Exelon 2014 Annual Report Download - page 239

Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
A portion of the net periodic benefit cost for all pension and OPEB plans are capitalized within each of the Registrant’s Consolidated
Balance Sheets. The following table presents the components of Exelon’s net periodic benefit costs, prior to any capitalization, for
the years ended December 31, 2014, 2013 and 2012.
Pension Benefits
Other
Postretirement
Benefits
2014 2013 2012 2014 2013 2012
Components of net periodic benefit cost:
Service cost ......................................................... $293 $ 317 $280 $117 $162 $156
Interest cost ......................................................... 749 650 698 186 194 205
Expected return on assets ............................................. (994) (1,015) (988) (154) (132) (115)
Amortization of:
Transition obligation ............................................... — ———— 11
Prior service cost (credit) ........................................... 14 14 15 (122) (19) (17)
Actuarial loss .................................................... 420 562 450 50 83 81
Curtailment benefits ................................................... — ———— (7)
Settlement charges ................................................... 2 9 31 — — —
Contractual termination benefits (a) ....................................... — — 14 — — 6
Net periodic benefit cost ............................................. $484 $ 537 $500 $ 77 $288 $320
(a) ComEd and BGE established regulatory assets of $1 million and $4 million, respectively, for their portion of the contractual termination benefit charge in 2012.
Through Exelon’s postretirement benefit plans, the Registrants provide retirees with prescription drug coverage. The Medicare
Prescription Drug, Improvement and Modernization Act of 2003 (Medicare Modernization Act), enacted on December 8, 2003,
introduced a prescription drug benefit under Medicare as well as a Federal subsidy to sponsors of retiree health care benefit plans
that provide a benefit that is at least actuarially equivalent to the Medicare prescription drug benefit (Part D subsidy). Management
believes the prescription drug benefit provided under Exelon’s postretirement benefit plans meets the requirements for the subsidy.
In December 2011, the Company decided that beginning in 2013, it would no longer elect to take the direct Part D subsidy. This
resulted in a $17 million increase in cost for the year ended December 31, 2012 related to the amortization of an actuarial loss.
Beginning in 2013, eligible employees are offered an Employee Group Waiver Plan (EGWP), a standard Medicare Part D Plan, with
a supplemental “wrap,” which contains a wraparound prescription drug design that allows the company to provide benefits above
those available under the EGWP.
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