Exelon 2014 Annual Report Download - page 78

Year Ended December 31, 2013 Compared to Year Ended December 31, 2012. The $70 million increase in revenue net of
purchased power and fuel expense in Other Regions was primarily as a result of the addition of Constellation in 2012, in addition to
increased renewable generation.
Mark-to-market
Year Ended December 31, 2014 Compared to Year Ended December 31, 2013. Generation is exposed to market risks associated
with changes in commodity prices and enters into economic hedges to mitigate exposure to these fluctuations. Mark-to-market
losses on economic hedging activities were $591 million in 2014 compared to gains of $504 million in 2013. See Note 11—Fair
Value of Financial Assets and Liabilities and Note 12—Derivative Financial Instruments of the Combined Notes to the Consolidated
Financial Statements for information on gains and losses associated with mark-to-market derivatives.
Year Ended December 31, 2013 Compared to Year Ended December 31, 2012. Generation is exposed to market risks associated
with changes in commodity prices and enters into economic hedges to mitigate exposure to these fluctuations. Mark-to-market gains
on economic hedging activities were $504 million in 2013 compared to gains of $515 million in 2012. See Note 11—Fair Value of
Financial Assets and Liabilities and Note 12—Derivative Financial Instruments of the Combined Notes to the Consolidated Financial
Statements for information on gains and losses associated with mark-to-market derivatives.
Other
Year Ended December 31, 2014 Compared to Year Ended December 31, 2013. The $265 million increase in other revenue net of
purchased power and fuel was primarily due to a reduction in amortization of in-the-money energy contracts recorded at fair value at
the Constellation merger date and an increase related to the amortization of out-of-the money energy contracts recorded at fair value
upon the consolidation of CENG partially offset by a loss on gas inventory from lower of cost or market adjustments in 2014. See
Note 10—Intangible Assets of the Combined Notes to Consolidated Financial Statements for information regarding contract
intangibles.
Year Ended December 31, 2013 Compared to Year Ended December 31, 2012. The $627 million increase in other revenue net of
purchased power and fuel was primarily due to reduced amortization expense of the acquired energy contracts recorded at fair value
at the merger date. In addition, the increase is also attributable to results from activities acquired as part of the 2012 merger with
Constellation including retail gas, energy efficiency, energy management and demand response, Upstream natural gas, and the
design and construction of renewable energy facilities. These increases were partially offset by the reduction in revenues net of
purchased power and fuel expense from the sale of Brandon Shores, H.A. Wagner and C.P. Crane, the generating facilities divested
in the fourth quarter of 2012 as a result of the Exelon and Constellation merger. See Note 10—Intangible Assets of the Combined
Notes to Consolidated Financial Statements for information regarding contract intangibles and assets planned for divestiture as a
result of the Constellation merger.
Nuclear Fleet Capacity Factor and Production Costs
The following table presents nuclear fleet operating data for 2014, as compared to 2013 and 2012, for the Generation-operated
plants. The nuclear fleet capacity factor presented in the table is defined as the ratio of the actual output of a plant over a period of
time to its output if the plant had operated at full average annual mean capacity for that time period. Nuclear fleet production cost is
defined as the costs to produce one MWh of energy, including fuel, materials, labor, contracting and other miscellaneous costs, but
excludes depreciation, required capital investment, benefits costs associated with labor, insurance, property taxes, unit contingent
costs, suspended DOE nuclear waste storage fee (as discussed further in Note 22—Commitments and Contingencies), and certain
other non-production related overhead costs. Generation considers capacity factor and production costs useful measures to analyze
the nuclear fleet performance between periods. Generation has included the analysis below as a complement to the financial
information provided in accordance with GAAP. However, these measures are not a presentation defined under GAAP and may not
be comparable to other companies’ presentations or be more useful than the GAAP information provided elsewhere in this report.
2014 2013 2012
Nuclear fleet capacity factor (a) .............................................................. 94.3% 94.1% 92.7%
Nuclear fleet production cost per MWh (a) ..................................................... $19.33 $19.83 $19.50
(a) Excludes Salem, which is operated by PSEG Nuclear, LLC. Reflects ownership percentage of stations operated by Exelon. As of April 1, 2014, CENG is included at
ownership.
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