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Income Taxes (All Registrants)
 6 Months Ended
Jun. 30, 2023
Income Tax Disclosure [Abstract]  
Income Taxes (All Registrants) Income Taxes (All Registrants)
Rate Reconciliation
The effective income tax rate from continuing operations varies from the U.S. federal statutory rate principally due to the following:
Three Months Ended June 30, 2023(a)
ExelonComEd
PECO(b)
BGEPHIPepcoDPLACE
U.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %
Increase (decrease) due to:
State income taxes, net of federal income tax benefit
6.5 7.8 (1.2)6.8 6.2 5.6 6.3 7.1 
Plant basis differences(4.8)(0.6)(15.8)0.1 (1.6)(2.6)(1.1)— 
Excess deferred tax amortization(7.4)(5.6)(2.4)(5.3)(8.0)(9.9)(9.9)(2.0)
Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.1)(0.1)
Tax credits(0.5)(0.3)— (0.4)(0.9)(1.1)(0.4)(0.3)
Other2.8 — 0.4 0.1 (0.3)0.5 0.9 (0.7)
Effective income tax rate17.5 %22.2 %2.0 %22.2 %16.3 %13.5 %16.7 %25.0 %
Three Months Ended June 30, 2022(a)
Exelon
ComEd
PECO(c)
BGE(c)
PHI
Pepco(c)
DPL
ACE(c)
U.S. Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %
Increase (decrease) due to:
State income taxes, net of federal income tax benefit(d)
(5.4)7.9 (0.6)2.1 1.5 (3.4)7.2 6.7 
Plant basis differences(3.3)(0.5)(11.0)(1.3)(1.7)(2.4)(0.7)(1.0)
Excess deferred tax amortization(10.5)(5.5)(3.1)(19.0)(19.2)(15.7)(20.0)(24.5)
Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)— (0.1)(0.1)— (0.2)(0.2)
Tax credits(0.4)(0.3)— (1.5)(0.4)(0.4)(0.4)(0.4)
Other(e)
7.7 — — 1.4 (0.1)(0.5)1.8 (1.6)
Effective income tax rate9.0 %22.5 %6.3 %2.6 %1.0 %(1.4)%8.7 %— %
__________
(a)Positive percentages represent income tax expense. Negative percentages represent income tax benefit.
(b)For PECO, the lower effective tax rate is primarily related to plant basis differences attributable to tax repair deductions.
(c)For PECO, the lower effective tax rate is primarily related to plant basis differences attributable to tax repair deductions. For BGE, the lower effective tax rate is primarily due to the Maryland multi-year plan which resulted in the acceleration of certain income tax benefits. For Pepco, the income tax benefit is primarily due to the Maryland and Washington, D.C. multi-year plans which resulted in the acceleration of certain income tax benefits. For ACE, the lower effective tax rate is primarily due to the acceleration of certain income tax benefits due to distribution rate case settlements.
(d)For Exelon, the lower state income taxes, net of federal income tax benefit, is primarily related to a one-time impact associated with a state tax benefit of $43 million and indemnification adjustments pursuant to the Tax Matters Agreement of $5 million as a result of the separation.
(e)For Exelon, primarily related to indemnification adjustments pursuant to the Tax Matters Agreement of $48 million.
Six Months Ended June 30, 2023(a)
ExelonComEd
PECO(b)
BGEPHIPepcoDPLACE
U.S. Federal statutory rate21.0%21.0%21.0%21.0%21.0%21.0%21.0%21.0%
Increase (decrease) due to:
State income taxes, net of federal income tax benefit6.27.8(1.3)6.46.15.56.36.9
Plant basis differences(4.3)(0.4)(15.4)(0.6)(1.7)(2.6)(1.0)(0.6)
Excess deferred tax amortization(6.7)(5.6)(2.4)(5.4)(7.4)(9.1)(9.2)(2.0)
Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)—(0.1)(0.1)—(0.1)(0.1)
Tax credits(0.5)(0.3)—(0.4)(0.6)(0.8)(0.4)(0.3)
Other1.30.1—0.3—0.50.10.1
Effective income tax rate16.9%22.5%1.9%21.2%17.3%14.5%16.7%25.0%

Six Months Ended June 30, 2022(a)
Exelon
ComEd
PECO(c)
BGE(c)
PHI
Pepco(c)
DPL
ACE(c)
U.S. Federal statutory rate21.0%21.0%21.0%21.0%21.0%21.0%21.0%21.0%
Increase (decrease) due to:
State income taxes, net of federal income tax benefit(d)
9.97.9(0.3)2.32.8(3.8)6.56.7
Plant basis differences(3.5)(0.5)(11.2)(1.0)(1.7)(2.5)(0.7)(1.2)
Excess deferred tax amortization(11.0)(5.8)(3.2)(17.8)(18.3)(16.3)(19.5)(22.9)
Amortization of investment tax credit, including deferred taxes on basis difference(0.1)(0.1)—(0.1)(0.1)—(0.2)(0.2)
Tax credits(e)
0.8(0.3)—(0.6)(0.4)(0.4)(0.3)(0.3)
Other(f)
4.70.10.30.30.1(0.7)0.4(0.5)
Effective income tax rate21.8%22.3%6.6%4.1%3.4%(2.7)%7.2%2.6%
__________
(a)Positive percentages represent income tax expense. Negative percentages represent income tax benefit.
(b)For PECO, the lower effective tax rate is primarily related to plant basis differences attributable to tax repair deductions.
(c)For PECO, the lower effective tax rate is primarily related to plant basis differences attributable to tax repair deductions. For BGE, the lower effective tax rate is primarily due to the Maryland multi-year plan which resulted in the acceleration of certain income tax benefits. For Pepco, the income tax benefit is primarily due to the Maryland and Washington, D.C. multi-year plans which resulted in the acceleration of certain income tax benefits. For ACE, the lower effective tax rate is primarily due to the acceleration of certain income tax benefits due to distribution rate case settlements.
(d)For Exelon, the higher state income taxes, net of federal income tax benefit, is primarily due to the long-term marginal state income tax rate change of approximately $67 million and the recognition of a valuation allowance of approximately $40 million against the net deferred tax asset position for certain standalone state filing jurisdictions, partially offset by a one-time impact associated with a state tax benefit of $43 million and indemnification adjustments pursuant to the Tax Matters Agreement of $4 million as a result of the separation.
(e)For Exelon, reflects the income tax expense related to the write-off of federal tax credits subject to recapture of approximately $15 million as a result of the separation.
(f)For Exelon, primarily reflects the nondeductible transaction costs of approximately $19 million arising as part of the separation and indemnification adjustments pursuant to the Tax Matters Agreement of $48 million.
Unrecognized Tax Benefits
Exelon, PHI and ACE have the following unrecognized tax benefits at June 30, 2023 and December 31, 2022. ComEd's, PECO's, BGE's, Pepco's, and DPL's amounts are not material.
Exelon(a)
PHIACE
June 30, 2023$148 $59 $17 
December 31, 2022148 59 17 
__________
(a)At June 30, 2023 and December 31, 2022, Exelon recorded a receivable of $50 million in Other deferred debits and other assets in the Consolidated Balance Sheet for Constellation’s share of unrecognized tax benefits for periods prior to the separation.
Reasonably possible the total amount of unrecognized tax benefits could significantly increase or decrease within 12 months after the reporting date
As of June 30, 2023, ACE has $14 million of unrecognized state tax benefits that could significantly decrease within the 12 months after the reporting date based on the outcome of pending court cases involving other taxpayers. The unrecognized tax benefit, if recognized, may be included in future base rates and that portion would have no impact to the effective tax rate.
Other Tax Matters
Tax Matters Agreement (Exelon)
In connection with the separation, Exelon entered into a TMA with Constellation. The TMA governs the respective rights, responsibilities, and obligations between Exelon and Constellation after the separation with respect to tax liabilities, refunds and attributes for open tax years that Constellation was part of Exelon’s consolidated group for U.S. federal, state, and local tax purposes.
Indemnification for Taxes. As a former subsidiary of Exelon, Constellation has joint and several liability with Exelon to the IRS and certain state jurisdictions relating to the taxable periods prior to the separation. The TMA specifies that Constellation is liable for their share of taxes required to be paid by Exelon with respect to taxable periods prior to the separation to the extent Constellation would have been responsible for such taxes under the existing Exelon tax sharing agreement. As of June 30, 2023, Exelon recorded a payable of $17 million in Other current liabilities that is due to Constellation.
Tax Refunds. The TMA specifies that Constellation is entitled to their share of any future tax refunds claimed by Exelon with respect to taxable periods prior to the separation to the extent that Constellation would have received such tax refunds under the existing Exelon tax sharing agreement.
Tax Attributes. At the date of separation certain tax attributes, primarily pre-closing tax credit carryforwards, that were generated by Constellation were required by law to be allocated to Exelon. The TMA provides that Exelon will reimburse Constellation when those allocated tax credit carryforwards are utilized. As of June 30, 2023, Exelon recorded a payable of $8 million and $524 million in Other current liabilities and Other deferred credits and other liabilities, respectively, in the Consolidated Balance Sheet for tax attribute carryforwards that are expected to be utilized and reimbursed to Constellation.
Corporate Alternative Minimum Tax (All Registrants)
On August 16, 2022, the IRA was signed into law and implements a new corporate alternative minimum tax (CAMT) that imposes a 15.0% tax on modified GAAP net income. Corporations are entitled to a tax credit (minimum tax credit) to the extent the CAMT liability exceeds the regular tax liability. This amount can be carried forward indefinitely and used in future years when regular tax exceeds the CAMT.
Beginning in 2023, based on the existing statue, Exelon and each of the Utility Registrants will be subject to and will report the CAMT on a separate Registrant basis in the Consolidated Statements of Operations and Comprehensive Income and the Consolidated Balance Sheets. The deferred tax asset related to the minimum tax credit carryforward will be realized to the extent Exelon’s consolidated deferred tax liabilities exceed the minimum tax credit carryforward. Exelon’s deferred tax liabilities are expected to exceed the minimum tax credit carryforward for the foreseeable future and thus no valuation allowance is required. Exelon is continuing to assess the financial statement impacts of the IRA and will update estimates based on future guidance issued by the U.S. Treasury.