ComEd 2003 Annual Report Download - page 130

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128 Notes to Consolidated Financial Statements
EXELON CORPORATION AND SUBSIDIARY COMPANIES
Supplemental Balance Sheet Information
December 31,
2003 2002
Investments
Direct financing leases $465 $ 445
Energy services and other ventures 170 177
Affordable housing projects 77 88
Investment in subsidiaries and joint ventures (a) 73 16
Investment in EXRES SHC, Inc. (b) 47 –
Investment in Sithe (b) –478
Investment in AmerGen (c) –160
Communication ventures 539
Total $ 837 $1,403
(a) Includes investments in financing trusts which were not consolidated within the
financial statements of Exelon at December 31, 2003 pursuant to the provisions of
FIN No. 46-R. See Note 1—Significant Accounting Policies for further discussion of
the effects of FIN No. 46-R.
(b) On November 25, 2003, Generation, Reservoir and Sithe completed a series of
transactions that restructured the ownership of Sithe, with Generation continuing
to own a 50% interest in Sithe through EXRES SHC, Inc. See Note 3—Sithe for fur-
ther information on these transactions.
(c) On December 22, 2003, Generation purchased British Energy’s 50% interest in
AmerGen. See Note 2—Acquisitions and Dispositions for further information.
Prior to the Merger, Unicom entered into a like-kind ex-
change transaction pursuant to which approximately $1.6
billion was invested in passive generating station leases with
two separate entities unrelated to Exelon. The generating
stations were leased back to such entities as part of the
transaction. For financial accounting purposes, the invest-
ments are accounted for as direct financing lease invest-
ments. Unicom Investments, Inc. holds the leasehold
interests in the generating stations in several separate
bankruptcy remote, special purpose companies it directly or
indirectly wholly owns. Under the terms of the lease agree-
ments, Exelon received a prepayment of $1.2 billion in the
fourth quarter of 2000, which reduced the investment in the
lease. The remaining payments are payable at the end of the
thirty-year lease and there are no minimum scheduled lease
payments to be received over the next five years. The
components of the net investment in the direct financing
leases were as follows:
December 31,
2003 2002
Total minimum lease payments $1,492 $1,492
Less: unearned income 1,027 1,047
Net investment in direct financing leases $ 465 $ 445
The following tables provide information about the regu-
latory assets and liabilities of ComEd and PECO as of De-
cember 31, 2003 and 2002.
December 31,
ComEd 2003 2002
Regulatory assets (liabilities)
Nuclear decommissioning $(1,183) $–
Removal costs (973) (933)
Reacquired debt costs and interest-rate swap
settlements 172 84
Recoverable transition costs 131 175
Deferred income taxes (61) (68)
Nuclear decommissioning costs for retired plants –248
Other 23 8
Total $(1,891) $(486)
December 31,
PECO 2003 2002
Regulatory assets
Competitive transition charges $4,303 $4,639
Deferred income taxes 762 729
Non-pension postretirement benefits 58 64
Reacquired debt costs 49 53
MGP regulatory asset 34 20
DOE facility decommissioning 26 32
Nuclear decommissioning (12) –
Other 69
Long-term regulatory assets 5,226 5,546
Deferred energy costs (current asset) 81 31
Total $5,307 $5,577
Nuclear Decommissioning Costs. These costs represent the
amount of future nuclear decommissioning costs that ex-
ceed (regulatory asset) or are less than (regulatory liability)
the associated decommissioning trust fund assets. ComEd
and PECO believe the trust fund assets including any future
collections from ratepayers will equal the associated future
decommissioning costs. See Note 13—Nuclear Decom-
missioning and Spent Fuel Storage.
Removal Costs. These amounts represent funds received
from ratepayers to cover the future removal of property,
plant and equipment. See Note 6—Property, Plant and
Equipment for further information.
Reacquired Debt Costs and Interest-Rate Swaps. The re-
acquired debt costs represent premiums paid for the early
extinguishment and refinancing of long-term debt, which is
amortized over the life of the new debt issued to finance the
debt redemption. Interest-rate swap settlements are de-
ferred and amortized over the period that the related debt is
outstanding.
Recoverable Transition Costs. These charges, related to the
recovery of ComEd’s former generating plants, are amortized