Exhibit F-1



October 24, 2002






Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Re:  Application to Issue Transition Bonds, File No. 70-9899

Ladies and Gentlemen:

This opinion is furnished to the Securities and Exchange Commission (the
"Commission") in connection with the Application-Declaration on Form U-1 under
the Public Utility Holding Company Act of 1935, as amended (the "Act") (File
70-9899) (the "Application") of Conectiv, Atlantic City Electric Company
("ACE"), PHI Service Company ("PHI Service"), and Atlantic City Electric
Transition Funding LLC (the "Special Purpose Issuer") (collectively, the
"Applicants").

As counsel for the Applicants, I deliver this opinion to you for filing as
Exhibit F-1 to the Application-Declaration referenced above. Terms not otherwise
defined herein have the meaning ascribed to them in the Application.

The Application seeks the authorization and approval of the Commission with
respect to the Special Purpose Issuer's issuance of up to $440 million in
transition bonds pursuant to the New Jersey Electric Discount and Energy
Competition Act and related transactions. Specifically, the Application seeks,
among other things, the following authorizations and approvals of the Commission
(collectively, "Transactions"):

     a.   for ACE to sell, pledge or assign bondable transition property to the
          Special Purpose Issuer from time to time in exchange for the net
          proceeds from the sale of a series of transition bonds;

     b.   for the Special Purpose Issuer to issue and sell transition bonds from
          time to time, pursuant to an underwriting agreement, in an aggregate
          principal amount up to $440 million, with a reservation of Commission
          jurisdiction on an amount up to $1.7 billion, to be authorized and
          approved by the New Jersey Board of Public Utilities;




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     c.   for the Special Purpose Issuer to enter into interest rate swaps,
          interest rate hedging programs, and credit enhancement arrangements to
          reduce interest rate and credit risks with respect to, and to
          facilitate the issuance of, transition bonds;

     d.   for ACE to act as the servicer of the bondable transition property and
          enter into a servicing agreement pursuant to which ACE or an affiliate
          will perform services for the Special Purpose Issuer and receive
          compensation determined on a market basis rather than the "at-cost"
          standard of Section 13(b) of the Act;

     e.   for ACE, PHI Service or any successor entity, or another affiliate to
          act as the administrator for the Special Purpose Issuer and enter into
          an administration agreement. The Special Purpose Issuer will pay a fee
          for these services which will be equal to a market rate fee rather
          than the "at-cost" standard of Section 13(b) of the Act;

     f.   for the Special Purpose Issuer to use the proceeds from the transition
          bonds to pay the expenses of issuance and to purchase the bondable
          transition property from ACE.;

     g.   for ACE to enter into the indemnity provisions of a sale agreement,
          through which it may indemnify the Special Purpose Issuer and related
          parties pursuant to the terms of the sale agreement; for ACE, as
          servicer, to enter into the indemnity provisions of a servicing
          agreement through which it may indemnify the Special Purpose Issuer
          and related parties pursuant to the terms of the servicing agreement;
          for ACE, PHI Service Company, or any successor entity or another
          affiliate, as administrator, to enter into the indemnity provisions of
          an administration agreement through which it may indemnify the Special
          Purpose Issuer pursuant to the terms of the administration agreement;
          and for the Special Purpose Issuer to inter into the indemnity
          provisions of its limited liability company agreement through which it
          may indemnify ACE and other parties pursuant to the limited liability
          company agreement, all as further described herein; and

     h.   for ACE to make capital contributions to the Special Purpose Issuer
          and receive interest and other investment earnings thereon.


I am counsel to the Applicants. I am a member of the bar of the State of
Delaware, the state in which Conectiv, PHI Service and the Special Purpose
Issuer were formed. I am not a member of the bars of other states. I do not hold
myself out as an expert in the laws of any state other than Delaware, although I
have consulted, and will consult, with counsel to the Applicants who are experts
in the laws of states other than Delaware, including New Jersey. For purposes of
rendering this opinion, to the extent I deemed necessary, I have relied on



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October 24, 2002
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advice from counsel employed or retained by Conectiv who are members of the bars
of the states in which the Applicants were formed, including, specifically, New
Jersey.

In connection with this opinion, I or attorneys in whom I have confidence, have
examined originals or copies certified or otherwise identified to my
satisfaction of such corporate records of the Applicants, certificates of public
officials, certificates of officers and representatives of Applicants, and other
documents as I have deemed necessary in order to render the opinions hereinafter
set forth.

In such examination, I have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity to
the original documents of all documents submitted to us as copies. As to any
facts material to our opinion, I have, when relevant facts were not
independently established, relied upon the aforesaid agreements, instruments,
certificates and documents.

The opinions expressed below are subject to the following assumptions,
qualifications, limitations, conditions and exceptions:

a.   The Transactions shall have been duly authorized and approved, to the
     extent required by the governing corporate documents and applicable state
     laws, by the Board of Directors of the appropriate Applicant.

b.   All required approvals, authorizations, consents, certificates, rulings and
     orders of, and all filings and registrations with, all applicable federal
     and state commissions and regulatory authorities with respect to the
     Transactions shall have been obtained or made, as the case may be, and
     shall have become final and unconditional in all respects and shall remain
     in effect (including the approval and authorization of the Commission under
     the Act) and such Transactions shall have been accomplished in accordance
     with all such approvals, authorizations, consents, certificates, orders,
     filings and registrations.

c.   The Commission shall have duly entered an appropriate order with respect to
     the Transactions as described in the Application, granting and permitting
     the Application to become effective under the Act and the rules and
     regulations thereunder.

d.   A registration statement shall have been declared effective under the
     Securities Act of 1933 or an exemption from registration shall be
     applicable under such Act with respect to any securities to be issued in a
     Transaction and no stop order shall have been entered by the Securities and
     Exchange Commission with respect thereto.

e.   The parties shall have obtained all consents, waivers and releases, if any,
     required for the transactions under all applicable governing corporate



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     documents, contracts, agreements, debt instruments, indentures, franchises,
     licenses and permits.

f.   No act or event other than as described herein shall have occurred
     subsequent to the date hereof which would change the opinions expressed
     herein.

Based on the foregoing, and subject to the assumptions and conditions set forth
herein, I am of the opinion that when the Commission has taken the action
requested in the Application:

     1.   The laws of the states of Delaware and New Jersey applicable to the
          proposed Transactions will have been complied with;

     2.   The Special Purpose Issuer is a limited liability company validly
          organized, duly existing and in good standing in its state of
          formation;

     3.   The transition bonds will be valid and binding obligations of the
          Special Purpose Issuer in accordance with their terms, subject to
          applicable bankruptcy, insolvency, fraudulent transfer,
          reorganization, moratorium or similar laws from time to time in effect
          affecting the enforceability of creditors' rights generally and to
          general principles of equity (including, without limitation, concepts
          of materiality, reasonableness, good faith and fair dealing)
          regardless of whether considered in a proceeding in equity or at law;

     4.   The Special Purpose Issuer will legally acquire the bondable
          transition property from ACE; and

     5.   The consummation of the Transactions will not violate the legal rights
          of the holders of any securities issued by the Applicants or any
          associate company thereof.

This letter is addressed to the Commission, and no person or entity, other than
the Commission, may rely on it. I hereby consent to the use of this opinion as
an exhibit to the Application.

Very truly yours,

/s/CHRISTIE DAY CANNON

Christie Day Cannon
Assistant General Counsel