EX-99.3 4 c87055exv99w3.htm EXELON WAY SAVINGS exv99w3
 

Exhibit 99.3

(EXELON HEADING)

                                     
    2003 Pre-tax O&M       2003 Cap Ex
($ in millions)   Ramp-up Savings
       Ramp-up Savings
    2002
   2003
       2002
   2003
GAAP Operating and Maintenance (O&M)
   $ 4,345     $ 4,587     GAAP Capital Expenditures (CapEx) (A)   $ 2,150     $ 1,862  
 
Operating Adjustments:
                   Adjustments:                
March 2003 ComEd Settlement Agreement
     —       (41 )                    
Severance
     (10 )     (256 )  
Exclude net impact of Boston Generating (A)
     —       20  
Enterprises goodwill impairment and impairments due to anticipated sales
     —       (53 )  
Include AmerGen
     155       171  
 
    
 		      
 		          
 		      
 		  
Operating O&M
     4,335       4,237     Adjusted CapEx   $ 2,305     $ 2,053  
 
                        
 		      
 		  
Exelon Way O&M Adjustments:
                   Year-over-year CapEx Savings           $ 252  
 
                                
 		  
Remove Enterprises and Boston Generating (BG) (1)
     (1,228 )     (903 )                    
Add incremental impact of Texas Plants
     10       —     Exelon Way CapEx Savings:                
Remove nuclear decommissioning accretion expense (2)
     —       (197 )                    
Add 2002 incremental impact of Exelon New England
     50       —     Difference between 2002 and 2003 Exelon Way CapEx           $ 252  
Normalize incremental impact of nuclear outages
     (24 )     —     2003 inflationary impact (B)             69  
 
                                
 		  
Add AmerGen, net of decommissioning accretion (3)
     412       393     Calculated 2003 Savings           $ 321  
Add Payroll Taxes (4)
     95       91     Exclude savings from prior cost management initiatives
    (e.g., CMI)		             (254 )
 
    
 		      
 		                  
 		  
Exelon Way O&M
   $ 3,650     $ 3,621     Exelon Way Savings - 2003 Ramp-up           $ 67  
 
    
 		      
 		                  
 		  
Exelon Way O&M Savings:
                   (A) Net of proceeds from liquidated damages for 2003                
Difference between 2002 and 2003 Exelon Way O&M
           $ 29     (B) Inflation assumed at 3%                
2003 inflationary impact (5)
             107                      
Pension and post-retirement increase (6)
             103                      
 
            
 		                      
Calculated 2003 Savings
           $ 239     Total Ramp-up Cash Savings                
Exclude savings from prior cost management initiatives (e.g., CMI)
             (76 )  
After-tax O&M
           $ 101  
 
            
 		                      
Exelon Way O&M Savings — Pre-tax
           $ 163    
CapEx
             67  
 
            
 		                  
 		  
 
                   Total Exelon Way Cash Savings           $ 168  
 
                                
 		  
After-tax O&M Savings (7)
           $ 101                      
 
            
 		                      

(1)   O&M is net of intercompany impact and excludes corporate business services costs that remain; Enterprises excludes Exelon Energy
 
(2)   Accretion expense is a non-cash expense related to nuclear decommissioning and is not included in Exelon Way expenditures
 
(3)   Normalized to 100% of AmerGen in 2002 and 2003; in 2002 and 2003, AmerGen was included in Equity in Earnings of Unconsolidated Affiliates
 
(4)   Includes AmerGen and excludes Enterprises
 
(5)   2002 base excluding pension and post-retirement expenses of $103m. Inflated at 3%
 
(6)   Pension and post-retirement expense increase
 
(7)   Tax rate is 38%

1

 

(EXELON HEADING)

                                     
    2004 Pre-tax O&M       2004 CapEx
($ in millions)   June YTD Savings
       June YTD Savings
    2003
   2004
       2003
   2004
GAAP Operating and Maintenance Expense (O&M)
   $ 2,212     $ 2,165     GAAP Capital Expenditures (CapEx)   $ 1,019     $ 844  
 
Operating Adjustments:
                   Adjustments:                
March 3 ComEd Global Settlement Agreement
     (41 )     —     Include AmerGen CapEx     33       —  
Boston Generating (BG)
     —       (57 )   Exclude BG CapEx (incl. 2004 credit)     (80 )     7  
 
                        
 		      
 		  
Investments in Synthetic Fuel Producing Facilities
     —       (48 )   Adjusted CapEx   $ 972     $ 851  
 
                        
 		      
 		  
Exelon Way Severance and Severance-related Charges
     —       (22 )                    
Impairment of Exelon Enterprises’ InfraSource Investment
     (48 )     —     Year over Year CapEx Savings           $ 121  
 
    
 		      
 		                  
 		  
Operating O&M
     2,123       2,038                      
 
                   Program-to-Date Exelon Way CapEx Savings:                
Exelon Way O&M Adjustments:
                                    
Remove Net Enterprises and BG (1)
     (473 )     (161 )  
2003 Ramp-up
           $ 67  
Remove Nuclear Decommissioning Accretion Expense (2)
     (117 )     (127 )  
2004 June YTD
             121  
 
                                
 		  
Remove 2004 Incremental Impact of Sithe
     —       (23 )   Total Exelon Way CapEx Savings           $ 188  
 
                                
 		  
Add AmerGen, net of Accretion and Severance (3)
     193       —                      
Normalize Incremental Impact of Nuclear Outages
     —       (63 )                    
Add Payroll Taxes (4)
     56       54                      
 
    
 		      
 		                      
Exelon Way O&M
   $ 1,782     $ 1,718     Total YTD Cash Savings thru June 2004                
 
    
 		      
 		                      
Year over Year Exelon Way O&M Savings
           $ 64    
After-tax O&M
           $ 40  
 
            
 		                      
 
                  
CapEx
             121  
 
                                
 		  
 
                   Total Exelon Way Cash Savings           $ 161  
 
                                
 		  
Program-to-Date O&M Savings
   Pre-tax   After-tax(5)                    
 
    
 		      
 		                      
2003 Ramp-up
   $ 163     $ 101     Total Program-to-Date Cash Savings                
2004 June YTD
     64       40                      
 
    
 		      
 		                      
Total Exelon Way O&M Savings
   $ 227     $ 141    
After-tax O&M
           $ 141  
 
    
 		      
 		                      
 
                  
CapEx
             188  
 
                                
 		  
 
                   Total Exelon Way Cash Savings           $ 329  
 
                                
 		  

(1)   O&M is net of intercompany impact and excludes corporate business services costs that remain. Enterprises excludes Exelon Energy in 2003; in 2004 Exelon Energy is included in Generation.
 
(2)   Accretion expense is a non-cash expense related to nuclear decommissioning and is not included in Exelon Way expenditures
 
(3)   Normalize to 100% of AmerGen in 2003; in 2003, AmerGen was included in Equity in Earnings of Unconsolidated Affiliates
 
(4)   Includes AmerGen and excludes Enterprises
 
(5)   Tax rate is 38%

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