Pension and Postretirement Benefits

9 Months Ended

Sep. 30, 2011

Pension and Postretirement Benefits

Pension and Postretirement Benefits

Pension and Postretirement Benefits

We show the components of net periodic pension benefit cost in the following table:

	Quarter Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
	(In millions)
Components of net periodic pension benefit cost
Service cost	$	13.4		$	9.7		$	39.8		$	28.3
Interest cost		24.0			21.7			71.2			63.1
Expected return on plan assets		(31.7	)		(26.0	)		(94.0	)		(75.9	)
Recognized net actuarial loss		12.3			8.8			36.4			25.6
Amortization of prior service cost		1.1			1.0			3.2			2.9
Amount capitalized as construction cost		(2.7	)		(2.5	)		(8.8	)		(7.3	)
Net periodic pension benefit cost1	$	16.4		$	12.7		$	47.8		$	36.7

1 BGE's portion of our net periodic pension benefit cost, excluding amounts capitalized, was $10.5 million for the quarter ended September 30, 2011 and $7.9 million for the quarter ended September 30, 2010. BGE's portion of our net periodic pension benefit cost, excluding amounts capitalized, was $28.6 million for the nine months ended September 30, 2011 and $22.7 million for the nine months ended September 30, 2010. Net periodic pension benefit costs exclude settlement charges of $4.0 million for the nine months ended September 30, 2011 and $1.5 million in the nine months ended September 30, 2010.

        We show the components of net periodic postretirement benefit cost in the following table:

	Quarter Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
	(In millions)
Components of net periodic postretirement benefit cost
Service cost	$	0.8		$	0.6		$	2.3		$	1.9
Interest cost		4.6			3.9			13.9			13.6
Amortization of transition obligation		0.4			0.5			1.4			1.6
Recognized net actuarial loss (gain)		0.4			0.1			1.2			0.3
Amortization of prior service cost		(0.7	)		(0.6	)		(2.2	)		(2.0	)
Amount capitalized as construction cost		(1.2	)		(1.2	)		(4.3	)		(4.1	)
Net periodic postretirement benefit cost1	$	4.3		$	3.3		$	12.3		$	11.3

1 BGE's portion of our net periodic postretirement benefit cost, excluding amounts capitalized, was $4.7 million for the quarter ended September 30, 2011 and $3.8 million for the quarter ended September 30, 2010. BGE's portion of our net periodic postretirement benefit costs, excluding amounts capitalized, was $14.2 million for the nine months ended September 30, 2011 and $13.2 million for the nine months ended September 30, 2010.

        Our non-qualified pension plans and our postretirement benefit programs are not funded; however, we have trust assets securing certain executive pension benefits. We estimate that we will incur approximately $9.4 million in pension benefit payments for our non-qualified pension plans and approximately $22.6 million for retiree health and life insurance costs in 2011.