ComEd 2015 Annual Report Download - page 105

Table of Contents
electric and gas base rates are expected to take effect in June 2016. BGE is also proposing to recover an annual increase of approximately $30
million for Baltimore City conduit lease fees through a surcharge. BGE cannot predict how much of the requested increase the MDPSC will
approve or if it will approve BGE’s request for a conduit fee surcharge.
Transmission Formula Rate Update Filing (Exelon, ComEd and BGE). On April 15, 2015 (and revised on May 19), ComEd filed its
annual 2015 transmission formula rate update with the FERC, reflecting an increased revenue requirement of $86 million, including an increase of
$68 million for the initial revenue requirement and an increase of $18 million related to the annual reconciliation. The filing establishes the revenue
requirement used to set rates that took effect in June 2015, subject to review by the FERC and other parties. The time period for any challenges to
ComEd’s annual update expired in October 2015. No challenges were submitted. See Note 3—Regulatory Matters of the Combined Notes to
Consolidated Financial Statements for further information related to transmission formula update.
In April 2015, BGE filed its annual transmission formula rate update with the FERC, reflecting an increased revenue requirement of $10
million, including an increase of $13 million for the initial revenue requirement, inclusive of dedicated facilities charge revenues, and a decrease of
$3 million related to the annual reconciliation for 2014. The filing establishes the revenue requirement used to set rates that took effect in June
2015. The time period for any challenges to BGE’s annual update expired in October 2015. No challenges were submitted. See Note 3—Regulatory
Matters of the Combined Notes to Consolidated Financial Statements for further information related to the transmission formula update.
Grand Prairie Gateway Transmission Line (Exelon and ComEd). On December 2, 2013, ComEd filed a request to obtain the ICC’s
approval to construct a 60-mile overhead 345kV transmission line that traverses Ogle, DeKalb, Kane and DuPage Counties in Northern Illinois. On
May 28, 2014, in a separate proceeding, FERC issued an order granting ComEd’s request to include 100% of the capital costs recorded to
construction work in progress during construction of the line in ComEd’s transmission rate base. If the project is cancelled or abandoned for
reasons beyond ComEd’s control, FERC approved the ability for ComEd to recover 100% of its prudent costs incurred after May 21, 2014 and
50% of its costs incurred prior to May 21, 2014 in ComEd’s transmission rate base. The costs incurred for the project prior to May 21, 2014 were
immaterial. ComEd has acquired numerous easements across the project route through voluntary transactions. ComEd will seek to acquire the
property rights on the remaining 28 parcels through condemnation proceedings in the circuit courts. ComEd began construction of the line during
the second quarter of 2015 with an in-service date expected in the second quarter of 2017.
FERC Ameren Order (Exelon and ComEd). In July 2012, FERC issued an order to Ameren Corporation (Ameren) finding that Ameren had
improperly included acquisition premiums/goodwill in its transmission formula rate, particularly in its capital structure and in the application of
AFUDC. FERC also directed Ameren to make refunds for the implied increase in rates in prior years. Ameren filed for rehearing of the July 2012
order, which was denied in June 2014. On July 20, 2015, FERC approved a settlement between Ameren and its customers to resolve the matter.
ComEd believes that the FERC settlement authorizing its transmission formula rate is distinguishable from the circumstances that led to the July
2012 FERC order in the Ameren case. However, if ComEd were required to exclude acquisition premiums/goodwill from its transmission formula
rate, the impact could be material to ComEd’s results of operations and cash flows.
FERC Order No. 1000 Compliance (ComEd, PECO and BGE). In FERC Order No. 1000, the FERC required public utility transmission
providers to enhance their transmission planning procedures and their cost allocation methods applicable to certain new regional and interregional
transmission
98
Source: BALTIMORE GAS & ELECTRIC CO, 10-K, February 10, 2016 Powered by Morningstar® Document Research℠
The information contained herein may not be copied, adapted or distributed and is not warranted to be accurate, complete or timely. The user assumes all risks for any damages or losses arising from any use of this information,
except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.