Segment Information (All Registrants)

Operating segments for each of the Registrants are determined based on information used by the chief operating decision maker(s) (CODM) in deciding how to evaluate performance and allocate resources at each of the Registrants.

In the first quarter of 2016, following the consummation of the PHI Merger, three new reportable segments were added: Pepco, DPL and ACE. As a result, Exelon has twelve reportable segments, which include ComEd, PECO, BGE, PHI's three reportable segments consisting of Pepco, DPL, and ACE, and Generation’s six reportable segments consisting of the Mid-Atlantic, Midwest, New England, New York, ERCOT and all other power regions referred to collectively as “Other Power Regions”, which includes activities in the South, West and Canada. ComEd, PECO, BGE, Pepco, DPL and ACE each represent a single reportable segment, and as such, no separate segment information is provided for these Registrants. Exelon, ComEd, PECO, BGE, Pepco, DPL and ACE's CODMs evaluate the performance of and allocate resources to ComEd, PECO, BGE, Pepco, DPL and ACE based on net income and return on equity.

Effective with the consummation of the PHI Merger, PHI's reportable segments have changed based on the information used by the CODM to evaluate performance and allocate resources. PHI's reportable segments consist of Pepco, DPL and ACE. PHI's Predecessor periods' segment information was recast in 2016 to conform to the current Exelon presentation. The reclassification of the segment information did not impact PHI's reported consolidated revenues or net income. PHI's CODM evaluates the performance of and allocates resources to Pepco, DPL and ACE based on net income and return on equity.

The basis for Generation's reportable segments is the integrated management of its electricity business that is located in different geographic regions, and largely representative of the footprints of ISO/RTO and/or NERC regions, which utilize multiple supply sources to provide electricity through various distribution channels (wholesale and retail). Generation's hedging strategies and risk metrics are also aligned to these same geographic regions. Descriptions of each of Generation’s six reportable segments are as follows:


•	Mid-Atlantic represents operations in the eastern half of PJM, which includes New Jersey, Maryland, Virginia, West Virginia, Delaware, the District of Columbia and parts of Pennsylvania and North Carolina.

•

Midwest represents operations in the western half of PJM, which includes portions of Illinois, Pennsylvania, Indiana, Ohio, Michigan, Kentucky and Tennessee, and the United States footprint of MISO, excluding MISO’s Southern Region, which covers all or most of North Dakota, South Dakota, Nebraska, Minnesota, Iowa, Wisconsin, the remaining parts of Illinois, Indiana, Michigan and Ohio not covered by PJM, and parts of Montana, Missouri and Kentucky.


•	New England represents the operations within ISO-NE covering the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont.


•	New York represents operations within ISO-NY, which covers the state of New York in its entirety.


•	ERCOT represents operations within Electric Reliability Council of Texas, covering most of the state of Texas.


•	Other Power Regions:

•

South represents operations in the FRCC, MISO’s Southern Region, and the remaining portions of the SERC not included within MISO or PJM, which includes all or most of Florida, Arkansas, Louisiana, Mississippi, Alabama, Georgia, Tennessee, North Carolina, South Carolina and parts of Missouri, Kentucky and Texas. Generation’s South region also includes operations in the SPP, covering Kansas, Oklahoma, most of Nebraska and parts of New Mexico, Texas, Louisiana, Missouri, Mississippi and Arkansas.


•	West represents operations in the WECC, which includes California ISO, and covers the states of California, Oregon, Washington, Arizona, Nevada, Utah, Idaho, Colorado and parts of New Mexico, Wyoming and South Dakota.


•	Canada represents operations across the entire country of Canada and includes AESO, OIESO and the Canadian portion of MISO.

The CODMs for Exelon and Generation evaluate the performance of Generation’s electric business activities and allocate resources based on revenues net of purchased power and fuel expense (RNF). Generation believes that RNF is a useful measurement of operational performance. RNF is not a presentation defined under GAAP and may not be comparable to other companies’ presentations or deemed more useful than the GAAP information provided elsewhere in this report. Generation’s operating revenues include all sales to third parties and affiliated sales to the Utility Registrants. Purchased power costs include all costs associated with the procurement and supply of electricity including capacity, energy and ancillary services. Fuel expense includes the fuel costs for Generation’s owned generation and fuel costs associated with tolling agreements. The results of Generation's other business activities are not regularly reviewed by the CODM and are therefore not classified as operating segments or included in the regional reportable segment amounts. These activities include natural gas, as well as other miscellaneous business activities that are not significant to Generation's overall operating revenues or results of operations. Further, Generation’s unrealized mark-to-market gains and losses on economic hedging activities and its amortization of certain intangible assets and liabilities relating to commodity contracts recorded at fair value from mergers and acquisitions are also excluded from the regional reportable segment amounts. Exelon and Generation do not use a measure of total assets in making decisions regarding allocating resources to or assessing the performance of these reportable segments.

An analysis and reconciliation of the Registrants’ reportable segment information to the respective information in the consolidated financial statements for the years ended December 31, 2017, 2016, and 2015 is as follows:



									Successor
	Generation ^(a)		ComEd		PECO		BGE		PHI ^(e)		Other ^(b)		Intersegment Eliminations			Exelon
Operating revenues^(c):
2017
Competitive businesses electric revenues	$	15,300	$	—	$	—	$	—	$	—	$	—	$	(1,105	)	$	14,195
Competitive businesses natural gas revenues	2,575		—		—		—		—		—		—			2,575
Competitive businesses other revenues	591		—		—		—		—		—		(1		)	590
Rate-regulated electric revenues	—		5,536		2,375		2,489		4,469		—		(29		)	14,840
Rate-regulated natural gas revenues	—		—		495		687		161		—		(10		)	1,333
Shared service and other revenues	—		—		—		—		49		1,831		(1,880		)	—
2016
Competitive businesses electric revenues	$	15,390	$	—	$	—	$	—	$	—	$	—	$	(1,430	)	$	13,960
Competitive businesses natural gas revenues	2,146		—		—		—		—		—		—			2,146
Competitive businesses other revenues	215		—		—		—		—		—		(4		)	211
Rate-regulated electric revenues	—		5,254		2,531		2,609		3,506		—		(31		)	13,869
Rate-regulated natural gas revenues	—		—		463		624		92		—		(13		)	1,166
Shared service and other revenues	—		—		—		—		45		1,648		(1,686		)	7
2015
Competitive businesses electric revenues	$	15,944	$	—	$	—	$	—	$	—	$	—	$	(744	)	$	15,200
Competitive businesses natural gas revenues	2,433		—		—		—		—		—		—			2,433



Competitive businesses other revenues	758			—		—		—		—			—			(1		)	757
Rate-regulated electric revenues	—			4,905		2,486		2,490		—			—			(5		)	9,876
Rate-regulated natural gas revenues	—			—		546		645		—			—			(15		)	1,176
Shared service and other revenues	—			—		—		—		—			1,372			(1,367		)	5
Intersegment revenues^(d):
2017	$	1,110		$	15	$	7	$	16	$	50		$	1,824		$	(3,020	)	$	2
2016	1,428			15		8		21		45			1,647			(3,159		)	5
2015	745			4		2		14		—			1,367			(2,127		)	5
Depreciation and amortization:
2017	$	1,457		$	850	$	286	$	473	$	675		$	87		$	—		$	3,828
2016	1,879			775		270		423		515			74			—			3,936
2015	1,054			707		260		366		—			63			—			2,450
Operating expenses ^(c):
2017	$	17,993		$	4,214	$	2,215	$	2,562	$	3,911		$	1,851		$	(3,026	)	$	29,720
2016	16,856			4,056		2,292		2,683		3,549			1,928			(3,164		)	28,200
2015	16,872			3,889		2,404		2,578		—			1,444			(2,131		)	25,056
Equity in earnings (losses) of unconsolidated affiliates:
2017	$	(33	)	$	—	$	—	$	—	$	—		$	1		$	—		$	(32	)
2016	(25		)	—		—		—		—			1			—			(24		)
2015	(8		)	—		—		—		—			1			—			(7		)
Interest expense, net:
2017	$	440		$	361	$	126	$	105	$	245		$	283		$	—		$	1,560
2016	364			461		123		103		195			290			—			1,536
2015	365			332		114		99		—			123			—			1,033
Income (loss) before income taxes:
2017	$	1,429		$	984	$	538	$	525	$	578		$	(296	)	$	(2	)	$	3,756
2016	873			679		587		468		(58		)	(555		)	(5		)	1,989
2015	1,850			706		521		477		—			(219		)	(5		)	3,330
Income taxes:
2017	$	(1,375	)	$	417	$	104	$	218	$	217		$	294		$	—		$	(125	)
2016	290			301		149		174		3			(156		)	—			761
2015	502			280		143		189		—			(41		)	—			1,073
Net income (loss):
2017	$	2,771		$	567	$	434	$	307	$	362		$	(590	)	$	(2	)	$	3,849
2016	558			378		438		294		(61		)	(398		)	(5		)	1,204
2015	1,340			426		378		288		—			(177		)	(5		)	2,250
Capital expenditures:
2017	$	2,259		$	2,250	$	732	$	882	$	1,396		$	65		$	—		$	7,584
2016	3,078			2,734		686		934		1,008			113			—			8,553
2015	3,841			2,398		601		719		—			65			—			7,624



Total assets:
2017	$	48,387	$	29,726	$	10,170	$	9,104	$	21,247	$	8,618	$	(10,552	)	$	116,700
2016	46,974		28,335		10,831		8,704		21,025		10,369		(11,334		)	114,904

__________

(a)

Generation includes the six reportable segments shown below: Mid-Atlantic, Midwest, New England, New York, ERCOT and Other Power Regions. For the year ended December 31, 2017, intersegment revenues for Generation include revenue from sales to PECO of $138 million, sales to BGE of $388 million, sales to Pepco of $255 million, sales to DPL of $179 million and sales to ACE of $29 million in the Mid-Atlantic region, and sales to ComEd of $121 million in the Midwest region, which eliminate upon consolidation. For the year ended December 31, 2016, intersegment revenues for Generation include revenue from sales to PECO of $290 million and sales to BGE of $608 million in the Mid-Atlantic region, and sales to ComEd of $47 million in the Midwest region, which eliminate upon consolidation. For the Successor period of March 24, 2016 to December 31, 2016, intersegment revenues for Generation include revenue from sales to Pepco of $295 million, sales to DPL of $154 million and sales to ACE of $37 million in the Mid-Atlantic region, which eliminate upon consolidation. For the year ended December 31, 2015, intersegment revenues for Generation include revenue from sales to PECO of $224 million and sales to BGE of $502 million in the Mid-Atlantic region, and sales to ComEd of $18 million in the Midwest region, which eliminate upon consolidation.


(b)	Other primarily includes Exelon’s corporate operations, shared service entities and other financing and investment activities.


(c)	Includes gross utility tax receipts from customers. The offsetting remittance of utility taxes to the governing bodies is recorded in expenses on the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 24 — Supplemental Financial Information for total utility taxes for the years ended December 31, 2017, 2016 and 2015.

(d)

Intersegment revenues exclude sales to unconsolidated affiliates. The intersegment profit associated with Generation’s sale of certain products and services by and between Exelon’s segments is not eliminated in consolidation due to the recognition of intersegment profit in accordance with regulatory accounting guidance. For Exelon, these amounts are included in operating revenues in the Consolidated Statements of Operations and Comprehensive Income.


(e)	Amounts included represent activity for PHI's successor period, March 24, 2016 through December 31, 2017. PHI includes the three reportable segments: Pepco, DPL and ACE. See tables below for PHI's predecessor periods, including Pepco, DPL and ACE, for January 1, 2016 to March 23, 2016 and for the year ended December 31, 2015.

Successor and Predecessor PHI:



	Pepco		DPL		ACE		Other^(b)		Intersegment Eliminations			PHI
Operating revenues^(a):
December 31, 2017 - Successor
Rate-regulated electric revenues	$	2,158	$	1,139	$	1,186	$	—	$	(14	)	$	4,469
Rate-regulated natural gas revenues	—		161		—		—		—			161
Shared service and other revenues	—		—		—		52		(3		)	49
March 24, 2016 to December 31, 2016 - Successor
Rate-regulated electric revenues	$	1,675	$	850	$	989	$	5	$	(13	)	$	3,506
Rate-regulated natural gas revenues	—		92		—		—		—			92
Shared service and other revenues	—		—		—		45		—			45
January 1, 2016 to March 23, 2016 - Predecessor
Rate-regulated electric revenues	$	511	$	279	$	268	$	42	$	(4	)	$	1,096
Rate-regulated natural gas revenues	—		56		—		1		—			57
Shared service and other revenues	—		—		—		—		—			—
December 31, 2015 - Predecessor
Rate-regulated electric revenues	$	2,129	$	1,138	$	1,295	$	210	$	(2	)	$	4,770
Rate-regulated natural gas revenues	—		164		—		1		—			165
Shared service and other revenues	—		—		—		—		—			—
Intersegment revenues:
December 31, 2017 - Successor	$	6	$	8	$	2	$	53	$	(19	)	$	50
March 24, 2016 to December 31, 2016 - Successor	4		5		2		47		(13		)	45



January 1, 2016 to March 23, 2016 - Predecessor	1		2			1			—			(4		)	—
December 31, 2015 - Predecessor	5		6			4			—			(15		)	—
Depreciation and amortization:
December 31, 2017 - Successor	$	321	$	167		$	146		$	42		$	(1	)	$	675
March 24, 2016 to December 31, 2016 - Successor	224		120			128			43			—			$	515
January 1, 2016 to March 23, 2016 - Predecessor	71		37			37			11			(4		)	$	152
December 31, 2015 - Predecessor	256		148			175			45			—			$	624
Operating expenses:
December 31, 2017 - Successor	$	1,760	$	1,071		$	1,029		$	68		$	(17	)	$	3,911
March 24, 2016 to December 31, 2016 - Successor	1,577		952			1,000			33			(13		)	$	3,549
January 1, 2016 to March 23, 2016 - Predecessor	443		284			251			73			(3		)	$	1,048
December 31, 2015 - Predecessor	1,790		1,137			1,161			220			—			$	4,308
Interest expense, net:
December 31, 2017 - Successor	$	121	$	51		$	61		$	13		$	(1	)	$	245
March 24, 2016 to December 31, 2016 - Successor	98		38			47			12			—			$	195
January 1, 2016 to March 23, 2016 - Predecessor	29		12			15			11			(2		)	$	65
December 31, 2015 - Predecessor	124		50			64			43			(1		)	$	280
Income (loss) before income taxes:
December 31, 2017 - Successor	$	310	$	192		$	103		$	377		$	(404	)	$	578
March 24, 2016 to December 31, 2016 - Successor	36		(30		)	(51		)	(84		)	71			$	(58	)
January 1, 2016 to March 23, 2016 - Predecessor	47		43			5			59			(118		)	$	36
December 31, 2015 - Predecessor	289		125			73			23			(29		)	$	481
Income taxes:
December 31, 2017 - Successor	$	105	$	71		$	26		$	15		$	—		$	217
March 24, 2016 to December 31, 2016 - Successor	26		5			(5		)	(23		)	—			$	3
January 1, 2016 to March 23, 2016 - Predecessor	15		17			1			(16		)	—			$	17
December 31, 2015 - Predecessor	102		49			33			(48		)	27			$	163
Net income (loss):
December 31, 2017 - Successor	$	205	$	121		$	77		$	(91	)	$	50		$	362
March 24, 2016 to December 31, 2016 - Successor	10		(35		)	(47		)	(34		)	45			$	(61	)
January 1, 2016 to March 23, 2016 - Predecessor	32		26			5			(44		)	—			$	19
December 31, 2015 - Predecessor	187		76			40			25			(1		)	$	327
Capital expenditures:
December 31, 2017 - Successor	$	628	$	428		$	312		$	28		$	—		$	1,396
March 24, 2016 to December 31, 2016 - Successor	489		277			218			24			—			$	1,008



January 1, 2016 to March 23, 2016 - Predecessor	97		72		93		11		—			273
December 31, 2015 - Predecessor	544		352		300		34		—			1,230
Total assets:
December 31, 2017 - Successor	$	7,832	$	4,357	$	3,445	$	10,600	$	(4,987	)	$	21,247
December 31, 2016 - Successor	7,335		4,153		3,457		10,804		(4,724		)	21,025

__________


(a)	Includes gross utility tax receipts from customers. The offsetting remittance of utility taxes to the governing bodies is recorded in expenses on the Registrants’ Consolidated Statements of Operations and Comprehensive Income. See Note 24 — Supplemental Financial Information for total utility taxes for the years ended December 31, 2017, 2016 and 2015.


(b)	Other primarily includes PHI’s corporate operations, shared service entities and other financing and investment activities. For the predecessor periods presented, Other includes the activity of PHI’s unregulated businesses which were distributed to Exelon and Generation as a result of the PHI Merger.

Generation total revenues:



	2017							2016							2015
	Revenues from external customers^(a)		Intersegment revenues			Total revenues		Revenues from external customers^(a)		Intersegment revenues			Total revenues		Revenues from external customers^(a)		Intersegment revenues			Total revenues
Mid-Atlantic	$	5,515	$	25		$	5,540	$	6,212	$	(33	)	$	6,179	$	5,974	$	(74	)	$	5,900
Midwest	4,206		(25		)	4,181		4,402		10			4,412		4,712		(2		)	4,710
New England	2,010		(8		)	2,002		1,778		(9		)	1,769		2,217		(5		)	2,212
New York	1,535		(17		)	1,518		1,198		(42		)	1,156		996		(11		)	985
ERCOT	958		4			962		831		6			837		863		(6		)	857
Other Power Regions	1,076		(27		)	1,049		969		(62		)	907		1,182		(80		)	1,102
Total Revenues for Reportable Segments	$	15,300	$	(48	)	$	15,252	$	15,390	$	(130	)	$	15,260	$	15,944	$	(178	)	$	15,766
Other ^(b)	3,166		48			3,214		2,361		130			2,491		3,191		178			3,369
Total Generation Consolidated Operating Revenues	$	18,466	$	—		$	18,466	$	17,751	$	—		$	17,751	$	19,135	$	—		$	19,135

__________


(a)	Includes all wholesale and retail electric sales to third parties and affiliated sales to the Utility Registrants.

(b)

Other represents activities not allocated to a region. See text above for a description of included activities. Also includes a $38 million decrease to revenues, a $52 million decrease to revenues, and a $7 million increase to revenues for the amortization of intangible assets related to commodity contracts recorded at fair value for the years ended December 31, 2017, 2016, and 2015, respectively, unrealized mark-to-market losses of $131 million, losses of $500 million, and gains of $203 million for the years ended December 31, 2017, 2016, and 2015, respectively, and elimination of intersegment revenues.

Generation total revenues net of purchased power and fuel expense:



	2017							2016							2015
	RNF from external customers^(a)		Intersegment RNF			Total RNF		RNF from external customers^(a)		Intersegment RNF			Total RNF		RNF from external customers^(a)		Intersegment RNF			Total RNF
Mid-Atlantic	$	3,105	$	109		$	3,214	$	3,282	$	35		$	3,317	$	3,556	$	15		$	3,571
Midwest	2,810		10			2,820		2,969		2			2,971		2,912		(20		)	2,892
New England	538		(24		)	514		467		(29		)	438		519		(58		)	461
New York	975		1			976		761		(19		)	742		584		50			634
ERCOT	575		(243		)	332		412		(131		)	281		425		(132		)	293
Other Power Regions	476		(171		)	305		483		(147		)	336		440		(190		)	250
Total Revenues net of purchased power and fuel expense for Reportable Segments	$	8,479	$	(318	)	$	8,161	$	8,374	$	(289	)	$	8,085	$	8,436	$	(335	)	$	8,101
Other ^(b)	297		318			615		547		289			836		678		335			1,013
Total Generation Revenues net of purchased power and fuel expense	$	8,776	$	—		$	8,776	$	8,921	$	—		$	8,921	$	9,114	$	—		$	9,114

__________


(a)	Includes purchases and sales from third parties and affiliated sales to the Utility Registrants.

(b)

Other represents activities not allocated to a region. See text above for a description of included activities. Includes a $54 million decrease in RNF, a $57 million decrease in RNF, and a $8 million increase in RNF for the amortization of intangible assets and liabilities related to commodity contracts for the years ended December 31, 2017, 2016, and 2015, respectively, unrealized mark-to-market losses of $175 million, losses of $41 million, and gains of $257 million for the years ended December 31, 2017, 2016, and 2015, respectively, accelerated nuclear fuel amortization associated with the announced early retirement decision for Clinton and Quad Cities as discussed in Note 8 - Early Nuclear Plant Retirements of $12 million and $60 million for the year ended December 31, 2017 and 2016, and the elimination of intersegment revenues net of purchased power and fuel expense.