8-KOther Events

EXELON CORP 8-K Report, Corporate Update (Feb 25, 2013)

Filed February 25, 2013For Securities:EXC

Summary

This 8-K filing from Exelon Corporation (EXC), dated February 25, 2013, reports on a significant regulatory decision impacting its subsidiary, Baltimore Gas and Electric Company (BGE). The Maryland Public Service Commission (MDPSC) issued an order approving a base rate increase for BGE's electric and gas services. While BGE had requested substantial increases, the MDPSC authorized a lower amount, which will impact the subsidiary's revenue and profitability. Investors should note that the approved rate increases are materially less than what BGE had initially sought. The electric base rate increase was capped at $81 million (about 62% of the $131 million requested), and the gas base rate increase was limited to $32 million (approximately 71% of the $45 million requested). These new rates became effective on February 23, 2013, and will influence BGE's financial performance moving forward. The allowed returns on equity for electric and gas distribution were set at 9.75% and 9.60% respectively.

Key Highlights

  • 1Maryland Public Service Commission (MDPSC) issued Order No. 85374 on February 22, 2013.
  • 2Baltimore Gas and Electric Company (BGE) received authorization for electric and gas base rate increases.
  • 3Approved annual electric base rate increase is $81 million, approximately 62% of the $131 million requested.
  • 4Approved annual gas base rate increase is $32 million, approximately 71% of the $45 million requested.
  • 5The approved electric distribution rate reflects an allowed return on equity of 9.75%.
  • 6The approved gas distribution rate reflects an allowed return on equity of 9.60%.
  • 7New electric and natural gas distribution rates took effect for services rendered on or after February 23, 2013.

Frequently Asked Questions

The main event is the Maryland Public Service Commission's (MDPSC) decision on Baltimore Gas and Electric Company's (BGE) request for electric and gas base rate increases. The MDPSC approved a lower increase than BGE had requested.

BGE was authorized to increase annual electric base rates by no more than $81 million and annual gas base rates by no more than $32 million. These amounts are significantly less than the $131 million and $45 million, respectively, that BGE had requested.

The new electric and natural gas distribution rates became effective for services rendered on or after February 23, 2013.

The MDPSC set the allowed return on equity for the electric distribution rate increase at 9.75% and for the gas distribution rate increase at 9.60%.