ComEd 2015 Annual Report Download - page 280

Table of Contents
Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)—(Continued)
that participate in the day ahead and real-time wholesale energy markets. Under Order No. 745, buyers in ISO and RTO markets were required to
pay demand response resources the full Locational Marginal Price when the demand response replaced a generation resource and was cost-
effective. On January 25, 2016, the U.S. Supreme Court reversed the D.C. Circuit Court decision and remanded the matter to the D.C. Circuit
Court. While we cannot predict exactly how the D.C. Circuit Court will handle the matter on remand, we do not expect there will be any significant
change in how demand response resources have or will participate in and be paid by wholesale energy markets. Thus, we do not anticipate that
there will be any impact to the Registrants’ results of operations or cash flows based on these proceedings.
New England Capacity Market Results (Exelon and Generation). Each year, ISO New England, Inc. (ISO-NE) files the results of its
annual capacity auction at the FERC which is required to include documentation regarding the competitiveness of the auction. Consistent with this
requirement, on February 27, 2015, ISO-NE filed the results of its ninth capacity auction (covering the June 1, 2018 through May 31, 2019 delivery
period). On June 18, 2015, the FERC accepted the results of the ninth capacity auction. On July 20, 2015, a union representing utility workers
sought rehearing of that decision which the FERC denied on December 30, 2015. It is not clear whether the FERC’s order will be appealed.
On February 28, 2014, ISO-NE filed the results of its eighth capacity auction (covering the June 1, 2017 through May 31, 2018 delivery
period). On June 27, 2014, the FERC issued a letter to ISO-NE noting that ISO-NE’s February 28, 2014 filing was deficient and that ISO-NE must
file additional information before the FERC can process the filing. ISO-NE filed the information on July 17, 2014, and the ISO-NE’s filings became
effective by operation of law pursuant to a notice issued by the secretary of FERC on September 16, 2014. Several parties sought rehearing of the
secretary’s notice which was effectively denied in October 2014 and have since appealed the matter to the D.C. Circuit Court. On April 7, 2015 the
D.C. Circuit Court issued an order referring the matter to a merits panel where issues raised by parties challenging the FERC decision will be heard
as well as FERC’s Motion to Dismiss the challenges. It is not clear whether the court will decide ultimately on the merits of the case or whether it
will dismiss the case as FERC urges based on the fact that there is no action by the FERC to be considered. Nonetheless, while any change in
the auction results is thought to be unlikely, Exelon and Generation cannot predict with certainty what further action the court may take concerning
the results of that auction, but any court action could be material to Exelon’s and Generation’s expected revenues from the capacity auction.
License Renewals (Exelon and Generation). Generation has 40-year operating licenses from the NRC for each of its nuclear units. The
operating license renewal process takes approximately four to five years from the commencement of the renewal process until completion of the
NRC’s review.
On May 29, 2013, Generation submitted applications to the NRC to extend the current operating licenses of Byron Units 1 and 2 and
Braidwood Units 1 and 2 by 20 years. On November 19, 2015, the NRC approved Generation’s request to extend the operating licenses of Byron
Unit 1 and 2 by 20 years to 2044 and 2046, respectively. On January 27, 2016 the NRC approved Generation’s request to extend the operating
licenses of Braidwood Unit 1 and 2 by 20 years to 2046 and 2047, respectively.
On December 09, 2014, Generation submitted an application to the NRC to extend the current operating licenses of LaSalle Units 1 and 2,
which were set to expire in 2022 and 2023, respectively.
On August 29, 2012 and August 30, 2012, Generation submitted hydroelectric license applications to FERC for 46-year licenses for the
Conowingo Hydroelectric Project (Conowingo) and the Muddy
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Source: BALTIMORE GAS & ELECTRIC CO, 10-K, February 10, 2016 Powered by Morningstar® Document Research℠
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