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Exelon Corporation 2011 Summary Annual Report

Table of contents

  • Page 1
    Exelon Corporation 2011 Summary Annual Report

  • Page 2
    ...three-unit natural gas-fired peaking plant in Fort Worth, Texas; Exelon Power's Chicago City Solar, a 10-megawatt solar photovoltaic facility on the city's South Side; ComEd transmission and distribution assets in Illinois. Adjusted (non-GAAP) operating earnings: This report includes a discussion of...

  • Page 3
    Best-in-class nuclear fleet performance. Expanding our natural gas-fueled generation. Disciplined investing in renewable energy. Strong reliability and performance at ComEd and PECO. Dedicated to clean energy and competitive markets. Pursuing strategic growth. Strong operating earnings, and $1.4 ...

  • Page 4
    To Our Shareholders In 2011, Exelon's operating and financial performance earned our shareholders $2.495 billion. We acted on a broad range of fronts to sustain and enhance your value in the face of painfully low natural gas and electricity prices. As I write, we are nearing completion of our merger...

  • Page 5
    ...to Exelon's profits. Our Texas gas plants were available to run and Power Team capitalized on market conditions during the February cold and the summer heat. We retired three aging fossil units in Pennsylvania as planned, with one additional coal unit scheduled for retirement in 2012. Exelon Exelon...

  • Page 6
    ... regulated open markets, shaped by customer choice and accurate price signals, will promote a clean, reliable My 11-year tenure as chairman and chief executive officer of Exelon has been the most profoundly satisfying period of a 28-year career at the helm of public utilities. 4 A LETTER FROM...

  • Page 7
    ... of a 28-year career at the helm of public utilities. The metrics are straightforward: a total shareholder return of 116 percent since the formation of Exelon (compared to 11 percent for John W. Rowe Chairman and Chief Executive Officer Exelon Corporation Feb. 22, 2012 A LETTER FROM THE CHAIRMAN...

  • Page 8
    ... generation and electric and gas delivery companies in the United States - providing superior value for our customers, employees, investors and the communities we serve. An operator inside ComEd's West Loop substation in Chicago. The substation, completed in 2008, helps manage the flow of power in...

  • Page 9
    Our Goals > Keep the lights on and the gas flowing > Run the nuclear fleet at world-class levels > Capitalize on environmental leadership and clean nuclear energy > Create a challenging and rewarding workplace > Enhance the value of our generation > Build value through disciplined financial ...

  • Page 10
    ... in 2000. 1997 PECO launches AmerGen with British Energy (BE) to acquire and operate U.S. nuclear power plants. AmerGen purchases Three Mile Island Unit 1, Clinton and Oyster Creek; Exelon bought BE's stake in 2003. Illinois enacts the Electric Service Customer Choice and Rate Relief Law, and...

  • Page 11
    ... units and Eddystone Unit 1 retired at the end of 2011; Eddystone Unit 2 will retire May 31, 2012. 2010 Exelon acquires a 735-megawatt portfolio of wind generation, now Exelon Wind, a unit of Exelon Power. Dresden Nuclear Power Station turns 50 - units 2 and 3 remain in operation; Unit 1 retired in...

  • Page 12
    Exelon's Merger with Constellation Exelon's merger with Constellation includes a package of benefits to the State of Maryland, City of Baltimore (pictured here) and BGE customers that totals more than $1 billion and is expected to create more than 6,000 jobs statewide. 10

  • Page 13
    ... April 28, 2011, Exelon and Constellation announced the merger of the two companies in an all-stock transaction in which Constellation shareholders will receive 0.93 shares of Exelon stock for each share they own in Constellation. Upon completing all required shareholder as well as state and federal...

  • Page 14
    Generation 12 GENERATION

  • Page 15
    ... resources, as well as the Power Team and Exelon Energy businesses. NUCLEAR Top: Exelon Power acquired Wolf Hollow Generating Station, a 720-megawatt, two-unit, combined-cycle natural gas electricity generating plant in Granbury, Texas, in 2011. Exelon Nuclear's 8,700 employees run its fleet...

  • Page 16
    ... facility, acquired in August 2011, is a combined-cycle natural gas-fired power plant that added 720 megawatts of clean energy to Exelon Generation's portfolio in the competitive Electric Reliability Council of Texas power market. Beyond the recent wind and natural gas additions to its fleet, Exelon...

  • Page 17
    ... 22 units in Illinois, Pennsylvania, Maryland, New Jersey and New York; and 15,528 megawatts of non-nuclear generation, including (in order of megawatt capacity) natural gas, coal, hydro, oil, wind, solar and landfill gas. Exelon Nuclear's fleet will expand to include a majority share of five units...

  • Page 18
    ... of Exelon's electric generating facilities, power purchase agreements, fuel requirements, emission credits, transmission contracts and wholesale and retail load obligations. Exelon Power Team's trade floor in Kennett Square, Pa. Power Team will merge, along with Exelon Energy, into a new Exelon...

  • Page 19
    ...24 hours a day, 365 days a year. The Power Team trade floor and headquarters are currently located in Kennett Square, Pa. Exelon Energy is the retail marketing arm of Exelon. It markets electricity to customers in Illinois and Pennsylvania, and natural gas to customers in Illinois, Michigan and Ohio...

  • Page 20
    Utilities 18 UTILITIES

  • Page 21
    ..., for the benefit of the companies' customers, employees and communities. COMED Top: At the PECO Transmission System Operations Center in Philadelphia, operators keep close watch on the regional electric grid. Bottom Left: ComEd's state-of-theart substation in Chicago's West Loop. This was...

  • Page 22
    ... safely conducts routine work on the utility's electricity delivery system. Right: Exelon's utilities are engaged in smart grid/smart meter pilots, including installation of new digital meters like this one installed in the ComEd service territory. Both PECO and BGE are recipients of $200 million...

  • Page 23
    ... for advanced products and services for customers. Upon close of the merger, a new organization, Exelon Utilities, will form to serve a coordinating function and ensure that best practices are shared among Exelon's three electricity and gas delivery companies, BGE, ComEd and PECO. For nearly...

  • Page 24
    ... and other services), Communications and Public Affairs, Corporate Strategy and Exelon 2020, Development, Finance, Government Affairs and Public Policy, Human Resources, Information Technology (which includes Cyber & Physical Security), Investments, Legal and Governance, and Supply. In 2011, the BSC...

  • Page 25
    ...and Chief Executive Officer, ComEd Kenneth W. Cornew Senior Vice President, Exelon, and President, Power Team Joseph Dominguez Senior Vice President, Federal Regulatory Affairs, Public Policy and Communications, Exelon, and Senior Vice President, State Governmental Affairs, Exelon Generation Ruth...

  • Page 26
    ... Partner, Dilworth Paxson LLP Sue L. Gin Chairman and Chief Executive Officer, Flying Food Group, LLC Rosemlrie B. Greco Principal, GRECOVentures; Former... P. Sloan Foundation Richlrd W. Mies President and Chief Executive Officer, The Mies Group, Ltd. Admiral (Retired), United States Navy John ...

  • Page 27
    ...Stock Performance Graph 28 Discussion of Financial Results - Exelon 30 Discussion of Financial Results - by Business Segment 31 Discussion of Financial Results... in Shareholders' Equity 41 Management's Report on Internal Control Over Financial Reporting 32 Discussion of Financial Results - ComEd 33 ...

  • Page 28
    ... Report Summdry of Edrnings dnd Findncidl Condition (Dolldrs in millions, except for per shdre ddtd) 2011 2010 2009 For the yedrs ended Dec. 31, 2008 2007 Stdtement of operdtions ddtd Operdting revenues Operdting income Income from continuing operdtions Income from discontinued operdtions Net...

  • Page 29
    ...09 9/09 12/09 3/10 6/10 9/10 12/10 3/11 6/11 9/11 12/11 Exelon Corporation S&P 500 S&P Utilities 2001 2002 2003 2004 2005 2006 2007 2008 2009 Vdlue of investment dt Dec. 31, 2010 2011 Exelon Corpordtion S&P 500 S&P Utilities $ 100.00 $ 100.00 $ 100.00 $ 114.04 $ $ 77.95 70.06 $ 148.09...

  • Page 30
    Discussion of Findncidl Results - Exelon Results of Operations-Exelon Fdvordble (Unfdvordble) Vdridnce (Dolldrs in millions, except for per shdre ddtd) 2011 2010 Operdting revenues Purchdsed power dnd fuel expense Revenue net of purchdsed power dnd fuel expense Other operdting expenses Operdting...

  • Page 31
    ...-run rdte schedule received in 2011. ComEd's dnd PECO's operdting revenues net of purchdsed power dnd fuel expense incredsed by $89 million dnd $155 million, respectively, ds d result of improved pricing primdrily due to the new electric distribution rdtes effective June 1, 2011, dt ComEd dnd new...

  • Page 32
    ...2010 operdting results dnd other stdtisticdl informdtion set forth below include intercompdny trdnsdctions, which dre elimindted in Exelon's consoliddted findncidl stdtements. Net In)ome (Loss) by Business Segment Fdvordble (Unfdvordble) Vdridnce (Dolldrs in millions) 2011 2010 Generdtion ComEd...

  • Page 33
    Discussion of Findncidl Results - Generdtion Results of Operations-Generation Fdvordble (Unfdvordble) Vdridnce (Dolldrs in millions) 2011 2010 Operdting revenues Purchdsed power dnd fuel expense Revenue net of purchdsed power dnd fuel expense Other operdting expenses Operdting dnd mdintendnce ...

  • Page 34
    Discussion of Findncidl Results - ComEd Results of Operations-ComEd Fdvordble (Unfdvordble) Vdridnce (Dolldrs in millions) 2011 2010 Operdting revenues Purchdsed power expense Revenue net of purchdsed power expense Other operdting expenses Operdting dnd mdintendnce Operdting dnd mdintendnce for ...

  • Page 35
    ...revenues. The incredse in PECO's net income wds driven primdrily by new distribution rdtes effective Jdn. 1, 2011, ds d result of the 2010 electric...deprecidtion expense dnd the net impdct of the 2010 CTC recoveries reflected in electric operdting revenues net of purchdsed power expense dnd CTC ...

  • Page 36
    ...Exelon Corpordtion dnd Subsididry Compdnies (Dolldrs In millions, except per shdre ddtd) 2011 For the yedrs ended Dec. 31, 2010 2009 Operdting revenues Operdting expenses Purchdsed power... dnd/or reguldtory progrdms thdt dre recoverdble from customers on d full dnd current bdsis through d ...

  • Page 37
    ... Income Exelon Corpordtion dnd Subsididry Compdnies (Dolldrs In millions, except per shdre ddtd) 2011 For the yedrs ended Dec. 31, 2010 2009 Other comprehensive income (loss) Pension dnd non-pension postretirement benefit pldns: Prior service benefit recldssified to periodic costs, net of...

  • Page 38
    Consoliddted Stdtements of Cdsh Flows Exelon Corpordtion dnd Subsididry Compdnies (Dolldrs in millions) 2011 For the yedrs ended Dec. 31, 2010 2009 Cdsh flows from operdting dctivities Net income Adjustments to reconcile net income to net cdsh flows provided by operdting dctivities: Deprecidtion...

  • Page 39
    ...findncing dffilidtes Dividends pdid on common stock Proceeds from employee stock pldns Other findncing dctivities Net cdsh flows used in findncing ...360 of Exelon's 2011 Form 10-K filed with the SEC. Also see Mdndgement's Discussion dnd Andlysis of Findncidl Condition dnd Results of Operdtions...

  • Page 40
    ... Restricted cdsh dnd investments Accounts receivdble, net Customer ($329 dnd $346 gross dccounts receivdbles pledged ds colldterdl ds of Dec. 31, 2011, dnd Dec. 31, 2010, respectively) Other Mdrk-to-mdrket derivdtive dssets Inventories, net Fossil fuel Mdteridls dnd supplies Deferred income tdxes...

  • Page 41
    ...2011, dnd 2010, respectively) Tredsury stock, dt cost (35 shdres held dt Dec. 31, 2011, dnd 2010, respectively) Retdined edrnings Accumuldted other comprehensive loss, net...of Exelon's 2011 Form 10-K filed with the SEC. Also see Mdndgement's Discussion dnd Andlysis of Findncidl Condition dnd Results ...

  • Page 42
    ... Acquisition of Exelon Wind Other comprehensive loss, net of income tdxes of $(221) Bdldnce, Dec. 31, 2010 Net income Long-term incentive pldn dctivity Employee stock purchdse pldn issudnces Common stock dividends Other comprehensive loss, net of income tdxes of $(41) Bdldnce, Dec. 31, 2011 692,953...

  • Page 43
    ... Form 10-K dnnudl report for the yedr ended Dec. 31, 2011. Thdt dnnudl report wds filed with the Securities dnd Exchdnge Commission on Feb. 9, 2012, dnd cdn be viewed dnd retrieved through the Commission's website dt www.sec.gov or our website dt www.exeloncorp.com. Our independent registered public...

  • Page 44
    ... and Corporate Secretary, Exelon Corporation, Post Office Box 805379, Chicago, Illinois 60680-5379. The company maintains a telephone information service that enables investors to obtain currently available information on financial performance, company news and to access shareholder services at...

  • Page 45
    © 2012 Exelon / design: paragraphs.com / editor: Howard Karesh, Exelon Corp. / photos: Amos Chan, Ron Wu and Exelon Media Productions / printing: Lithographix The paper utilized for the printing of this report is certified to Forest Stewardship Council standards, which promotes environmentally ...

  • Page 46
    Exelon Corporation P.O. Box 805379 Chicago, IL 60680-5379 www.exeloncorp.com ©2012 Exelon