Exelon Corporation · NASDAQ:EXC
Exelon — Edison Electric Institute Financial Conference 2013
52 slides from Exelon's conference presentation, Nov 8, 2013
Slide 1: Edison Electric Institute Financial Conference
Exhibit 99.1 Edison Electric Institute Financial Conference November 11 –12, 2013
Slide 2: Cautionary Statements Regarding Forward-Looking Information
Cautionary Statements Regarding Forward-Looking Information This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. The factors that could cause actual results to differ mat
Slide 3: Setting the Context
Setting the Context Increasing natural gas production The current trends in the Expanding renewable capacity industry… Growing demand response and energy efficiency …are continuing to create Low natural gas and power prices a challenging Low load growth environment… Lack of volatility Asset optimiza
Slide 4: Exelon's Strategic Response to the Current Environment
Exelon’s Strategic Response to the Current Environment Asset Optimization Growth Investments Cost Management Review Solutions from All Angles Utilities Our Record Infrastructure Invest $15 billion across the Record of managing costs Commercial planning period $550 million in merger Policy Upgrade ag
Slide 5: Advocating for Public Policy to Enhance Customer and Shareholder Value
Advocating for Public Policy to Enhance Customer and Shareholder Value Regulatory / Policy Actions Market Policy Federal Policy State Policy PJM: Subsidies: Oppose Subsidized Generation: Engaged in stakeholder process Leading voice against extension IL: Defeated Taylorsville Energy regarding PJM rel
Slide 6: Investing in a Stronger Future
Investing in a Stronger Future Core Strength Strategic Focus and Actions Solidfinancial footing and investmentgradecredit ratingwill allow us to Strong Balance Sheet grow in challenging times. Utility Investment Significant infrastructure and technology enhancements under regulatory structures that
Slide 7: Financial Update
Financial Update «= Exelon.
Slide 8: 2013 Operating Earnings Guidance
2013 Operating Earnings Guidance $2.35 - $2.65 (1) $2.40 - $2.60 (1) $0.15 - $0.25 $0.20 - $0.25 $0.35 - $0.45 Key Drivers of Change in $0.40 - $0.45 Full-Year Guidance $0.35 - $0.45 • Strong YTD earnings $0.45 - $0.50 through Q3 • Lower than expected ExGen gross margin largely offset by O&M savings
Slide 9: Capital Expenditure Expectations
Capital Expenditure Expectations Exelon Utilities (1) ExelonGeneration (in $M) (in $M) 3,025 3,100 2,725 2,950 150 300 50 2,400 2,625 450 225 2,350 75 225 250 150 25 500 50 2,075 450 225 25 125 25 25 150 50 200 100 850 725 25 100 75 200 700 100 100 75 575 1,000 900 950 1,050 1,650 1,725 1,750 1,400
Slide 10: 2013 Projected Sources and Uses of Cash
2013 Projected Sources and Uses of Cash 9 2013 EEI Conference
Slide 11: Commitment to Investment Grade
Commitment to Investment Grade (1) Current senior unsecured ratings for Exelon, Exelon Generation and BGE and senior secured ratings for ComEd and PECO as of September 25, 2013. (2) All ratings at S&Pand Moody’s have a stable outlook. OnAugust 23rd, BGEwas upgraded one notch to A-as part of S&P’s an
Slide 12: Pension and OPEB Forecast
Pension and OPEB Forecast Current Forecast: • The table below provides the combined company’s forecasted 2014 and 2015 pension and OPEB expense and contributions 11 2013 EEI Conference
Slide 13: 2014 Pension and OPEB Sensitivities
2014 Pension and OPEB Sensitivities • Tables below provide sensitivities for the combined company’s 2014 pension and OPEB expense and contributions(1) under various discount rate and S&P 500 asset return scenarios 12 2013 EEI Conference
Slide 14: Additional 2013 ExGen and CENG Modeling
Additional 2013 ExGen and CENG Modeling P&L Item 2013 Estimate (1) ExGenModel Inputs (2) O&M $4,275M (3) Taxes Other Than Income (TOTI) $300M Depreciation & Amortization(4) $825M Interest Expense $350M CENG Model Inputs (at ownership)(5) Gross Margin Included in ExGen Disclosures O&M/TOTI $400M - $4
Slide 15: Debt Maturity Schedule
Debt Maturity Schedule Debt Maturity Profile(1) (2014-2020) (in $M) 1,610 1,600 1,482 1,342 1,340 500 800 300 1,125 617 425 840 250 665 260 600 1,100 700 615 550 500 300 77 2014 2015 2016 2017 2018 2019 2020 BGE Exelon Corp ComEd PECO ExGen(2) (1) As of 9/30/13 (2) Includes $550M in 2015 and 2020 of
Slide 16: GAAP to Operating Adjustments
GAAP to Operating Adjustments 15 2013 EEI Conference
Slide 17: Exelon Utilities
* * * * * * Exelon Utilities
Slide 18: ComEd April 2013 Distribution Formula Rate Updated Filing
ComEd April 2013 Distribution Formula Rate Updated Filing 17 2013 EEI Conference
Slide 19: BGE Rate Case
BGE Rate Case Rate Case Request Electric Gas Docket # 9326 Test Year August 2012 –July 2013 Common Equity Ratio 51.1% Requested Returns ROE: 10.5%; ROR: 7.87% ROE: 10.35%; ROR: 7.79% Rate Base $2.8B $1.0B Revenue Requirement Increase $82.6M $24.4M Proposed Distribution Price 2% 3% Increase as % of o
Slide 20: ComEd Load
ComEd Load Weather-Normalized Load YoY Growth Economic Forecast of Drivers that Influence Load Driver or Indicator 2014 Outlook 2.1% Gross Metro 2.2% growth in GMP reflects overall better Product (GMP) economic conditions than the slow growth in 2013 (Manufacturing and Professional Business Services
Slide 21: PECO Load
PECO Load Weather-Normalized Load YoY Growth Economic Forecast of Drivers that Influence Load Driver or Indicator 2014 Outlook 1.7% Gross Metro GMP projected to grow at 2.1% for 2014, 1.5% 1.0% Product (GMP) vs. pre-recession average of 2.5% 0.2% Resident Resident Employment outlook is 1.0% in Emplo
Slide 22: BGE Load
BGE Load Weather-Normalized Load YoY Growth Economic Forecast of Drivers that Influence Load Driver or Indicator 2.5% 2014 Outlook 1.8% Gross Metro GMP is projected to grow at 2.4% for Product (GMP) 2014. Employment 1.4% growth projected. BGE’s decoupled non-rate case revenue growth is primarily -0.
Slide 23: Exelon Utilities: Rate Base and ROE Targets
Exelon Utilities: Rate Base(1) and ROE Targets ($ in billions) Transmission Gas Delivery Gas Delivery Distribution Electric Transmission Electric Transmission $11.6 Electric Distribution Electric Distribution $10.7 $9.5 $3.1 $8.7 $2.9 $2.3 $2.1 $6.1 $5.7 $5.9 $5.3 $5.4 $4.8 $5.1 $1.3 $1.3 $4.6 $1.2
Slide 24: Capital Expenditures
Capital Expenditures ($ in millions) Gas Delivery Electric Transmission Smart Meter/Smart Grid (1) Electric Distribution $2,025 $1,925 $1,775 $600 $500 $1,450 $550 $625 $625 $625 $600 $600 $275 $225 $550 $100 $125 $125 $450 $125 $150 $175 $475 $100 $50 $425 $100 $100 $150 $50 $100 $175 $100 $175 $15
Slide 25: Regulatory Schedule
Regulatory Schedule 4Q13 1Q14 2Q14 3Q14 4Q14 2014 formula rate case 13-0318 final order 2014 formula rate filing final order (by (by 12/25); rates case filing (by 12/31/14); rates ComEd Distribution effective 1/2/14 – 5/15/14) 12/31/14 effective 1/2/15 – Formula Rate 12/31/15 Illinois Power Agency I
Slide 26: Constellation. An Exelon Company
—_ <= Constellation. An Exelon Company
Slide 27: Commercial Business Overview
Commercial Business Overview Scale, Scope and Flexibility Across the Energy Value Chain Development and Leading merchant power Industry-leading wholesaleOne of the largest and most exploration of natural gas generation portfolio in the and retail sales and experienced Energy and liquids properties U
Slide 28: Generation and Load Match
Generation and Load Match Generation Capacity, Expected Generation and Expected Load 2014 in TWh (1,2) MidWest MidAtlantic ERCOT New England New York Generationcapacity: Renewables Baseload Intermediate Peaking Expected Generation Expected Load South/West/ Canada The combination establishes an indus
Slide 29: Electric Load Serving Business: Growth Target
Electric Load Serving Business: Growth Target Commercial Load(1) Load Split by Customer Class 2013 – 2016 TWh (2013 TWh) Mass Markets 7% Small C&I 8% Wholesale 35% 16% Medium C&I 33% C&I = Commercial & Industrial 8% Large C&I Focus on disciplined pricing and A diverse set of customers enhances maxim
Slide 30: Electric Load Serving Business: Strategy
Electric Load Serving Business: Strategy Total U.S. Power Market in 2013 Estimated Load ~ 3,700 TWh(1) Eligible Non-Switched 14% Other Eligible Switched 20% 48% Ineligible 18% Muni/Co-Op Market Through retail and wholesale channels, Constellation currently serves 150 TWhs, or approximately 4%, of to
Slide 31: Capacity Markets
Capacity Markets 30 2013 EEI Conference
Slide 32: Retail and Wholesale Gas
Retail and Wholesale Gas Retail Gas Wholesale Gas Portfolio Size: Portfolio Size: • 410 Bcf expected to be served in 2013 with • 8 Bcf wholesale storage moderate growth thereafter • 450,000 MMBtu’s per day of term transport • Month by month renewals, with high retention • Over 1 Bcf/day of plant sup
Slide 33: Upstream E&P Assets
Upstream E&P Assets (1) Oil/NGL conversion to gas is 6:1. (2) Constellation does not operate any of its properties. Note: E&P = Exploration and Production (3) 12/31/12 Year end reserves excluding Eagle Ford (4) Net daily production as of Q2 2013 excluding Eagle Ford 32 2013 EEI Conference
Slide 34: Energy Price Upside - NiHub
Energy Price Upside -NIHub $6.00 $36.00 Key Drivers $5.50 $34.00 • Year over year increases in fuel prices $33.07 $5.00 • Current and future coal retirements $32.00 $31.25 • Higher variable unit costs due to MATS $31.00 $30.25 $30.50 $4.50 • Modest load growth $30.00 $28.95 • Offset by new generatio
Slide 35: Exelon Generation Disclosures
Exelon Generation Disclosures September 30, 2013 (As disclosed in Third Quarter 2013 Earnings materials) 34 2013 EEI Conference
Slide 36: Portfolio Management Strategy
Portfolio Management Strategy Protect Balance Sheet Ensure Earnings Stability Create Value 35 2013 EEI Conference
Slide 37: Components of Gross Margin Categories
Components of Gross Margin Categories Gross margin from Gross margin linked to power production and sales other business activities 36 2013 EEI Conference
Slide 38: ExGen Disclosures
ExGen Disclosures Gross Margin Category ($M) (1,2) 2013 2014 2015 2016 OpenGrossMargin(including South, West& Canadahedged GM) (3) $5,600 $5,650 $5,800 $5,800 Mark to Market of Hedges(3,4) $1,700 $900 $450 $250 PowerNew Business/ To Go $50 $500 $750 $750 Non-PowerMarginsExecuted(5) $400 $200 $100 $1
Slide 39: ExGen Disclosures
ExGen Disclosures Generation and Hedges 2013 2014 2015 2016 Exp. Gen (GWh) (1) 214,700 215,500 209,400 211,000 Midwest 97,200 96,900 96,400 97,400 Mid-Atlantic(2) 74,500 73,600 70,100 71,400 ERCOT 13,200 17,800 19,600 19,400 New York(2) 14,000 12,500 9,300 9,300 New England 15,800 14,700 14,000 13,5
Slide 40: ExGen Hedged Gross Margin Sensitivities
ExGen Hedged Gross Margin Sensitivities Gross Margin Sensitivities (With Existing Hedges) (1, 2,3) 2013 2014 2015 2016 Henry Hub Natural Gas ($/MMbtu) + $1/MMbtu $10 $110 $370 $575 - $1/MMbtu $0 $(45) $(305) $(550) NiHub ATC Energy Price + $5/MWh $0 $65 $325 $450 - $5/MWh $0 $(60) $(325) $(450) PJM-
Slide 41: Exelon Generation Hedged Gross Margin Upside/Risk
Exelon Generation Hedged Gross Margin Upside/Risk 10,000 9,500 $9,300 9,000 8,500 $8,400 $8,000 $7,950 8,000 $7,900 7,500 7,000 $7,300 $6,900 6,500 6,000 $5,900 5,500 2013 2014 2015 2016 40 2013 EEI Conference
Slide 42: Illustrative Example of Modeling Exelon Generation 2014 Gross Margin
Illustrative Example of Modeling Exelon Generation 2014 Gross Margin South, Mid- New Row Item Midwest ERCOT New York West & Atlantic England Canada (A) Start with fleet-wide open gross margin $5.65 billion (B) Expected Generation (TWh) 96.9 73.6 17.8 12.5 14.7 (C) Hedge % (assuming mid-point of rang
Slide 43: Constellation Energy Nuclear Group (CENG) Background
Constellation Energy Nuclear Group (CENG) Background Asa result of Exelon’sequityinterest in CENG,CENGgrossmarginsand earningsare reflectedin ExGendisclosures and other financial statements.Thefollowingis informationrelated to PPAcontracts betweenCENGand 3 rd parties and the PPAbetweenCENGand its eq
Slide 44: Constellation Energy Nuclear Group (CENG) Background
Constellation EnergyNuclear Group(CENG)Background 43 2013 EEI Conference
Slide 45: Generation
* * * * * Generation
Slide 46: Exelon Generation Fleet
Exelon Generation Fleet National Scope • Power generation assets in 20 states and Canada • Low-cost generation capacity provides unparalleled leverage to rising commodity prices Large and Diverse • 35 GW of diverse generation (1) – 19 GW of Nuclear – 10 GW of Gas – 2 GW of Hydro – 2 GW of Oil – 1 GW
Slide 47: Executing on Generation Development and Growth Projects
Executing on Generation Development and Growth Projects Wildcat Wind AVSR 1 Los Angeles Expanding the contracted renewable portfolio of Solar and Wind while adding incremental MWs to our existing nuclear fleet 46 2013 EEI Conference
Slide 48: Exelon Nuclear Fleet Overview (including CENG and Salem)
Exelon Nuclear Fleet Overview (including CENG and Salem) (1) Operating license renewal process takes approximately 4-5 years from commencement until completion of NRC review. (2) The date for loss of full core reserve identifies when the on-site storage pool will no longer have sufficient space to r
Slide 49: World Class Nuclear Operator
World Class Nuclear Operator(1) 1,169 1,208 1,104 Among major nuclear plant fleet operators, Exelon is consistently one of the lowest-cost and most efficient producers of electricity in the nation (1) Exelon fleet averages exclude Salem and CENG (2) Source: 2012 Electric Utility Cost Group (EUCG) su
Slide 50: Nuclear Output and Refueling Outages
Nuclear Output and Refueling Outages Nuclear Output (1) Nuclear Refueling Cycle • All Exelon owned units on a 24 month cycle except for Braidwood 14% U1/U2, Byron U1/U2 and Salem U1/U2, which are on 18 month cycles • Starting in31% 2015 Clinton is on annual cycles 14% 2013 Refueling Outage Impact •
Slide 51: Nuclear Fuel Costs
Nuclear Fuel Costs(1) Projected Exelon (100%) Uranium Demand Components of Fuel Expense in 2013 2013 – 2016: 100% hedged in volume 2017: ~80% hedged in volume Fabrication 2018: ~50% hedged in volume 11 14% 10 Enrichment 9 30% 8 Nuclear Waste 7 13% 6 5 4 2% 3 Tax/Interest 3% 2 Conversion 1 38% 0 2013
Slide 52: Constellation Energy Nuclear Group (CENG) Operating Services Agreement
Constellation Energy Nuclear Group (CENG) Operating Services Agreement • AgreementssignedbetweenExelonandEDF,withexpectedclosein 2014 (firstquarter or early second quarter) • Nuclear Operating services agreement • Integrate CENG and their 3 plants into Exelon Nuclear with transfer of operating licen
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