Nuclear Decommissioning (Exelon and Generation)

3 Months Ended

Mar. 31, 2012

Nuclear Decommissioning Disclosure [Line Items]

Nuclear Decommissioning (Exelon and Generation)

10. Nuclear Decommissioning (Exelon andGeneration)

Nuclear Decommissioning Asset Retirement Obligations

Generation has a legal obligation to decommission its nuclear power plants following the expiration of their operating licenses. To estimate its decommissioning obligation related to its nuclear generating stations, Generation uses a probability-weighted, discounted cash flow model which, on a unit-by-unit basis, considers multiple outcome scenarios that include significant estimates and assumptions, and are based on decommissioning cost studies, cost escalation rates, probabilistic cash flow models and discount rates.

The following table provides a rollforward of the nuclear decommissioning ARO reflected on Exelon's and Generation's Consolidated Balance Sheets from December 31, 2011 to March 31, 2012:

Nuclear decommissioning ARO at December 31, 2011 (a)	$	3,680
Accretion expense		55
Net increase due to changes in estimated cash flows		80
Costs incurred to decommission retired plants		(1)
Nuclear decommissioning ARO at March 31, 2012 (a)	$	3,814

(a)Includes $5 millionas the current portion of the ARO at March 31, 2012 and December 31, 2011, which is included in other current liabilities on Exelon's and Generation's Consolidated Balance Sheets.

During the first quarter of 2012, Generation's ARO increased by $134 million, primarily due to increases for accretion and a net increase of $80 million due to changes in estimated cash flows primarily related to increased costs resulting from an updated decommissioning cost study received for the Quad Cities generating station. The increase due to the changes in estimated cash flows had no impact to Exelon's or Generation's Consolidated Statements of Operations and Comprehensive Income.

Nuclear Decommissioning Trust FundInvestments

NDT funds have been established for each generating station unit to satisfy Generation's nuclear decommissioning obligations. NDT funds established for a particular unit may not be used to fund the decommissioning obligations of any other unit.

The NDT funds associated with the former ComEd, former PECO and former AmerGen units have been funded with amounts collected from ComEd customers, PECO customers and the previous owners of the former AmerGen plants, respectively. Based on an ICC order, ComEd ceased collecting amounts from its customers to pay for decommissioning costs. PECO currently collects funds, in revenues, for decommissioning the former PECO nuclear plants through regulated rates, and these collections may continue through the operating lives of the plants. The amounts collected from PECO customers are remitted to Generation and deposited into the NDT funds. Every five years, PECO files a rate adjustment with the PAPUC that reflects PECO's calculations of the estimated amount needed to decommission each of the former PECO units based on updated fund balances and estimated decommissioning costs. The rate adjustment is used to determine the amount collectible from PECO customers. On March 30, 2012, PECO filed its Nuclear Decommissioning Cost Adjustment with the PAPUC proposing an annual recovery from customers of $24 million which, if approved by the PAPUC, will be effective January 1, 2013. This amount reflects a reduction from the current approved annual collections of $29 million.See Note 12 of the Exelon 2011 Form 10-K for information regarding amounts collected from PECO customers for decommissioning costs. See below for discussion of NRC minimum funding requirements.

At March 31, 2012 and December 31, 2011, Exelon and Generation had NDT fund investments totaling $6,927 million and $6,507 million, respectively.The following table provides unrealized gains(losses) on NDT funds for the threemonths ended March 31, 2012 and 2011:

		Three Months Ended
		March 31,
			2012		2011
Net unrealized gains on decommissioning trust funds —
	Regulatory Agreement Units (a)	$	247	$	111
Net unrealized gains on decommissioning trust funds —
	Non-Regulatory Agreement Units (b)(c)		65		43

(a)       Net unrealized gains related to Generation's NDT funds associated with Regulatory Agreement Units are included in regulatory liabilities on Exelon's Consolidated Balance Sheets and noncurrent payables to affiliates on Generation's Consolidated Balance Sheets.

(b)       Excludes $35million and $23 millionof net unrealized gains related to the Zion Station pledged assets for the threemonths ended March 31, 2012 and March 31, 2011, respectively.Net unrealized gainsrelated to Zion Station pledged assets are included in the payable for Zion Station decommissioning on Exelon's and Generation's Consolidated Balance Sheets.

(c)       Net unrealized gains related to Generation's NDT funds associated with Non-Regulatory Agreement Units are included within Other, net in Exelon's and Generation's Consolidated Statements of Operations and Comprehensive Income.

Interest and dividends on NDT fund investments are recognized when earned and are included in Other, net in Exelon's and Generation's Consolidated Statements of Operations and Comprehensive Income. Interest and dividends earned on the NDT fund investments for the Regulatory Agreement Units, which are subject to regulatory accounting, are eliminated within Other, net in Exelon's and Generation's Consolidated Statement of Operations and Comprehensive Income.

See Note 2 of the Exelon 2011 Form 10-Kfor information regarding regulatory liabilities at ComEd and PECO and intercompany balances between Generation, ComEd and PECO reflecting the obligation to refund the customers any decommissioning-related assets in excess of the related decommissioning obligations.

Zion Station Decommissioning.On September 1, 2010, Generation completed an Asset Sale Agreement (ASA) with EnergySolutions Inc. and its wholly owned subsidiaries, EnergySolutions, LLC(EnergySolutions) and ZionSolutions under which ZionSolutions has assumed responsibility for decommissioning Zion Station, which is located in Zion, Illinois and ceased operation in 1998. See Note 12 of the Exelon2011Form 10-K for information regarding the specific treatment of assets, including NDT funds, and decommissioning liabilities transferred in the transaction.On July 14, 2011, three people filed a purported class action lawsuit in the United States District Court for the Northern District of Illinois naming ZionSolutions and Bank of New York Mellon as defendants and seeking, among other things, an accounting for use of NDT funds, an injunction against the use of NDT funds, the appointment of a trustee for the NDT funds, and the return of NDT funds to customers of ComEd to the extent legally entitled thereto.

ZionSolutions is subject to certain restrictions on its ability to request reimbursements from the Zion Station NDT funds as defined withinthe ASA.Therefore, the transfer of the Zion Station assets did not qualify for asset sale accounting treatment and, as a result, the relatedNDT funds were reclassified to pledged assets for Zion Station decommissioning within Generation's and Exelon's Consolidated Balance Sheets and will continue to be measured in the same manner as prior to the completion of the transaction. Additionally, the transferred ARO for decommissioning was replaced with a payable to ZionSolutions in Generation's and Exelon's Consolidated Balance Sheets.Changes in the value of the Zion Station NDT assets, net of applicable taxes, will be recorded as a change in the payable to ZionSolutions. At no point will the payable to ZionSolutions exceed the project budget of the costs remaining to decommission Zion Station. Any Zion Station NDT funds remaining after the completion of all decommissioning activities will be returned to ComEd customers.Generation has retained its obligation to transfer the SNF at Zion Station to the DOE for ultimate disposal and has a liability of approximately $66 million, which is included within the nuclear decommissioning ARO at March 31, 2012.Generation also has retained a requisite level of NDT assets to fund its obligation to maintain and transfer the SNF at Zion Station. As of March 31, 2012, the carrying value of the Zion Station pledged assetsand the payable to Zion Solutions was approximately $708 million and $660 million, respectively. The payable excludes a liability recorded within Generation's Consolidated Balance Sheets related to the tax obligation on the unrealized activity associated with the Zion Station NDT funds. The NDT funds will be utilized to satisfy the tax obligations as gains and losses are realized.The current portion of the payable to ZionSolutions, included in other current liabilities within Generation's Consolidated Balance Sheetsat March 31, 2012 and December 31, 2011 was $86 millionand $128 million, respectively.

NRC Minimum Funding Requirements. NRC regulations require that licensees of nuclear generating facilities demonstrate reasonable assurance that funds will be available in specified minimum amounts to decommission the facility at the end of its life. On March 31, 2011, Generation, in its NRC-required biennial decommissioning funding status report, provided data from which the NRC concluded that the amount of decommissioning funding as of December 31, 2010 for Limerick Unit 1 was less than the amount required by the NRC's regulations. Generation performed the calculations again in early 2012, which reflected that the amount of decommissioning funding as of December 31, 2011 for Limerick Unit 1 was less than the amount required by the NRC's regulations. In February 2012, Generation obtained a parent guarantee in the amount ofapproximately$115 million to cover the NRC minimum funding assurance requirements for Limerick Unit 1 and informed the NRC that it had addressed the minimum funding issues by obtaining the parent guarantee.

Exelon Generation Co L L C [Member]

Nuclear Decommissioning Disclosure [Line Items]

Nuclear Decommissioning (Exelon and Generation)

10. Nuclear Decommissioning (Exelon andGeneration)

Nuclear Decommissioning Asset Retirement Obligations

Generation has a legal obligation to decommission its nuclear power plants following the expiration of their operating licenses. To estimate its decommissioning obligation related to its nuclear generating stations, Generation uses a probability-weighted, discounted cash flow model which, on a unit-by-unit basis, considers multiple outcome scenarios that include significant estimates and assumptions, and are based on decommissioning cost studies, cost escalation rates, probabilistic cash flow models and discount rates.

The following table provides a rollforward of the nuclear decommissioning ARO reflected on Exelon's and Generation's Consolidated Balance Sheets from December 31, 2011 to March 31, 2012:

Nuclear decommissioning ARO at December 31, 2011 (a)	$	3,680
Accretion expense		55
Net increase due to changes in estimated cash flows		80
Costs incurred to decommission retired plants		(1)
Nuclear decommissioning ARO at March 31, 2012 (a)	$	3,814

(a)Includes $5 millionas the current portion of the ARO at March 31, 2012 and December 31, 2011, which is included in other current liabilities on Exelon's and Generation's Consolidated Balance Sheets.

During the first quarter of 2012, Generation's ARO increased by $134 million, primarily due to increases for accretion and a net increase of $80 million due to changes in estimated cash flows primarily related to increased costs resulting from an updated decommissioning cost study received for the Quad Cities generating station. The increase due to the changes in estimated cash flows had no impact to Exelon's or Generation's Consolidated Statements of Operations and Comprehensive Income.

Nuclear Decommissioning Trust FundInvestments

NDT funds have been established for each generating station unit to satisfy Generation's nuclear decommissioning obligations. NDT funds established for a particular unit may not be used to fund the decommissioning obligations of any other unit.

The NDT funds associated with the former ComEd, former PECO and former AmerGen units have been funded with amounts collected from ComEd customers, PECO customers and the previous owners of the former AmerGen plants, respectively. Based on an ICC order, ComEd ceased collecting amounts from its customers to pay for decommissioning costs. PECO currently collects funds, in revenues, for decommissioning the former PECO nuclear plants through regulated rates, and these collections may continue through the operating lives of the plants. The amounts collected from PECO customers are remitted to Generation and deposited into the NDT funds. Every five years, PECO files a rate adjustment with the PAPUC that reflects PECO's calculations of the estimated amount needed to decommission each of the former PECO units based on updated fund balances and estimated decommissioning costs. The rate adjustment is used to determine the amount collectible from PECO customers. On March 30, 2012, PECO filed its Nuclear Decommissioning Cost Adjustment with the PAPUC proposing an annual recovery from customers of $24 million which, if approved by the PAPUC, will be effective January 1, 2013. This amount reflects a reduction from the current approved annual collections of $29 million.See Note 12 of the Exelon 2011 Form 10-K for information regarding amounts collected from PECO customers for decommissioning costs. See below for discussion of NRC minimum funding requirements.

At March 31, 2012 and December 31, 2011, Exelon and Generation had NDT fund investments totaling $6,927 million and $6,507 million, respectively.The following table provides unrealized gains(losses) on NDT funds for the threemonths ended March 31, 2012 and 2011:

		Three Months Ended
		March 31,
			2012		2011
Net unrealized gains on decommissioning trust funds —
	Regulatory Agreement Units (a)	$	247	$	111
Net unrealized gains on decommissioning trust funds —
	Non-Regulatory Agreement Units (b)(c)		65		43

(a)       Net unrealized gains related to Generation's NDT funds associated with Regulatory Agreement Units are included in regulatory liabilities on Exelon's Consolidated Balance Sheets and noncurrent payables to affiliates on Generation's Consolidated Balance Sheets.

(b)       Excludes $35million and $23 millionof net unrealized gains related to the Zion Station pledged assets for the threemonths ended March 31, 2012 and March 31, 2011, respectively.Net unrealized gainsrelated to Zion Station pledged assets are included in the payable for Zion Station decommissioning on Exelon's and Generation's Consolidated Balance Sheets.

(c)       Net unrealized gains related to Generation's NDT funds associated with Non-Regulatory Agreement Units are included within Other, net in Exelon's and Generation's Consolidated Statements of Operations and Comprehensive Income.

Interest and dividends on NDT fund investments are recognized when earned and are included in Other, net in Exelon's and Generation's Consolidated Statements of Operations and Comprehensive Income. Interest and dividends earned on the NDT fund investments for the Regulatory Agreement Units, which are subject to regulatory accounting, are eliminated within Other, net in Exelon's and Generation's Consolidated Statement of Operations and Comprehensive Income.

See Note 2 of the Exelon 2011 Form 10-Kfor information regarding regulatory liabilities at ComEd and PECO and intercompany balances between Generation, ComEd and PECO reflecting the obligation to refund the customers any decommissioning-related assets in excess of the related decommissioning obligations.

Zion Station Decommissioning.On September 1, 2010, Generation completed an Asset Sale Agreement (ASA) with EnergySolutions Inc. and its wholly owned subsidiaries, EnergySolutions, LLC(EnergySolutions) and ZionSolutions under which ZionSolutions has assumed responsibility for decommissioning Zion Station, which is located in Zion, Illinois and ceased operation in 1998. See Note 12 of the Exelon2011Form 10-K for information regarding the specific treatment of assets, including NDT funds, and decommissioning liabilities transferred in the transaction.On July 14, 2011, three people filed a purported class action lawsuit in the United States District Court for the Northern District of Illinois naming ZionSolutions and Bank of New York Mellon as defendants and seeking, among other things, an accounting for use of NDT funds, an injunction against the use of NDT funds, the appointment of a trustee for the NDT funds, and the return of NDT funds to customers of ComEd to the extent legally entitled thereto.

ZionSolutions is subject to certain restrictions on its ability to request reimbursements from the Zion Station NDT funds as defined withinthe ASA.Therefore, the transfer of the Zion Station assets did not qualify for asset sale accounting treatment and, as a result, the relatedNDT funds were reclassified to pledged assets for Zion Station decommissioning within Generation's and Exelon's Consolidated Balance Sheets and will continue to be measured in the same manner as prior to the completion of the transaction. Additionally, the transferred ARO for decommissioning was replaced with a payable to ZionSolutions in Generation's and Exelon's Consolidated Balance Sheets.Changes in the value of the Zion Station NDT assets, net of applicable taxes, will be recorded as a change in the payable to ZionSolutions. At no point will the payable to ZionSolutions exceed the project budget of the costs remaining to decommission Zion Station. Any Zion Station NDT funds remaining after the completion of all decommissioning activities will be returned to ComEd customers.Generation has retained its obligation to transfer the SNF at Zion Station to the DOE for ultimate disposal and has a liability of approximately $66 million, which is included within the nuclear decommissioning ARO at March 31, 2012.Generation also has retained a requisite level of NDT assets to fund its obligation to maintain and transfer the SNF at Zion Station. As of March 31, 2012, the carrying value of the Zion Station pledged assetsand the payable to Zion Solutions was approximately $708 million and $660 million, respectively. The payable excludes a liability recorded within Generation's Consolidated Balance Sheets related to the tax obligation on the unrealized activity associated with the Zion Station NDT funds. The NDT funds will be utilized to satisfy the tax obligations as gains and losses are realized.The current portion of the payable to ZionSolutions, included in other current liabilities within Generation's Consolidated Balance Sheetsat March 31, 2012 and December 31, 2011 was $86 millionand $128 million, respectively.

NRC Minimum Funding Requirements. NRC regulations require that licensees of nuclear generating facilities demonstrate reasonable assurance that funds will be available in specified minimum amounts to decommission the facility at the end of its life. On March 31, 2011, Generation, in its NRC-required biennial decommissioning funding status report, provided data from which the NRC concluded that the amount of decommissioning funding as of December 31, 2010 for Limerick Unit 1 was less than the amount required by the NRC's regulations. Generation performed the calculations again in early 2012, which reflected that the amount of decommissioning funding as of December 31, 2011 for Limerick Unit 1 was less than the amount required by the NRC's regulations. In February 2012, Generation obtained a parent guarantee in the amount ofapproximately$115 million to cover the NRC minimum funding assurance requirements for Limerick Unit 1 and informed the NRC that it had addressed the minimum funding issues by obtaining the parent guarantee.