Information by Operating Segment

12 Months Ended

Dec. 31, 2011

Information by Operating Segment

Information by Operating Segment

3  Information by Operating Segment

        Our reportable operating segments are Generation, NewEnergy, Regulated Electric, and Regulated Gas:

• •

  Our Generation business includes:

  –

  a power generation and development operation that owns, operates and maintains fossil and renewable generating facilities, a fuel processing facility, qualifying facilities, and power projects in the United States,

  –

  an operation that manages certain contractually controlled physical assets, including generating facilities, and

  –

  an interest in a nuclear generation joint venture (CENG) that owns, operates, and maintains five nuclear generating units.

  •

  Our NewEnergy business includes:

  –

  full requirements load-serving sales of energy and capacity to utilities, cooperatives, and commercial, industrial, and governmental customers,

  –

  sales of retail energy products and services to residential, commercial, industrial, and governmental customers,

  –

  structured transactions and risk management services for various customers (including hedging of output from generating facilities and fuel costs) and trading in energy and energy-related commodities to facilitate portfolio management,

  –

  risk management services for our Generation business,

  –

  design, construction, and operation of renewable energy, heating, cooling, and cogeneration facilities for commercial, industrial, and governmental customers throughout North America, including energy performance contracting and energy efficiency engineering services,

  –

  upstream (exploration and production) natural gas activities, and

  –

  sales of home improvements, servicing of electric and gas appliances, and heating, air conditioning, plumbing, electrical, and indoor air quality systems, and providing electric and natural gas to residential customers in central Maryland.

  •

  Our regulated electric business purchases, transmits, distributes, and sells electricity in central Maryland.

  •

  Our regulated gas business purchases, transports, and sells natural gas in central Maryland.

        Our Generation, NewEnergy, Regulated Electric, and Regulated Gas reportable segments are strategic businesses based principally upon regulations, products, and services that require different technologies and marketing strategies. We evaluate the performance of these segments based on net income. We account for intersegment revenues using market prices. A summary of information by operating segment is shown in the table below.

	Reportable Segments
											Holding Company and Other
	Generation			NewEnergy			Regulated Electric		Regulated Gas					Eliminations			Consolidated
	(In millions)
2011
Unaffiliated revenues	$	1,122.3		$	9,649.0		$	2,320.7	$	664.5	$	1.7		$	—		$	13,758.2
Intersegment revenues		1,595.4			471.2			0.7		7.2		—			(2,074.5	)		—
Total revenues		2,717.7			10,120.2			2,321.4		671.7		1.7			(2,074.5	)		13,758.2
Depreciation, depletion, accretion, and amortization		187.4			89.4			226.5		45.6		40.4			—			589.3
Fixed charges		128.8			9.4			103.4		23.2		0.1			0.5			265.4
Income tax (benefit) expense		(300.7	)		(8.8	)		50.1		23.4		5.1			—			(230.9	)
Net (loss) income (1)		(441.1	)		2.8			93.6		42.1		(4.2	)		—			(306.8	)
Net (loss) income attributable to common stock		(441.1	)		(17.5	)		83.8		38.7		(4.2	)		—			(340.3	)
Segment assets		8,738.6			4,136.1			5,506.7		1,480.3		854.2			(1,303.3	)		19,412.6
Capital expenditures		159.7			322.9			535.4		142.5		—			—			1,160.5
2010
Unaffiliated revenues	$	1,189.2		$	9,692.6		$	2,752.1	$	704.9	$	1.2		$	—		$	14,340.0
Intersegment revenues		1,055.1			428.8			0.2		4.5		—			(1,488.6	)		—
Total revenues		2,244.3			10,121.4			2,752.3		709.4		1.2			(1,488.6	)		14,340.0
Depreciation, depletion, accretion, and amortization		137.7			83.7			205.2		44.0		48.9			—			519.5
Fixed charges		142.0			3.0			106.3		24.0		(0.2	)		2.7			277.8
Income tax (benefit) expense		(873.1	)		106.5			72.6		24.5		3.8			—			(665.7	)
Net (loss) income (2)		(1,255.3	)		176.2			110.0		37.6		(0.3	)		—			(931.8	)
Net (loss) income attributable to common stock		(1,255.3	)		138.6			99.8		34.6		(0.3	)		—			(982.6	)
Segment assets		9,789.6			3,836.2			5,287.4		1,379.9		858.0			(1,132.6	)		20,018.5
Capital expenditures		327.4			127.2			499.1		103.0		—			—			1,056.7
2009
Unaffiliated revenues	$	664.2		$	11,345.8		$	2,820.7	$	753.8	$	14.3		$	—		$	15,598.8
Intersegment revenues		2,110.0			163.4			—		4.5		0.1			(2,278.0	)		—
Total revenues		2,774.2			11,509.2			2,820.7		758.3		14.4			(2,278.0	)		15,598.8
Depreciation, depletion, accretion, and amortization		238.9			82.7			218.1		44.0		67.7			—			651.4
Fixed charges		166.5			39.7			113.3		26.0		2.4			2.2			350.1
Income tax expense (benefit)		3,107.1			(179.1	)		50.9		17.1		(9.2	)		—			2,986.8
Net income (loss) (3)		4,766.7			(348.2	)		79.1		25.5		(19.7	)		—			4,503.4
Net income (loss) attributable to common stock		4,766.7			(402.3	)		68.9		22.5		(12.4	)		—			4,443.4
Segment assets		12,402.1			4,167.5			4,994.6		1,413.4		4,573.7			(4,006.9	)		23,544.4
Capital expenditures		1,039.2			116.8			373.0		66.0		—			—			1,595.0

(1)

Our Generation business recognized the following after-tax items: impairment losses and other costs of $530.2 million, amortization of the basis difference in CENG of $90.5 million, impact of the power purchase agreement with CENG of $118.5 million, gain on settlements with DOE for storage of spent nuclear fuel of $57.3 million, transaction fees incurred related to our acquisition of Boston Generating's 2,950 MW fleet of generating plants in Massachusetts of $9.9 million, and costs incurred related to our pending merger with Exelon of $37.0 million. Our NewEnergy business recognized a gain on divestitures of $32.7 million, amortization of credit facility amendment fees in connection with the 2009 EDF transaction of $5.8 million, and costs incurred related to our pending merger with Exelon of $16.1 million. Our Regulated Electric and Gas businesses recognized costs incurred related to our pending merger with Exelon of $13.3 million and $4.5 million, respectively. BGE will not seek recovery of these costs in rates. In addition, our regulated electric business incurred total incremental operating expenses of $24.6 million related to Hurricane Irene.

(2)

Our Generation business recognized the following after-tax items: impairment charges on certain of our equity method investment of $1,487.1 million, loss on the early retirement of 2012 Notes of $30.9 million, amortization of the basis difference in CENG of $117.5 million, impact of the power purchase agreement with CENG of $113.3 million, gain on the sale of Mammoth Lakes geothermal generating facility of $24.7 million, and a gain on the comprehensive agreement with EDF of $121.3 million. Our NewEnergy business recognized earnings relating to an international coal supplier contract dispute settlement of $35.4 million. Our Generation, NewEnergy, regulated electric and holding company and other businesses recognized deferred income tax expense relating to federal subsidies for providing post-employment prescription drug benefits of $0.8 million, $0.1 million, $3.1 million, and $4.8 million, respectively. We discuss these items in more detail in Note 2.

(3)

Our Generation business recognized the following after-tax items: gain on sale of a 49.99% membership interest in CENG to EDF of $4,456.1 million, amortization of basis difference in investment in CENG of $17.8 million, loss on the early extinguishment of zero coupon senior notes of $10.0 million, merger termination and strategic alternatives costs of $9.7 million, and impairment charges of our nuclear decommissioning trust assets through November 6, 2009 of $46.8 million. Our NewEnergy business recognized the following after-tax items: merger termination and strategic alternatives costs of $4.1 million, losses on divestitures, which include losses on the sales of the international commodities and gas trading operations, the reclassification of losses on previously designated cash-flow hedges from Accumulated Other Comprehensive Loss because the forecasted transactions are probable of not occurring, earnings that are no longer part of our core business, of $371.9 million, impairment losses and other costs of $84.7 million, and workforce reduction costs of $9.3 million. Our regulated electric and gas businesses recognized after-tax charges of $56.7 million and $10.4 million, respectively, for the accrual of a residential customer credit. Our holding company and other businesses recognized after-tax charges of $11.5 million for impairment losses and other costs. We discuss these items in more detail in Note 2.