Exelon 2014 Annual Report Download - page 167

Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
December 31, 2013
Current Noncurrent
Regulatory liabilities
Other postretirement benefits ..................................................................... $ 2 $ 43
Nuclear decommissioning ........................................................................ — 2,740
Removal costs ................................................................................. 99 1,423
Energy efficiency and demand response programs ................................................... 53 —
DLC Program Costs ............................................................................ 1 10
Energy efficiency phase II ........................................................................ — 21
Electric distribution tax repairs .................................................................... 20 114
Gas distribution tax repairs ....................................................................... 8 37
Energy and transmission programs ................................................................ 78 —
Over-recovered gas universal service fund costs ..................................................... 8 —
Revenue subject to refund ....................................................................... 38 —
Over-recovered electric and gas revenue decoupling ................................................. 16 —
Other ......................................................................................... 4 —
Total regulatory liabilities ......................................................................... $327 $4,388
Pension and other postretirement benefits. As of December 31, 2014, Exelon had regulatory assets of $3,256 million and
regulatory liabilities of $88 million related to ComEd’s and BGE’s portion of deferred costs associated with Exelon’s pension plans
and ComEd’s, PECO’s and BGE’s portion of deferred costs associated with Exelon’s other postretirement benefit plans. PECO’s
pension regulatory recovery is based on cash contributions and is not included in the regulatory asset (liability) balances. The
regulatory asset (liability) is amortized in proportion to the recognition of prior service costs (gains), transition obligations and
actuarial losses (gains) attributable to Exelon’s pension and other postretirement benefit plans determined by the cost recognition
provisions of the authoritative guidance for pensions and postretirement benefits. ComEd, PECO and BGE will recover these costs
through base rates as allowed in their most recently approved regulated rate orders. The pension and other postretirement benefit
regulatory asset balance includes a regulatory asset established at the date of the Constellation merger related to BGE’s portion of
the deferred costs associated with legacy Constellation’s pension and other postretirement benefit plans. The BGE-related
regulatory asset is being amortized over a period of approximately 12 years, which generally represents the expected average
remaining service period of plan participants at the date of the Constellation merger. See Note 16—Retirement Benefits for
additional detail. No return is earned on Exelon’s regulatory asset.
Deferred income taxes. These costs represent the difference between the method by which the regulator allows for the recovery of
income taxes and how income taxes would be recorded under GAAP. Regulatory assets and liabilities associated with deferred
income taxes, recorded in compliance with the authoritative guidance for accounting for certain types of regulation and income taxes,
include the deferred tax effects associated principally with accelerated depreciation accounted for in accordance with the ratemaking
policies of the ICC, PAPUC and MDPSC, as well as the revenue impacts thereon, and assume continued recovery of these costs in
future transmission and distribution rates. For ComEd and BGE, this amount includes the impacts of a reduction in the deductibility,
for Federal income tax purposes, of certain retiree health care costs pursuant to the March 2010 Health Care Reform Acts. ComEd
was granted recovery of these additional income taxes on May 24, 2011 in the ICC’s 2010 Rate Case order. The recovery period for
these costs was through May 31, 2014. For BGE, these additional income taxes are being amortized over a 5-year period that began
in March 2011 in accordance with the MDPSC’s March 2011 rate order. For PECO, this amount includes the impacts of electric and
gas distribution repairs in the deductibility pursuant to PUC’s 2010 rate case settlement agreement. See Note 14—Income Taxes
and Note 16—Retirement Benefits for additional information. ComEd, PECO and BGE are not earning a return on the regulatory
asset in base rates.
AMI programs. For ComEd, this amount represents operating and maintenance expenses and meter costs associated with
ComEd’s AMI pilot program approved in the May 24, 2011, ICC order in ComEd’s 2010 rate case. The recovery periods for
operating and maintenance expenses and meter costs through May 31, 2014, and January 1, 2020, respectively. As of
December 31, 2014 and December 31, 2013, ComEd had regulatory assets of $88 million and $35 million, respectively, related to
accelerated depreciation costs resulting from the early retirements of non-AMI meters, which will be amortized over an average ten
year period pursuant to the ICC approved AMI Deployment plan. ComEd is earning a return on the regulatory asset. For PECO, this
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