ComEd 2015 Annual Report Download - page 334

Table of Contents
Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
At December 31, 2015, Exelon had total outstanding fixed-to-floating fair value hedges related to interest rate swaps of $800 million, with a
derivative asset of $25 million. At December 31, 2014, Exelon and Generation had outstanding fixed-to-floating fair value hedges related to interest
rate swaps of $1,450 million and $550 million, with a derivative asset of $29 million and $7 million, respectively. During the years ended
December 31, 2015 and 2014, the impact on the results of operations, as a result of the ineffectiveness from fair value hedges, was a $17 million
gain and $18 million gain, respectively.
. During 2014, Exelon entered into $400 million of floating-to-fixed forward starting interest rate swaps to manage a portion
of the interest rate exposure associated with the anticipated refinancing of existing debt. The swaps are designated as cash flow hedges. In
January 2015, in connection with Generation’s $750 million issuance of five-year Senior Unsecured Notes, Exelon terminated these swaps. As the
original forecasted transactions were a series of future interest payments over a ten year period, a portion of the anticipated interest payments are
probable not to occur. As a result, $26 million of anticipated payments were reclassified from Accumulated OCI to Other, net in Exelon’s
Consolidated Statement of Operations and Comprehensive Income.
During the third quarter of 2014, ExGen Texas Power, LLC, a subsidiary of Generation, entered into a floating-to-fixed interest rate swap to
manage a portion of its interest rate exposure in connection with the long-term borrowing. See Note 14—Debt and Credit Agreements for additional
information regarding the financing. The swaps have a notional amount of $500 million as of December 31, 2015 and expire in 2019. The swap was
designated as a cash flow hedge in the fourth quarter of 2014. At December 31, 2015, the subsidiary had a $12 million derivative liability related to
the swap.
During the first quarter of 2014, ExGen Renewables I, LLC, a subsidiary of Generation, entered into floating-to-fixed interest rate swaps to
manage a portion of its interest rate exposure in connection with the long-term borrowings. See Note 14—Debt and Credit Agreements for
additional information regarding the financing. The swaps have a notional amount of $189 million as of December 31, 2015 and expire in 2020. The
swaps are designated as cash flow hedges. At December 31, 2015, the subsidiary had a $2 million derivative liability related to the swaps.
During the years ended December 31, 2015 and 2014, the impact on the results of operations as a result of ineffectiveness from cash flow
hedges in continuing designated hedge relationships were immaterial.
During the third quarter of 2011, Sacramento PV Energy, a subsidiary of Generation, entered into floating-to-fixed interest
rate swaps to manage a portion of its interest rate exposure in connectionwith the long-term borrowings. See Note 14—Debt and Credit
Agreements for additional information regarding the financing. The swaps have a total notional amount of $25 million as of December 31, 2015 and
expire in 2027. After the closing of the Constellation merger, the swaps were re-designated as cash flow hedges. During the first quarter of 2015,
the swaps were de-designated as the forecasted transaction was no longer probable of occurring. All future changes in fair value are reflected in
Interest expense. At December 31, 2015, the subsidiary had a $2 million derivative liability related to these swaps, which included an immaterial
amount that was amortized to Interest expense after de-designation.
During the third quarter of 2012, Constellation Solar Horizons, a subsidiary of Generation, entered into a floating-to-fixed interest rate swap to
manage a portion of its interest rate exposure in connection with the long-term borrowings. See Note 14—Debt and Credit Agreements for
additional information
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Source: BALTIMORE GAS & ELECTRIC CO, 10-K, February 10, 2016 Powered by Morningstar® Document Research℠
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