Exelon 2014 Annual Report Download - page 172

Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
Nuclear decommissioning. These amounts represent estimated future nuclear decommissioning costs for the Regulatory
Agreement Units that exceed (regulatory asset) or are less than (regulatory liability) the associated decommissioning trust fund
assets. Exelon believes the trust fund assets, including prospective earnings thereon and any future collections from customers, will
be sufficient to fund the associated future decommissioning costs at the time of decommissioning. See Note 15—Asset Retirement
Obligations for additional information.
Removal costs. These amounts represent funds ComEd and BGE have received from customers through depreciation rates to
cover the future non-legally required cost of removal of property, plant and equipment which reduces rate base for ratemaking
purposes. This liability is reduced as costs are incurred.
DLC Program Costs. The DLC program costs include equipment, installation, and information technology costs necessary to
implement the DLC Program under PECO’s EE&C Phase I Plans. PECO received full cost recovery through Phase I collections and
will amortize the costs as a credit to the income statement to offset the related depreciation expense during the same period through
September 2025, which is the remaining useful life of the assets. PECO is not paying interest on these over-recovered costs.
Electric distribution tax repairs. PECO’s 2010 electric distribution rate case settlement required that the expected cash benefit
from the application of Revenue Procedure 2011-43, which was issued on August 19, 2011, to prior tax years be refunded to
customers over a seven-year period. Credits began being reflected in customer bills on January 1, 2012. No interest will be paid to
customers.
Gas distribution tax repairs. PECO’s 2010 natural gas distribution rate case settlement required that the expected cash benefit from
the application of new tax repairs deduction methodologies for 2010 and prior tax years be refunded to customers over a seven-year
period. In September 2012, PECO filed an application with the IRS to change its method of accounting for gas distribution repairs for
the 2011 tax year. Credits began being reflected in customer bills on January 1, 2013. No interest will be paid to customers.
Under (Over)-recovered AEPS costs current asset (liability). The AEPS costs represent the administrative and AEC costs
incurred to comply with the requirements of the AEPS Act, which are recoverable on a full and current basis. PECO earns interest on
under-recovered costs and pays interest on over-recovered costs to customers. These costs are included within the energy and
transmission programs line item.
Revenue subject to refund. These amounts represent refunds and associated interest ComEd owes to customers primarily related
to the treatment of the post-test year accumulated depreciation issue in the 2007 Rate Case. As of December 31, 2014, and
December 31, 2013, ComEd owed $3 million and $37 million with $1 million of interest, respectively. See above discussion of the
2007 Rate Case for further information.
Purchase of Receivables Programs
ComEd, PECO and BGE are required, under separate legislation and regulations in Illinois, Pennsylvania and Maryland,
respectively, to purchase certain receivables from retail electric and natural gas suppliers. For retail suppliers participating in the
utilities’ consolidated billing, ComEd, PECO and BGE must purchase their customer accounts receivables. ComEd purchases
receivables at a discount to primarily recover uncollectible accounts expense from the suppliers. BGE’s tariff provides that
receivables are to be purchased at a discount, primarily to recover uncollectible accounts expense from the suppliers. However, if
the discount rate is negative, the tariff provides that the receivable is purchased at a zero discount rate. BGE is currently purchasing
certain receivables at a zero discount rate. PECO is required to purchase receivables at face value and is permitted to recover
uncollectible accounts expense from customers through distribution rates. Exelon, ComEd, PECO, and BGE do not record unbilled
commodity receivables under their POR programs. Purchased billed receivables are classified in other accounts receivable, net on
Exelon’s, Consolidated Balance Sheets. The following table provides information about the purchased receivables of Exelon as of
December 31, 2014 and 2013.
As of
December 31,
2014 2013
Purchased receivables (a) ........................................................................... $290 $263
Allowance for uncollectible accounts (b) ............................................................... (42) (30)
Purchased receivables, net ......................................................................... $248 $233
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