Exelon 2014 Annual Report Download - page 209

Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
hedges and proprietary trading derivatives are shown gross. The impact of the netting of fair value balances with the same
counterparty that are subject to legally enforceable master netting agreements, as well as netting of cash collateral including initial
margin on exchange positions, is aggregated in the collateral and netting column. As of December 31, 2014 and 2013, $8 million and
$10 million of cash collateral posted, respectively, was not offset against derivative positions because such collateral was not
associated with any energy-related derivatives, were associated with accrual positions, or as of the balance sheet date there were
no positions to offset. Excluded from the tables below are economic hedges that qualify for the NPNS scope exception and other
non-derivative contracts that are accounted for under the accrual method of accounting.
ComEd’s use of cash collateral is generally unrestricted unless ComEd is downgraded below investment grade (i.e. to BB+ or Ba1).
Cash collateral held by PECO and BGE must be deposited in a non affiliate major U.S. commercial bank or foreign bank with a U.S.
branch office that meet certain qualifications.
The following table provides a summary of the derivative fair value balances recorded by the Registrants as of December 31, 2014:
Generation ComEd Exelon
Derivatives
Economic
Hedges
Proprietary
Trading
Collateral
and
Netting (a) Subtotal (b)
Economic
Hedges (c)
Total
Derivatives
Mark-to-market
derivative assets (current assets) .................. $4,992 $ 456 $(4,184) $1,264 $ — $1,264
Mark-to-market
derivative assets (noncurrent assets) ............... 1,821 56 (1,112) 765 — 765
Total mark-to-market
derivative assets ................................ 6,813 512 (5,296) 2,029 — 2,029
Mark-to-market
derivative liabilities (current liabilities) ............... (4,947) (468) 5,200 (215) (20) (235)
Mark-to-market
derivative liabilities (noncurrent liabilities) ........... (1,540) (64) 1,502 (102) (187) (289)
Total mark-to-market
derivative liabilities .............................. (6,487) (532) 6,702 (317) (207) (524)
Total mark-to-market
derivative net assets (liabilities) .................... $ 326 $ (20) $ 1,406 $1,712 $(207) $1,505
(a) Exelon and Generation net all available amounts allowed under the derivative accounting guidance on the balance sheet. These amounts include unrealized
derivative transactions with the same counterparty under legally enforceable master netting agreements and cash collateral. In some cases Exelon and Generation
may have other offsetting exposures, subject to a master netting or similar agreement, such as trade receivables and payables, transactions that do not qualify as
derivatives, letters of credit and other forms of non-cash collateral. These are not reflected in the table above.
(b) Current and noncurrent assets are shown net of collateral of $(416) million and $(171) million, respectively, and current and noncurrent liabilities are shown net of
collateral of $(599) million and $(220) million, respectively. The total cash collateral posted, net of cash collateral received and offset against mark-to-market assets
and liabilities was $1,406 million at December 31, 2014.
(c) Includes current and noncurrent liabilities relating to floating-to-fixed energy swap contracts with unaffiliated suppliers.
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