Segment Information (All Registrants)

Operating segments for each of the Registrants are determined based on information used by the chief operating decision maker(s) (CODM) in deciding how to evaluate performance and allocate resources at each of the Registrants.

In the first quarter of 2016, following the consummation of the PHI Merger, three new reportable segments were added: Pepco, DPL and ACE. As a result, Exelon has twelve reportable segments, which include ComEd, PECO, BGE, PHI's three reportable segments consisting of Pepco, DPL, and ACE, and Generation’s six reportable segments consisting of the Mid-Atlantic, Midwest, New England, New York, ERCOT and all other power regions referred to collectively as “Other Power Regions”, which includes activities in the South, West and Canada. ComEd, PECO, BGE, Pepco, DPL and ACE each represent a single reportable segment, and as such, no separate segment information is provided for these Registrants. Exelon, ComEd, PECO, BGE, Pepco, DPL and ACE's CODMs evaluate the performance of and allocate resources to ComEd, PECO, BGE, Pepco, DPL and ACE based on net income and return on equity.

Effective with the consummation of the PHI Merger, PHI's reportable segments have changed based on the information used by the CODM to evaluate performance and allocate resources. PHI's reportable segments consist of Pepco, DPL and ACE. PHI's Predecessor periods' segment information has been recast to conform to the current presentation. The reclassification of the segment information did not impact PHI's reported consolidated revenues or net income. PHI's CODM evaluates the performance of and allocates resources to Pepco, DPL and ACE based on net income and return on equity.

The basis for Generation's reportable segments is the integrated management of its electricity business that is located in different geographic regions, and largely representative of the footprints of ISO/RTO and/or NERC regions, which utilize multiple supply sources to provide electricity through various distribution channels (wholesale and retail). Generation's hedging strategies and risk metrics are also aligned to these same geographic regions. Descriptions of each of Generation’s six reportable segments are as follows:


•	Mid-Atlantic represents operations in the eastern half of PJM, which includes New Jersey, Maryland, Virginia, West Virginia, Delaware, the District of Columbia and parts of Pennsylvania and North Carolina.

•

Midwest represents operations in the western half of PJM, which includes portions of Illinois, Pennsylvania, Indiana, Ohio, Michigan, Kentucky and Tennessee, and the United States footprint of MISO, excluding MISO’s Southern Region, which covers all or most of North Dakota, South Dakota, Nebraska, Minnesota, Iowa, Wisconsin, the remaining parts of Illinois, Indiana, Michigan and Ohio not covered by PJM, and parts of Montana, Missouri and Kentucky.


•	New England represents the operations within ISO-NE covering the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont.


•	New York represents operations within ISO-NY, which covers the state of New York in its entirety.


•	ERCOT represents operations within Electric Reliability Council of Texas, covering most of the state of Texas.


•	Other Power Regions:

•

South represents operations in the FRCC, MISO’s Southern Region, and the remaining portions of the SERC not included within MISO or PJM, which includes all or most of Florida, Arkansas, Louisiana, Mississippi, Alabama, Georgia, Tennessee, North Carolina, South Carolina and parts of Missouri, Kentucky and Texas. Generation’s South region also includes operations in the SPP, covering Kansas, Oklahoma, most of Nebraska and parts of New Mexico, Texas, Louisiana, Missouri, Mississippi and Arkansas.


•	West represents operations in the WECC, which includes California ISO, and covers the states of California, Oregon, Washington, Arizona, Nevada, Utah, Idaho, Colorado and parts of New Mexico, Wyoming and South Dakota.


•	Canada represents operations across the entire country of Canada and includes AESO, OIESO and the Canadian portion of MISO.

The CODMs for Exelon and Generation evaluate the performance of Generation’s electric business activities and allocate resources based on revenues net of purchased power and fuel expense (RNF). Generation believes that RNF is a useful measurement of operational performance. RNF is not a presentation defined under GAAP and may not be comparable to other companies’ presentations or deemed more useful than the GAAP information provided elsewhere in this report. Generation’s operating revenues include all sales to third parties and affiliated sales to the Utility Registrants. Purchased power costs include all costs associated with the procurement and supply of electricity including capacity, energy and ancillary services. Fuel expense includes the fuel costs for Generation’s owned generation and fuel costs associated with tolling agreements. The results of Generation's other business activities are not regularly reviewed by the CODM and are therefore not classified as operating segments or included in the regional reportable segment amounts. These activities include natural gas, as well as other miscellaneous business activities that are not significant to Generation's overall operating revenues or results of operations. Further, Generation’s unrealized mark-to-market gains and losses on economic hedging activities and its amortization of certain intangible assets and liabilities relating to commodity contracts recorded at fair value from mergers and acquisitions are also excluded from the regional reportable segment amounts. Exelon and Generation do not use a measure of total assets in making decisions regarding allocating resources to or assessing the performance of these reportable segments.

An analysis and reconciliation of the Registrants’ reportable segment information to the respective information in the consolidated financial statements for the years ended December 31, 2016, 2015, and 2014 is as follows:



									Successor
	Generation ^(a)		ComEd		PECO		BGE		PHI ^(e)		Other ^(b)		Intersegment Eliminations			Exelon
Operating revenues^(c):
2016
Competitive businesses electric revenues	$	15,390	$	—	$	—	$	—	$	—	$	—	$	(1,430	)	$	13,960
Competitive businesses natural gas revenues	2,146		—		—		—		—		—		—			2,146
Competitive businesses other revenues	215		—		—		—		—		—		(4		)	211



Rate-regulated electric revenues	—			5,254		2,531		2,609		3,506		—		(31		)	13,869
Rate-regulated natural gas revenues	—			—		463		624		92		—		(13		)	1,166
Shared service and other revenues	—			—		—		—		45		1,648		(1,686		)	7
2015
Competitive businesses electric revenues	$	15,944		$	—	$	—	$	—	$	—	$	—	$	(744	)	$	15,200
Competitive businesses natural gas revenues	2,433			—		—		—		—		—		—			2,433
Competitive businesses other revenues	758			—		—		—		—		—		(1		)	757
Rate-regulated electric revenues	—			4,905		2,486		2,490		—		—		(5		)	9,876
Rate-regulated natural gas revenues	—			—		546		645		—		—		(15		)	1,176
Shared service and other revenues	—			—		—		—		—		1,372		(1,367		)	5
2014
Competitive businesses electric revenues	$	14,533		$	—	$	—	$	—	$	—	$	—	$	(760	)	$	13,773
Competitive businesses natural gas revenues	2,705			—		—		—		—		—		(1		)	2,704
Competitive businesses other revenues	155			—		—		—		—		—		(1		)	154
Rate-regulated electric revenues	—			4,564		2,448		2,460		—		—		(5		)	9,467
Rate-regulated natural gas revenues	—			—		646		705		—		—		(26		)	1,325
Shared service and other revenues	—			—		—		—		—		1,285		(1,279		)	6
Intersegment revenues^(d):
2016	$	1,428		$	15	$	8	$	21	$	45	$	1,647	$	(3,159	)	$	5
2015	745			4		2		14		—		1,367		(2,127		)	5
2014	762			4		2		25		—		1,280		(2,067		)	6
Depreciation and amortization:
2016	$	1,879		$	775	$	270	$	423	$	515	$	74	$	—		$	3,936
2015	1,054			707		260		366		—		63		—			2,450
2014	967			687		236		371		—		53		—			2,314
Operating expenses ^(c):
2016	$	16,856		$	4,056	$	2,292	$	2,683	$	3,549	$	1,928	$	(3,164	)	$	28,200
2015	16,872			3,889		2,404		2,578		—		1,444		(2,131		)	25,056
2014	16,923			3,586		2,522		2,726		—		1,353		(2,071		)	25,039
Equity in earnings (losses) of unconsolidated affiliates:
2016	$	(25	)	$	—	$	—	$	—	$	—	$	1	$	—		$	(24	)
2015	(8		)	—		—		—		—		1		—			(7		)
2014	(20		)	—		—		—		—		—		—			(20		)
Interest expense, net:
2016	$	364		$	461	$	123	$	103	$	195	$	290	$	—		$	1,536
2015	365			332		114		99		—		123		—			1,033
2014	356			321		113		106		—		169		—			1,065
Income (loss) before income taxes:



2016	$	873	$	679	$	587	$	468	$	(58	)	$	(555	)	$	(5	)	$	1,989
2015	1,850		706		521		477		—			(219		)	(5		)	3,330
2014	1,226		676		466		351		—			(227		)	(6		)	2,486
Income taxes:
2016	$	290	$	301	$	149	$	174	$	3		$	(156	)	$	—		$	761
2015	502		280		143		189		—			(41		)	—			1,073
2014	207		268		114		140		—			(63		)	—			666
Net income (loss):
2016	$	558	$	378	$	438	$	294	$	(61	)	$	(398	)	$	(5	)	$	1,204
2015	1,340		426		378		288		—			(177		)	(5		)	2,250
2014	1,019		408		352		211		—			(164		)	(6		)	1,820
Capital expenditures:
2016	$	3,078	$	2,734	$	686	$	934	$	1,008		$	113		$	—		$	8,553
2015	3,841		2,398		601		719		—			65			—			7,624
2014	3,012		1,689		661		620		—			95			—			6,077
Total assets:
2016	$	46,974	$	28,335	$	10,831	$	8,704	$	21,025		$	10,369		$	(11,334	)	$	114,904
2015	46,529		26,532		10,367		8,295		—			15,389			(11,728		)	95,384

__________________________

(a)

Generation includes the six reportable segments shown below: Mid-Atlantic, Midwest, New England, New York, ERCOT and Other Power Regions. For the year ended December 31, 2016, intersegment revenues for Generation include revenue from sales to PECO of $290 million, sales to BGE of $608 million, sales to Pepco of $295 million, sales to DPL of $154 million and sales to ACE of $37 million in the Mid-Atlantic region, and sales to ComEd of $47 million in the Midwest region, which eliminate upon consolidation. For the year ended December 31, 2015, intersegment revenues for Generation include revenue from sales to PECO of $224 million and sales to BGE of $502 million in the Mid-Atlantic region, and sales to ComEd of $18 million in the Midwest region, which eliminate upon consolidation. For the year ended December 31, 2014, intersegment revenues for Generation include revenue from sales to PECO of $198 million and sales to BGE of $387 million in the Mid-Atlantic region, and sales to ComEd of $176 million in the Midwest region, net of $7 million related to the unrealized mark-to-market losses related to the ComEd swap, which eliminate upon consolidation.


(b)	Other primarily includes Exelon’s corporate operations, shared service entities and other financing and investment activities.

(c)

For the years ended December 31, 2016, 2015 and 2014, utility taxes of $122 million, $105 million and $89 million, respectively, are included in revenues and expenses for Generation. For the years ended December 31, 2016, 2015 and 2014, utility taxes of $242 million, $236 million and $238 million, respectively, are included in revenues and expenses for ComEd. For the years ended December 31, 2016, 2015 and 2014, utility taxes of $136 million, $133 million and $128 million, respectively, are included in revenues and expenses for PECO. For the years ended December 31, 2016, 2015 and 2014, utility taxes of $85 million, $85 million and $86 million are included in revenues and expenses for BGE, respectively.

(d)

Intersegment revenues exclude sales to unconsolidated affiliates. The intersegment profit associated with Generation’s sale of certain products and services by and between Exelon’s segments is not eliminated in consolidation due to the recognition of intersegment profit in accordance with regulatory accounting guidance. For Exelon, these amounts are included in operating revenues in the Consolidated Statements of Operations and Comprehensive Income.


(e)	Amounts included represent activity for PHI's successor period, March 24, 2016 through December 31, 2016. PHI includes the three reportable segments: Pepco, DPL and ACE. See tables below for PHI's predecessor periods, including Pepco, DPL and ACE, for January 1, 2016 to March 23, 2016 and for the years ended December 31, 2015 and December 31, 2014.

Successor and Predecessor PHI:



	Pepco		DPL		ACE		Other^(b)		Intersegment Eliminations			PHI
Operating revenues^(a):
March 24, 2016 to December 31, 2016 - Successor
Rate-regulated electric revenues	$	1,675	$	850	$	989	$	5	$	(13	)	$	3,506
Rate-regulated natural gas revenues	—		92		—		—		—			92
Shared service and other revenues	—		—		—		45		—			45
January 1, 2016 to March 23, 2016 - Predecessor
Rate-regulated electric revenues	$	511	$	279	$	268	$	42	$	(4	)	$	1,096
Rate-regulated natural gas revenues	—		56		—		1		—			57
Shared service and other revenues	—		—		—		—		—			—
December 31, 2015 - Predecessor
Rate-regulated electric revenues	$	2,129	$	1,138	$	1,295	$	210	$	(2	)	$	4,770



Rate-regulated natural gas revenues	—		164			—			1			—			165
Shared service and other revenues	—		—			—			—			—			—
December 31, 2014 - Predecessor
Rate-regulated electric revenues	$	2,055	$	1,088		$	1,210		$	264		$	(3	)	$	4,614
Rate-regulated natural gas revenues	—		194			—			—			—			194
Shared service and other revenues	—		—			—			—			—			—
Intersegment revenues:
March 24, 2016 to December 31, 2016 - Successor	$	4	$	5		$	2		$	47		$	(13	)	$	45
January 1, 2016 to March 23, 2016 - Predecessor	1		2			1			—			(4		)	—
December 31, 2015 - Predecessor	5		6			4			—			(15		)	—
December 31, 2014 - Predecessor	5		7			4			—			(16		)	—
Depreciation and amortization:
March 24, 2016 to December 31, 2016 - Successor	$	224	$	120		$	128		$	43		$	—		$	515
January 1, 2016 to March 23, 2016 - Predecessor	71		37			37			11			(4		)	152
December 31, 2015 - Predecessor	256		148			175			45			—			624
December 31, 2014 - Predecessor	212		122			155			38			(1		)	526
Operating expenses:
March 24, 2016 to December 31, 2016 - Successor	$	1,577	$	952		$	1,000		$	33		$	(13	)	$	3,549
January 1, 2016 to March 23, 2016 - Predecessor	443		284			251			73			(3		)	1,048
December 31, 2015 - Predecessor	1,790		1,137			1,161			220			—			4,308
December 31, 2014 - Predecessor	1,706		1,075			1,073			350			(1		)	4,203
Interest expense, net:
March 24, 2016 to December 31, 2016 - Successor	$	98	$	38		$	47		$	12		$	—		$	195
January 1, 2016 to March 23, 2016 - Predecessor	29		12			15			11			(2		)	65
December 31, 2015 - Predecessor	124		50			64			43			(1		)	280
December 31, 2014 - Predecessor	115		48			64			42			—			269
Income (loss) before income taxes:
March 24, 2016 to December 31, 2016 - Successor	$	36	$	(30	)	$	(51	)	$	(84	)	$	71		$	(58	)
January 1, 2016 to March 23, 2016 - Predecessor	47		43			5			59			(118		)	36
December 31, 2015 - Predecessor	289		125			73			23			(29		)	481
December 31, 2014 - Predecessor	264		169			76			306			(435		)	380
Income taxes:
March 24, 2016 to December 31, 2016 - Successor	$	26	$	5		$	(5	)	$	(23	)	$	—		$	3
January 1, 2016 to March 23, 2016 - Predecessor	15		17			1			(16		)	—			17
December 31, 2015 - Predecessor	102		49			33			(48		)	27			163
December 31, 2014 - Predecessor	93		65			30			(228		)	178			138
Net income (loss):
March 24, 2016 to December 31, 2016 - Successor	$	10	$	(35	)	$	(47	)	$	(34	)	$	45		$	(61	)
January 1, 2016 to March 23, 2016 - Predecessor	32		26			5			(44		)	—			19
December 31, 2015 - Predecessor	187		76			40			25			(1		)	327
December 31, 2014 - Predecessor	171		104			46			(78		)	(1		)	242
Capital Expenditures:
March 24, 2016 to December 31, 2016 - Successor	$	489	$	277		$	218		$	24		$	—		$	1,008
January 1, 2016 to March 23, 2016 - Predecessor	97		72			93			11			—			273
December 31, 2015 - Predecessor	544		352			300			34			—			1,230
December 31, 2014 - Predecessor	567		352			225			79			—			1,223
Total assets:
December 31, 2016 - Successor	$	7,335	$	4,153		$	3,457		$	10,804		$	(4,724	)	$	21,025
December 31, 2015 - Predecessor	6,908		3,969			3,387			7,162			(5,238		)	16,188

_________


(a)	Includes gross utility tax receipts from customers. The offsetting remittance of utility taxes to the governing bodies is recorded in expenses on the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 25 — Supplemental Financial Information for total utility taxes for the year ended December 31, 2016 and 2015


(b)	Other primarily includes PHI’s corporate operations, shared service entities and other financing and investment activities. For the predecessor periods presented, Other includes the activity of PHI’s unregulated businesses which were distributed to Exelon and Generation as a result of the PHI Merger.

Generation total revenues:



	2016							2015							2014
	Revenues from external customers^(b)		Intersegment revenues			Total revenues		Revenues from external customers^(b)		Intersegment revenues			Total revenues		Revenues from external customers^(b)(d)		Intersegment revenues^(d)			Total revenues
Mid-Atlantic ^(a)	$	6,212	$	(33	)	$	6,179	$	5,974	$	(74	)	$	5,900	$	5,414	$	(155	)	$	5,259
Midwest	4,402		10			4,412		4,712		(2		)	4,710		4,488		(13		)	4,475
New England	1,778		(9		)	1,769		2,217		(5		)	2,212		1,468		(46		)	1,422
New York ^(a)	1,198		(42		)	1,156		996		(11		)	985		846		(3		)	843
ERCOT	831		6			837		863		(6		)	857		938		(3		)	935
Other Power Regions	969		(62		)	907		1,182		(80		)	1,102		1,379		(70		)	1,309
Total Revenues for Reportable Segments	$	15,390	$	(130	)	$	15,260	$	15,944	$	(178	)	$	15,766	$	14,533	$	(290	)	$	14,243
Other ^(c)	2,361		130			2,491		3,191		178			3,369		2,860		290			3,150
Total Generation Consolidated Operating Revenues	$	17,751	$	—		$	17,751	$	19,135	$	—		$	19,135	$	17,393	$	—		$	17,393

_______________________


(a)	On April 1, 2014, Generation assumed operational control of CENG's nuclear fleet. As a result, beginning on April 1, 2014, CENG's revenues are included on a fully consolidated basis.


(b)	Includes all wholesale and retail electric sales to third parties and affiliated sales to the Utility Registrants.

(c)

Other represents activities not allocated to a region. See text above for a description of included activities. Also includes a $52 million decrease to revenues, a $7 million increase to revenues, and a $289 million decrease to revenues for the amortization of intangible assets related to commodity contracts recorded at fair value for the years ended December 31, 2016, 2015, and 2014, respectively, unrealized mark-to-market losses of $500 million, gains of $203 million, and losses of $174 million for the years ended December 31, 2016, 2015, and 2014, respectively, and elimination of intersegment revenues.

(d)

Exelon corrected an error in the December 31, 2014 balances within Intersegment revenues and Revenues from external customers for an overstatement of Intersegment revenues for Reportable Segments of $284 million for the year ended December 31, 2014, an understatement of Revenues from external customers for Reportable Segments of $284 million for the year ended December 31, 2014, an understatement of Intersegment revenues for Other of $284 million for the year ended December 31, 2014, and an overstatement of Revenues from external customers for Other of $284 million for the year ended December 31, 2014. The error is not considered material to any prior period, and there is no net impact to Total Revenues.

Generation total revenues net of purchased power and fuel expense:



	2016							2015							2014
	RNF from external customers^(b)		Intersegment RNF			Total RNF		RNF from external customers^(b)		Intersegment RNF			Total RNF		RNF from external customers^(b)(d)			Intersegment RNF^(d)			Total RNF
Mid-Atlantic ^(a)	$	3,282	$	35		$	3,317	$	3,556	$	15		$	3,571	$	3,544		$	(113	)	$	3,431
Midwest	2,969		2			2,971		2,912		(20		)	2,892		2,607			(8		)	2,599
New England	467		(29		)	438		519		(58		)	461		450			(99		)	351
New York ^(a)	761		(19		)	742		584		50			634		439			44			483
ERCOT	412		(131		)	281		425		(132		)	293		573			(256		)	317
Other Power Regions	483		(147		)	336		440		(190		)	250		517			(190		)	327
Total Revenues net of purchased power and fuel expense for Reportable Segments	$	8,374	$	(289	)	$	8,085	$	8,436	$	(335	)	$	8,101	$	8,130		$	(622	)	$	7,508
Other ^(c)	547		289			836		678		335			1,013		(662		)	622			(40		)
Total Generation Revenues net of purchased power and fuel expense	$	8,921	$	—		$	8,921	$	9,114	$	—		$	9,114	$	7,468		$	—		$	7,468

____________________________


(a)	On April 1, 2014, Generation assumed operational control of CENG's nuclear fleet. As a result, beginning on April 1, 2014, CENG's revenues net of purchased power and fuel expense are included on a fully consolidated basis.


(b)	Includes purchases and sales from third parties and affiliated sales to the Utility Registrants.

(c)

Other represents activities not allocated to a region. See text above for a description of included activities. Also includes a $57 million decrease in RNF, a $8 million increase in RNF, and a $124 million decrease in RNF for the amortization of intangible assets related to commodity contracts recorded at fair value for the years ended December 31, 2016, 2015, and 2014, respectively, unrealized mark-to-market losses of $41 million, gains of $257 million, and losses of $591 million for the years ended December 31, 2016, 2015, and 2014, respectively, accelerated nuclear fuel amortization associated with the initial early retirement decision for Clinton and Quad Cities as discussed in Note 9 - Early Nuclear Plant Retirements of $60 million for the year ended December 31, 2016, and the elimination of intersegment revenues net of purchased power and fuel expense.

(d)

Exelon corrected an error in the December 31, 2014 balances within Intersegment RNF and RNF from external customers for an understatement of $8 million of Intersegment RNF for Reportable Segments for the year ended December 31, 2014, an understatement of RNF from external customers for Reportable Segments of $11 million for the year ended December 31, 2014, an overstatement of $8 million of Intersegment RNF for Other for the year ended December 31, 2014, and an overstatement of RNF from external customers for Other of $11 million for the year ended December 31, 2014. This also included an understatement of total RNF for Reportable Segments and an overstatement of total RNF for Other of $19 million for the year ended December 31, 2014. The error is not considered material to any prior period, and there is no net impact to Generation Total RNF for 2014.