Exelon

value driven
Exelon Corporation 06 Summary Annual Report

01

02

08

10

12

14

16

18

20

22

24 

25

26

Introduction

Letter to Shareholders

Exelon’s Vision Statement and Strategic Direction

Value driven to keep the lights on and the gas flowing

Value driven to run our nuclear fleet at world-class levels

Value driven to capitalize on environmental leadership and clean nuclear energy

Value driven to create a challenging and rewarding workplace

Value driven to enhance the value of our generation

Value driven to build value through disciplined financial management

Exelon at a Glance

Strategy and Policy Committee

Board of Directors

Financial Section

“Despite many challenges, we at Exelon have kept our confidence 
in the future.

> We have an experienced management team, focused 

on delivering superior operating performance.

> We have a uniquely positioned generation business, one 
that we expect to drive strong earnings and cash flow.

> We are building healthy, self-sustaining delivery companies,
while managing the transition to competitive procurement.

> We have announced a new value return policy that reflects 
a realignment of our financial policies with the changing 
composition of our earnings.

> We have announced a 10% dividend increase.

> We are redoubling our effort to promote and support

competitive markets.

> We are advancing an environmental strategy that leverages 

our carbon advantage.

> And we are evaluating a variety of growth opportunities.

In short, I have no magic pills or potions – this is still an uncertain world.

But I do have proven judgment, absolute commitment, a talented
team, and what I believe is the best business platform in the industry.”

John W. Rowe / December 12, 2006

John W. Rowe
Chairman, President and CEO

2

To our shareholders

Much has changed this past year, most of it good, some not. In Illinois,
Commonwealth Edison won the right to pass through its cost of 
purchased power to its retail customers, despite a last ditch effort to
extend a ten-year rate freeze in the Illinois legislature. While the issue
seems likely to arise again, ComEd’s success to date is testament to the
strength of the wholesale competitive market, the strength of its legal
position and the tireless efforts of ComEd’s regulatory and legislative
teams. In New Jersey, however, we were obliged to walk away from our
long-pending merger with PSEG, despite its continuing strategic value,
when it became clear that we could not meet the significant financial
demands of state regulators and other government officials.

Yet each of these outcomes, seemingly very different, demonstrates 
the one thing that hasn’t changed here at Exelon. We are value driven.
The same focus and dedication that gave us a successful resolution 
of the rate issue in Illinois compelled us to abandon the merger in New
Jersey. And the same commitment and determination that resulted in 
a stellar operating year at Exelon Generation enabled PECO to install 
a new Common Customer IT system with few complications, while 
successfully dealing with record peak demands and a very demanding
summer storm season. We have never lost sight of our commitment
to deliver superior value to you, our shareholders.

3

As evidence of that commitment, Exelon has again reported improved 

operating earnings for 2006. Thanks primarily to higher generation margins

and continued strong operating performance, our 2006 adjusted (non-GAAP)

operating earnings were nearly $2.2 billion, or $3.22 per diluted share,

a 4 percent increase over comparable earnings in 2005. Over the past six years,

our operating earnings have increased by almost 9 percent a year. Exelon’s

2006 GAAP earnings were $1.6 billion, or $2.35 per diluted share, reflecting 

a further impairment charge to ComEd’s goodwill, this time arising from an

initial unfavorable ruling in last year’s delivery service case.* 

Our continuing success has again made us the most highly valued company

in the industry, with a year-end market capitalization exceeding $41 billion.

Our overall stock price rose by 16 percent over the course of the year, from

$53.14 on December 30, 2005 to $61.89 on December 29, 2006. And our total

return, measured by stock appreciation plus dividend reinvestment, was

approximately 20 percent. All in all, our total return over the past five years

has been 204 percent, far outstripping the performance of the Philadelphia

Utility Index, the S&P 500 Utility Index, and the S&P 500.

And we continue to earn favorable recognition in the media and from 

industry and civic groups. Fortune magazine named Exelon one of America’s

“Most Admired Companies,” and ranked Exelon number one on the electric

and gas utilities industry list, for both 2004 and 2005. We were also recently

named to the Dow Jones Sustainability North America Index and the Carbon

Disclosure Project’s Climate Leadership Index. And due to our diversity efforts,

the Minority Supplier Development Council of Pennsylvania, New Jersey and

Delaware recently named Exelon as the 2006 Corporation of the Year.

Thus, we have kept our commitment to deliver superior value to you, our

shareholders, despite our many challenges. I am very proud of all that we have

accomplished. And I am very grateful to both the Exelon management team,

and our employees, for their dedication and tireless efforts on your behalf.

And I am very grateful 
to both the Exelon 
management team,
and our employees,
for their dedication
and tireless efforts on
your behalf.

*The ICC initially granted only $8.3 million of a requested $317 million increase. On rehearing, the ICC increased the grant
to nearly $83 million, still well short of our original request. For a complete reconciliation of adjusted (non GAAP) operating
earnings to GAAP (accounting principles generally accepted in the United States) earnings, see Exelon’s fourth quarter
earnings release, issued January 24, 2007, posted on the Investor Relations page at www.exeloncorp.com and included
in the 8-K filing with the SEC on that date.

4

value driven operations

As always, our success begins with superior operating performance, particularly

in generation. Our world-class nuclear fleet achieved a 93.9 percent capacity

factor for the year and a summer capacity factor record of 98.1 percent.

No other nuclear fleet has achieved Exelon’s consistent level of excellence 

in capacity factor over the past six years. Our fossil and hydro fleet likewise

ended the year with commercial and equivalent availability factors of 93.5

percent and 95 percent, respectively. This represents the highest commercial

availability ever achieved by our fossil units.

Our power marketing team again excelled in turning our operational prowess

into commercial success. Despite somewhat lower gas and power prices,

and lower load volume, Power Team hedged and optimized our portfolio to

again deliver above budget growth and profitability.

Our delivery companies, ComEd and PECO, have kept the lights on and the

gas flowing, even when confronted with record demands and abnormal storm

activity. They have also continued to improve their overall safety performance,

and reached second quartile in customer satisfaction for the first time ever.

Our finance group continues to ensure that Exelon exercises disciplined

financial management, and has taken steps to align our financial management

policies with the changing profile of the company. We have now adopted a

new value return policy, with a base dividend of $1.76 per share (annualized)

that will grow modestly over time. In the future, excess cash and/or balance

sheet capacity will be returned to shareholders from time to time through

share repurchases. Future dividends and share repurchases are subject to the

approval of our board of directors.

And lastly, our Business Services Group again improved its overall performance

and service levels, delivering quality products and services at the best cost

to all Exelon companies.

5

challenges

Winston Churchill once observed, “Kites rise highest against the wind – not

with it.” Although the past year has presented us with a series of challenges,

we have risen higher by squarely facing those challenges, squarely disclosing

them, and squarely resolving them consistent with our fundamental 

commitment to shareholder value.

Competition

Last year, we faced serious regulatory and legislative challenges in Illinois 

as the transition period under the Illinois Restructuring Act came to an end.

In January 2006, the Illinois Commerce Commission (ICC) unanimously

approved a plan for ComEd to procure power on behalf of its customers

through a reverse auction with the new power supply contracts beginning 

in 2007. The ICC showed great courage approving the auction in the face 

of vocal political opposition. In September 2006, the first Illinois auction 

was successfully conducted, resulting in a 22 percent increase in average 

residential rates. A rate increase was inevitable in the wake of a 20 percent

rate reduction in 1997, a nine-year rate freeze and the recent increase in 

natural gas and oil prices. Even with the increase, customer rates remained

lower than cost based rates that were approved in 1995. But not surprisingly,

there was a legislative effort to freeze rates at the end of the year, even after

ComEd had entered into ICC approved contracts to purchase the power from

the auction winners.

Fortunately, the effort to extend the freeze failed. But many continue to

oppose the auction and the rate increase, and the issue will likely rise again.

In the interim, ComEd has taken steps to help its customers manage the

impact of the rate increase. The ICC has approved ComEd’s residential rate

stabilization plan, which allows residential customers the opportunity to

phase-in rates, if they choose to do so. ComEd is also proactively taking steps

to educate customers on energy efficiency and renewable energy programs

and assistance for low-income customers through the ComEd CARE

(Customers’ Affordable Reliable Energy) program.

Illinois is not alone in revisiting its commitment to competition. Despite 

the demonstrated improvement in operating performance brought on 

by competition, and the documented savings to customers, many national

advocacy groups are now calling for a return to cost-based regulation.

The irony, of course, is that many of today’s critics were in the forefront

of efforts to inject competition into the industry years ago. And while the

early transition to competitive markets was rocky, we have now seen steady

progress throughout the Northeast, the Midwest, and particularly in Illinois.

We at Exelon are deeply committed to wholesale competition, and in the

coming months we intend to redouble our advocacy for the competitive

model, at both the federal and state level.

Winston Churchill 
once observed, “Kites
rise highest against
the wind – not with it.”

6

Climate Change 

We are also dealing with climate change. We believe that global climate

change is real. The scientific evidence strongly suggests that human activity

is warming the planet. And we believe that the time to act is now. Exelon has

already taken voluntary action to reduce our own greenhouse gas emissions

by 8 percent from 2001 levels under the Environmental Protection Agency’s

Climate Leaders Program. We are also actively advocating the passage of

economy-wide mandatory limits at the federal level, both individually and

through our association with the National Commission on Energy Policy 

and the Pew Center on Global Climate Change. We support federal legislation

that will impose either a carbon tax or a cap-and-trade system with a safety

valve to govern economic impact. With our current nuclear fleet, we are 

well positioned to provide environmental leadership into a low-carbon energy

future. And in the future, we intend to expand our low-carbon resource 

portfolio around low or no carbon generation, energy efficiency, demand

management and renewables.

looking forward

I am often asked what our strategy is. The answer is quite simple. Our strategy

is to execute our Vision, in good times and in bad, to protect today’s value,

and to grow long-term value for the future. In the pages that follow we provide

a more detailed look at the Vision, and how its goals drive value, now and in

the future.

In sum, I continue to believe that Exelon has the best platform for confronting

an uncertain future. We have an exceptional generation business, one well

positioned to respond to increasing environmental challenges, and with 

a demonstrated ability to make money when markets are up, or when they

are down. We have a stable and improving delivery business, with a strong

commitment to our customers and the communities we serve. And we have

the balance sheet and the financial discipline to sustain us.

We also have the Vision and the talent to guide that platform. We know

what it takes to be the very best, and we have the proven judgment and the

absolute commitment of a seasoned management team to get us there.

And even more fundamentally, we have a bedrock commitment to value, one

that will see us through our current and future challenges. We are value driven.

John W. Rowe
Chairman, President and CEO 
Exelon Corporation
March 9, 2007

7

our vision
Exelon will be the best group of electric generation and electric
and gas delivery companies in the United States – providing
superior value for our customers, employees, investors and the
communities we serve.

our goals

> Keep the lights on and the gas flowing

> Run the nuclear fleet at world-class levels

> Capitalize on environmental leadership and clean nuclear energy

> Create a challenging and rewarding workplace

> Enhance the value of our generation

> Build value through disciplined financial management

our values

Safety – for our employees, our customers and our communities

Integrity – the highest ethical standards in what we say and what we do

Diversity – in ethnicity, gender, experience and thought

Respect – trust and teamwork through open and honest communication

Accountability – for our commitments, actions and results

Continuous improvement – stretch goals and measured results

8

our strategic direction

protect today’s value

+

grow long-term value

> Deliver superior operating 

performance

> Take the organization to the 
next level of performance

> Support competitive markets

> Protect the value of our 

generation

> Build healthy, self-sustaining

delivery companies

> Align our financial management
policies with the changing profile
of our company

> Rigorously evaluate new growth

opportunities

> Advance an environmental 
strategy that leverages our 
carbon position

“Our strategy is to execute our Vision, in good times and in bad,
to protect today’s value, and to grow long-term value for the future.”

John W. Rowe

9

Value driven to keep the lights on and the gas flowing

Protect today’s value 
First and foremost, we must live up to our commitment to keep the lights on and the gas flowing. Our delivery 
companies must continue to operate safely, reliably and efficiently, and provide superior service to our customers.
They must also secure power supplies for those customers at the best price available in the marketplace.

10

Grow long-term value
Each of our delivery companies must stand on its own feet. For ComEd, this means opposing rate freeze legislation,
seeking regulatory and political solutions that enable it to recover prudently incurred purchased power and delivery
service costs, and putting itself on a path to financial health. For PECO, this means maintaining its strong operating
and financial performance while preparing for its transition to market in 2011.

11

Value driven to run our nuclear fleet
at world-class levels 

Protect today’s value
In 2006, Exelon Nuclear performed at world-class levels. We achieved 
a record summer capacity factor of 98.1 percent, and our fleet-wide
annual capacity factor was 93.9 percent, the sixth consecutive year 
that it has exceeded 92 percent. Our fossil and hydro units also excelled,
with commercial availability factors of 93.5 percent and 95 percent,
respectively.

Grow long-term value
To assure the continued growth of the nuclear industry, we must sustain
and improve our current level of performance, while at the same time
taking concrete steps to bolster public confidence in nuclear power
through greater disclosure and applying the lessons learned from the 
tritium incidents. We must also continue to press for the safe and 
effective storage of spent fuel, and the development of next generation
passive designs.

13

Value driven to capitalize on environmental 
leadership and clean nuclear energy

Protect today’s value
In 2006, Exelon was named to both the Dow Jones Sustainability North
American Index and the Carbon Disclosure Project’s Leadership Index.
We further demonstrated our commitment to environmental leadership
through the design and construction of our new corporate headquarters 
in downtown Chicago. Utilizing existing space, the new facility uses the
latest in environmental and sustainable design to provide employees
with an inviting space in which they can feel positive about their work
environment.

Grow long-term value
As the nation’s largest nuclear generator, Exelon is well positioned to 
provide environmental leadership in a low-carbon energy future. We must
leverage that advantage by providing real and measurable environmental
benefits that also make good business sense. We have already taken 
voluntary action to reduce our greenhouse gas emissions, and we are
active advocates of mandatory federal greenhouse gas regulation. In the
future, we will expand our low-carbon resource portfolio around clean
nuclear energy, natural gas, energy efficiency, demand management
and renewables.

14

Value driven to create a challenging and rewarding workplace

Protect today’s value
Exelon is striving to become a high-performance organization with a strong culture of continuous improvement –
where each employee strives to do his or her best each day, and the organization provides support and opportunity
for diversity and growth. In recognition of our effort, BusinessWeek recently named Exelon one of the 50 Best Places
to Launch a Career.

16

Grow long-term value
We must continue our efforts to create an environment that brings out the best in our employees, while attracting,
developing and retaining top-notch talent. We will do this by focusing on integrating our values of safety, integrity,
diversity, respect, accountability and continuous improvement into a workplace where employees understand how
the work they do links to the Vision and to Exelon’s strategic direction.

17

Value driven to enhance the value of our generation

Protect today’s value
A significant portion of Exelon’s current stock value depends on sustaining market prices for the output of Exelon
Generation’s unregulated nuclear fleet. To protect the value of that fleet, Exelon Generation must continue to 
optimize the generation portfolio and appropriately hedge market risk. It must also oppose regulatory or political
efforts to regulate generation prices, “claw back” unregulated generation profits, or otherwise hinder its ability 
to obtain market prices for its power.

18

Grow long-term value
We are ardent supporters of competitive wholesale markets. We believe that competitive market forces ensure 
the best value for both customers and investors. As the debate over restructuring and competition continues,
we are stepping up our advocacy efforts on a range of issues, including organized markets like PJM and ERCOT 
and competitive procurement approaches like the Illinois auction.

19

Value driven to build value through disciplined
financial management

Protect today’s value
Exelon is transitioning from a more traditional, stable utility to a more
cyclical commodity-driven merchant generator with a sizable utility 
presence. As our business profile changes, its financial characteristics
and value proposition to investors also change. We have recently adopted
a new value return policy, with a base dividend that will grow modestly
over time. In the future, excess cash and/or balance sheet capacity will 
be returned to shareholders from time to time through share repurchases.
Future dividends and share repurchases are subject to the approval of
our board of directors.

Grow long-term value
As we look forward, we are dedicated to growing future value by taking 
the organization to the next level of performance, aligning our financial
policies, evaluating new growth opportunities, and advancing our 
environmental strategy. We must find growth opportunities without
sacrificing financial discipline, without getting hung up in protracted
approval proceedings and without trading too much of today’s earnings
for promised future returns. We are open to a variety of opportunities
that meet these criteria.

21

Exelon at a Glance

comed and peco – energy delivery operations 

In 2006, ComEd and PECO continued sharing best practices
in support of Exelon’s corporate vision of fulfilling com-
mitments, performing at world-class levels, and building
value through disciplined financial management. In this
effort, the utilities improved upon their distinguished 2005
safety performance, reached second quartile in customer
satisfaction for the first time ever, and performed well
during record heat waves and powerful storms.

ComEd
Regulatory activities highlighted ComEd’s year, as a nine-
year rate freeze ended in January 2007 as part of Illinois’
transition to a competitive electric industry. While Illinois’
first ever electricity auction resulted in the lowest avail-
able market price for electricity, there will be a 24 percent
increase on residential customer bills in 2007 due to higher
energy and delivery service costs. Still, ComEd rates will
remain lower than they were in 1995.

To help customers prepare for new rates, ComEd established
the ComEd CARE (Customers’ Affordable Reliable Energy)
program. This initiative includes an optional residential
rate phase in program to pay for the rate increase over time,
special programs to assist low-income customers, and an
energy efficiency campaign to help customers reduce
their energy use and lower their bills. One of this year’s
highlights was CARE’s compact fluorescent light bulb 
program, which provided ComEd customers deep discounts
on more than 1 million energy efficient light bulbs. An
additional 200,000 bulbs were distributed free to low-
income customers.

Extreme summer weather in ComEd’s territory, including
two straight days of record demand, stressed the distribu-
tion system. ComEd received positive comments from
Chicago Mayor Richard M. Daley for its overall perform-
ance and response to outages during the heat wave.
ComEd also received praise from many customers and
area leaders for the utility’s restoration efforts following
especially destructive storms.

PECO
On Jan. 1, 2006, PECO instituted changes to its electric 
distribution, competitive transition and generation
charges, which increased the bundled residential rate by
about 1 cent per kilowatt-hour, or 7.6 percent. The rate
changes were part of a 12-year rate plan approved by the 

22

Pennsylvania Public Utility Commission in 1997. The com-
petitive transition charge (CTC) and generation charges
rose again on Jan. 1, 2007 with no other changes scheduled
through 2010 at which time PECO’s CTC, which provides a
dedicated funding stream for securitization bonds, expires.

For gas customers, lower wholesale costs allowed PECO 
to reduce its purchased gas cost portion of its overall gas
rate in four consecutive quarters. The rate decreases rolled
back sharp increases that took effect in 2005 following
the Gulf of Mexico hurricanes.

Customer outages associated with storms were more than
three times the previous year, and storm-related outages
accounted for roughly half of all customer interruptions.
PECO’s response to the storms was commendable.

One of PECO’s most important strategic projects was the
completion of a new Customer Information Management
System (CIMS), which went live Oct. 16. PECO and ComEd
now operate a common platform for account management,
billing, and other customer service functions. The implemen-
tation involved 350 employees from across PECO, ComEd and
Information Technology, and more than 18 months of plan-
ning and transfer of data from 70 interfacing systems.

Early in 2006, the U.S. Department of Energy’s National
Renewable Energy Laboratory recognized the PECO WIND
program as the 7th largest utility-sponsored renewable
energy program in the country. PECO WIND enrollments
grew 55 percent, to more than 34,000 customers over 
the year, including several municipalities in southeastern
Pennsylvania. Purchases through PECO WIND in 2006 had
an environmental benefit equal to taking 6,500 cars off
the road or planting 7.6 million trees.

By the Numbers
ComEd, with about 5,500 employees, serves 3.8 million
electric customers in Chicago and northern Illinois. PECO
and its 2,100 employees serve about 1.6 million electric
customers and more than 475,000 natural gas customers
in Philadelphia and southeastern Pennsylvania. In 2006,
ComEd and PECO collectively distributed more than 128,000
gigawatt-hours of electricity to customers. PECO provided
more than 76 billion cubic feet of natural gas through
approximately 12,000 miles of pipelines.

exelon generation 

exelon business services company 

Exelon Nuclear, the nation’s largest operator of commercial
nuclear reactors, continued to perform at world-class levels
in 2006. Exelon Nuclear’s owned generation produced
131,385,409 megawatt-hours of electricity in 2006, an all-
time company record. There are 6,800 nuclear professionals
working at Exelon Nuclear. Whether serving at a site or 
at Exelon Nuclear’s headquarters in Warrenville, Ill., these
professionals implement industry best practices to ensure
safe, reliable operation throughout the fleet. With 10 
generating stations and 17 reactors in the Midwest and
Mid-Atlantic regions, Exelon Nuclear also achieved a record
summer capacity factor of 98.1 percent and an overall
capacity factor of 93.9 percent, both well above the industry
average. Exelon Nuclear continued its industry leadership
in well-executed planned outages, completing 10 refueling
outages in an average of 24 days, versus an industry aver-
age of 39 days. Exelon Nuclear generation performance
was enhanced by continued focus on equipment reliability,
resulting in the fleet’s best-ever forced loss rate.

Exelon Power’s fleet of fossil and hydroelectric units in
Illinois, Maryland, Massachusetts, Pennsylvania and Texas
provided more than 14,966,280 megawatt-hours of reliable
generation in 2006. With 113 units at 23 different sites,
Exelon Power can provide more than 8,000 megawatts 
of safe, efficient and environmentally responsible base
load, intermediate, and peak power generation. Over the
past few years, Exelon Power has made great strides in
optimizing the performance of its units and maintenance
programs while continuing to perform safely to provide
the company with the right power, at the right time, and
at the right price.

Exelon Power Team is the power marketing division of
Exelon, whose role it is to manage the risk and maximize
the economic value associated with Exelon’s electric 
generating facilities, fuel requirements, emission credits,
transmission contracts and load obligations. Power Team’s
wholesale marketing and transaction efforts are focused
on the electricity markets in several regions of the United
States: the Mid-Atlantic, the Midwest, the Northeast, the
Southwest and Texas. Power Team’s retail electric and gas
marketing, sales and operations are focused in the Midwest.
Power Team’s trade floor and headquarters are located 
in Kennett Square, Pennsylvania, with retail offices in Ohio
and Illinois.

Exelon Business Services Company (EBSC) is a direct, wholly
owned subsidiary of Exelon Corporation that serves as a
strategic partner to provide quality products and services
at the best costs for all Exelon companies. EBSC practice
areas include Communications, Corporate Governance,
Corporate Strategy, Finance, Government & Environmental
Affairs and Public Policy, Human Resources, IT, Legal, Real
Estate, Supply, Commercial Operations such as accounts
payable, payroll and business planning, and Energy Delivery
Shared Services.

EBSC has approximately 1,900 employees in Northern
Illinois, Pennsylvania and at virtually every Exelon business
location, delivering value by providing cost and operating
efficiencies, high-quality service, and developing enterprise-
wide and organization-specific solutions. EBSC partners
closely with Exelon affiliates and external suppliers to
leverage technology and economies of scale to improve
managing costs, quality and efficiencies.

In 2006, EBSC improved its overall performance and service
levels, ranking above industry benchmarks in most areas,
including IT service reliability, legal client satisfaction 
and payroll accuracy, while exceeding demanding cost-
savings targets. The company enabled supply chain savings
of $70 million, surpassing its aggressive target for the
third consecutive year. Importantly, the Diverse Business
Enablement program directed $341 million of Exelon’s
spending on materials and services to minority- and
women-owned businesses.

EBSC also implemented a Common Customer System
across Exelon Energy Delivery for billing and managing
customer information, replacing a legacy application at
PECO, and providing more automated controls and processes
in accordance with Sarbanes-Oxley requirements. Other
highlights include the financial and legal support of Illinois’
first auction for procuring wholesale electricity for ComEd.

To continue to provide exceptional service and unparal-
leled value in 2007, EBSC will focus on providing greater
cost transparency and broadening its benchmarking to
demonstrate the value of its products and services. It also
will support Exelon’s environmental leadership by pursuing
LEED certification for the corporate headquarters.

23

Strategy and Policy Committee

John W. Rowe
Chairman, President
and Chief Executive Officer

Frank M. Clark
Chairman and CEO, ComEd

Ian P. McLean
Executive Vice President, Exelon
and President, Power Team

Randall E. Mehrberg
Executive Vice President,
Chief Administrative Officer,
and Chief Legal Officer

Elizabeth A. Moler
Executive Vice President,
Government and Environmental
Affairs and Public Policy

John L. Skolds
Executive Vice President, Exelon
and President, Exelon Energy
Delivery and President, Exelon
Generation

S. Gary Snodgrass
Executive Vice President
and Chief Human 
Resources Officer

John F. Young
Executive Vice President,
Finance and Markets,
and Chief Financial Officer

24
24

Board of Directors

Edward A. Brennan
Retired Chairman 
and Chief Executive Officer,
Sears, Roebuck and Co.

M. Walter D’Alessio
Vice Chairman,
NorthMarq Capital, Inc.

Nicholas DeBenedictis
Chairman, President
and Chief Executive Officer,
Aqua America, Inc.

Bruce DeMars
Admiral (Retired),
United States Navy

Nelson A. Diaz
Partner,
Blank Rome LLP

Sue L. Gin
Chairman and 
Chief Executive Officer,
Flying Food Group, LLC

Rosemarie B. Greco
Director,
Office of Health Care Reform,
Commonwealth of Pennsylvania

Edgar D. Jannotta
Chairman,
William Blair & Company, LLC

John M. Palms, Ph.D.
Distinguished 
President Emeritus,
University of South Carolina

William C. Richardson, Ph.D.
President and 
Chief Executive Officer Emeritus,
W. K. Kellogg Foundation 

Thomas J. Ridge
Former Secretary,
Department of Homeland
Security, Former Governor 
of Pennsylvania

John W. Rogers, Jr.
Chairman and 
Chief Executive Officer,
Ariel Capital Management LLC

John W. Rowe
Chairman, President and 
Chief Executive Officer,
Exelon Corporation

Ronald Rubin
Chairman and 
Chief Executive Officer,
Pennsylvania Real Estate
Investment Trust

Richard L. Thomas
Retired Chairman,
First Chicago NBD Corporation

25

Financial Section 

27

28

29

32

36

Summary of Earnings and Financial Condition

Stock Performance Graph

Discussion of Financial Results – Exelon 

Discussion of Financial Results – by Business Segment

Condensed Consolidated Financial Statements:

> Consolidated Statements of Operations

> Consolidated Statements of Cash Flows

> Consolidated Balance Sheets

> Consolidated Statements of Changes in Shareholders’ Equity

> Consolidated Statements of Comprehensive Income

42

Management’s Report on Internal Control Over Financial Reporting

Summary of Earnings and Financial Condition

in millions, except for per share data

2006

2005

For the Years Ended December 31,
2002
2003

2004

Statement of Operations data:
Operating revenues
Operating income
Income from continuing operations
Income (loss) from discontinued operations
Income before cumulative effect of changes

in accounting principles

Cumulative effect of changes in accounting principles

(net of income taxes)

Net income (a), (b)

Earnings per average common share (diluted):
Income from continuing operations
Income (loss) from discontinued operations
Cumulative effect of changes in accounting principles

(net of income taxes)

Net income

Dividends per common share

Average shares of common stock outstanding – diluted

$15,655
3,521
$ 1,590
2

$15,357
2,724
951
14

$

$14,133
3,499
$ 1,870
(29)

$15,148
2,409
892
(99)

$

1,592

965

1,841

–

(42)

23

$ 1,592

$

$

$

2.35
–

–

2.35

1.60

676

$

$

$

$

923

$ 1,864

1.40
0.02

$

2.79
(0.04)

(0.06)

1.36

1.60

676

$

$

0.03

2.78

1.26

669

$

$

$

$

$14,060
3,280
$ 1,690
(20)

1,670

(230)

$ 1,440

793

112

905

1.36
(0.15)

$

2.60
(0.03)

0.17

1.38

0.96

657

$

$

(0.35)

2.22

0.88

649

(a) The changes between 2006 and 2005 and between 2005 and 2004 were primarily due to the goodwill impairment charges of $776 million and $1.2 billion in 2006 and

2005, respectively.

(b) Change between 2004 and 2003 was primarily due to the impairment of Boston Generating, LLC long-lived assets of $945 million in 2003.

in millions

Balance Sheet data:
Current assets
Property, plant and equipment, net
Noncurrent regulatory assets
Goodwill (a)
Other deferred debits and other assets

Total assets

2006

2005

2004

2003

December 31,
2002

$ 4,992
22,775
5,808
2,694
8,050

$ 4,637
21,981
4,734
3,475
7,970

$ 3,880
21,482
5,076
4,705
7,867

$ 4,524
20,630
5,564
4,719
6,800

$ 4,096
17,957
6,061
4,992
5,249

$44,319

$42,797

$43,010

$42,237

$38,355

Current liabilities
Long-term debt, including long-term debt to financing trusts (c)
Noncurrent regulatory liabilities
Other deferred credits and other liabilities (b)
Minority interest
Preferred securities of subsidiaries (c)
Shareholders’ equity

$ 5,795
11,911
2,975
13,578
–
87
9,973

$ 6,563
11,760
2,518
12,743
1
87
9,125

$ 4,836
12,148
2,490
13,918
42
87
9,489

$ 5,683
13,489
2,229
12,246
–
87
8,503

$ 5,845
13,127
1,001
9,968
77
595
7,742

Total liabilities and shareholders’ equity

$44,319

$42,797

$43,010

$42,237

$38,355

(a) The changes between 2006 and 2005 and between 2005 and 2004 were primarily due to the goodwill impairment charge of $776 million and $1.2 billion in 2006 and

2005, respectively.

(b) Change between 2006 and 2005 was primarily due to the impact of adopting SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other

Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106, and 132(R)” (SFAS No. 158).

(c) Due to the adoption of Financial Accounting Standards Board (FASB) Interpretation No. (FIN) 46 and FIN 46-R in 2003, the mandatorily redeemable preferred

securities of ComEd and PECO were reclassified as long-term debt to financing trusts in 2003.

EXELON CORPORATION AND SUBSIDIARY COMPANIES

27

Stock Performance Graph

The performance graph below illustrates a five year comparison of cumulative total returns based on an initial investment of

$100 in Exelon Corporation common stock, as compared with the Standard & Poor’s (S&P) 500 Stock Index and the S&P Utility

Index for the period 2001 through 2006.

This performance chart assumes:

(cid:129)

(cid:129)

$100 invested on December 31, 2001 in Exelon Corporation common stock, in the S&P 500 Stock Index and in the S&P

Utility Index; and

All dividends are reinvested.

Comparison of Five-Year Cumulative Return 

D
O
L
L
A
R
S

350

300

250

200

150

100

50

0

12/01

3/02

6/02

9/02

12/02

3/03

6/03

9/03

12/03

3/04

6/04

9/04

12/04

3/05

6/05

9/05

12/05

3/06

6/06

9/06

12/06

Exelon Corporation

S&P 500

S&P Utilities

Exelon Corporation

S&P 500

S&P Utilities

2006

2005

2004

2003

2002

2001

$302.99

$253.08

$203.40

$148.09

$114.04

$100.00

134.96

154.70

116.59

127.89

111.15

109.58

100.27

88.27

77.95

70.06

100.00

100.00

28

EXELON CORPORATION AND SUBSIDIARY COMPANIES

Results of Operations

(Dollars in millions, except for per share data, unless otherwise noted)

Operating revenues

Operating expenses

Purchased power and fuel

Operating and maintenance

Impairment of goodwill

Depreciation and amortization

Taxes other than income

Total operating expenses

Operating income

Other income and deductions

Interest expense

Interest expense to affiliates, net

Equity in losses of unconsolidated affiliates

Other, net

Total other income and deductions

Income from continuing operations before income taxes

Income taxes

Income from continuing operations

Income from discontinued operations, net of income taxes

Income before cumulative effect of a change in accounting principle

Cumulative effect of changes in accounting principles

Net income

Diluted earnings per share

Discussion of Financial Results – Exelon

2006

2005

Favorable
(Unfavorable)
Variance

$15,655

$15,357

$ 298

5,232

3,868

776

1,487

771

5,670

3,694

1,207

1,334

728

12,134

12,633

3,521

2,724

(616)

(264)

(111)

266

(725)

2,796

1,206

1,590

2

1,592

–

(513)

(316)

(134)

134

(829)

1,895

944

951

14

965

(42)

438

(174)

431

(153)

(43)

499

797

(103)

52

23

132

104

901

(262)

639

(12)

627

42

$ 1,592

$

2.35

$

$

923

1.36

$ 669

$0.99

Net Income. Exelon’s net income for 2006 reflects higher realized prices on market sales and increased nuclear output at

Generation; a one-time benefit of approximately $158 million to recover previously incurred severance costs approved by the

December 2006 amended Illinois Commerce Commission (ICC) rate order; a one-time benefit of approximately $130 million to

recover certain costs approved by the July 2006 ICC rate order; a decrease in Generation’s nuclear asset retirement obligation

resulting from changes in management’s assessment of the probabilities associated with the anticipated timing of cash flows to

decommission primarily AmerGen Energy Company, LLC (AmerGen) nuclear plants; unrealized mark-to-market gains;

increased electric revenues at PECO associated with certain authorized rate increases; and increased kWh deliveries,

excluding the effects of weather, reflecting load growth at ComEd and PECO. These increases were partially offset by a $776

million impairment charge associated with ComEd’s goodwill; unfavorable weather conditions in both the ComEd and PECO

service territories; a charge of approximately $55 million for the write-off of capitalized costs associated with the terminated

proposed merger with Public Service Enterprise Group Incorporated (PSEG); increased severance and severance-related

charges; losses from investments in synthetic fuel-producing facilities; increased depreciation and amortization expense,

including competitive transition charges (CTC) amortization at PECO; and higher operating and maintenance expenses

including increased costs associated with storm damage in the PECO service territory, increased nuclear refueling outage

costs,

increased stock-based compensation expense as a result of adopting FASB Statement No. 123 (revised 2004),

EXELON CORPORATION AND SUBSIDIARY COMPANIES

29

Discussion of Financial Results – Exelon

(continued)

“Share-Based Payment” (SFAS No. 123-R), and the impacts of inflation. Exelon’s net income for 2005 reflects an impairment

charge of $1.2 billion associated with ComEd’s goodwill; unrealized mark-to-market losses; losses of $42 million for the

cumulative effect of adopting FIN 47 “Accounting for Conditional Asset Retirement Obligations” (FIN 47);

favorable tax

settlements at Generation and PECO; and gains realized on AmerGen’s decommissioning trust fund investments related to

changes in the investment strategy.

Operating Revenues. Operating revenues increased primarily due to an increase in wholesale and retail electric sales at

Generation due to an increase in market prices; higher nuclear output; electric rate increases at PECO; and higher kWh

deliveries at ComEd and PECO, excluding the effects of weather. These increases were partially offset by unfavorable weather

conditions in the ComEd and PECO service territories.

Purchased Power and Fuel Expense. Purchased power and fuel expense decreased due to lower volumes of power purchased

in the market and decreased fossil generation, partially offset by overall higher market energy prices and higher natural gas

and oil prices. Purchased power represented 20% of Generation’s total supply in 2006 compared to 22% for 2005.

Operating and Maintenance Expense. Operating and maintenance expense increased primarily due to a charge of

approximately $55 million for the write-off of capitalized costs associated with the terminated proposed merger with PSEG;

increased nuclear refueling outage costs;

increased severance and severance-related charges;

increased stock-based

compensation expense as a result of adopting SFAS No. 123-R; and the impacts from inflation. These increases were partially

offset by a one-time benefit of $201 million to recover certain costs approved by the ICC’s July 2006 rate order and the ICC’s

December 2006 amended rate order; the impact of the reduction in Generation’s estimated nuclear asset retirement obligation;

mark-to-market gains associated with Exelon’s investment in synthetic fuel-producing facilities; and a charge for a reserve

recorded by Generation in 2005 for estimated future asbestos-related bodily injury claims.

Impairment of Goodwill. During 2006, ComEd recorded a $776 million impairment charge associated with its goodwill primarily

due to the impacts of the ICC’s July 2006 rate order. During 2005, in connection with the annually required assessment of

goodwill for impairment, ComEd recorded a $1.2 billion charge.

Depreciation and Amortization Expense. Depreciation and amortization expense increased primarily due to additional CTC

amortization at PECO and additional plant placed in service.

Taxes Other Than Income. Taxes other than income increased primarily due to a reduction in 2005 of previously established

real estate tax reserves at PECO and Generation and a net increase in utility revenue taxes at ComEd and PECO in 2006,

partially offset by favorable state franchise tax settlements at PECO in 2006.

Other Income and Deductions. The change in other income and deductions reflects increased interest expense associated with

the debt issued in 2005 to fund Exelon’s voluntary pension contribution; higher interest rates on variable rate debt outstanding;

higher interest expense on Generation’s one-time fee for pre-1983 spent nuclear fuel obligations to the Department of Energy;

an interest payment to the Internal Revenue Service associated with the settlement of a tax matter at Generation; and a

one-time benefit of $87 million approved by the ICC’s July 2006 rate order to recover previously incurred debt expenses to

retire debt early .

Effective Income Tax Rate. The effective income tax rate from continuing operations was 43.1% for 2006 compared to 49.8% for

2005. The goodwill impairment charges increased the effective income tax rate from continuing operations by 9.7% and 22.3%

for 2006 and 2005, respectively. See Note 12 of the Combined Notes to the Consolidated Financial Statements within Exelon’s

2006 Form 10-K for further discussion of the change in the effective income tax rate.

30

EXELON CORPORATION AND SUBSIDIARY COMPANIES

Discussion of Financial Results – Exelon

(continued)

Discontinued Operations. On January 31, 2005, subsidiaries of Generation completed a series of transactions that resulted in

Generation’s sale of its investment in Sithe. In addition, Exelon has sold or wound down substantially all components of

Enterprises. Accordingly, the results of operations and any gain or loss on the sale of these entities have been presented as

discontinued operations within Exelon’s (for Sithe Energies, Inc. (Sithe) and Exelon Enterprises Company, LLC (Enterprises))

and Generation’s (for Sithe) Consolidated Statements of Operations and Comprehensive Income. See Notes 2 and 3 of the

Combined Notes to Consolidated Financial Statements within Exelon’s 2006 Form 10-K for further information regarding the

presentation of Sithe and certain Enterprises businesses as discontinued operations.

The income from discontinued operations decreased by $12 million for 2006 compared to 2005 primarily due to the gain on the

sale of Sithe in 2005 partially offset by an adjustment to the gain on the sale of Sithe in 2006 as a result of the expiration of

certain tax indemnifications.

Cumulative Effect of Changes in Accounting Principles. The cumulative effect of changes in accounting principles reflects the

impact of adopting FIN 47 as of December 31, 2005. See Note 13 of the Combined Notes to Consolidated Financial Statements

within Exelon’s 2006 Form 10-K for further discussion of the adoption of FIN 47.

EXELON CORPORATION AND SUBSIDIARY COMPANIES

31

Discussion of Financial Results – by Business Segment

Results of Operations by Business Segment

The comparisons of 2006 and 2005 operating results and other statistical information set forth below include intercompany

transactions, which are eliminated in Exelon’s consolidated financial statements.

Net Income (Loss) from Continuing Operations by Business Segment

Generation

ComEd

PECO

Other (a)

Total

2006

2005

$1,403

$1,109

(112)

441

(142)

(676)

520

(2)

$1,590

$ 951

Favorable
(Unfavorable)
Variance

$ 294

564

(79)

(140)

$ 639

(a) Other includes corporate operations, shared service entities, including Exelon Business Services Company (BSC), Enterprises, investments in synthetic fuel-producing

facilities and intersegment eliminations.

Net Income (Loss) Before Cumulative Effect of Changes in Accounting Principles by Business Segment

Generation

ComEd

PECO

Other (a)

Total

2006

2005

$1,407

$1,128

(112)

441

(144)

(676)

520

(7)

$1,592

$ 965

Favorable
(Unfavorable)
Variance

$ 279

564

(79)

(137)

$ 627

(a) Other includes corporate operations, shared service entities,

including BSC, Enterprises,

investments in synthetic fuel-producing facilities and intersegment

eliminations.

Net Income (Loss) by Business Segment

Generation

ComEd

PECO

Other (a)

Total

2006

2005

$1,407

$1,098

(112)

441

(144)

(685)

517

(7)

$1,592

$ 923

Favorable
(Unfavorable)
Variance

$ 309

573

(76)

(137)

$ 669

(a) Other includes corporate operations, shared service entities,

including BSC, Enterprises,

investments in synthetic fuel-producing facilities and intersegment

eliminations.

32

EXELON CORPORATION AND SUBSIDIARY COMPANIES

Results of Operations – Generation

Operating revenues

Operating expenses

Purchased power and fuel

Operating and maintenance

Depreciation and amortization

Taxes other than income

Total operating expenses

Operating income

Other income and deductions

Interest expense

Equity in losses of unconsolidated affiliates

Other, net

Total other income and deductions

Income from continuing operations before income taxes

Income taxes

Income from continuing operations

Discontinued operations

Gain on disposal of discontinued operations

Income from discontinued operations

Discussion of Financial Results – Generation

2006

2005

Favorable
(Unfavorable)
Variance

$9,143

$9,046

$ 97

3,978

2,305

279

185

6,747

2,396

4,482

2,288

254

170

7,194

1,852

(159)

(128)

(9)

41

(127)

2,269

866

1,403

4

4

(1)

95

(34)

1,818

709

1,109

19

19

504

(17)

(25)

(15)

447

544

(31)

(8)

(54)

(93)

451

(157)

294

(15)

(15)

279

30

Income before cumulative effect of changes in accounting principles

Cumulative effect of changes in accounting principles

1,407

1,128

–

(30)

Net income

$1,407

$1,098

$ 309

Generation’s net income for 2006 compared to 2005 increased due to higher revenue, net of purchased power and fuel

expense partially offset by higher operating and maintenance expense, higher depreciation expense, higher interest expense

and lower other income. The increase in Generation’s revenue, net of purchased power and fuel expense was due to realized

revenues associated with forward sales contracts entered into in prior periods which were recognized at higher prices,

combined with lower purchased power and fuel expense due to the impact of higher nuclear output. Unlike the energy delivery

business, the effects of unusually warm or cold weather on Generation depend on the nature of its market position at the time of

the unusual weather. Generation’s net income for 2006 and 2005 reflects income from discontinued operations of $4 million and

$19 million (after tax), respectively.

EXELON CORPORATION AND SUBSIDIARY COMPANIES

33

Discussion of Financial Results – ComEd

Results of Operations – ComEd

.

Operating revenues

Operating expenses

Purchased power

Operating and maintenance

Impairment of goodwill

Depreciation and amortization

Taxes other than income

Total operating expense

Operating income (loss)

Other income and deductions

Interest expense, net

Equity in losses of unconsolidated affiliates

Other, net

Total other income and deductions

Income (loss) before income taxes and cumulative effect of a change in accounting

principle

Income taxes

Loss before cumulative effect of a change in accounting principles

Cumulative effect of change in accounting principle

2006

2005

Favorable
(Unfavorable)
Variance

$6,101

$6,264

$(163)

3,292

745

776

430

303

3,520

833

1,207

413

303

5,546

6,276

555

(12)

(308)

(10)

96

(222)

333

445

(112)

–

(291)

(14)

4

(301)

(313)

363

(676)

(9)

228

88

431

(17)

–

730

567

(17)

4

92

79

646

(82)

564

9

Net loss

$ (112)

$ (685)

$ 573

ComEd’s decreased net loss in 2006 compared to 2005 was driven by a smaller impairment of goodwill

in 2006, lower

purchased power expense and one-time benefits associated with reversing previously incurred expenses as a result of the July

2006 and December 2006 ICC rate orders, partially offset by lower operating revenues.

34

EXELON CORPORATION AND SUBSIDIARY COMPANIES

Discussion of Financial Results – PECO

Results of Operations – PECO

Operating revenues

Operating expenses

Purchased power and fuel

Operating and maintenance

Depreciation and amortization

Taxes other than income

Total operating expense

Operating income

Other income and deductions

Interest expense, net

Equity in losses of unconsolidated affiliates

Other, net

Total other income and deductions

Income before income taxes and cumulative effect of a change in accounting principle

Income taxes

Income before cumulative effect of a change in accounting principle

Cumulative effect of a change in accounting principle

Net income

Preferred stock dividends

Net income on common stock

2006

2005

Favorable
(Unfavorable)
Variance

$5,168

$4,910

$ 258

2,702

2,515

628

710

262

4,302

866

(266)

(9)

30

(245)

621

180

441

–

441

4

549

566

231

3,861

1,049

(279)

(16)

13

(282)

767

247

520

(3)

517

4

(187)

(79)

(144)

(31)

(441)

(183)

13

7

17

37

(146)

67

(79)

3

(76)

–

$ 437

$ 513

$ (76)

PECO’s net income in 2006 decreased primarily due to higher CTC amortization and higher operating and maintenance

expense, which reflected higher storm costs. Partially offsetting these factors were higher revenues, net of purchased power

and fuel expense. Higher net revenues reflected certain authorized electric rate increases, including a scheduled CTC rate

increase, partially offset by lower net electric and gas revenues as a result of unfavorable weather relative to the prior year. The

increases in CTC amortization expense and CTC rates were in accordance with PECO’s 1998 restructuring settlement with the

Pennsylvania Public Utility Commission. The increase in CTC amortization expense exceeded the increase in CTC revenues.

EXELON CORPORATION AND SUBSIDIARY COMPANIES

35

Exelon Corporation and Subsidiary Companies

Consolidated Statements of Operations

(in millions, except per share data)

Operating revenues
Operating expenses
Purchased power
Fuel
Operating and maintenance
Impairment of goodwill
Depreciation and amortization
Taxes other than income

Total operating expenses

Operating income

Other income and deductions

Interest expense
Interest expense to affiliates, net
Equity in losses of unconsolidated affiliates
Other, net

Total other income and deductions

Income from continuing operations before income taxes and minority interest
Income taxes

Income from continuing operations before minority interest
Minority interest

Income from continuing operations
Discontinued operations

Loss from discontinued operations (net of taxes of $0, $(3) and $(40), respectively)
Gain on disposal of discontinued operations (net of taxes of $2, $6 and $19,

respectively)

Income (loss) from discontinued operations

Income before cumulative effect of changes in accounting principles
Cumulative effect of changes in accounting principles (net of income taxes of $0, $(27)

and $17, respectively)

Net income

Average shares of common stock outstanding

Basic
Diluted

Earnings per average common share – basic:

Income from continuing operations
Income (loss) from discontinued operations
Cumulative effect of changes in accounting principles

Net income

Earnings per average common share – diluted:

Income from continuing operations
Income (loss) from discontinued operations
Cumulative effect of changes in accounting principles

Net income

Dividends per common share

For the Years Ended December 31,
2004
2005

2006

$15,655

$15,357

$14,133

2,683
2,549
3,868
776
1,487
771

12,134

3,521

(616)
(264)
(111)
266

(725)

2,796
1,206

1,590
–

1,590

(2)

4

2

1,592

3,162
2,508
3,694
1,207
1,334
728

12,633

2,724

(513)
(316)
(134)
134

(829)

1,895
944

951
–

951

(4)

18

14

965

2,709
2,220
3,700
–
1,295
710

10,634

3,499

(471)
(357)
(154)
60

(922)

2,577
713

1,864
6

1,870

(61)

32

(29)

1,841

–

(42)

23

$ 1,592

$

923

$ 1,864

670
676

2.37
–
–

2.37

2.35
–
–

2.35

1.60

$

$

$

$

$

669
676

1.42
0.02
(0.06)

1.38

1.40
0.02
(0.06)

1.36

1.60

$

$

$

$

$

661
669

2.83
(0.04)
0.03

2.82

2.79
(0.04)
0.03

2.78

1.26

$

$

$

$

$

The information in the Consolidated Statements of Operations shown above is a replication of the information in the Consolidated Statements of Operations in Exelon’s
2006 Form 10-K. For complete consolidated financial statements, including notes, please refer to pages 149 through 324 of Exelon’s 2006 Form 10-K filed with the
Securities and Exchange Commission (SEC). See also management’s discussion and analysis of financial condition and results of operation, which includes a discussion
of critical accounting policies and estimates, on pages 62 through 133 of Exelon’s 2006 Form 10-K filed with the SEC.

36

EXELON CORPORATION AND SUBSIDIARY COMPANIES

Exelon Corporation and Subsidiary Companies

Consolidated Statements of Cash Flows

(in millions)
Cash flows from operating activities
Net income
Adjustments to reconcile net income to net cash flows provided by operating activities:

Depreciation, amortization and accretion, including nuclear fuel
Cumulative effect of changes in accounting principles (net of income taxes)
Impairment charges
Deferred income taxes and amortization of investment tax credits
Net realized and unrealized mark-to-market and hedging transactions
Other non-cash operating activities
Changes in assets and liabilities:

Accounts receivable
Inventories
Accounts payable, accrued expenses and other current liabilities
Counterparty collateral asset
Counterparty collateral liability
Income taxes
Pension and non-pension postretirement benefit contributions
Other assets and liabilities

Net cash flows provided by operating activities

Cash flows from investing activities

Capital expenditures
Proceeds from nuclear decommissioning trust fund sales
Investment in nuclear decommissioning trust funds
Acquisitions of businesses, net of cash acquired
Proceeds from sales of investments, long-lived assets and wholly owned subsidiaries, net of

$32 of cash sold during 2005

Change in restricted cash
Other investing activities

Net cash flows used in investing activities

Cash flows from financing activities

Issuance of long-term debt
Retirement of long-term debt
Retirement of long-term debt to financing affiliates
Issuance of short-term debt
Retirement of short-term debt
Change in short-term debt
Dividends paid on common stock
Proceeds from employee stock plans
Purchase of treasury stock
Other financing activities

Net cash flows used in financing activities

Increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period

For the Years Ended December 31,
2004
2005
2006

$ 1,592

$

923

$ 1,864

2,132
–
894
73
(83)
197

(62)
(59)
67
259
172
69
(180)
(236)

4,835

(2,418)
4,793
(5,081)
–

2
(9)
(49)

1,967
42
1,207
493
(30)
423

(279)
(118)
172
(244)
57
138
(2,225)
(379)

2,147

(2,165)
5,274
(5,501)
(97)

107
21
(126)

1,933
(23)
11
202
49
461

(123)
(60)
133
42
31
293
(580)
165

4,398

(1,921)
2,320
(2,587)
–

381
52
16

(2,762)

(2,487)

(1,739)

1,370
(402)
(910)
–
(300)
(685)
(1,071)
184
(186)
11

(1,989)

84
140

224

$

1,788
(508)
(835)
2,500
(2,200)
500
(1,070)
222
(362)
(54)

(19)

(359)
499

232
(1,629)
(728)
–
–
164
(831)
240
(82)
7

(2,627)

32
467

499

$

140

$

The information in the Consolidated Statements of Cash Flows shown above is a replication of the information in the Consolidated Statements of Cash Flows in Exelon’s
2006 Form 10-K. For complete consolidated financial statements, including notes, please refer to pages 149 through 324 of Exelon’s 2006 Form 10-K filed with the SEC.
See also management’s discussion and analysis of financial condition and results of operation, which includes a discussion of critical accounting policies and estimates,
on pages 62 through 133 of Exelon’s 2006 Form 10-K filed with the SEC.

EXELON CORPORATION AND SUBSIDIARY COMPANIES

37

Exelon Corporation and Subsidiary Companies

Consolidated Balance Sheets

(in millions)

Assets

Current assets

Cash and cash equivalents

Restricted cash and investments

Accounts receivable, net

Customer

Other

Mark-to-market derivative assets

Inventories, net, at average cost

Fossil fuel

Materials and supplies

Deferred income taxes

Other

Total current assets

Property, plant and equipment, net

Deferred debits and other assets

Regulatory assets

Nuclear decommissioning trust funds

Investments

Investments in affiliates

Goodwill

Mark-to-market derivative assets

Other

Total deferred debits and other assets

Total assets

December 31,
2005

2006

$

224

$

140

58

49

1,747

462

1,418

1,858

337

916

300

431

–

352

311

351

80

595

4,992

4,637

22,775

21,981

5,808

6,415

643

167

2,694

171

654

4,734

5,585

613

200

3,475

371

1,201

16,552

16,179

$44,319

$42,797

The information in the Consolidated Balance Sheets shown above is a replication of the information in the Consolidated Balance Sheets in Exelon’s 2006 Form 10-K. For
complete consolidated financial statements,
including notes, please refer to pages 149 through 324 of Exelon’s 2006 Form 10-K filed with the SEC. See also
management’s discussion and analysis of financial condition and results of operation, which includes a discussion of critical accounting policies and estimates, on pages
62 through 133 of Exelon’s 2006 Form 10-K filed with the SEC.

38

EXELON CORPORATION AND SUBSIDIARY COMPANIES

Exelon Corporation and Subsidiary Companies

Consolidated Balance Sheets

(in millions)

Liabilities and shareholders’ equity

Current liabilities

Commercial paper and notes payable

Long-term debt due within one year

Long-term debt to ComEd Transitional Funding Trust and PECO Energy Transition Trust due within one

year

Accounts payable

Mark-to-market derivative liabilities

Accrued expenses

Other

Total current liabilities

Long-term debt

Long-term debt due to ComEd Transitional Funding Trust and PECO Energy Transition Trust

Long-term debt to other financing trusts

Deferred credits and other liabilities

Deferred income taxes and unamortized tax credits

Asset retirement obligations

Pension obligations

Non-pension postretirement benefits obligations

Spent nuclear fuel obligation

Regulatory liabilities

Mark-to-market derivative liabilities

Other

Total deferred credits and other liabilities

Total liabilities

Commitments and contingencies

Minority interest of consolidated subsidiaries

Preferred securities of subsidiaries

Shareholders’ equity

Common stock (No par value, 2,000 shares authorized, 670 and 666 shares outstanding at December 31,

2006 and 2005, respectively)

Treasury stock, at cost (13 and 9 shares held at December 31, 2006 and 2005, respectively)

Retained earnings

Accumulated other comprehensive loss, net

Total shareholders’ equity

Total liabilities and shareholders’ equity

December 31,
2005

2006

$

305

248

$ 1,290

407

581

1,382

1,015

1,180

1,084

5,795

8,896

2,470

545

5,424

3,780

747

1,817

950

2,975

78

782

507

1,467

1,282

1,005

605

6,563

7,759

3,456

545

5,078

4,157

268

1,014

906

2,518

522

798

16,553

15,261

34,259

33,584

–

87

1

87

8,314

7,987

(630)

(444)

3,426

3,206

(1,137)

(1,624)

9,973

9,125

$44,319

$42,797

The information in the Consolidated Balance Sheets shown above is a replication of the information in the Consolidated Balance Sheets in Exelon’s 2006 Form 10-K. For
including notes, please refer to pages 149 through 324 of Exelon’s 2006 Form 10-K filed with the SEC. See also
complete consolidated financial statements,
management’s discussion and analysis of financial condition and results of operation, which includes a discussion of critical accounting policies and estimates, on pages
62 through 133 of Exelon’s 2006 Form 10-K filed with the SEC.

EXELON CORPORATION AND SUBSIDIARY COMPANIES

39

Exelon Corporation and Subsidiary Companies

Consolidated Statements of Changes in Shareholders’ Equity

(Dollars in millions, shares in thousands)

Issued
Shares

Common
Stock

Treasury
Stock

Retained
Earnings

Accumulated
Other
Comprehensive
Income (Loss)

Total
Shareholders’
Equity

Balance, December 31, 2003

656,366 $7,347

$

Net income

Long-term incentive plan activity

Employee stock purchase plan issuances

Common stock purchases

Common stock dividends declared

Adjustments to accumulated other comprehensive loss due

to the consolidation of Sithe

Other comprehensive loss, net of income taxes of $(190)

–

10,013

309

–

–

–

–

–

307

10

–

–

–

–

–

–

–

–

(82)

–

`–

–

$ 2,320

$(1,109)

$ 8,558

1,864

–

–

–

(831)

–

–

–

–

–

–

–

(6)

(331)

1,864

307

10

(82)

(831)

(6)

(331)

Balance, December 31, 2004

666,688

7,664

(82)

3,353

(1,446)

9,489

Net income

Long-term incentive plan activity

Employee stock purchase plan issuances

Common stock purchases

Common stock dividends declared

Other comprehensive loss, net of income taxes of $(127)

–

8,862

259

–

–

–

–

311

12

–

–

–

–

–

–

(362)

–

–

Balance, December 31, 2005

675,809

7,987

(444)

Net income

Long-term incentive plan activity

Employee stock purchase plan issuances

Common stock purchases

Common stock dividends declared

Adjustment to initially apply SFAS No. 158, net of income

taxes of $773

Other comprehensive income, net of income taxes of $1,179

–

6,385

280

–

–

–

–

–

313

14

–

–

–

–

–

–

–

(186)

–

–

–

923

–

–

–

(1,070)

–

–

–

–

–

–

(178)

3,206

1,592

–

–

–

(1,372)

(1,624)

–

–

–

–

–

–

–

(1,302)

1,789

923

311

12

(362)

(1,070)

(178)

9,125

1,592

313

14

(186)

(1,372)

(1,302)

1,789

Balance, December 31, 2006

682,474 $8,314

$(630) $ 3,426

$(1,137)

$ 9,973

The information in the Consolidated Statements of Changes in Shareholders’ Equity shown above is a replication of the information in the Consolidated Statements of
Changes in Shareholders’ Equity in Exelon’s 2006 Form 10-K. For complete consolidated financial statements, including notes, please refer to pages 149 through 324 of
Exelon’s 2006 Form 10-K filed with the SEC. See also management’s discussion and analysis of financial condition and results of operation, which includes a discussion
of critical accounting policies and estimates, on pages 62 through 133 of Exelon’s 2006 Form 10-K filed with the SEC.

40

EXELON CORPORATION AND SUBSIDIARY COMPANIES

(in millions)

Net income

Other comprehensive income (loss)

Exelon Corporation and Subsidiary Companies

Consolidated Statements of Comprehensive Income

For the Years Ended December 31,
2004
2005

2006

$1,592

$ 923

$1,864

Minimum pension liability, net of income taxes of $674, $3, and $(228), respectively

1,138

10

(392)

Net unrealized gain (loss) on cash-flow hedges, net of

income taxes of $368, $(133), and $6, respectively

Foreign currency translation adjustment, net of income taxes of $0, $(1), and $1, respectively

Unrealized gain on marketable securities, net of income taxes of

$137, $4, and $31, respectively

State income tax rate alignment

Other comprehensive income (loss)

Comprehensive income

561

–

92

(2)

(199)

(3)

14

–

8

1

52

–

1,789

(178)

(331)

$3,381

$ 745

$1,533

The information in the Consolidated Statements of Comprehensive Income shown above is a replication of
the information in the Consolidated Statements of
Comprehensive Income in Exelon’s 2006 Form 10-K. For complete consolidated financial statements, including notes, please refer to pages 149 through 324 of Exelon’s
2006 Form 10-K filed with the SEC. See also management’s discussion and analysis of financial condition and results of operation, which includes a discussion of critical
accounting policies and estimates, on pages 62 through 133 of Exelon’s 2006 Form 10-K filed with the SEC.

EXELON CORPORATION AND SUBSIDIARY COMPANIES

41

Management’s Report on Internal Control Over Financial Reporting

The management of Exelon Corporation (Exelon) is responsible for establishing and maintaining adequate internal control over

financial reporting. Exelon’s internal control over financial reporting is a process designed to provide reasonable assurance

regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance

with accounting principles generally accepted in the United States of America.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,

projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate

because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Exelon’s management conducted an assessment of the effectiveness of Exelon’s internal control over financial reporting as of

December 31, 2006. In making this assessment, management used the criteria in Internal Control – Integrated Framework

issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment,

Exelon’s management concluded that, as of December 31, 2006, Exelon’s internal control over financial reporting was effective.

February 13, 2007

Information Derived from 2006 Form 10-K

We have presented a condensed discussion of financial results, excerpts from our consolidated financial statements and a

copy of our Management’s Report on Internal Control Over Financial Reporting in this summary annual report. A complete

discussion of our financial results and our complete consolidated financial statements, including notes, appears on pages 62

through 324 of our Form 10-K annual report for the year ended December 31, 2006. That annual report was filed with the

Securities and Exchange Commission on February 13, 2007 and can be viewed and retrieved through the Commission’s web

site at www.sec.gov or our web site at www.exeloncorp.com.

Our independent registered public accounting firm, PricewaterhouseCoopers LLP, issued a report dated February 13, 2007 on

their integrated audit of our consolidated financial statements and our internal controls over financial reporting. In their report

they expressed an unqualified opinion that those consolidated financial statements present fairly, in all material respects, the

financial position of Exelon Corporation and its subsidiaries at December 31, 2006 and 2005 and the results of their operations

and their cash flows for each of the three years in the period ended December 31, 2006 in conformity with accounting

principles generally accepted in the United States of America. They also expressed an unqualified opinion that Exelon’s

assessment, included in Management’s Report on Internal Controls Over Financial Reporting, that Exelon maintained effective

internal control over financial reporting as of December 31, 2006, based on criteria established in Internal Control – Integrated

Framework issued by COSO, is fairly stated, in all material respects. Furthermore, they expressed an unqualified opinion that

Exelon maintained, in all material respects, effective internal control over financial reporting as of December 31, 2006, based on

criteria established in Internal Control – Integrated Framework issued by the COSO. The full text of PricewaterhouseCoopers

LLP’s report can be found on pages 150 and 151 of our 2006 Form 10-K.

Certifications

The CEO of Exelon has made the required annual certifications for 2006 to the New York Stock Exchange and the Philadelphia

Stock Exchange that Exelon is in compliance with the listing standards of those exchanges. The CEO and CFO have filed with

the SEC all required certifications under section 302 of the Sarbanes-Oxley Act of 2002. These certifications are filed as

Exhibits 31-1 and 31-2 to Exelon’s 2006 Form 10-K.

42

EXELON CORPORATION AND SUBSIDIARY COMPANIES

corporate profile

Exelon Corporation is one of the nation’s largest electric utilities with approximately 5.8 million customers and more than
$15 billion in annual revenues. The company has one of the industry’s largest portfolios of electricity generation capacity,
with a nationwide reach and strong positions in the Midwest and Mid-Atlantic. Exelon distributes electricity to approximately
5.4 million customers in Northern Illinois and Pennsylvania and gas to more than 475,000 customers in Southeastern
Pennsylvania. Exelon is headquartered in Chicago and trades on the NYSE under the ticker symbol EXC.

investor and general information

Corporate Headquarters
Exelon Corporation
P.O. Box 805398
Chicago, IL 60680-5398

Investor Relations
312.394.2345

Independent Public Accountants
PricewaterhouseCoopers LLP

Website
www.exeloncorp.com

New York Stock Exchange Listing
EXC

Shareholder Inquiries
Computershare Trust Company, N.A., is Dividend Disbursing Agent, Dividend
Reinvestment Agent and Transfer Agent for all classes of Exelon Corporation Stock.

Should you have questions or requests concerning your account, payment of 
dividends, the dividend reinvestment plan or transfer of stock, you may call 
toll-free, 1.800.626.8729. You may also mail your inquiry to Exelon Corporation 
c/o Computershare Trust Company, N.A., Post Office Box 43069, Providence, RI
02940-3069, www.computershare.com.

The Company had approximately 161,000 holders of record of its common stock
as of December 31, 2006.

The 2006 Form 10-K Annual Report to the Securities and Exchange Commission
was filed on February 13, 2007. To obtain a copy without charge, write to
Katherine K. Combs, Senior Vice President, Corporate Governance, Deputy General
Counsel and Corporate Secretary, Exelon Corporation, Post Office Box 805398,
Chicago, Illinois 60680-5398.

The Company maintains a telephone information service, which enables 
shareholders to obtain currently available information on financial performance,
company news and shareholder services. To use this service, please call our 
toll-free number, 1.866.530.8108.

h
p
a
r
g
o
h
t
i
L
n
o
s
r
e
d
n
A
/
o
e
v
n
e
C

:

g
n
i
t
n
i
r
p
/
y
h
p
a
r
g
o
t
o
h
P
e
r
t
i

i

m
D
©

:
s
o
t
o
h
p
/
.

p
r
o
C
n
o
l
e
x
E

,

y
e
s
s
a
M
a
n
n
o
D
d
n
a
s
i

m
o
o
L

.

E
h
p
a
R

l

:
s
r
e
t
i
r

w
/
.

p
r
o
C
n
o
l
e
x
E

,

.

o
n
a
r
u
T
M
n
y
l
e
m
a
J

:
r
e
t
i
r

w
d
n
a
r
o
t
i
d
e
/
o
g
a
c
i
h
C

,

n
g
i
s
e
D
s
h
p
a
r
g
a
r
a
P

:

n
g
i
s
e
d

Forward Looking Statements
This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to
risks and uncertainties. The factors that could cause actual results to differ materially from these forward-looking statements include those discussed
herein as well as those discussed in (1) Exelon Corporation’s 2006 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note 18; and
(2) other factors discussed in filings with the Securities and Exchange Commission (SEC) by Exelon Corporation, Commonwealth Edison Company,
PECO Energy Company and Exelon Generation Company, LLC (Companies). Readers are cautioned not to place undue reliance on these forward-looking
statements, which apply only as of the date of this presentation. None of the Companies undertakes any obligation to publicly release any revision
to its forward-looking statements to reflect events or circumstances after the date of this presentation.

© 2007 Exelon 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Exelon Corporation
P.O. Box 805398
Chicago, IL 60680-5398
www.exeloncorp.com

©2007 Exelon