PECO $XX case to September increase Commission. We order filed in PECO and distribution reliability gas On seeking a May revenue of Public gas a system investments and of continued distribution Utility service. million

We expect an in June XXXX. order of

also several orders conducted multiyear of which still evidentiary rate October, hearings rate We on of case. cases In were have as expect this progress, two year. BGE’s in part we pending

and and reliability well electric customer supports investments investments As distribution made reminder, as XXXX in for planned the filing service a maintain XXXX to our gas XXXX increased as late to systems. capital benefit and from

order expect in December. We an

improved has be decrease ago. formula bills this by the intervenors of row grid in On October place, details proposed found have orders than formula through case. a in investments is decided been ComEd’s annual the decade of and as reliability draft for ComEd’s the More in XX delivery update part a a expected December and were the modernization rate on ICC filing and they rates energy year. were the filed requests rate filing appendix. fifth year clean keeping reduction Since to third in nearly XX can be the Additionally, XXth, of staff XX-years. in while enabling cases lower ComEd, This by Slides rate on the XX% in growth

of $X.X deploy A Turning the on to that for Despite to $X.X expectations largely from pandemic, of of involving the capital at utility our customer investing as needs increasing spent system. and our capital advance Slide customers. changing for resiliency billion third the is strategy anticipate the year, during challenges and the I utilities, Today, XX. Utilities track key planned is that and quarter will benefit Exelon plan about continue The we early strategy. projects reliability some talk capital year. two our to capabilities and for our infrastructure element billion meet the year-to-date, improving and our of have

a new the to Pepco’s system, streetlight efficiency automatic of project management central to The integration response will in system. and project accuracy. send customer conversion first Maryland. is outage project modernization billing smart maintenance streetlights XX,XXX approximately The This existing includes improving streetlights LEDs management and notifications time, with central

is LEDs filing Additionally, plan safety improve benefit the included and multiyear light public in quality Maryland discussed earlier. and security. This I project Pepco

improvements one Exelon is completed project is was $XXX though to improve upgrade, project second and almost The done BGE’s customer information streamlined will and the remotely. implement transform a to utilities the to for include across platform Improvements customer more experience such will billing community of efficient personalized issue where project customer and information enable a and resolution allowing simplified future customer than offerings, customer new simply system the system it million efficiencies Utilities’ a cloud billing This different and time as ongoing on is even PECO. for which benefits. an will piece is support provide the fully This system BGE, customers’ was upgrade energy Oracle’s locations of solar experience a new ComEd more system. well customer operational as as residents. care at service satisfaction. produced implementation These at customer It customer

margin ExGen. allow services structures, our will EV such bringing of provide to it hedging and storage pricing pricing XX, for rate current we market position charging Additionally, as Slide Transitioning implementation faster. new update faster to and at new gross for

the of respectively. of XXXX, the in plants Our the September Dresden of reflect November and retirements Byron and nuclear disclosures planned now impacts

For gross in due XXXX, at margin million. is Hub. primarily margin million, NiHub $XX prices gross decreased partially higher Open to lower $XXX spark up by spreads total ERCOT, West offset and

New million hedges of to due open decrease mark-to-market of margin position, offset execution including $XXX of Our million the $XXX which our Power the up in were gross hedge Business.

also raising higher we new on favorable cost Based the associated non-Power during the $XX across and We New XXXX million load in are our with volumes third $XX targets weather by serve portfolio, to business quarter. million. quarter Business the executed lower

$XXX is the nuclear plants, gross line. is million total by gross Dresden of down flowing XXXX, margin For Byron retirements which the through driven margin open and

of due Power margin Mark-to-market prices New hedge A. million gross quarter. inside Zone million, the New is York down West the open at of Hub, Business flat However, $XX of was higher our and down by $XXX to to NiHub hedges being execution position offset due million $XXX

cash As the and be a and reminder, retirements are to Byron Dresden expected accretive. flow earnings

decrease offset the in The depreciation $XXX flat essentially due and million million. in O&M, and of to retirements. the is TOTI lower XXXX totaling gross are they $XXX However, margin amortization by timing

Additionally, hedging XXXX hedges. X% program ratable we cross-commodity by remained slightly X% behind considering in when our to

removal Our of and hedge the the in Byron of percentages XXXX. fall Dresden reflect

XX. Moving Slide on to

Our consolidated with XX% quarter. last FFO to for debt be is projected to XXXX, consistent

at target Looking of our we ExGen, of X.Xx. are debt-to-EBITDA ahead

For expect when to XXXX, debt-to-EBITDA debt. X.Xx excluding it at and nonrecourse X.Xx be we

existing ratings ratings to call to the balance in quarter. and for for strong investment-grade ratings. On closing affirmed will the the Moody third remarks. its Exelon you. and Corporation Chris credit Thank turn front, sheet remain committed back a And maintaining now I his We ComEd

Christopher Crane

Joe. Thanks,

Finally, proposition. these calls, Slide to with as value one turning do close each XX. I our of to we want

targeting a EPS X% We our focused X.X% growth growth with and X% we utilities, are growing XXXX. on through rate now are a to base

pay the dividend. the debt external support cash use support to Genco Genco the from will down flow We utility growth, free the and

get as only a not zero compensation seeking that our and value. of I a say nuclear asking we bailout. continue call that fleet compensation not And for editorials does towards It many X-emitting optimize emitting is the by fleet bailout. value Exelon have is others generation. to The We to Generation for are business fair what

is bailout, across competitive the field. a It leveling leveling political last the the is, or is venues it not is field. bailout. It playing nice this a So thing venues, and editorial it comes is but

will continue value uneconomic of the the Dresden, Constellation, Byron these and closing wholesale. retail retirement through We plants, Mystic, and we assets like maximizing monetizing announced and

sustain metrics will and through sheet strong our continue investment-grade credit to annually XXXX. We X% dividend maintain a grown at balance have and

news the want is on comment some Before Exelon from Q&A, I turning Exelon to Generation recent considering that the Utilities. to separating reports

employees communities, As we earnings those our when create structure serves We call, of we The our discussed best it is over corporate that the consider evaluate regularly our that can last would recently our and landscape of whether the also interest the our modifying and been value our evolving on customers structure investors. years. nature interests. and business has and in recognize

seen number you have in considerably. In competitive have integrated companies addition, of sector a that our shrunk

a structure outside help is advisers. and the Given of year, we have those this our circumstances, corporate earlier started of review underway,

As our employees, continue as creating we value, this the I the we have customers of communities serve. we mentioned, stakeholders: review, into focus and taking investors, all account, on the the

So call. that the an I to to determine you on to on would earnings for provide issues. do and our the regulatory continue financial complex progress want work No of been and operational, involve next decision the our stakeholders, emphasize will addressing we the but made, companies the has some separation we best outcome update

open it questions. with can So that, we now up operator, to

Operator

first the line [Operator comes question from Byrd of Stephen from Morgan Instructions] Stanley. Our

line is Your open. now

Stephen Byrd

through the But maybe high guess, I here, would you overall, review. I fairly provide what what for strategy? strategy greater achieve stage know start derisk consistent would good fleet sort your your to that strategic How profile business are do was consistent or merchant you, strategy versus your I guess of not be about of trying think sort wanted I options. to talk with your are about to just first think ExGen be profile you to respect trying risk you with sort a wanted risk of at want just about and that? to the I I attributes of stability. the for to with a and level, Hi, And at, I thinking morning. early

Christopher Crane

that evaluation. Yes. we the are stages. in I an we review would wouldn’t in-depth say say of I the would at early are

it companies, sure of some with degradation of right collateral we sheets, shareholders aspects on do, the this the are cost many healthy the to the Board two determine business have thing provide is under customers, that their But we at capital, healthy look are the review support balance things that is And we is can employees, the like that, the make forward. to to we utility Constellation business go the of the want we a stand costs. what things now. if There businesses right for needed that - the as two own and and the

yet a has So there. and I say pinpointed in a lot we that that the we - yet to a I well, profile have think don’t be Board pinpointed risk with. have risk I taken agreed But can agreed haven’t with profile

Stephen Byrd

volatility Understood. forward, the it just objective fair here? part of that guess, an to to also improve and clear Is of say business right? try That is to to it that seems is strategy I the viability, reduce going the that,

Christopher Crane

machine. flow we and it most cash free the a side. that is best return and shareholder It that side on optimize be to the valuation And how can Yes. produce do

So of the that is kind focus.

Stephen Byrd

just More about makes thinking plants. one maybe that sense. Yes, tactical last your on the one nuclear for And me. side,

for Would agree But of over plants guess or will with what made I guess, of decisions some already. negative frame you making be decisions And about are the cash like flow. I that remaining some they obviously your some look we thinking negative that are time flow? that nuclear assessment? calculate cash have shutdown currently You plants you are

Christopher Crane

at looked disclosures. our have You

is plants We with not right plants are depends they A do plants, or treated being sliding the which we zero with space. comparable and into market how equally FRR lot carbon-emitting we what treat outlined on that the have the capacity other that are now. the

in there the we and the would get have frame, redesign issues If watch we coming be the a have some we time capacity watch the legislation. to auction, future. So could auctions you anticipate up to the don’t run,

Stephen Byrd

appreciate it. I much, so Thanks Understood.

Operator

you. Thank

Research. line of Wolfe the Steve Fleishman from comes question from next Our

now Your line open. is

Steven Fleishman

Great.

if arguably, maybe year or So stock you little have the even Exelon ExGen for I in last value, so, getting price. value first, been the negative guess, for

case just obviously, but decision? seems talk obvious, through. you are some what value in get of just this probably the and obstacles to risks So those to there maybe making Could is

Christopher Crane

we that center, you at path out complex start get financials, on we combination one an dissynergies, the that the have that corporate do are wouldn’t considerations mean bodies these the laying of those, employees, I the the the the integrated. split the out I in-synergies imagine, this make one. to the to the complex and that There we properly. had splitting we of easy will not design can Many of not when of lot have integrateds creating and tell Yes. corporate you each splitting integration a look is or scale to out competitive I not have and that level a of regulatory that a is size competitive of switched the of but And that organization, have. we splitting has for do IP, is out the sure other to it make for have you

most wholesale that anything trading nobody the split organization, We and that. like retail have had premier has

So there too. but there being expense is value there created, is

consumer and do make is the sure to it for what it, we market. carbon we have to a do we watch lot do So said be properly. the zero how about we There

You a zero split-off. carbon fleet like has haven’t seen that anybody ours

have plants, you gas split-off. gas You infrastructure have seen seen have seen plants, you coal

you elements. of not Illinois it, XX% And for they the to we carbon for is right is they are the not when compensation we or We or that that make the legislators is the state look right if assets is XX% administrations They thus but the is do far. one have And have have recognized regulators just not Nuclear its being recognize compensated that recognized something it that or generation only when low if solar, been by recognize now, carbon-free. is that nuclear. carbon the spun-off. of at the sure of or nuclear. the that zero

last a figure have we have of this we is down avenues market’s out we how So to, there in and said go as it. call, lot to different with to changing, right. to the the I But change get

Steven Fleishman

Great.

just supporting comments made, you of this making that business type say the kind you or some get on nukes to decision? is on based need Illinois Chris, of law, Just fair either decision it structure not before to

Christopher Crane

but that, that will Bill, if not you Bill I add to jump say I in gating to is a want be function. don’t let here, going would I know to anything that?

William Von Hoene

Chris, you agree But here. identified No, you Yes. I have said. Steve, what point with sensitivity of big a

As take into a not, stakeholders, we considering account, or do Chris the the have to, this alluded our we to of and including whether to like. employees in communities variety serve, customers,

function exact whether that the are this. it has the the into doing before that. not. equation of all of - of or to we one, decision we So the what lots gating but goes It decided Number timing And timing this, - not only that, consideration we of be. relevant There the the to our plow not is but timing it relevant is to FRR number decide I on two, this. to if the is of that a optimal do substance ground what’s of to Board before we a to get it is And wouldn’t would put as obviously, function. decide so, hard the if is

Christopher Crane

profitable, business it earning I requirements, not And a FRR. the decision. with The add they their plants we or that if are needs don’t or - to is, their them cover only is and down without shut would thing cash

threat. them is down. a it have reality. is When money a people Some assets, just It they not threat. a It shut called businesses on don’t make

the the based at timing the we are sure doing the current look to to all have but these and we value, of so of off we for make is decisions conditions. And legislation thing. make important economic have decisions right But

Christopher Crane

to your great Great, Thanks and voice. her answers. the just thanks Bill, for

William Von Hoene

notes very your for Thank really Thank much. you I to nice it. appreciate me, you

Operator

Thanks you.

Our the from Capital next BMO from question comes Markets. line James of Thalacker

Your now open. is line

James Thalacker

time good Thanks morning. and for guys the

in this But help you work you prior quick of level of the kind around? I corporate Just the of next is, has your the on is structure, real time One reviews advisers retention of Or questions. process? previously know included the stated review you basis. regular kind outside conduct to this process of two evaluation a through this

Christopher Crane

No.

the at think put and be a In And outside point, very, very a be policy. we coming I Genco. of public. Utilities did looked very into we off at reasonable flow to used accretive reduce we XXXX, to it we debt, were dividend evaluation. support the was able And free equity thorough to able and cash advisers, that also

kept looked So advisers nothing that from but It assets structure through the been the not we always to with insular is this as It company. only also. is advice is been close in outside. we business have have on past,

James Thalacker

X magnitude you ExGen on mitigate Okay. the I And thinking, shared move in appreciate as potentially about that falls initial the about guess? how overall were thinking sort thoughts of you I the of guess, you services could Great. separation. you the on last company regulated into are guess, guidance, to the I any that. as allocation, and I that And you if across guess, just buckets? cost question, review undergo of and how Is potential how I give us just there forward,

Christopher Crane

sensitive to there. go can Utilities very and too early be Genco the back falls we to you will manage. have that I the to tell what is It what on

the accelerating focus. technology accelerating organization a but Not you in services business so of some lot. The seen going you other a when the formula. too type away. One the some that revenue know model that, is of things integrated, if would spread split. mitigate is update cost costs about and quarterly do generated a around. this done That we get the have when use contracts thing We and that to is split or that And savings on Genco’s costs that those goes Massachusetts-modified to us stuff far, competitive

the And the owners the to that that are company. so through costs have to their Genco programs increase we figure have keep I we keep most are And sure how of financials, the But shareholders things make an not databases. we benefits of efficient. do that go do to want - are all that mean the employee sure we the can going the list do. of right, the because make want going you see regulators to to in the want Genco we are to all going we to to understand complex out the in the split

are but we we that now, yet. through number So a have don’t working

James Thalacker

you Okay. I you the Slide appreciate that. or million And the XX, ExGen roughly can as as that going coming we million we move XXXX just on sort Should a forward? level. you that of Or the of how run cost about XXXX? this think on year $XXX of about retain savings think being decent and talked into at $XXX much do rate

Christopher Crane

to other will Joe, want things on travel, you But Joe some take we that in now. are jump that. there are I smaller There doing is let not that? right

Joseph Nigro

million $XXX is This Yes. Thank of million to the you, savings And year, Chris. cost $XXX expectation. - we going across that goal we of of enterprise. million overachieve our about a $XXX to by are had or O&M

that. been now. To in your the we repeatable analyzing We point, working in are right X of the of learned Chris’ remotely. months, here almost the we is that much where that we To how have question are have working in a about throes lot future, through last

We have entertainment. travel and had savings on

have savings. consulting had dollar training We savings,

to have line, that an that bleed will be things our almost going bottom and would at through. We provide think to on that things I now. will through are we quarter everything. the expect on update looked call, there fourth you We there be And that but fall

We rate future. are that of the commit in how run much to just not ready to is

James Thalacker

Okay, Thanks appreciate great. the for I time. that.

Operator

you. Thank

question next the Jeremy from Tonet from of JPMorgan. line comes Our

now line Your open. is

Jeremy Tonet

require the Hi the could more business, on you we to And funding if about should the the Exelon’s cash there? ExGen And details speak here? at that an prospects I scenario financial is you review. needs, bunch Utilities the could think from speak under share And would namely, equity any more to to independent want flows? something how considerations strategic good from support morning. without ExGen a growth separate just of

Christopher Crane

now. there that. I on we anticipation still Well, an lot work is going don’t a have think right of of

still do to are level it? ratings we figure take But of the We to you Dan, keep. trying what out want that

Daniel Eggers

making a start Jeremy, I Chris. Right I I is little calls good think allocation decisions. now, it think Yes. early balance probably question. to sheet mean, is a it Thanks, around capital and

considering aspect. their review, all the thinking about the that of through to Utilities we cash number be this of amongst and internally the would analysis go but decision. will how agencies, flow can Utilities is at the months. the with a metrics, growth, factors flows, free both imagine with are been funding with part an be going go into But over looking ExGen also could credit fund all the funding the retained generated other factors sources working You it, our cash will that how about their into Thinking thinking use is coming of to the

Jeremy Tonet

That if announcements received response are any the you you feedback in in is have that Illinois to with And recently? helpful. just put to a retirement you out very share wondering position that

Christopher Crane

imagine, first There There No. And not can nuclear these disappointment, is have employees. to we communities. is shut some plants are from as the the you down. had disappointment from

will not money make just but not we work. we already, that businesses say them down, that should way Some is shut the enough

are so the here us are the feel constituents reaction. and that the money, through you because And with down, major these work going to have so two the units pain to shutting we losing are much employees And the communities.

it and far and the commerce you what as not - provide easy. employment in If in the at look taxes as we community is

you support Kathleen legislative will figure communities lot so I And side. staying are to a us haven’t from they in and can to on heard open. do trying out But - what the those that let Bill imagine side. keeping those And plants jump can

Kathleen Barron

the I mean, is jump in Yes. Chris, as not in. can you session. I know, legislature

is there So the won’t group that governor’s potential But with the side is where the work House a through you I agree in clean and back on the working have broader legislation the that communities Senate around the watching happen But the energy will and well up, ramp will down, because sort extent plants, to struggling that will as and of employees the already with Illinois plants fossil COVID. is around these legislature session, affect side. state the been communities of both continued has this communities going. of and in efforts plants we as sense the air effects what until shut that and the pollution on are on similar impact, both are the

of folks it So for lot are a sure. watching

Jeremy Tonet

And and to impacting ROE proposed X% if sustainability one maintaining to it. of see just you one ask I Got plans range? do target your here. Understood. multiyear that the return XX% last How could

Christopher Crane

will I Yes. let that Calvin one. answer

to Calvin, had brought the with back have We couple some us want other things. gut a But in down cover that punches this that? you year storms and

Calvin Butler

with foundation our Absolutely, and Chris was around good say on regulators working growth would multiyear for was plans process giving really our in morning. What geared this and transparency whole that customers also and is our I jurisdictions long-term create to going. how our to and accountability a

customers transparent for to way our it to that continue to and it is to reliable our invest where is commitment XX%, going it just in but safe a X% is going a our system. and are remain So system to be we operate that are in to able to in we done

that course we very already are commitment, D.C. and So have jurisdictions. in D.C. now obligation, in what we as you on And discussing, of and environments in both that we utilities that our meet Maryland are is Maryland to have the in is in other with heard constructive our and

moving are we with forward that. So

Jeremy Tonet

me. is That Thanks is it. great. for that it Got

Operator

Thank you.

line next of the Julien of from comes Our Bank America. Dumoulin-Smith from question

open. now is line Your

Julien Dumoulin-Smith

So business. IG it past spin shift? the of Jeremy about under clearly And you here seems if broadly here? the side an prospects of you Just If been the up as ExGen way, to you you about off want I Can where pick how but earlier a these to The want then retail this can alluded you left has ask of from of strategic you talk the committed to can one call, little entity. under being to especially balance extra equation thinking are any a know talk about clear sheet, this it. you in I hear about I rating metrics investment-grade calculations spin? can are be in all I to how just that periods, agencies implications about have talked a subsequently, the have kind this. any if under that the bit,

Christopher Crane

want to you team tag do Jim, and that Joe one?

Joseph Nigro

Yes.

and very seriously. how committed have our obviously, investment-grade question ratings strong I we Julien’s are our think, that around Chris, to grade, we the answer to sheet take balance investment strong today, we

and it will And being includes that too are would mentioned, rating would anything commit business. the impact the it the that to turn to and stakeholders to all impacts at it agencies stand is ramifications a alone. all evaluating As lines. And point, Jim Genco one retail of rating we I the the process of those along But still early of what like talk the to look about with you in this that, the mentioned, those over to how of spin you that.

James McHugh

guess, work understand going team to over optimize time our few we I how of Julien, over to Thanks, Yes, the likewise, period gentlemen. sure. to are continue with are next we the and next And we finance working the through - months, business. can

bring that our is we large capability of capability overall the flow bring business Genco. to customer-serving to we portion the really and that the Genco cash Our earnings

We are customers we going, market the way the to and generation through structures want will structures and that committed management output. the load through that to all to we and maintain then the that. optimize work to We and and keep need spot managing in those to product the the of serve continue the

can the the focus sure maintain we our impacts see growth on the products are all going we and such that in keep that think that So that a will way customer business. and I we make

Julien Dumoulin-Smith

And further kind of if is. clarification, it

How ultimately how back state, PPA you to carbon do states’ to could might ultimately Clearly way First, subject for here. impact or election and another. programs that a rights - the these translate Chris, end of think and implement one the the of lot up right, recognizing all’s portfolio your on that?

eventually? that Given Illinois implemented how you think about potentially do today context, carbon as in

Christopher Crane

So trying level. state work the what to at is we are do

issue. it is polarizing you It elected, and federal gets the level, who still very doesn’t had going be a have at as to is know. matter it traction little polarizing We

it got focused. we where is you cross-state because the markets states have working then through So the through and the have been leakages

hope happens what see tomorrow body to versus want and Senate in versus where technology-neutral outcomes. the happens and the as size gone do see. go. have technologies what it to what House the they to approach We We at will will and the But have the we a of house they Senate, have legislative some

level get the at the make assets. still the for going to sure fight are right our valuation state we and to We that market level

like with looking to those assets. nice We editor an or or producing earlier, politician editorial we a is entity for remunerations say no for But bailout. are for it said I a largest the non-carbon are

the that tomorrow are a other We We for resources about want care bailout. paper is up are a getting country largest have you they looking emitting looking look Non-carbon it somebody emitting are But a pick will low just people the that other is source value in shut to Exelon to when that the valuation We But decided compete. the largest don’t we don’t compensated units in If just we a frustrating. the bailout. be that carbon able non-carbon compete, write and will with of to down. country provide non-carbon for that, will competing for against output. you payment, at to compete and and the company the

Julien Dumoulin-Smith

Thanks Understood. clear. and Chris team. quite

Christopher Crane

Thanks.

Operator

you. Thank

from comes Evercore. Our line the from of next Chopra Durgesh question

Your now line is open.

Durgesh Chopra

the Hey the to review. and one in. Maybe want guys, back just to on thanks strategic for quick then including me I one quarter, go

with your the Just guidance up. The on slide QX like balance. projected versus call is you flow $XXX million is cash the lower, the significantly this balance and quarter, showed XXXX lower

wondering just that. drives what So

Joseph Nigro

that. I Chris, can Yes. take

Christopher Crane

Yes. Joe. Take that

Joseph Nigro

Yes.

yes, there a going is on. So things of couple

quarter. even the on we of assumption then the of were from kind at materially one, flow quarter. the for some the of our number cash quarter, of pretty activity for an the small enterprise that And there up quarter free earnings flow needs. see last Exelon - and for to a other up across did given related versus moved importantly, we movement the that, we requirement Generation, number activity normal-type though were had cash operations more range in capital factors just cash Our had less working flow But we would were because

Durgesh Chopra

mentioned the about gating procedurally that Okay. strategic helpful. to time quickly, there Maybe Understood. this factor. really internally if you steps you you the talk not a to is That extent is review can, you here? line FRR on over? a just And get Chris, that next are could just And guys working

Christopher Crane

that you the the communities although have Yes. business the to make employees, we our can tell decisions. I is FRR the and legislation for and critical

of gating I factor. we now complications and the use think evaluate to trying that the going are wouldn’t separation, through as we the potential the review but right

but think done call. then, once heading. So would saying fourth we more the don’t will else? I Dan, lot you by know were we of want are we anything we done that say where get provide through guaranteeing very color the if review, on like the be be a Not to whole view complicated to quarter we would or

Daniel Eggers

No, think Chris, you I it. have covered

Christopher Crane

Alright.

Durgesh Chopra

quarter. Thanks Okay guys. Great much. so

Christopher Crane

Thanks.

Operator

remarks. further closing I’m showing questions, would Crane At back this to Chris for time, turn over call to like the I no

Christopher Crane

thank just busy in is Election’s concern day. the on, joining want a for I call. everybody Yes. about stability the to going country. of It kinds all

commitment their share the us for and to thank your to for be appreciated. to able it so is time, And really want I employees dedication.

safe had going I you that, storms, close the are have And a lot only the that with and COVID, and families And of had and the We on I healthy. have work will this they to your the through. year, call. things stuff hope not that

Exelon (EXC) 3 Nov 202020 Q3 Earnings call transcript