The Registrants have an ongoing severance plan under which, in general, the longer an employee worked prior to termination the greater the amount of severance benefits. The Registrants record a liability and expense or regulatory asset for severance once terminations are probable of occurrence and the related severance benefits can be reasonably estimated. For severance benefits that are incremental to its ongoing severance plan (“one-time termination benefits”), the Registrants measure the obligation and record the expense at fair value at the communication date if there are no future service requirements, or, if future service is required to receive the termination benefit, ratably over the required service period.

Severance Liability

Amounts included in the table below represent the severance liability recorded for employees of each Registrant. Exelon's severance liability includes amounts related to BSC that are billed through intercompany allocations.




Severance Liability	Exelon			Generation			ComEd			PECO		BGE		PHI			Pepco			DPL		ACE
Balance at December 31, 2016	$	88		$	36		$	3		$	—	$	—	$	29		$	—		$	—	$	—
Severance costs^(a)	35			31			2			—		—		3			—			—		—
Payments	(29		)	(9		)	(2		)	—		—		(12		)	—			—		—
Balance at December 31, 2017	$	94		$	58		$	3		$	—	$	—	$	20		$	—		$	—	$	—
Severance costs^(a)	35			9			1			—		1		5			1			—		—
Payments	(52		)	(20		)	(2		)	—		—		(18		)	(1		)	—		—
Balance at December 31, 2018	$	77		$	47		$	2		$	—	$	1	$	7		$	—		$	—	$	—

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(a)	Includes salary continuance and health and welfare severance benefits.

Severance Costs Related to the PHI Merger

Upon closing the PHI Merger, Exelon recorded a severance accrual for the anticipated employee position reductions as a result of the post-merger integration. Cash payments under the plan began in May 2016 and will continue through 2020.

For the years ended December 31, 2018 and December 31, 2017, the PHI Merger severance costs were immaterial. For the year ended December 31, 2016, the Registrants recorded the following severance costs associated with the identified job reductions within Operating and maintenance expense in their Consolidated Statements of Operations and Comprehensive Income:



Severance Benefits	Exelon		Generation		ComEd		PECO		BGE		PHI		Pepco		DPL		ACE
Severance costs^(a)	$	57	$	9	$	2	$	1	$	1	$	44	$	21	$	13	$	10


(a)	The amounts above for Generation, ComEd, PECO, BGE, Pepco, DPL, and ACE include $8 million, $2 million, $1 million, $1 million, $20 million, $12 million and $10 million, respectively, for amounts billed by BSC and/or PHISCO through intercompany allocations.

PHI, Pepco, DPL and ACE recorded regulatory assets for merger related integration costs which include a portion of these severance costs. These regulatory assets are either currently being recovered in rates or are deemed probable of recovery in future rates. See Note 4 — Regulatory Matters for additional information.