Exelon's and ComEd's gross amount of goodwill, accumulated impairment losses and carrying amount of goodwill for the years ended December 31, 2013 and 2012 were as follows:


			Accumulated
	Gross		Impairment		Carrying
	Amount(a)		Losses		Amount

Balance, January 1, 2012	$	4,608	$	1,983	$	2,625

Impairment losses		0		0		0

Balance, December 31, 2013	$	4,608	$	1,983	$	2,625

(a) Reflects goodwill recorded in 2000 from the PECO/Unicom (predecessor parent company of ComEd) merger net of amortization, resolution of tax matters and other non-impairment-related changes as allowed under previous authoritative guidance.

Goodwill is not amortized, but is subject to an assessment for impairment at least annually, or more frequently if events occur or circumstances change that would more likely than not reduce the fair value of the ComEd reporting unit below its carrying amount. Under the authoritative guidance for goodwill, a reporting unit is an operating segment or one level below an operating segment (known as a component) and is the level at which goodwill is tested for impairment. A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and is regularly reviewed by segment management. ComEd has a single operating segment for its combined business. There is no level below this operating segment for which discrete financial information is regularly reviewed by segment management. Therefore, ComEd's operating segment is considered its only reporting unit.

Entities assessing goodwill for impairment have the option of first performing a qualitative assessment before calculating the fair value of the reporting unit (i.e., step one of the two-step fair value based impairment test). If an entity determines, on the basis of qualitative factors, that the fair value of the reporting unit is more likely than not less than the carrying amount, the two-step fair value based impairment test is required. Otherwise, no further testing is required.

If an entity bypasses the qualitative assessment or performs the qualitative assessment, but determines that it is more likely than not that its fair value is less than its carrying amount, a quantitative two-step, fair value based test is performed. The first step compares the fair value of the reporting unit to its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds its fair value, the second step is performed. The second step requires an allocation of fair value to the individual assets and liabilities using purchase price allocation in order to determine the implied fair value of goodwill. If the implied fair value of goodwill is less than the carrying amount, an impairment loss is recorded as a reduction to goodwill and a charge to operating expense. Any goodwill impairment charge at ComEd will affect Exelon's consolidated results of operations.

ComEd's valuation approach is based on a market participant view, pursuant to authoritative guidance for fair value measurement, and utilizes a weighted combination of a discounted cash flow analysis and a market multiples analysis. The discounted cash flow analysis relies on a single scenario reflecting “base case” or “best estimate” projected cash flows for ComEd's business and includes an estimate of ComEd's terminal value based on these expected cash flows using the generally accepted Gordon Dividend Growth formula, which derives a valuation using an assumed perpetual annuity based on the entity's residual cash flows. The discount rate is based on the generally accepted Capital Asset Pricing Model and represents the weighted average cost of capital of comparable companies. The market multiples analysis utilizes multiples of business enterprise value to earnings, before interest, taxes, depreciation and amortization (EBITDA) of comparable companies in estimating fair value. Significant assumptions used in estimating the fair value include discount and growth rates, utility sector market performance and transactions, projected operating and capital cash flows from ComEd's business and the fair value of debt. Management performs a reconciliation of the sum of the estimated fair value of all Exelon reporting units to Exelon's enterprise value based on its trading price to corroborate the results of the discounted cash flow analysis and the market multiple analysis.

2013 Goodwill Impairment Assessments. Management concluded the remeasurement of the like-kind exchange position and the charge to ComEd's earnings in the first quarter of 2013 triggered an interim goodwill impairment assessment and, as a result, ComEd tested its goodwill for impairment as of January 31, 2013. The first step of the interim impairment assessment comparing the estimated fair value of ComEd to its carrying value, including goodwill, indicated no impairment of goodwill; therefore, the second step was not required.

ComEd performed a quantitative assessment as of November 1, 2013, for its 2013 annual goodwill impairment assessment. The first step of the annual impairment assessment comparing the estimated fair value of ComEd to its carrying value, including goodwill, indicated no impairment of goodwill; therefore, the second step was not required.

In both the interim and annual assessments, the discounted cash flow analysis reflected Exelon's indemnity to hold ComEd harmless from any unfavorable impacts of the after-tax interest amounts related to the like-kind exchange position on ComEd's equity. While neither the interim nor the annual assessments indicated an impairment of ComEd's goodwill, certain assumptions used to estimate the fair value of ComEd are highly sensitive to changes. Adverse regulatory actions, such as early termination of EIMA, or changes in significant assumptions, including discount and growth rates, utility sector market performance and transactions, projected operating and capital cash flows from ComEd's business, and the fair value of debt could potentially result in a future impairment of ComEd's goodwill, which could be material. Based on the results of the annual goodwill test performed as of November 1, 2013, the estimated fair value of ComEd would have needed to decrease by more than 10% for ComEd to fail the first step of the impairment test.

Prior Goodwill Impairment Assessments. Management concluded that the May 2012 ICC final Order in ComEd's 2011 formula rate proceeding triggered an interim goodwill impairment assessment and, as a result, ComEd tested its goodwill for impairment as of May 31, 2012. The first step of the interim impairment assessment comparing the estimated fair value of ComEd to its carrying value, including goodwill, indicated no impairment of goodwill; therefore, the second step was not required. ComEd performed a qualitative assessment as of November 1, 2012, for its 2012 annual goodwill impairment assessment and determined that its fair value was not more likely than not less than its carrying value. Therefore, ComEd did not perform a quantitative assessment. As part of its qualitative assessment, ComEd evaluated, among other things, management's best estimate of projected operating and capital cash flows for ComEd's business (including the impacts of the May 2012 Order) as well as changes in certain other market conditions, such as the discount rate and EBITDA multiples.

For discussion surrounding Exelon's and Generation's unamortized energy contracts, trade name and retail relationships recorded in conjunction with the Merger, refer to Note 4 – Merger and Acquisitions.

Exelon's, Generation's and ComEd's other intangible assets, included in unamortized energy contract assets and deferred debits and other assets in their Consolidated Balance Sheets, consisted of the following as of December 31, 2013:

										Estimated amortization expense
		Weighted Average Amortization Years (e)		Gross		Accumulated Amortization		Net		2014		2015		2016		2017		2018
Generation (f)
	Exelon Wind acquisition (a)		18.0	$	224	$	(41)	$	183	$	14	$	14	$	14	$	14	$	14
	Antelope Valley acquisition (b)		25.0		190		(4)		186		8		8		8		8		8
ComEd
	Chicago settlement – 1999 agreement (c)		21.8		100		(76)		24		3		3		3		4		4
	Chicago settlement – 2003 agreement (d)		17.9		62		(38)		24		4		4		4		3		3

Total intangible assets				$	576	$	(159)	$	417	$	29	$	29	$	29	$	29	$	29

(a) In December 2010, Generation acquired all of the equity interests of John Deere Renewables, LLC (later named Exelon Wind), adding 735 MWs of installed, operating wind capacity located in eight states.

(b) Refer to Note 4 – Merger and Acquisitions for additional information regarding Antelope Valley.

(c) In March 1999, ComEd entered into a settlement agreement with the City of Chicago associated with ComEd's franchise agreement. Under the terms of the settlement, ComEd agreed to make payments to the City of Chicago each year from 1999 to 2002. The intangible asset recognized as a result of these payments is being amortized ratably over the remaining term of the franchise agreement, which ends in 2020.

(d) In February 2003, ComEd entered into separate agreements with the City of Chicago and with Midwest Generation, LLC (Midwest Generation). Under the terms of the settlement agreement with the City of Chicago, ComEd agreed to pay the City of Chicago a total of $60 million over a ten-year period, beginning in 2003. The intangible asset recognized as a result of the settlement agreement is being amortized ratably over the remaining term of the City of Chicago franchise agreement, which ends in 2020. As required by the settlement, ComEd also made a payment of $2 million to a third-party on the City of Chicago's behalf. Under the terms of the agreement with Midwest Generation, ComEd received payments of $32 million from Midwest Generation to relieve Midwest Generation's obligation under the 1999 fossil sale agreement with ComEd to build the generation facility in the City of Chicago. The payments received by ComEd, which have been recorded in other long-term liabilities, are being recognized ratably (approximately $2 million annually) as an offset to amortization expense over the remaining term of the franchise agreement.

(e) Weighted-average amortization period was calculated at the date of acquisition for acquired assets or settlement agreement.

(f) Excludes $67 million of other miscellaneous unamortized energy contracts that have been acquired at various points in time.

The following table summarizes the amortization expense related to intangible assets for each of the years ended December 31, 2013, 2012 and 2011:

For the Year Ended December 31,	Exelon		Generation		ComEd

2013	$	27	$	20	$	7
2012		20		13		7
2011		19		12		7

Accounting guidance for business combinations requires that the acquirer must recognize separately identifiable intangible assets in the application of purchase accounting. The valuation of the acquired intangible assets discussed below were estimated by applying the income approach, which is based upon discounted projected future cash flows associated with the respective PPAs. Key assumptions used in the valuation of these intangible assets include forecasted power prices and discount rates. Those measures are based upon certain unobservable inputs, which are considered Level 3 inputs, pursuant to applicable accounting guidance. The intangible assets are amortized as a decrease in operating revenue within Exelon's and Generation's Consolidated Statements of Operations and Comprehensive Income over the term of the underlying PPAs.

Exelon Wind. The output of the acquired wind turbines has been sold under PPA contracts. The excess of the contract price of the PPAs over market prices was recognized as intangible assets at the acquisition date. Generation determined that the estimated acquisition-date fair value of the intangible assets was approximately $224 million, which is recorded in unamortized energy contract assets within Exelon's and Generation's Consolidated Balance Sheets. The intangible assets are amortized on a straight-line basis over the period in which the associated contract revenues are recognized.

Antelope Valley. Upon completion of the development project, all of the output will be sold under a PPA with Pacific Gas & Electric Company. The excess of the contract price of the PPA over forecasted MPR-based market prices was recognized as an intangible asset at the acquisition date. Generation determined that the estimated acquisition-date fair value of the intangible asset was approximately $190 million, which is recorded in unamortized energy contract assets within Exelon's and Generation's Consolidated Balance Sheets. The fair value is amortized over the life of the contract in relation to the present value of the underlying cash flows as of the acquisition date.

Renewable Energy Credits and Alternative Energy Credits (Exelon, Generation, ComEd and PECO).

Exelon's, Generation's, ComEd's and PECO's other intangible assets, included in other current assets and other deferred debits and other assets on the Consolidated Balance Sheets, include RECs (Exelon, Generation and ComEd) and AECs (Exelon and PECO). Revenue for RECs that are part of a bundled power sale is recognized when the power is produced and delivered to the customer. As of December 31, 2013, and 2012, PECO had current AECs of $19 million and $17 million, respectively, and noncurrent AECs of $5 million and $9 million, respectively. As of December 31, 2013, and 2012, Generation had current RECs of $158 million and $61 million, respectively, and noncurrent RECs of $0 million and $45 million, respectively. As of December 31, 2013, and 2012, ComEd, had current RECs of $3 million and $4 million, respectively. See Note 3 - Regulatory Matters and Note 22 - Commitments and Contingencies for additional information on RECs and AECs.