Severance (All Registrants)

The Registrants have an ongoing severance plan under which, in general, the longer an employee worked prior to termination the greater the amount of severance benefits. 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 its ongoing severance plan (“one-time termination benefits”), 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.

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, 2018 and 2017, 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:



	Exelon		Generation^(a)		ComEd^(a)		PECO^(a)		BGE^(a)		PHI^(a)		Pepco^(a)		DPL^(a)		ACE^(a)
Three Months Ended
March 31, 2018	$	8	$	2	$	1	$	—	$	1	$	4	$	2	$	1	$	1
March 31, 2017	4		3		1		—		—		—		—		—		—

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(a)	The amounts above for Generation, ComEd, PECO, BGE, and PHI include immaterial amounts billed by BSC the three months ended March 31, 2018 and 2017. Pepco, DPL and ACE include immaterial amounts billed by PHISCO for the three months ended March 31, 2018 and 2017.

Cost Management Program-Related Severance

In August 2015, Exelon announced a cost management program focused on cost savings of approximately $400 million at BSC and Generation. Additionally, in November 2017, Exelon announced a new commitment for an additional $250 million of cost savings, primarily at Generation, to be achieved by 2020. These actions are in response to the continuing economic challenges confronting all parts of Exelon’s business and industry, necessitating continued focus on cost management through enhanced efficiency and productivity. In connection with the program, certain positions have been identified for elimination and severance costs were recognized as both probable and estimable.

While there may be additional position eliminations identified leading to potential severance or other termination benefit changes, Exelon, Generation and BSC intend to manage any staff reductions through natural attrition to the extent possible to minimize impacts on employees. Any additional severance or other termination benefit charges related to this commitment will be recognized when such amounts are considered probable and can be reasonably estimated.

For the three months ended March 31, 2018 and 2017, these costs were immaterial.

Early Plant Retirement-Related Severance (Exelon and Generation)

As a result of the Three Mile Island and Oyster Creek plant retirement decision, Exelon and Generation have recognized severance costs as both probable and estimable. Severance costs will be provided to management employees that are eligible under Exelon’s severance policy and to union employees if specified within the respective collective bargaining agreements, to the extent that those employees are not redeployed to other locations.

The final amount of the severance cost will ultimately depend on the specific employees severed. See Note 8 - Early Plant Retirements for additional information regarding the announced early retirement of TMI and Oyster Creek.

For the three months ended March 31, 2018 and 2017, these costs were immaterial.

Severance Liability

Amounts included in the table below represent the severance liability recorded for employees of each Registrant and exclude amounts included at Exelon and billed through intercompany allocations:




Severance Liability	Exelon			Generation			ComEd			PECO		BGE		PHI			Pepco			DPL		ACE
Balance at December 31, 2017	$	94		$	58		$	3		$	—	$	—	$	20		$	—		$	—	$	—
Severance charges^(a)	9			3			1			—		1		2			1			—		—
Payments	(16		)	(5		)	(1		)	—		—		(6		)	(1		)	—		—
Balance at March 31, 2018	$	87		$	56		$	3		$	—	$	1	$	16		$	—		$	—	$	—

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(a)	Includes salary continuance and health and welfare severance benefits.