Exelon 2014 Annual Report Download - page 212

Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
Economic Hedges. These instruments represent hedges that economically mitigate exposure to fluctuations in commodity prices and
include financial options, futures, swaps, physical forward sales and purchases, but for which the fair value or cash flow hedge
elections were not made. Additionally, Generation enters into interest rate derivative contracts and foreign exchange currency swaps
(“treasury”) to manage the exposure related to the interest rate component of commodity positions and international purchases of
commodities in currencies other than U.S. Dollars. Exelon entered into floating-to-fixed forward starting interest rate swaps to
manage interest rate risks associated with anticipated future debt issuance related to the proposed PHI acquisition. For the years
ended December 31, 2014, 2013 and 2012, the following net pre-tax mark-to-market gains (losses) of certain purchase and sale
contracts were reported in operating revenues or purchased power and fuel expense, or interest expense at Exelon in the
Consolidated Statements of Operations and Comprehensive Income and are included in “Net fair value changes related to
derivatives” in Exelon’s Consolidated Statements of Cash Flows. In the tables below, “Change in fair value” represents the change in
fair value of the derivative contracts held at the reporting date. The “Reclassification to realized at settlement” represents the
recognized change in fair value that was reclassified to realized due to settlement of the derivative during the period.
Generation
Intercompany
Eliminations
Exelon
Corporate Exelon
Year Ended December 31, 2014
Operating
Revenues
Purchased
Power
and Fuel
Interest
Expense Total
Operating
Revenues (a)
Interest
Expense Total
Change in fair value of commodity positions ...... $(413) $(194) $— $(607) $— $ — $(607)
Reclassification to realized at settlement of
commodity positions ........................ 231 (223) — 8 — — 8
Net commodity mark-to-market gains
(losses) ........................... (182) (417) — (599) — — (599)
Change in fair value of treasury positions ......... 10 — (2) 8 — (100) (92)
Reclassification to realized at settlement of treasury
positions .................................. (2) — — (2) — — (2)
Net treasury mark-to market gains (losses) . . . 8 — (2) 6 — (100) (94)
Net mark-to market gains (losses) ............... $(174) $(417) $ (2) $(593) $— $(100) $(693)
Generation
Intercompany
Eliminations
Exelon
Corporate Exelon
Year Ended December 31, 2013
Operating
Revenues
Purchased
Power
and Fuel
Interest
Expense Total
Operating
Revenues (a)
Interest
Expense Total
Change in fair value of commodity positions ....... $286 $180 $— $466 $ (6) $— $460
Reclassification to realized at settlement of
commodity positions ......................... (64) 104 — 40 13 — 53
Net commodity mark-to-market gains
(losses) ........................... 222 284 — 506 7 — 513
Change in fair value of treasury positions ......... (1) — (4) (5) — — (5)
Reclassification to realized at settlement of treasury
positions .................................. (1) — — (1) — — (1)
Net treasury mark-to market gains (losses) .... (2) — (4) (6) — — (6)
Net mark-to market gains (losses) ............... $220 $284 $ (4) $500 $ 7 $— $507
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