Exelon 2015 Annual Report Download - page 111

Table of Contents
The following table illustrates the effects of changing certain ARO assumptions, discussed above, while holding all other assumptions
constant (dollars in millions):
Change in ARO Assumption
Increase (Decrease) to
ARO at
December 31, 2015
Cost escalation studies
Uniform increase in escalation rates of 50 basis points $ 1,600
Probabilistic cash flow models
Increase the estimated costs to decommission the nuclear plants by 20 percent $ 1,420
Increase the likelihood of the DECON scenario by 10 percentage points and decrease the likelihood of the
SAFSTOR scenario by 10 percentage points $ 410
Increase the likelihood of the SAFSTOR scenario by 20 percentage points and decrease the likelihood of
the Delayed DECON scenario by 20 percentage points $ (240)
Increase the likelihood of operating through current license lives by 10 percentage points and decrease the
likelihood of operating through anticipated license renewals by 10 percentage points $ 540
Extend the estimated date for DOE acceptance of SNF to 2030 $ (20)
Extend the estimated date for DOE acceptance of SNF to 2030 coupled with an increase in discount rates
of 100 basis points $ (480)
Extend the estimated date for DOE acceptance of SNF to 2030 coupled with a decrease in discount rates
of 50 basis points $ 270
(a) The Delayed DECON scenario is currently assumed to be the most likely decommissioning approach for a majority of Exelon’s nuclear plants.
For more information regarding accounting for nuclear decommissioning obligations, see Note 1—Significant Accounting Policies, Note 9—
Implications of Potential Early Plant Retirements and Note 16—Asset Retirement Obligations of the Combined Notes to Consolidated Financial
Statements.
Goodwill (Exelon and ComEd)
As of December 31, 2015, Exelon’s and ComEd’s carrying amount of goodwill was approximately $2.7 billion, relating to the acquisition of
ComEd in 2000 as part of the PECO/Unicom Merger. Under the provisions of the authoritative guidance for goodwill, ComEd is required to perform
an assessment for possible impairment of its goodwill at least annually or more frequently if an event occurs or circumstances change that would
more likely than not reduce the fair value of the ComEd reporting unit below its carrying amount. Under the authoritative guidance, a reporting unit
is an operating segment or one level below an operating segment (known as a component) and is the level at which goodwill is tested for
impairment. A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial
information is available and its operating results are regularly reviewed by segment management. ComEd has a single operating segment for its
combined business. There is no level below this operating segment for which operating results are regularly reviewed by segment management.
Therefore, ComEd’s operating segment is considered its only reporting unit.
Entities assessing goodwill for impairment have the option of first performing a qualitative assessment to determine whether a quantitative
assessment is necessary. In performing a qualitative assessment, entities should assess, among other things, macroeconomic conditions,
industry and market considerations, overall financial performance, cost factors, and entity-specific events. If an entity determines, on the basis of
qualitative factors, that the fair value of the reporting unit is more likely than not greater than the carrying amount, no further testing is required. If
an entity bypasses the
104
(a)
Source: BALTIMORE GAS & ELECTRIC CO, 10-K, February 10, 2016 Powered by Morningstar® Document Research℠
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