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Severance And Plants Retirements (exelon and Generation)

3 Months Ended

Mar. 31, 2014

Corporate Restructuring and Plant Retirements (Exelon, Generation, ComEd and PECO)

12. Severance (Exelon, Generation, ComEd, PECO and BGE)

The Registrants have an ongoing severance plan under which, in general, employees receive severance benefits based on their years of service. The Registrants record a liability and expense or regulatory asset for severance once terminations are probable of occurrence and the related severance benefits can be reasonably estimated. For severance benefits that are incremental to their ongoing severance plan, the Registrants measure the obligation and record the expense at fair value at the communication date if there are no future service requirements, or, if future service is required to receive the termination benefit, ratably over the required service period.

Merger-Related Severance

Upon closing the merger with Constellation, Exelon recorded a severance accrual for anticipated employee position reductions as a result of the post-merger integration. The majority of these positions are corporate and Generation support positions. Since then, Exelon has identified specific employees to be severed pursuant to the merger-related staffing and selection process as well as employees that were previously identified for severance but have since accepted another position within Exelon and are no longer receiving a severance benefit. Exelon adjusts its accrual each quarter to reflect its best estimate of remaining severance costs.

The amount of severance expense associated with the post-merger integration recognized for the three months ended March 31, 2014 and 2013 is not material. Estimated costs to be incurred after March 31, 2014 are not material.

Amounts included in the table below represent the severance liability recorded by Exelon, Generation, ComEd, PECO and BGE for employees of those Registrants and exclude amounts billed through intercompany allocations:


Severance Liability		Exelon		Generation		ComEd		PECO		BGE
Balance at December 31, 2013	$	53	$	10	$	0	$	0	$	6
Payments		(12)		(1)		0		0		(2)
Balance at March 31, 2014	$	41	$	9	$	0	$	0	$	4

Substantially all cash payments under the plan are expected to be made by the end of 2016.

Ongoing Severance Plans

The Registrants provide severance and health and welfare benefits under Exelon's ongoing severance benefit plans to terminated employees in the normal course of business. These benefits are accrued for when the benefits are considered probable and can be reasonably estimated.

For the three months ended March 31, 2014 and 2013, the Registrants recorded the following severance costs associated with these ongoing severance benefits within operating and maintenance expense in their Consolidated Statements of Operations and Comprehensive Income:

Severance Benefits		Exelon		Generation		ComEd		PECO		BGE
Severance charges - 2014	$	4	$	4	$	0	$	0	$	0
Severance charges - 2013		1		0		1		0		0

The severance liability balances associated with these ongoing severance benefits as of March 31, 2014 and December 31, 2013 are not material.

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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