ComEd 2015 Annual Report Download - page 370

Table of Contents
Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
Generation is required to provide to the NRC a biennial report by unit (annually for units that have been retired or are within five years of the
current approved license life), based on values as of December 31, addressing Generation’s ability to meet the NRC minimum funding levels.
Depending on the value of the trust funds, Generation may be required to take steps, such as providing financial guarantees through letters of
credit or parent company guarantees or making additional contributions to the trusts, which could be significant, to ensure that the trusts are
adequately funded and that NRC minimum funding requirements are met. As a result, Exelon’s and Generation’s cash flows and financial position
may be significantly adversely affected.
On March 31, 2014, Generation submitted its NRC required annual decommissioning funding report as of December 31, 2013 for reactors
that have been shut down except for Zion Station which is included on a separate report to the NRC submitted by EnergySolutions (see Zion
Station Decommissioning above). This submittal also included the required updated financial tests for the Limerick Unit 1 parent guarantee that
had been established in 2013. There was no change to the amount of the parent guarantee, or the funding status of these reactors. Adequate
decommissioning funding assurance was in place for all reactors owned by Generation. During 2014, the operating license for Limerick Unit 1 was
extended by 20 years. As a result of this extension, and the subsequent funding assurance calculation performed by the NRC, it was found that
the parent company guarantee was no longer required and thus the parent guarantee for Limerick Unit 1 has been cancelled effective March 13,
2015. See Note 3—Regulatory Matters for additional information regarding the operating license extension for Limerick Unit 1.
Generation filed its biennial decommissioning funding status report with the NRC on March 31, 2015. This report reflects the status of
decommissioning funding assurance as of December 31, 2014. Due to increased cost estimates received in the second half of 2014, Braidwood
Unit 1, Braidwood Unit 2, and Byron Unit 2 did not meet the NRC’s minimum funding assurance criteria as of December 31, 2014. NRC guidance
provides licensees with two years or by the time of submitting the next biennial report (on or before March 31, 2017) to resolve funding assurance
shortfalls. During this period, Generation will monitor funding assurance and new developments, including the impact of a 20-year license renewal
for Braidwood and Byron, to assess the status of funding assurance and to take steps, if necessary, to address any funding shortfall on these
funds on or before March 31, 2017. On February 4, 2016, Generation submitted an updated decommissioning funding status report with the NRC
for Braidwood Units 1 and 2, and Byron Unit 2. This report reflected the recently approved license renewals for these units, and showed that they
have adequate decommissioning funding assurance, and that the shortfall identified in the March 31, 2015 report has now been resolved. The
increased security costs discussed above will be taken into consideration, as appropriate and in accordance with the regulatory requirements, in
Generation’s future decommissioning funding status reports submitted to the NRC. Generation does not expect the increased costs to change
Generation’s NRC minimum funding assurance status.
As the future values of trust funds change due to market conditions, the NRC minimum funding status of Generation’s units will change. In
addition, if changes occur to the regulatory agreement with the PAPUC that currently allows amounts to be collected from PECO customers for
decommissioning the former PECO units, the NRC minimum funding status of those plants could change at subsequent NRC filing dates.
Non-Nuclear Asset Retirement Obligations (Exelon, Generation, ComEd, PECO and BGE)
Generation has AROs for plant closure costs associated with its fossil and renewable generating facilities, including asbestos abatement,
removal of certain storage tanks, restoring leased land to the
363
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.