Exelon 2014 Annual Report Download - page 232

Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
The following table provides unrealized gains on NDT funds for 2014, 2013 and 2012:
For the Years Ended December 31,
2014 2013 2012
Net unrealized gains on decommissioning trust funds—Regulatory Agreement Units (a) ......... $180 $406 $386
Net unrealized gains on decommissioning trust funds—Non-Regulatory Agreement Units (b)(c) . . . 134 146 105
(a) Net unrealized gains related to Generation’s NDT funds associated with Regulatory Agreement Units are included in Regulatory liabilities on Exelon’s Consolidated
Balance Sheets.
(b) Excludes $29 million, $7 million and $73 million of net unrealized gains related to the Zion Station pledged assets in 2014, 2013 and 2012, respectively. Net
unrealized gains related to Zion Station pledged assets are included in the Payable for Zion Station decommissioning on Exelon’s Consolidated Balance Sheets.
(c) Net unrealized gains related to Generation’s NDT funds with Non-Regulatory Agreement Units are included within Other, net in Exelon’s Consolidated Statements of
Operations and Comprehensive Income.
Interest and dividends on NDT fund investments are recognized when earned and are included in Other, net in Exelon’s
Consolidated Statements of Operations and Comprehensive Income. Interest and dividends earned on the NDT fund investments for
the Regulatory Agreement Units are eliminated within Other, net in Exelon’s Consolidated Statement of Operations and
Comprehensive Income.
Accounting Implications of the Regulatory Agreements with ComEd and PECO. Based on the regulatory agreement with the ICC that
dictates Generation’s obligations related to the shortfall or excess of NDT funds necessary for decommissioning the former ComEd
units on a unit-by-unit basis, as long as funds held in the NDT funds are expected to exceed the total estimated decommissioning
obligation, decommissioning-related activities, including realized and unrealized gains and losses on the NDT funds and accretion of
the decommissioning obligation, are generally offset within Exelon’s and Generation’s Consolidated Statements of Operations and
Comprehensive Income. The offset of decommissioning-related activities within the Consolidated Statement of Operations and
Comprehensive Income results in an equal adjustment to the noncurrent payables to affiliates at Generation and an adjustment to
the regulatory liabilities at Exelon. Likewise, ComEd has recorded an equal noncurrent affiliate receivable from Generation and
corresponding regulatory liability. Should the expected value of the NDT fund for any former ComEd unit fall below the amount of the
expected decommissioning obligation for that unit, the accounting to offset decommissioning-related activities in the Consolidated
Statement of Operations and Comprehensive Income for that unit would be discontinued, the decommissioning-related activities
would be recognized in the Consolidated Statements of Operations and Comprehensive Income and the adverse impact to Exelon’s
and Generation’s results of operations and financial position could be material. As of December 31, 2014, the NDT funds of each of
the former ComEd units, except for Zion (see Zion Station Decommissioning below), are expected to exceed the related
decommissioning obligation for each of the units. For the purposes of making this determination, the decommissioning obligation
referred to is different, as described below, from the calculation used in the NRC minimum funding obligation filings based on NRC
guidelines.
Based on the regulatory agreement supported by the PAPUC that dictates Generation’s rights and obligations related to the shortfall
or excess of trust funds necessary for decommissioning the former PECO units, regardless of whether the funds held in the NDT
funds are expected to exceed or fall short of the total estimated decommissioning obligation, decommissioning-related activities are
generally offset within Exelon’s and Generation’s Consolidated Statements of Operations and Comprehensive Income. The offset of
decommissioning-related activities within the Consolidated Statement of Operations and Comprehensive Income results in an equal
adjustment to the noncurrent payables to affiliates at Generation and an adjustment to the regulatory liabilities at Exelon. Likewise,
PECO has recorded an equal noncurrent affiliate receivable from Generation and a corresponding regulatory liability. Any changes
to the PECO regulatory agreements could impact Exelon’s and Generation’s ability to offset decommissioning-related activities
within the Consolidated Statement of Operations and Comprehensive Income, and the impact to Exelon’s and Generation’s results
of operations and financial position could be material.
The decommissioning-related activities related to the Non-Regulatory Agreement Units are reflected in Exelon’s Consolidated
Statements of Operations and Comprehensive Income.
Refer to Note 3—Regulatory Matters and Note 25—Related Party Transactions for information regarding regulatory liabilities at
ComEd and PECO and intercompany balances between Generation, ComEd and PECO reflecting the obligation to refund to
customers any decommissioning-related assets in excess of the related decommissioning obligations.
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