Income Taxes (Tables)

6 Months Ended

Jun. 30, 2015

Reconciliation of Consolidated Income Tax Expense

A reconciliation of PHI’s consolidated effective income tax rates is as follows:

	Three Months Ended June 30,										Six Months Ended June 30,
	2015					2014					2015					2014
	(millions of dollars)
Income tax at Federal statutory rate	$	28		35.0	%	$	34		35.0	%	$	57		35.0	%	$	77		35.0	%
Increases (decreases) resulting from:
State income taxes, net of Federal effect		4		5.0	%		7		7.1	%		10		6.1	%		15		6.8	%
Asset removal costs		(5	)	(6.3	)%		(2	)	(2.0	)%		(8	)	(4.9	)%		(5	)	(2.3	)%
Energy efficiency-related tax deductions		—		—			—		—			(4	)	(2.5	)%		—		—
Merger-related costs		1		1.2	%		7		7.1	%		3		1.8	%		7		3.2	%
Other, net		(1	)	(1.1	)%		(1	)	(1.3	)%		(1	)	(0.5	)%		(3	)	(1.1	)%
Consolidated income tax expense	$	27		33.8	%	$	45		45.9	%	$	57		35.0	%	$	91		41.6	%

Delmarva Power & Light Co/De [Member]

Reconciliation of Consolidated Income Tax Expense

A reconciliation of DPL’s effective income tax rates is as follows:

	Three Months Ended June 30,									Six Months Ended June 30,
	2015					2014				2015					2014
	(millions of dollars)
Income tax at Federal statutory rate	$	5		35.0	%	$	11	35.0	%	$	23		35.0	%	$	33		35.0	%
Increases (decreases) resulting from:
State income taxes, net of Federal effect		1		7.7	%		2	6.3	%		4		6.1	%		5		5.3	%
Depreciation		(1	)	(7.7	)%		—	—			(1	)	(1.5	)%		(1	)	(1.1	)%
Other, net		—		3.5	%		—	(0.7	)%		—		(0.2	)%		1		1.2	%
Income tax expense	$	5		38.5	%	$	13	40.6	%	$	26		39.4	%	$	38		40.4	%

Atlantic City Electric Co [Member]

Reconciliation of Consolidated Income Tax Expense

A reconciliation of ACE’s consolidated effective income tax rates is as follows:

	Three Months Ended June 30,								Six Months Ended June 30,
	2015				2014				2015				2014
	(millions of dollars)
Income tax at Federal statutory rate	$	6	35.0	%	$	3	35.0	%	$	8	35.0	%	$	9		35.0	%
Increases (decreases) resulting from:
State income taxes, net of Federal effect		1	5.9	%		1	10.0	%		1	4.3	%		2		7.7	%
Depreciation		—	—			—	—			—	—			(1	)	(3.8	)%
Other, net		—	0.3	%		—	(5.0	)%		—	(0.2	)%		—		(0.4	)%
Consolidated income tax expense	$	7	41.2	%	$	4	40.0	%	$	9	39.1	%	$	10		38.5	%

Potomac Electric Power Co [Member]

Reconciliation of Consolidated Income Tax Expense

A reconciliation of Pepco’s effective income tax rates is as follows:

	Three Months Ended June 30,										Six Months Ended June 30,
	2015					2014					2015					2014
	(millions of dollars)
Income tax at Federal statutory rate	$	21		35.0	%	$	26		35.0	%	$	34		35.0	%	$	43		35.0	%
Increases (decreases) resulting from:
State income taxes, net of Federal effect		3		5.0	%		4		5.4	%		5		5.1	%		7		5.7	%
Asset removal costs		(5	)	(8.3	)%		(2	)	(2.7	)%		(8	)	(8.2	)%		(5	)	(4.1	)%
Change in estimates and interest related to uncertain and effectively settled tax positions		—		—			—		—			—		—			(1	)	(0.8	)%
Other, net		(1	)	(1.7	)%		—		0.1	%		(1	)	(1.3	)%		—		0.3	%
Income tax expense	$	18		30.0	%	$	28		37.8	%	$	30		30.6	%	$	44		36.1	%