Discontinued Operations (Tables)

12 Months Ended

Dec. 31, 2013

(Loss) Income from Discontinued Operations, Net of Income Taxes

PHI’s (loss) income from discontinued operations, net of income taxes, is comprised of the following:

	For the Year Ended December 31,
	2013			2012		2011
	(millions of dollars)
Cross-border energy lease investments	$	(327	)	$	41	$	36
Pepco Energy Services’ retail electric and natural gas supply businesses		5			26		2
Conectiv Energy		—			—		(3	)
(Loss) income from discontinued operations, net of income taxes	$	(322	)	$	67	$	35

(Loss) Income Recognized from Cross-Border Energy Lease Investments

The operating results for the cross-border energy lease investments are as follows:

	For the Year Ended December 31,
	2013			2012		2011
	(millions of dollars)
Operating revenue from PHI’s cross-border energy lease investments	$	7		$	50	$	55
Non-cash charge to reduce carrying value of PHI’s cross-border energy lease investments		(373	)		—		(7	)
Total operating revenue	$	(366	)	$	50	$	48
(Loss) income from operations of discontinued operations, net of income taxes (a)	$	(325	)	$	32	$	33
Net (losses) gains associated with the early termination of the cross-border energy lease investments, net of income taxes (b)		(2	)		9		3
(Loss) income from discontinued operations, net of income taxes	$	(327	)	$	41	$	36

(a) Includes income tax (benefit) expense of approximately $(44) million, $5 million and $(2) million for the years ended December 31, 2013, 2012 and 2011, respectively.

(b) Includes income tax (benefit) expense of approximately $(1) million, $30 million and $36 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Cross-Border Energy Lease Investments

As of December 31, 2013 and 2012, the assets held for disposition and liabilities associated with assets held for disposition related to the cross-border energy lease investments are:

	2013		2012
	(millions of dollars)
Scheduled lease payments to PHI, net of non-recourse debt	$	—	$	1,852
Less: Unearned and deferred income		—		(615	)
Assets held for disposition	$	—	$	1,237
Liabilities associated with assets held for disposition	$	—	$	1

Net Investment in Leases by Published Credit Ratings

The table below shows PHI’s net investment in these leases by the published credit ratings of the lessees as of December 31:

Lessee Rating (a)	2013		2012
	(millions of dollars)
Rated Entities
AA/Aa and above	$	—	$	766
A		—		471
Total	$	—	$	1,237

(a) Excludes the credit ratings associated with collateral posted by the lessees in these transactions.

Operating Results for Retail Electric and Natural Gas Supply Businesses

The operating results for the retail electric and natural gas supply businesses of Pepco Energy Services are as follows:

	For the Year Ended December 31,
	2013		2012		2011
	(millions of dollars)
Operating revenue	$	84	$	415	$	954
Income from operations of discontinued operations, net of income taxes	$	4	$	26	$	2
Net gains associated with accelerated disposition of retail electric and natural gas contracts, net of income taxes		1		—		—
Income from discontinued operations, net of income taxes (a)	$	5	$	26	$	2

(a) Includes income tax expense of approximately $3 million, $18 million and $1 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Discontinued Operations [Member]

Schedule of Derivative Gain (Loss) Amounts Recognized in Income

For the years ended December 31, 2013, 2012, and 2011, the amount of the derivative gain (loss) for the retail electric and natural gas supply businesses of Pepco Energy Services recognized in (Loss) income from discontinued operations, net of income taxes is provided in the table below:

	For the Year Ended December 31,
	2013		2012			2011
	(millions of dollars)
Reclassification of mark-to-market to realized on settlement of contracts	$	10	$	27		$	—
Unrealized mark-to-market loss		—		(3	)		(30	)
Total net gain (loss)	$	10	$	24		$	(30	)