##### Table of Contents



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
   FORM 10-Q
  þ


QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Quarterly Period Ended June 30, 2006oro


TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934   Name of Registrant; State of Incorporation;

IRS EmployerCommission

Address of Principal Executive Offices; and

IdentificationFile Number

Telephone Number

Number1-16169

EXELON CORPORATION
    (a Pennsylvania corporation)
    10 South Dearborn Street 
    37th Floor
    
    P.O. Box 805379 
    Chicago, Illinois
    60680-5379(312) 394-7398

23-29901901-1839

COMMONWEALTH EDISON COMPANY
    (an Illinois corporation) 
    440 South LaSalle Street
    Chicago, Illinois
    60605-1028(312) 394-4321

36-0938600000-16844

PECO ENERGY COMPANY
    (a Pennsylvania corporation)
    P.O. Box 8699
    2301 Market Street 
    Philadelphia, Pennsylvania
    19101-8699(215) 841-4000

23-0970240333-85496

EXELON GENERATION COMPANY, LLC 
    (a Pennsylvania limited liability company) 
    300 Exelon Way 
    Kennett Square, Pennsylvania 19348(610) 765-6900

23-3064219   þ o
    Exelon Corporation Common Stock,
    without par value

669,489,140Commonwealth Edison Company Common
    Stock, $12.50 par value

127,016,519PECO Energy Company Common Stock,
    without par value

170,478,507Exelon Generation Company, LLC

not applicable   Rule 12b-2
  Large Accelerated Filer

Accelerated Filer

Non-accelerated FilerExelon Corporation


üCommonwealth Edison Company










üPECO Energy Company










üExelon Generation Company, LLC










ü   Rule 12b-2 o þ




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##### Table of Contents



TABLE OF
    CONTENTS
  
  Page No.FILING
    FORMAT


3FORWARD-LOOKING
    STATEMENTS


3WHERE TO FIND
    MORE INFORMATION


3PART I.

FINANCIAL
    INFORMATION


4ITEM 1.

FINANCIAL
    STATEMENTS


4Exelon
    CorporationConsolidated
    Statements of Income and Comprehensive Income


5Consolidated
    Statements of Cash Flows


6Consolidated
    Balance Sheets


7Consolidated
    Statement of Changes in Shareholders Equity


9Commonwealth Edison
    CompanyConsolidated
    Statements of Income and Comprehensive Income


10Consolidated
    Statements of Cash Flows


11Consolidated
    Balance Sheets


12Consolidated
    Statement of Changes in Shareholders Equity


14PECO Energy
    CompanyConsolidated
    Statements of Income and Comprehensive Income


15Consolidated
    Statements of Cash Flows


16Consolidated
    Balance Sheets


17Consolidated
    Statement of Changes in Shareholders Equity


19Exelon Generation
    Company, LLCConsolidated
    Statements of Income and Comprehensive Income


20Consolidated
    Statements of Cash Flows


21Consolidated
    Balance Sheets


22Consolidated
    Statement of Changes in Members Equity


24Combined Notes to
    Consolidated Financial Statements


25ITEM 2.

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
    CONDITION AND RESULTS OF OPERATIONS


77Exelon
    Corporation


77Commonwealth
    Edison Company


127PECO Energy
    Company


128Exelon Generation
    Company, LLC


130ITEM 3.

QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


132ITEM 4.

CONTROLS AND
    PROCEDURES


138PART II.

OTHER
    INFORMATION


138ITEM 1.

LEGAL
    PROCEEDINGS


138ITEM 1A.

RISK
    FACTORS


138ITEM 2.

UNREGISTERED
    SALES OF EQUITY SECURITIES AND USE OF PROCEEDS


139ITEM 4.

SUBMISSION OF
    MATTERS TO VOTE OF SECURITY HOLDERS


140ITEM 5.

OTHER
    INFORMATION


140 1




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##### Table of Contents



Page No.ITEM 6.

EXHIBITS


141SIGNATURES


142Exelon
    Corporation


142Commonwealth Edison
    Company


142PECO Energy
    Company


143Exelon Generation
    Company, LLC


143CERTIFICATION
    EXHIBITS


144Exelon Corporation


144,152Commonwealth Edison Company


146,154PECO Energy Company


148,156Exelon Generation Company, LLC


150,158CertificationCertificationCertificationCertificationCertificationCertificationCertificationCertificationCertificationCertificationCertificationCertificationCertificationCertificationCertificationCertification   2




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##### Table of Contents



FILING
    FORMAT  Form 10-Q
 FORWARD-LOOKING
    STATEMENTS  Form 10-K:
 WHERE TO
    FIND MORE INFORMATION  1-800-SEC-0330. www.sec.gov www.exeloncorp.com
 3




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##### Table of Contents



PART I. FINANCIAL
    INFORMATION Item 1.  Financial
    Statements  4




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##### Table of Contents



EXELON
    CORPORATION  EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENTS OF INCOME AND
    COMPREHENSIVE INCOME
 (Unaudited)
  Three Months


Six MonthsEnded June 30,


Ended June 30,(In millions, except per share data)

2006


2005


2006


2005Operating revenues

$
3,697


$
3,484


$
7,559


$
7,045Operating expensesPurchased power


571



663



1,096



1,232Fuel


502



493



1,438



1,115Operating and maintenance


881



929



1,906



1,877Depreciation and amortization


371



325



735



644Taxes other than income


170



177



364



349Total operating expenses


2,495



2,587



5,539



5,217Operating income


1,202



897



2,020



1,828Other income and
    deductionsInterest expense


(154
)


(129
)


(306
)


(235
)Interest expense to affiliates


(68
)


(81
)


(139
)


(164
)Distributions on preferred
    securities of subsidiaries


(1
)


(1
)


(2
)


(2
)Equity in losses of unconsolidated
    affiliates


(22
)


(32
)


(61
)


(68
)Other, net


47



69



93



99Total other income and deductions


(198
)


(174
)


(415
)


(370
)Income from continuing
    operations before income taxes


1,004



723



1,605



1,458Income taxes


363



207



564



435Income from continuing
    operations


641



516



1,041



1,023Discontinued
    operationsLoss from discontinued operations
    (net of taxes of $0 and $(3) for the three and six months ended
    June 30, 2005, respectively)






(1
)






(3
)Gain (loss) on disposal of
    discontinued operations (net of taxes of $2, $(1), $2 and $4 for
    the three and six months ended June 30, 2006 and 2005,
    respectively)


3



(1
)


3



15Income (loss) from discontinued
    operations


3



(2
)


3



12Net income


644



514



1,044



1,035Other comprehensive income
    (loss), net of income taxesMinimum pension liability














2Change in unrealized gain (loss) on
    cash-flow hedges


140



(31
)


232



(133
)Unrealized gain (loss) on
    marketable securities


(13
)


(9
)


15



(24
)Other comprehensive income (loss)


127



(40
)


247



(155
)Comprehensive income

$
771


$
474


$
1,291


$
880Average shares of common stock
    outstanding:Basic


670



670



669



669Diluted


676



677



675



676Earnings per average common
    share  basic:Income from continuing operations

$
0.96


$
0.77


$
1.56


$
1.53Income from discontinued operations














0.02Net income

$
0.96


$
0.77


$
1.56


$
1.55Earnings per average common
    share  diluted:Income from continuing operations

$
0.95


$
0.76


$
1.55


$
1.51Income from discontinued operations














0.02Net income

$
0.95


$
0.76


$
1.55


$
1.53Dividends per common
    share

$
0.40


$
0.40


$
0.80


$
0.80    5




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EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited)
  For the Six Months Ended June 30,(In millions)

2006


2005Cash flows from operating
    activitiesNet income

$
1,044


$
1,035Adjustments to reconcile net income
    to net cash flows provided by operating activities:Depreciation, amortization and
    accretion, including nuclear fuel


1,060



961Deferred income taxes and
    amortization of investment tax credits


(81
)


528Provision for uncollectible accounts


42



22Equity in losses of unconsolidated
    affiliates


61



68Gain on sales of investments and
    wholly owned subsidiaries


(2
)


(17
)Net realized (gains) losses on
    nuclear decommissioning trust funds


11



(55
)Other decommissioning-related
    activities


(149
)


13Impairment charges


117



Other non-cash operating activities


32



27Changes in assets and liabilitiesAccounts receivable


230



53Inventories


11



26Other current assets


(136
)


(136
)Accounts payable, accrued expenses
    and other current liabilities


(406
)


(211
)Counterparty collateral asset


178



(20
)Counterparty collateral liability


5



7Income taxes


300



24Net realized and unrealized
    mark-to-market
    and hedging transactions


(69
)


(74
)Pension and non-pension
    postretirement benefits


99



(1,927
)Other noncurrent assets and
    liabilities


(159
)


(38
)Net cash flows provided by
    operating activities


2,188



286Cash flows from investing
    activitiesCapital expenditures


(1,156
)


(1,007
)Proceeds from nuclear
    decommissioning trust fund sales


2,554



2,149Investment in nuclear
    decommissioning trust funds


(2,706
)


(2,256
)Acquisitions of businesses, net of
    cash acquired






(97
)Proceeds from sales of investments
    and wholly owned subsidiaries, net of $32 of cash sold during
    the six months ended June 30, 2005


1



103Investments in synthetic
    fuel-producing facilities


(53
)


(56
)Change in restricted cash


1



23Other investing activities


(1
)


(2
)Net cash flows used in investing
    activities


(1,360
)


(1,143
)Cash flows from financing
    activitiesIssuance of long-term debt


326



1,788Retirement of long-term debt


(34
)


(185
)Retirement of long-term debt to
    financing affiliates


(422
)


(397
)Issuance of short-term debt






2,500Retirement of short-term debt






(2,200
)Change in other short-term debt


(106
)


(161
)Dividends paid on common stock


(535
)


(535
)Proceeds from employee stock plans


107



156Purchase of treasury stock


(53
)


(8
)Other financing activities


31



(55
)Net cash flows provided by (used
    in) financing activities


(686
)


903Increase in cash and cash
    equivalents


142



46Cash and cash equivalents at
    beginning of period


140



499Cash and cash equivalents at end
    of period

$
282


$
545    6




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
 CONSOLIDATED BALANCE SHEETS
 (Unaudited)
  June 30,


December 31,(In millions)

2006


2005ASSETSCurrent assetsCash and cash equivalents

$
282


$
140Restricted cash and investments


48



49Accounts receivable, netCustomer


1,609



1,858Other


265



337Mark-to-market
    derivative assets


737



916Inventories, at average costFossil fuel


282



311Materials and supplies


381



351Deferred income taxes


114



80Other


540



595Total current assets


4,258



4,637Property, plant and equipment,
    net


22,122



21,981Deferred debits and other
    assetsRegulatory assets


4,093



4,386Nuclear decommissioning trust funds


5,809



5,585Investments


819



813Goodwill


3,476



3,475Mark-to-market
    derivative assets


586



371Prepaid pension asset


374



377Other


753



824Total deferred debits and other
    assets


15,910



15,831Total assets

$
42,290


$
42,449    7




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    CONSOLIDATED BALANCE SHEETS
    (Unaudited)
  June 30,


December 31,(In millions)

2006


2005LIABILITIES AND
    SHAREHOLDERS EQUITYCurrent liabilitiesCommercial paper and notes payable

$
1,184


$
1,290Long-term debt due within one year


554



407Long-term debt to ComEd
    Transitional Funding Trust and PECO EnergyTransition Trust due within one
    year


577



507Accounts payable


1,195



1,467Mark-to-market
    derivative liabilities


885



1,282Accrued expenses


1,070



1,005Other


838



605Total current liabilities


6,303



6,563Long-term debt


7,904



7,759Long-term debt to ComEd
    Transitional Funding Trust and PECOEnergy Transition
    Trust


2,963



3,456Long-term debt to other
    financing trusts


545



545Deferred credits and other
    liabilitiesDeferred income taxes


4,957



4,816Unamortized investment tax credits


256



262Asset retirement obligations


3,676



4,157Pension obligations


292



268Non-pension postretirement benefit
    obligations


1,086



1,014Spent nuclear fuel obligation


926



906Regulatory liabilities


2,293



2,170Mark-to-market
    derivative liabilities


504



522Other


763



798Total deferred credits and other
    liabilities


14,753



14,913Total liabilities


32,468



33,236Commitments and
    contingenciesMinority interest of
    consolidated subsidiaries






1Preferred securities of
    subsidiaries


87



87Shareholders
    equityCommon stock (No par value,
    2,000 shares authorized, 669.5 and 666.4 shares
    outstanding at June 30, 2006 and December 31, 2005,
    respectively)


8,166



7,987Treasury stock, at cost (10.4 and
    9.4 shares held at June 30, 2006 and December 31,
    2005, respectively)


(497
)


(444
)Retained earnings


3,443



3,206Accumulated other comprehensive
    loss


(1,377
)


(1,624
)Total shareholders equity


9,735



9,125Total liabilities and
    shareholders equity

$
42,290


$
42,449    8




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENT OF CHANGES IN
    SHAREHOLDERS EQUITY
 (Unaudited)
  AccumulatedOther


Total(Dollars in millions,

Issued


Common


Treasury


Retained


Comprehensive


Shareholdersshares in thousands)

Shares


Stock


Stock


Earnings


Loss


EquityBalance, December 31,
    2005


675.8


$
7,987


$
(444
)

$
3,206


$
(1,624
)

$
9,125Net income














1,044







1,044Long-term incentive plan activity


4.1



179















179Common stock purchases










(53
)










(53
)Common stock dividends declared














(807
)






(807
)Other comprehensive income, net of
    income taxes of $175


















247



247Balance, June 30,
    2006


679.9


$
8,166


$
(497
)

$
3,443


$
(1,377
)

$
9,735    9




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##### Table of Contents



COMMONWEALTH
    EDISON COMPANY COMMONWEALTH
    EDISON COMPANY AND SUBSIDIARY COMPANIES
    CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
    (Unaudited)  Three Months


Six MonthsEnded June 30,


Ended June 30,(In millions)

2006


2005


2006


2005Operating revenuesOperating revenues

$
1,450


$
1,485


$
2,874


$
2,869Operating revenues from affiliates


3



3



6



6Total operating revenues


1,453



1,488



2,880



2,875Operating expensesPurchased power


81



88



172



156Purchased power from affiliate


685



770



1,456



1,523Operating and maintenance


165



158



329



316Operating and maintenance from
    affiliates


53



44



105



88Depreciation and amortization


106



101



205



198Taxes other than income


71



73



152



151Total operating expenses


1,161



1,234



2,419



2,432Operating income


292



254



461



443Other income and
    deductionsInterest expense


(58
)


(53
)


(114
)


(102
)Interest expense to affiliates


(19
)


(24
)


(39
)


(49
)Equity in losses of unconsolidated
    affiliates


(3
)


(4
)


(5
)


(8
)Interest income from affiliates






1







3Other, net


1



6



1



10Total other income and deductions


(79
)


(74
)


(157
)


(146
)Income before income
    taxes


213



180



304



297Income taxes


86



71



123



118Net income


127



109



181



179Other comprehensive loss, net
    of income taxesChange in unrealized loss on
    cash-flow hedges






(19
)






(21
)Other comprehensive loss






(19
)






(21
)Comprehensive income

$
127


$
90


$
181


$
158    10




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##### Table of Contents



COMMONWEALTH
    EDISON COMPANY AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited)
  For the Six Months Ended June 30,(In millions)

2006


2005Cash flows from operating
    activitiesNet income

$
181


$
179Adjustments to reconcile net
    income to net cash flows provided by (used in) operating
    activities:Depreciation, amortization and
    accretion


205



198Deferred income taxes and
    amortization of investment tax credits


(25
)


230Provision for uncollectible
    accounts


11



12Equity in losses of unconsolidated
    affiliates


5



8Other non-cash operating activities


18



23Changes in assets and liabilitiesAccounts receivable


24



(100
)Inventories


(8
)


1Other current assets


(10
)


(14
)Accounts payable, accrued expenses
    and other current liabilities


(3
)


(27
)Changes in receivables and
    payables to affiliates


33



137Income taxes


100



3Net realized and unrealized
    mark-to-market
    and hedging transactions


7



Pension and non-pension
    postretirement benefits


34



(767
)Other noncurrent assets and
    liabilities


3



(11
)Net cash flows provided by (used
    in) operating activities


575



(128
)Cash flows from investing
    activitiesCapital expenditures


(465
)


(391
)Changes in Exelon intercompany
    money pool contributions






287Change in restricted cash


(1
)


(1
)Other investing activities


5



1Net cash flows used in investing
    activities


(461
)


(104
)Cash flows from financing
    activitiesChanges in short-term debt


(120
)


Issuance of long-term debt


320



91Retirement of long-term debt


(1
)


(146
)Retirement of Exelon intercompany
    money pool borrowings


(140
)


Retirement of long-term debt to
    ComEd Transitional Funding Trust


(174
)


(190
)Dividends paid on common stock






(245
)Contributions from parent






834Other financing activities


(3
)


(5
)Net cash flows provided by (used
    in) financing activities


(118
)


339Increase (decrease) in cash and
    cash equivalents


(4
)


107Cash and cash equivalents at
    beginning of period


38



30Cash and cash equivalents at
    end of period

$
34


$
137    11




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##### Table of Contents



COMMONWEALTH
    EDISON COMPANY AND SUBSIDIARY COMPANIES
 CONSOLIDATED BALANCE SHEETS
 (Unaudited)
  June 30,


December 31,(In millions)

2006


2005ASSETSCurrent assetsCash and cash equivalents

$
34


$
38Restricted cash


1



Accounts receivable, netCustomer


747



806Other


39



46Inventories, at average cost


58



50Deferred income taxes


20



13Receivables from affiliates


16



37Other


44



34Total current assets


959



1,024Property, plant and equipment,
    net


10,194



9,906Deferred debits and other
    assetsInvestments


41



41Investments in affiliates


27



34Goodwill


3,476



3,475Receivables from affiliates


1,529



1,447Prepaid pension asset


926



938Other


347



346Total deferred debits and other
    assets


6,346



6,281Total assets

$
17,499


$
17,211    12




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##### Table of Contents



COMMONWEALTH
    EDISON COMPANY AND SUBSIDIARY COMPANIES
    CONSOLIDATED BALANCE SHEETS
    (Unaudited)
  June 30,


December 31,(In millions)

2006


2005LIABILITIES AND
    SHAREHOLDERS EQUITYCurrent liabilitiesLong-term debt due within one year

$
473


$
328Long-term debt to ComEd
    Transitional Funding Trust due within one year


303



307Accounts payable


192



223Accrued expenses


512



417Payables to affiliates


291



278Commercial paper


339



459Borrowing from Exelon intercompany
    money pool






140Customer deposits


115



110Other


56



46Total current liabilities


2,281



2,308Long-term debt


2,674



2,500Long-term debt to ComEd
    Transitional Funding Trust


510



680Long-term debt to other
    financing trusts


361



361Deferred credits and other
    liabilitiesDeferred income taxes


2,131



2,147Unamortized investment tax credits


42



43Asset retirement obligations


155



151Non-pension postretirement benefit
    obligations


197



175Regulatory liabilities


2,293



2,170Other


278



280Total deferred credits and other
    liabilities


5,096



4,966Total liabilities


10,922



10,815Commitments and
    contingenciesShareholders
    equityCommon stock


1,588



1,588Other paid-in capital


4,890



4,890Retained earnings (deficit)


100



(81
)Accumulated other comprehensive
    loss


(1
)


(1
)Total shareholders equity


6,577



6,396Total liabilities and
    shareholders equity

$
17,499


$
17,211    13




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##### Table of Contents



COMMONWEALTH
    EDISON COMPANY AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENT OF CHANGES IN
    SHAREHOLDERS EQUITY
 (Unaudited)
  AccumulatedOther


Retained


Retained


Other


TotalCommon


Paid-In


Earnings


Earnings


Comprehensive


Shareholders(In millions)

Stock


Capital


Unappropriated


Appropriated


Loss


EquityBalance, December 31,
    2005

$
1,588


$
4,890


$
(1,180
)

$
1,099


$
(1
)

$
6,396Net income










181











181Appropriation of Retained Earnings
    for future dividends










(181
)


181







Balance, June 30,
    2006

$
1,588


$
4,890


$
(1,180
)

$
1,280


$
(1
)

$
6,577    14




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##### Table of Contents



PECO
    ENERGY COMPANY PECO
    ENERGY COMPANY AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENTS OF INCOME AND
    COMPREHENSIVE INCOME
 (Unaudited)
  Three Months


Six MonthsEnded June 30,


Ended June 30,(In millions)

2006


2005


2006


2005Operating revenuesOperating revenues

$
1,144


$
1,040


$
2,546


$
2,331Operating revenues from affiliates


4



4



8



8Total operating revenues


1,148



1,044



2,554



2,339Operating expensesPurchased power


72



58



142



109Purchased power from affiliate


429



379



845



760Fuel


76



66



402



331Operating and maintenance


109



91



225



200Operating and maintenance from
    affiliates


32



28



64



53Depreciation and amortization


172



137



343



273Taxes other than income


53



60



117



115Total operating expenses


943



819



2,138



1,841Operating income


205



225



416



498Other income and
    deductionsInterest expense


(18
)


(13
)


(35
)


(26
)Interest expense to affiliates


(49
)


(57
)


(101
)


(116
)Equity in losses of unconsolidated
    affiliates


(2
)


(4
)


(6
)


(8
)Other, net


2



6



5



9Total other income and deductions


(67
)


(68
)


(137
)


(141
)Income before income
    taxes


138



157



279



357Income taxes


45



47



93



118Net income


93



110



186



239Preferred stock
    dividends


1



1



2



2Net income on common
    stock

$
92


$
109


$
184


$
237Comprehensive income, net of
    income taxesNet income

$
93


$
110


$
186


$
239Other comprehensive loss, net
    of income taxesChange in net unrealized loss on
    cash-flow hedges


(1
)


(2
)


(1
)


(2
)Other comprehensive loss


(1
)


(2
)


(1
)


(2
)Comprehensive income

$
92


$
108


$
185


$
237    15




---



##### Table of Contents



PECO
    ENERGY COMPANY AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited)
  For the Six Months Ended June 30,(In millions)

2006


2005Cash flows from operating
    activitiesNet income

$
186


$
239Adjustments to reconcile net
    income to net cash flows provided by operating activities:Depreciation, amortization and
    accretion


343



273Deferred income taxes and
    amortization of investment tax credits


(138
)


(60
)Provision for uncollectible
    accounts


31



11Equity in losses of unconsolidated
    affiliates


6



8Other non-cash operating activities


9



(4
)Changes in assets and liabilitiesAccounts receivable


73



43Inventories


9



23Deferred/over-recovered energy
    costs


61



18Prepaid utility taxes


(81
)


(99
)Other current assets


(3
)


Accounts payable, accrued expenses
    and other current liabilities


(123
)


(79
)Change in receivables and payables
    to affiliates, net


39



36Income taxes


142



27Pension and non-pension
    postretirement benefits


5



(144
)Other noncurrent assets and
    liabilities


3



9Net cash flows provided by
    operating activities


562



301Cash flows from investing
    activitiesCapital expenditures


(164
)


(126
)Changes in Exelon intercompany
    money pool contributions


8



34Change in restricted cash


(1
)


28Other investing activities






6Net cash flows used in investing
    activities


(157
)


(58
)Cash flows from financing
    activitiesIssuance of long-term debt


6



Retirement of long-term debt






(8
)Retirement of long-term debt to
    PECO Energy Transition Trust


(248
)


(207
)Change in short-term debt


7



Dividends paid on common and
    preferred stock


(253
)


(233
)Contributions from parent


71



180Net cash flows used in financing
    activities


(417
)


(268
)Decrease in cash and cash
    equivalents


(12
)


(25
)Cash and cash equivalents at
    beginning of period


37



74Cash and cash equivalents at
    end of period

$
25


$
49    16




---



##### Table of Contents



PECO
    ENERGY COMPANY AND SUBSIDIARY COMPANIES
 CONSOLIDATED BALANCE SHEETS
 (Unaudited)
  June 30,


December 31,(In millions)

2006


2005ASSETSCurrent assetsCash and cash equivalents

$
25


$
37Restricted cash


3



2Accounts receivable, netCustomer


350



454Other


21



57Affiliate






13Inventories, at average costGas


142



151Materials and supplies


11



11Contributions to Exelon
    intercompany money pool






8Deferred income taxes


34



7Deferred energy costs






39Prepaid utility taxes


81



Other


19



16Total current assets


686



795Property, plant and equipment,
    net


4,552



4,471Deferred debits and other
    assetsRegulatory assets


4,093



4,386Investments


22



22Investment in affiliates


68



73Receivable from affiliate


100



68Prepaid pension asset


198



195Other


4



8Total deferred debits and other
    assets


4,485



4,752Total assets

$
9,723


$
10,018    17




---



##### Table of Contents



PECO
    ENERGY COMPANY AND SUBSIDIARY COMPANIES
    CONSOLIDATED BALANCE SHEETS
    (Unaudited)
  June 30,


December 31,(In millions)

2006


2005LIABILITIES AND
    SHAREHOLDERS EQUITYCurrent liabilitiesCommercial paper

$
227


$
220Long-term debt to PECO Energy
    Transition Trust due within one year


274



199Accounts payable


94



182Accrued expenses


169



92Payables to affiliates


204



178Customer deposits


57



54Over-recovered energy costs


22



Other


5



11Total current liabilities


1,052



936Long-term debt


1,189



1,183Long-term debt to PECO Energy
    Transition Trust


2,453



2,776Long-term debt to other
    financing trusts


184



184Deferred credits and other
    liabilitiesDeferred income taxes


2,674



2,781Unamortized investment tax credits


16



17Asset retirement obligations


21



20Non-pension postretirement benefit
    obligations


286



278Other


141



139Total deferred credits and other
    liabilities


3,138



3,235Total liabilities


8,016



8,314Commitments and
    contingenciesShareholders
    equityCommon stock


2,193



2,193Preferred stock


87



87Receivable from parent


(1,161
)


(1,232
)Retained earnings


582



649Accumulated other comprehensive
    income


6



7Total shareholders equity


1,707



1,704Total liabilities and
    shareholders equity

$
9,723


$
10,018    18




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##### Table of Contents



PECO
    ENERGY COMPANY AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENT OF CHANGES IN
    SHAREHOLDERS EQUITY
 (Unaudited)
  AccumulatedReceivable





Other


TotalCommon


Preferred


from


Retained


Comprehensive


Shareholders(In millions)

Stock


Stock


Parent


Earnings


Income


EquityBalance, December 31,
    2005

$
2,193


$
87


$
(1,232
)

$
649


$
7


$
1,704Net income














186







186Common stock dividends














(251
)






(251
)Preferred stock dividends














(2
)






(2
)Repayment of receivable from parent










71











71Other comprehensive loss, net of
    income taxes of $(1)


















(1
)


(1
)Balance, June 30,
    2006

$
2,193


$
87


$
(1,161
)

$
582


$
6


$
1,707    19




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##### Table of Contents



EXELON
    GENERATION COMPANY, LLC  EXELON
    GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENTS OF INCOME AND
    COMPREHENSIVE INCOME
 (Unaudited)
  Three Months


Six MonthsEnded June 30,


Ended June 30,(In millions)

2006


2005


2006


2005Operating revenuesOperating revenues

$
1,100


$
955


$
2,132


$
1,840Operating revenues from affiliates


1,114



1,150



2,302



2,285Total operating revenues


2,214



2,105



4,434



4,125Operating expensesPurchased power


418



517



781



967Fuel


425



428



1,036



786Operating and maintenance


362



536



955



1,077Operating and maintenance from
    affiliates


78



66



153



134Depreciation and amortization


72



63



139



125Taxes other than income


41



39



84



74Total operating expenses


1,396



1,649



3,148



3,163Operating income


818



456



1,286



962Other income and
    deductionsInterest expense


(40
)


(29
)


(81
)


(56
)Interest expense to affiliates










(1
)


(2
)Equity in earnings (losses) of
    unconsolidated affiliates


(1
)


4



(5
)


4Other, net


14



51



20



69Total other income and deductions


(27
)


26



(67
)


15Income from continuing
    operations before income taxes


791



482



1,219



977Income taxes


294



185



454



376Income from continuing
    operations


497



297



765



601Discontinued
    operationsLoss from discontinued operations
    (net of taxes of $0 and $(1) for the three and six months ended
    June 30, 2005, respectively)














Gain (loss) on disposal of
    discontinued operations (net of taxes of $2, $(1), $2 and $4 for
    the three and six months ended June 30, 2006 and 2005,
    respectively)


3



(1
)


3



15Income (loss) from discontinued
    operations


3



(1
)


3



15Net income


500



296



768



616Other comprehensive income
    (loss), net of income taxesChange in unrealized gain (loss)
    on cash-flow hedges


141



39



232



(85
)Unrealized gain (loss) on
    marketable securities


(13
)


(9
)


15



(24
)Foreign currency translation
    adjustment






(1
)






(1
)Other comprehensive income (loss)


128



29



247



(110
)Comprehensive income

$
628


$
325


$
1,015


$
506    20




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##### Table of Contents



EXELON
    GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited)
  For the SixMonths EndedJune 30,(In millions)

2006


2005Cash flows from operating
    activitiesNet income

$
768


$
616Adjustments to reconcile net
    income to net cash flows provided by operating activities:Depreciation, amortization and
    accretion, including nuclear fuel


464



440Deferred income taxes and
    amortization of investment tax credits


81



337Equity in losses (earnings) of
    unconsolidated affiliates


5



(4
)Gain on sale of investments


(2
)


(19
)Net realized (gains) losses on
    nuclear decommissioning trust funds


11



(55
)Other decommissioning-related
    activities


(149
)


13Other non-cash operating activities


20



17Changes in assets and liabilitiesAccounts receivable


79



61Receivables and payables to
    affiliates, net


11



(181
)Inventories


10



3Other current assets


(70
)


(25
)Accounts payable, accrued expenses
    and other current liabilities


(237
)


(52
)Counterparty collateral asset


178



(20
)Counterparty collateral liability


5



7Income taxes


38



174Net realized and unrealized
    mark-to-market
    and hedging transactions


(37
)


(57
)Pension and non-pension
    postretirement benefits


45



(839
)Other noncurrent assets and
    liabilities


(148
)


(36
)Net cash flows provided by
    operating activities


1,072



380Cash flows from investing
    activitiesCapital expenditures


(512
)


(484
)Proceeds from nuclear
    decommissioning trust fund sales


2,554



2,149Investment in nuclear
    decommissioning trust funds


(2,706
)


(2,256
)Acquisitions of businesses, net of
    cash acquired






(97
)Proceeds from sales of wholly
    owned subsidiaries, net of $32 of cash sold during the six
    months ended June 30, 2005






103Change in restricted cash


1



(2
)Other investing activities


(3
)


(5
)Net cash flows used in
    investing activities


(666
)


(592
)Cash flows from financing
    activitiesRetirement of long-term debt






(1
)Changes in Exelon intercompany
    money pool borrowings


(92
)


(283
)Distribution to member


(322
)


(319
)Contribution from member






843Other financing activities


(2
)


1Net cash flows provided by
    (used in) financing activities


(416
)


241Increase (decrease) in cash and
    cash equivalents


(10
)


29Cash and cash equivalents at
    beginning of period


34



263Cash and cash equivalents at
    end of period

$
24


$
292    21




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##### Table of Contents



EXELON
    GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
 CONSOLIDATED BALANCE SHEETS
 (Unaudited)
  June 30,


December 31,(In millions)

2006


2005ASSETSCurrent assetsCash and cash equivalents

$
24


$
34Restricted cash and investments


2



3Accounts receivable, netCustomer


506



585Other


128



109Mark-to-market
    derivative assets


699



916Receivable from affiliates


428



411Inventories, at average costFossil fuel


140



160Materials and supplies


312



290Deferred income taxes


41



35Prepayments and other current
    assets


380



497Total current assets


2,660



3,040Property, plant and equipment,
    net


7,241



7,464Deferred debits and other
    assetsNuclear decommissioning trust funds


5,809



5,585Investments


128



120Mark-to-market
    derivative assets


473



286Prepaid pension asset


1,005



1,013Other


286



216Total deferred debits and other
    assets


7,701



7,220Total assets

$
17,602


$
17,724    22




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##### Table of Contents



EXELON
    GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
 CONSOLIDATED BALANCE SHEETS
 (Unaudited)
  June 30,


December 31,(In millions)

2006


2005LIABILITIES AND MEMBERS
    EQUITYCurrent liabilitiesLong-term debt due within one year

$
12


$
12Accounts payable


813



954Mark-to-market
    derivative liabilities


874



1,282Payables to affiliates


36



4Borrowings from Exelon
    intercompany money pool






92Commercial paper


309



311Accrued expenses


387



415Other


283



330Total current liabilities


2,714



3,400Long-term debt


1,788



1,788Deferred credits and other
    liabilitiesAsset retirement obligations


3,500



3,986Pension obligation


17



13Non-pension postretirement benefit
    obligations


574



541Spent nuclear fuel obligation


926



906Deferred income taxes


931



663Unamortized investment tax credits


198



202Payables to affiliates


1,616



1,503Mark-to-market
    derivative liabilities


420



460Other


244



280Total deferred credits and other
    liabilities


8,426



8,554Total liabilities


12,928



13,742Commitments and contingenciesMinority interest of
    consolidated subsidiary


1



2Members
    equityMembership interest


3,220



3,220Undistributed earnings


1,448



1,002Accumulated other comprehensive
    income (loss)


5



(242
)Total members equity


4,673



3,980Total liabilities and
    members equity

$
17,602


$
17,724    23




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##### Table of Contents



EXELON
    GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
 CONSOLIDATED STATEMENT OF CHANGES IN
    MEMBERS EQUITY
 (Unaudited)
  AccumulatedOther


TotalMembership


Undistributed


Comprehensive


Members(In millions)

Interest


Earnings


Income (Loss)


EquityBalance, December 31,
    2005

$
3,220


$
1,002


$
(242
)

$
3,980Net income






768







768Distribution to member






(322
)






(322
)Other comprehensive income, net of
    income taxes of $(106)










247



247Balance, June 30,
    2006

$
3,220


$
1,448


$
5


$
4,673    24




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIESCOMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS
 (Dollars in millions, except per share data, unless
    otherwise noted)
  1.
    Basis of
    Presentation (Exelon, ComEd, PECO and Generation)        Form 10-Q. Form 10-K.
  2.
    Discontinued
    Operations (Exelon and Generation)   25




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Three Months Ended June 30, 2005

Sithe(a)


Enterprises(b)


TotalTotal operating revenues

$



$
4


$
4Operating loss






(2
)


(2
)Loss before income taxes


(2
)(c)


(1
)


(3
)     (a)
    
    Sithe was sold on January 31,
    2005. Accordingly, there are no operating results for the three
    months ended June 30, 2005. See Note 4 
    Acquisitions and Dispositions for further information regarding
    the sale of Sithe.(b)
    
    Excludes certain investments.(c)
    
    Represents an adjustment to the
    gain on sale of Sithe as a result of interest accrued on certain
    tax indemnifications.  Six Months Ended June 30, 2005

Sithe(a)


Enterprises(b)


TotalTotal operating revenues

$
30


$
8


$
38Operating income (loss)


5



(4
)


1Income (loss) before income taxes


18
(c)


(5
)


13     (a)
    
    Includes Sithes results of
    operations from January 1, 2005 through January 31,
    2005, which was the date of the sale. See
    Note 4  Acquisitions and Dispositions for
    further information regarding the sale of Sithe.(b)
    
    Excludes certain investments.(c)
    
    Sithe includes a pre-tax gain on
    sale of $19 million.      3.
    New
    Accounting Pronouncements (Exelon, ComEd, PECO and
    Generation)    SFAS No. 123-R
  (SFAS No. 123-R), SFAS No. 123-R SFAS No. 123-R
 26




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Three Months


Six MonthsEnded


EndedJune 30,


June 30,Components of Stock-Based Compensation Expense

2006


2005


2006


2005Stock options

$
8


$



$
25


$
Performance shares


20



11



41



22Other stock-based awards


2



3



3



5Total stock-based compensation
    included in operating and maintenance expense


30



14



69



27Income tax benefit


11



5



26



10Total after-tax stock-based
    compensation expense

$
19


$
9


$
43


$
17     Three Months


Six MonthsEnded


EndedJune 30,


June 30,Registrant

2006


2005


2006


2005ComEd

$
9


$
3


$
19


$
5PECO


4



2



10



3Generation


17



9



39



17   Stock
    Options
  SFAS No. 123-R,
     27




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Six MonthsEndedJune 30,2006


2005Dividend yield


3.2
%


3.6
%Expected volatility


25.5
%


18.1
%Risk-free interest rate


4.27
%


3.83
%Expected life (years)


6.25



6.25         Weighted


WeightedAverage


AverageExercise


Remaining


AggregatePrice


Contractual


IntrinsicShares


(per share)


Life


ValueBalance at December 31, 2005


21,674,270


$
31.23Options granted/assumed


4,075,145



58.55Options exercised


(3,433,230
)


29.17Options forfeited/cancelled


(214,391
)


40.82Balance at June 30, 2006


22,101,794



36.48



7.05


$
449,801,532Exercisable at June 30,
    2006(a)


11,087,045



30.30



5.74



294,184,725     (a)
    
    Includes stock options issued to
    retirement-eligible employees.     28




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  SFAS No. 123-R SFAS No. 123-R,
    WeightedAverageExercisePriceShares


(per share)Nonvested at December 31, 2005


12,000,284


$
35.42Granted


4,075,145



58.55Vested


(4,839,877
)


37.91Forfeited


(220,803
)


41.92Nonvested at June 30, 2006


11,014,749



42.70     Performance
    Share Awards
  and/or and/or
      SFAS No. 123-R,
 29




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  SFAS No. 123-R
      Other
    Stock-Based Awards
  SFAS No. 123-R.
   30




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   2005 Pro
    Forma Information
    Three Months


Six MonthsEnded


EndedJune 30, 2005


June 30, 2005Net income  as reported

$
514


$
1,035Add: Stock-based compensation
    expense included in reported net income, net of income taxes


9



17Deduct: Total stock-based
    compensation expense determined under fair-value method for all
    awards, net of income taxes(a)


(12
)


(24
)Pro forma net income

$
511


$
1,028Earnings per share:Basic  as reported

$
0.77


$
1.55Basic  pro forma


0.76



1.54Diluted  as reported


0.76



1.53Diluted  pro forma


0.75



1.52     (a)
    
    The fair value of stock options
    granted was estimated using a Black-Scholes-Merton
    option-pricing model.  SFAS No. 123-R, SFAS No. 123-R
  EITF 04-13
  No. 04-13, (EITF 04-13). EITF 04-13 EITF 04-13 EITF 04-13
  FSP
    No. FIN 46(R)-6
   31




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    SFAS No. 155
    SFAS No. 156
    FIN 48
    EITF 06-3
  No. 06-3, (EITF 06-3). EITF 06-3 EITF 06-3 EITF 06-3
 32




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  No. 99-19, EITF 06-3
  4.
    Acquisitions
    and Dispositions (Exelon and Generation)  Proposed
    Merger with PSEG (Exelon)
            Form 10-K
 33




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Sithe
    (Exelon and Generation)
        Three Months


Six MonthsEnded


EndedJune 30, 2005(a)


June 30, 2005(b)Operating revenues

$



$
30Operating income






5Net income (loss)


(1
)


15(c
)     (a)
    
    Sithe was sold on January 31,
    2005. Accordingly, there are no operating results for the three
    months ended June 30, 2005.(b)
    
    Sithe was sold on January 31,
    2005. Accordingly, results include only one month of operations.(c)
    
    Includes a pre-tax gain on sale of
    Sithe of $19 million.    Form 10-K
  5.
    Regulatory
    Issues (Exelon, ComEd, PECO and Generation)  ComEd
    Illinois Procurement Filing.
 34




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Illinois Rate Case.
  Original Cost Audit.
  Residential Rate Stabilization Program.
 35




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Renewable Energy Filing.
  Rate Freeze Extension Proposal.
  Customers Affordable Reliable Energy.
  Post 2006 Summary.
 36




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   PECO
  Partial Settlement before the Pennsylvania Public Utility
    Commission (PAPUC). Form 10-K
  ComEd
    and PECO
  Through and Out Rates/SECA. and/or
  PJM Transmission Design.
 37




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Generation
  Market-Based Rates Filing. Form 10-K.
  6.
    Intangible
    Assets (Exelon and ComEd)  Goodwill (Exelon and ComEd).
  Other Intangible Assets
    (Exelon).
  June 30, 2006


December 31, 2005Amortization








AccumulatedExelon

Gross


Accumulated


Net


Gross


Amortization


NetSynthetic fuel investments(a)

$



$



$



$
264


$
(121
)

$
143Intangible pension asset


34







34



34







34Total intangible assets

$
34


$



$
34


$
298


$
(121
)

$
177     (a)
    
    See Note 3 of Exelons
    Notes to Consolidated Financial Statements within Exelons
    2005 Annual Report on
    Form 10-K
    for a description of Exelons right to acquire tax credits
    through investments in synthetic fuel-producing facilities. In
    the second quarter of 2006, Exelon recorded an impairment charge
    of $115 million (before income taxes) associated with the
    full write-off of the intangible asset related to its investment
    in synthetic fuel-producing facilities. See
    Note 10  Income Taxes for further discussion. 38




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     7.
    Debt and
    Credit Agreements (Exelon, ComEd, PECO and Generation)  Commercial
    Paper
    June 30,


December 31,Borrower

2006


2005Exelon

$
10


$
ComEd


339



459PECO


227



220Generation


309



311   Credit
    Facilities
  Form 10-K
  Generation
  Form 10-K.
  ComEd
    Issuance
    of Long-Term Debt
    InterestCompany

Type

Rate

Maturity

AmountComEd

First Mortgage Bonds


5.90
%


March 15, 2036


$
325
(a)PECO

Notes payable, accounts receivable
    agreement


5.22
%


November 12, 2010



6     (a)
    
    Excludes unamortized bond discounts. 39




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Retirement
    of Long-Term Debt
    InterestCompany

Type

Rate


Maturity

AmountExelon

Notes payable for investments in
    synthetic
    fuel-producing facilities


6.00-8.00
%

Various

$
33ComEd

Sinking Fund Debentures


4.75
%

December 1, 2011


1ComEd

ComEd Transitional Funding Trust


5.63
%

June 25, 2007


174PECO

PECO Energy Transition Trust (PETT)


6.05
%

March 1, 2007


248   SCEP
  20-year
    8.
    Severance
    Benefits (Exelon, ComEd, PECO and Generation)    Salary Continuance Severance

ComEd

PECO

Generation

Other(a)

ExelonExpense recorded for the three
    months ended June 30, 2006

$



$



$



$



$
Expense (income) recorded for the
    six months ended June 30, 2006


(2
)






1
(c)


2
(b)


1
(b),(c)     (a)
    
    Other includes corporate
    operations, shared service entities, including Exelon Business
    Services Company (BSC) and Enterprises.(b)
    
    Includes $1 million of
    severance related to stock-based compensation, which is not
    included in the salary continuance severance obligations table
    below.(c)
    
    Excludes reduction of previously
    recorded severance charges of approximately $1 million
    related to Salem, of which Generation owns 42.59% and which is
    operated by PSEG. Salary Continuance Severance

ComEd

PECO

Generation

Other(a)

ExelonExpense (income) recorded for the
    three months ended June 30, 2005

$
(3
)

$



$
(1
)

$
2


$
(2
)Expense (income) recorded for the
    six months ended June 30, 2005


(4
)


1



(2
)


1



(4
)     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC and
    Enterprises. 40




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Salary Continuance Obligations

ComEd


PECO


Generation


Other(a)


ExelonBalance at January 1, 2006

$
8


$
1


$
7


$
6


$
22Severance (benefits) charges
    recorded


(2
)






1



1



Cash payments


(1
)






(2
)


(3
)


(6
)Balance at June 30, 2006

$
5


$
1


$
6


$
4


$
16     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC and
    Enterprises.  9.
    Retirement
    Benefits (Exelon, ComEd, PECO and Generation)    OtherPension


PostretirementBenefits


BenefitsThree Months


Three MonthsEnded


EndedJune 30,


June 30,2006


2005


2006


2005Service cost

$
38


$
38


$
25


$
23Interest cost


139



139



44



43Expected return on assets


(204
)


(192
)


(27
)


(24
)Amortization of:Transition obligation (asset)






(1
)


3



2Prior service cost (benefit)


4



4



(23
)


(22
)Actuarial loss


34



30



21



17Net periodic benefit cost

$
11


$
18


$
43


$
39   41




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Pension


OtherBenefits


PostretirementSix Months


BenefitsEnded


Six Months EndedJune 30,


June 30,2006


2005


2006


2005Service cost

$
79


$
76


$
50


$
47Interest cost


281



278



91



86Expected return on assets


(408
)


(385
)


(53
)


(49
)Amortization of:Transition obligation (asset)






(2
)


5



5Prior service cost (benefit)


8



8



(46
)


(45
)Actuarial loss


74



60



44



33Net periodic benefit cost

$
34


$
35


$
91


$
77     Three Months


Six MonthsEnded


EndedJune 30,


June 30,Pension and Postretirement Benefit Costs(a),(b)

2006


2005


2006


2005ComEd

$
20


$
22


$
43


$
43PECO


6



7



18



14Generation


28



27



63



54     (a)
    
    Includes capitalized costs and
    operating and maintenance expense.(b)
    
    Includes allocated amounts from BSC.    Three Months


Six MonthsEnded


EndedJune 30,


June 30,Savings Plan Matching Contributions

2006


2005


2006


2005Exelon

$
15


$
15


$
30


$
29ComEd


4



4



8



8PECO


1



1



3



3Generation


8



7



16



14    42




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   10.  Income
    Taxes (Exelon, ComEd, PECO and Generation)
  Exelon
    Three Months


Six MonthsEnded


EndedJune 30,


June 30,2006


2005


2006


2005U.S. Federal statutory rate


35.0
%


35.0
%


35.0
%


35.0
%Increase (decrease) due to:State income taxes, net of Federal
    income tax benefit


3.7



3.4



3.6



3.7Synthetic fuel-producing
    facilities credit(a)






(8.8
)


(1.6
)


(8.1
)Qualified nuclear decommissioning
    trust fund income


0.3



1.0



0.4



0.7Domestic production activities
    deduction


(0.5
)


(0.2
)


(0.6
)


(0.2
)Tax exempt income


(0.3
)


(0.4
)


(0.4
)


(0.4
)Nontaxable postretirement benefits


(0.3
)


(0.2
)


(0.3
)


(0.3
)Amortization of investment tax
    credit


(0.3
)


(0.3
)


(0.4
)


(0.3
)Other


(1.4
)


(0.9
)


(0.6
)


(0.3
)Effective income tax rate


36.2
%


28.6
%


35.1
%


29.8
%     (a)
    
    See Notes 3 and 12 of
    Exelons Notes to Consolidated Financial Statements within
    Exelons 2005 Annual Report on
    Form 10-K
    for further information regarding investments in synthetic
    fuel-producing facilities.  ComEd
    Three Months


Six MonthsEnded


EndedJune 30,


June 30,2006


2005


2006


2005U.S. Federal statutory rate


35.0
%


35.0
%


35.0
%


35.0
%Increase (decrease) due to:State income taxes, net of Federal
    income tax benefit


4.9



4.8



4.8



4.8Amortization of regulatory asset


0.7



0.8



0.7



0.8Nontaxable postretirement benefits


(0.3
)


(0.4
)


(0.4
)


(0.5
)Amortization of investment tax
    credit


(0.3
)


(0.4
)


(0.5
)


(0.5
)Other


0.4



(0.4
)


0.9



0.1Effective income tax rate


40.4
%


39.4
%


40.5
%


39.7
%  43




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   PECO
    Three Months


Six MonthsEnded


EndedJune 30,


June 30,2006


2005


2006


2005U.S. Federal statutory rate


35.0
%


35.0
%


35.0
%


35.0
%Increase (decrease) due to:State income taxes, net of Federal
    income tax benefit


(2.1
)


(3.5
)


(1.3
)


(1.7
)Plant basis differences


0.8



(0.7
)


0.4



(0.2
)Nontaxable postretirement benefits


(0.3
)


(0.3
)


(0.3
)


(0.2
)Amortization of investment tax
    credit


(0.4
)


(0.4
)


(0.4
)


(0.3
)Other


(0.4
)


(0.2
)


(0.1
)


0.5Effective income tax rate


32.6
%


29.9
%


33.3
%


33.1
%   Generation
    Three Months


Six MonthsEnded


EndedJune 30,


June 30,2006


2005


2006


2005U.S. Federal statutory rate


35.0
%


35.0
%


35.0
%


35.0
%Increase (decrease) due to:State income taxes, net of Federal
    income tax benefit


4.4



4.3



4.4



4.6Qualified nuclear decommissioning
    trust fund income


0.4



1.5



0.5



1.0Domestic production activities
    deduction


(0.6
)


(0.3
)


(0.8
)


(0.3
)Tax exempt income


(0.4
)


(0.6
)


(0.5
)


(0.5
)Nontaxable postretirement benefits


(0.2
)


(0.2
)


(0.2
)


(0.2
)Amortization of investment tax
    credit


(0.1
)


(0.2
)


(0.2
)


(0.2
)Other


(1.3
)


(1.1
)


(1.0
)


(0.9
)Effective income tax rate


37.2
%


38.4
%


37.2
%


38.5
%   Investments
    in Synthetic Fuel-Producing Facilities (Exelon)
   44




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   year-to-date
  Estimated2006Beginning of Phase-Out Range(a)

$
60End of Phase-Out Range(a)


762006 Annual Average NYMEX


71     (a)
    
    The estimated 2006 phase-out range
    is based upon the actual 2005 phase-out range. The actual 2005
    phase-out range was determined using the inflation adjustment
    factor published by the IRS in April 2006. The actual 2005
    phase-out range was increased by 2% (Exelons estimate of
    inflation) to arrive at the estimated 2006 phase-out range.        mark-to-market mark-to-market
 45




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   mark-to-market
      1999
    Sale of Fossil Generating Assets (Exelon and
    ComEd)
    Impact
    of Illinois Auction on State Income Taxes (Exelon and
    Generation)
   46




---



##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    and/or
  Pennsylvania
    Tax Law (Exelon and Generation)
    11.  Asset
    Retirement Obligations (Exelon, ComEd, PECO and
    Generation)
  Nuclear
    Decommissioning Asset Retirement Obligations (ARO) (Exelon and
    Generation)
  Form 10-K
 47




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     
    Revised management assumptions concerning an increased
    likelihood of successful nuclear license renewal efforts due to
    an increasingly favorable environment for nuclear power and,
    therefore, an increased likelihood of operating the nuclear
    plants through a full license extension period; and
    A change in managements expectation of when the U.S.
    Department of Energy (DOE) will establish a repository for and
    begin accepting spent nuclear fuel.    
    A decrease in Generations asset retirement cost (ARC),
    which is included in property, plant and equipment in
    Exelons and Generations Consolidated Balance Sheets,
    of approximately $393 million;
    An increase in Generations intercompany payable to ComEd
    and PECO, which is included in non-current payable to affiliates
    in Generations Consolidated Balance Sheets, of
    approximately $62 million;
    An increase in ComEds and PECOs intercompany
    receivables from Generation, which are included in non-current
    receivables from affiliates in ComEds and PECOs
    Consolidated Balance Sheets, of approximately $36 million
    and $26 million, respectively, offset by equivalent
    increases in ComEds and PECOs regulatory liabilities
    of approximately $36 million and $26 million,
    respectively (these increases are reflected as increases in
    Exelons regulatory liabilities on Exelons
    Consolidated Balance Sheet); and
    The recognition of other operating income by Generation (and,
    therefore, also by Exelon) of $149 million (pre-tax), which
    is included in operating and maintenance expense in
    Exelons and Generations Consolidated Statements of
    Income and Comprehensive Income, representing the reduction in
    the ARO in excess of the existing ARC balance for the AmerGen
    units.      Exelon and GenerationNuclear decommissioning AROs at
    January 1, 2006

$
3,921Net decrease resulting from
    updates to estimated future cash flows


(604
)Accretion expense


123Payments to decommission retired
    plants


(6
)Nuclear decommissioning AROs at
    June 30, 2006

$
3,434   year-over-year
 48




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Nuclear
    Decommissioning Trust Fund Investments (Exelon and
    Generation)
          other-than-temporary other-than-temporarily
  Non-Nuclear
    AROs (Exelon, ComEd, PECO and Generation)
   49




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  and/or Form 10-K
    Exelon


ComEd


PECO


GenerationNon-nuclear AROs at
    January 1, 2006

$
236


$
151


$
20


$
65Accretion expense(a)


6



4



1



1Non-nuclear AROs at June 30,
    2006

$
242


$
155


$
21


$
66     (a)
    
    For ComEd and PECO, the majority of
    the accretion is recorded as an increase to a regulatory asset
    due to the associated regulations.  12.
    Earnings
    Per Share and Shareholders Equity (Exelon)  Earnings
    per Share
    Three Months


Six MonthsEnded


EndedJune 30,


June 30,2006


2005


2006


2005Income from continuing operations

$
641


$
516


$
1,041


$
1,023Income (loss) from discontinued
    operations


3



(2
)


3



12Net income

$
644


$
514


$
1,044


$
1,035Average common shares
    outstanding  basic


670



670



669



669Assumed exercise of stock options,
    performance share awards and restricted stock


6



7



6



7Average common shares
    outstanding  diluted


676



677



675



676    50




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Share
    Repurchase Program
  Form 10-K
  Other
    Share Repurchases
    13.  Commitments
    and Contingencies (Exelon, ComEd, PECO and Generation)
  Form 10-K.
  Energy
    Commitments
    Commercial
    Commitments
    
    Exelons letters of credit increased $61 million and
    guarantees (outside the scope of FIN 45) decreased
    $85 million primarily as a result of energy trading
    activities.
    ComEds letters of credit increased $16 million.
    Generations letters of credit increased $45 million
    and guarantees (outside the scope of FIN 45) decreased
    $62 million primarily as a result of energy trading
    activities.  Environmental
    Liabilities
   51




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  and/or
      TotalEnvironmentalInvestigation and


Portion of Total RelatedRemediation


to MGP InvestigationJune 30, 2006

Reserve


and Remediation(a)ComEd

$
53


$
46PECO


42



40Generation


20



Exelon

$
115


$
86     (a)
    
    Discounted.  TotalEnvironmentalInvestigation and


Portion of Total RelatedRemediation


to MGP InvestigationDecember 31, 2005

Reserve


and Remediation(a)ComEd

$
54


$
48PECO


47



41Generation


27



Exelon

$
128


$
89     (a)
    
    Discounted. 52




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       Section 316(b)
    of the Clean Water Act
       53




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Nuclear
    Generating Station Groundwater
       54




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
             55




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Cotter
    Corporation
    Air
    Quality Regulation
    Leases
  Form 10-K
 56




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Litigation
  Exelon,
    PECO and Generation
  Reverse-Employment Discrimination Claim.
      PJM Billing Dispute.
  Form 10-K.
   57




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Exelon
  Pension Claim.
  ComEd
  ComEd Rate Case.
  
    recovery through rates of approximately $86 million
    related to losses on extinguishment of long-term debt as part of
    ComEds 2004 Accelerated Liability Management Plan;
    recovery of $40 million of previously incurred MGP costs;
    recovery of $158 million of previously incurred severance
    costs; and
    recovery of $7 million of expenses previously incurred in
    the Procurement Case.    Generation
  Asbestos Claims.
 58




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Form 10-K.
    Oil Spill Liability
    Trust Fund Claim.
  PECO and
    Generation
  Real Estate Tax Appeals.
 59




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Exelon,
    ComEd, PECO and Generation
    Income
    Taxes
  Refund Claims.
  Other Refund Claims.
  Other.
 60




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   14.
    Supplemental
    Financial Information (Exelon, ComEd, PECO and
    Generation)  Supplemental
    Income Statement Information
    Three Months


Six MonthsEnded


EndedJune 30,


June 30,Exelon

2006


2005


2006


2005Investment income

$
2


$
3


$
4


$
6Gain on disposition of assets and
    investments, net


(3
)


6



(2
)


7Decommissioning-related activities:Decommissioning trust fund
    income(a)


37



50



66



79Decommissioning trust fund
    income  AmerGen(a)


10



47



19



59Other-than-temporary
    impairment of decommissioning trust funds


(7
)


(6
)


(10
)


(14
)Regulatory offset to non-operating
    decommissioning-related activities(b)


(31
)


(46
)


(57
)


(67
)Net direct financing lease income


6



6



12



11Allowance for funds used during
    construction (AFUDC), equity






2







3Unrealized income tax credits(c)


24







53



Other


9



7



8



15Other, net

$
47


$
69


$
93


$
99     (a)
    
    Includes investment income and
    realized gains and losses.(b)
    
    Includes the elimination of
    non-operating decommissioning-related activity for those units
    that are subject to regulatory accounting, including the
    elimination of decommissioning trust fund income and
    other-than-temporary
    impairments for certain nuclear units. See Notes 13 and 16
    of Exelons Notes to Consolidated Financial Statements
    within Exelons Annual Report on 2005
    Form 10-K
    for more information regarding the regulatory accounting applied
    for certain nuclear units.(c)
    
    Receivable for the contractual
    recovery of unrealized income tax credits related to
    Exelons investment in synthetic fuel-producing facilities.
    See Note 10  Income Taxes for further
    information.  Three Months


Six MonthsEnded


EndedJune 30,


June 30,ComEd

2006


2005


2006


2005Investment income

$



$
1


$



$
2Gain (loss) on disposition of
    assets and investments, net


(2
)


2



(2
)


4AFUDC, equity






1







2Other


3



2



3



2Other, net

$
1


$
6


$
1


$
10   61




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Three Months


Six MonthsEnded


EndedJune 30,


June 30,PECO

2006


2005


2006


2005Investment income

$
2


$
2


$
4


$
5Gain (loss) on disposition of
    assets and investments, net


(1
)


4







3Other


1







1



1Other, net

$
2


$
6


$
5


$
9   Three Months


Six MonthsEnded


EndedJune 30,


June 30,Generation

2006


2005


2006


2005Decommissioning-related activities:Decommissioning trust fund
    income(a)

$
37


$
50


$
66


$
79Decommissioning trust fund
    income  AmerGen(a)


10



47



19



59Other-than-temporary
    impairment of decommissioning trust funds


(7
)


(6
)


(10
)


(14
)Contractual offset to
    non-operating decommissioning-related activities(b)


(31
)


(46
)


(57
)


(67
)Other


5



6



2



12Other, net

$
14


$
51


$
20


$
69     (a)
    
    Includes investment income and
    realized gains and losses.(b)
    
    Includes the elimination of
    non-operating decommissioning-related activity for those units
    that are subject to contractual accounting, including the
    elimination of decommissioning trust fund income and
    other-than-temporary
    impairments for certain nuclear units. See Notes 13 and 16
    of Exelons Notes to Consolidated Financial Statements
    within Exelons 2005 Annual Report
    Form 10-K
    for more information regarding the regulatory accounting applied
    for certain nuclear units.  Supplemental
    Balance Sheet Information
    June 30,


December 31,Exelon and ComEd

2006


2005Regulatory assets
    (liabilities):Nuclear decommissioning

$
(1,516
)

$
(1,435
)Removal costs


(1,036
)


(1,015
)Reacquired debt costs and
    interest-rate swap settlements


99



107Conditional asset retirement
    obligations


95



91Recoverable transition costs


30



43Deferred income taxes


9



8Other


26



31Total net regulatory liabilities

$
(2,293
)

$
(2,170
)  62




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   June 30,


December 31,Exelon and PECO

2006


2005Regulatory assets
    (liabilities):Competitive transition charges

$
3,271


$
3,532Deferred income taxes


786



781Non-pension postretirement benefits


42



45Reacquired debt costs


34



36MGP remediation costs


20



26Conditional asset retirement
    obligations


14



13U.S. Department of Energy
    facility decommissioning


10



13Nuclear decommissioning


(100
)


(68
)Other


16



8Long-term regulatory assets


4,093



4,386Deferred (over-recovered) energy
    costs  current asset (liability)


(22
)


39Total net regulatory assets

$
4,071


$
4,425     June 30, 2006

Exelon


ComEd


PECO


GenerationProperty, plant and
    equipment:Accumulated depreciation

$
8,205
(a)

$
1,334


$
2,209


$
4,518
(a)Accounts receivable:Allowance for uncollectible
    accounts


92



20



49



16     (a)
    
    Includes accumulated amortization
    of nuclear fuel of $2,255 million.  December 31, 2005

Exelon


ComEd


PECO


GenerationProperty, plant and
    equipment:Accumulated depreciation

$
7,872
(a)

$
1,253


$
2,172


$
4,315
(a)Accounts receivable:Allowance for uncollectible
    accounts


77



20



39



15     (a)
    
    Includes accumulated amortization
    of nuclear fuel of $2,103 million.    June 30,


December 31,Exelon and Generation

2006


2005Other current assets:Counterparty collateral asset

$
107


$
285Option premiums


193



126Other current
    liabilities:Counterparty collateral liability


106



101  63




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   15.  Segment
    Information (Exelon, ComEd, PECO and Generation)
      Three
    Months Ended June 30, 2006 and 2005
    ComEd


PECO


Generation


Other(a)


Eliminations


ConsolidatedTotal revenues(b):2006

$
1,453


$
1,148


$
2,214


$
203


$
(1,321
)

$
3,6972005


1,488



1,044



2,105



174



(1,327
)


3,484Intersegment
    revenues:2006

$
2


$
2


$
1,114


$
203


$
(1,321
)

$
2005


2



2



1,150



173



(1,327
)


Income (loss) from continuing
    operations before income taxes:2006

$
213


$
138


$
791


$
(138
)

$



$
1,0042005


180



157



482



(96
)






723Income taxes:2006

$
86


$
45


$
294


$
(62
)

$



$
3632005


71



47



185



(96
)






207Income (loss) from continuing
    operations:2006

$
127


$
93


$
497


$
(76
)

$



$
6412005


109



110



297











516Income (loss) from discontinued
    operations:2006

$



$



$
3


$



$



$
32005










(1
)


(1
)






(2
)Net income (loss):2006

$
127


$
93


$
500


$
(76
)

$



$
6442005


109



110



296



(1
)






514     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises
    and investments in synthetic fuel-producing facilities. 64




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (b)
    
    For the three months ended
    June 30, 2006 and 2005, utility taxes of $57 million
    and $57 million, respectively, are included in revenues and
    expenses for ComEd. For the three months ended June 30,
    2006 and 2005, utility taxes of $58 million and
    $53 million, respectively, are included in revenues and
    expenses for PECO.    ComEd


PECO


Generation


Other(a)


Eliminations


ConsolidatedTotal
    revenues (b):2006

$
2,880


$
2,554


$
4,434


$
410


$
(2,719
)

$
7,5592005


2,875



2,339



4,125



341



(2,635
)


7,045Intersegment
    revenues:2006

$
4


$
4


$
2,302


$
409


$
(2,719
)

$
2005


4



4



2,285



342



(2,635
)


Income (loss) from continuing
    operations before income taxes:2006

$
304


$
279


$
1,219


$
(197
)

$



$
1,6052005


297



357



977



(173
)






1,458Income taxes:2006

$
123


$
93


$
454


$
(106
)

$



$
5642005


118



118



376



(177
)






435Income (loss) from continuing
    operations:2006

$
181


$
186


$
765


$
(91
)

$



$
1,0412005


179



239



601



4







1,023Income (loss) from discontinued
    operations:2006

$



$



$
3


$



$



$
32005










15



(3
)






12Net income (loss):2006

$
181


$
186


$
768


$
(91
)

$



$
1,0442005


179



239



616



1







1,035Total assets:June 30, 2006

$
17,499


$
9,723


$
17,602


$
13,567


$
(16,101
)

$
42,290December 31, 2005


17,211



10,018



17,724



13,079



(15,583
)


42,449     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises
    and investments in synthetic fuel- producing facilities.(b)
    
    For the six months ended
    June 30, 2006 and 2005, utility taxes of $119 million
    and $120 million, respectively, are included in revenues
    and expenses for ComEd. For the six months ended June 30,
    2006 and 2005, utility taxes of $115 million and
    $105 million, respectively, are included in revenues and
    expenses for PECO. 65




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   16.
    Related-Party
    Transactions (Exelon, ComEd, PECO and Generation)  Exelon
    and ComEd
    Three Months


Six MonthsEnded June 30,


Ended June 30,2006


2005


2006


2005Operating revenues from affiliatesComEd Transitional Funding Trust

$
1


$
1


$
2


$
2Interest expense to affiliatesComEd Transitional Funding Trust


12



17



26



36ComEd Financing II


4



4



7



7ComEd Financing III


3



3



6



6Equity in losses of unconsolidated
    affiliatesComEd Funding LLC


3



4



5



8   June 30,


December 31,2006


2005Receivables from affiliates
    (current)ComEd Transitional Funding Trust

$
16


$
14Investment in affiliatesComEd Funding LLC


11



18ComEd Financing II


10



10ComEd Financing III


6



6Receivable from affiliates
    (noncurrent)ComEd Transitional Funding Trust


13



12Payables to affiliates (current)ComEd Transitional Funding Trust






1ComEd Financing II


6



6ComEd Financing III


4



4Long-term debt to ComEd
    Transitional Funding Trust and other financing trusts (including
    due within one year)ComEd Transitional Funding Trust


813



987ComEd Financing II


155



155ComEd Financing III


206



206  66




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Three Months


Six MonthsEnded June 30,


Ended June 30,2006


2005


2006


2005Operating revenues from affiliatesGeneration(a)

$
2


$
2


$
3


$
4Other










1



Purchased power from affiliatePPA with Generation(b)


685



770



1,456



1,523Operations and maintenance from
    affiliatesBSC(c)


53



44



105



88Interest income from affiliatesExelon intercompany money pool(d)






1







3Capitalized costsBSC(c)


19



16



36



30Cash dividends paid to parent






107







245   June 30,


December 31,2006


2005Receivables from affiliates
    (current)Other

$



$
23Receivables from affiliates
    (noncurrent)Generation(e)


1,516



1,435Payables to affiliates (current)Generation decommissioning(f)


11



11Generation (a),( b)


247



242BSC(c)


21



14Other


2



Borrowings from Exelon
    intercompany money pool(d)






140     (a)
    
    ComEd provides retail electric and
    ancillary services to Generation.(b)
    
    ComEd has entered into a
    full-requirements PPA, as amended, with Generation. See
    Note 17 of ComEds Notes to Consolidated Financial
    Statements within ComEds 2005 Annual Report on
    Form 10-K
    for more information regarding the PPA.(c)
    
    ComEd receives a variety of
    corporate support services from BSC, including legal, human
    resources, financial, information technology, supply management
    services, planning and engineering of delivery systems,
    management of construction, maintenance and operations of the
    transmission and delivery systems and management of other
    support services. All services are provided at cost, including
    applicable overhead. A portion of such services is capitalized.(d)
    
    ComEd participated in Exelons
    intercompany money pool, whereby ComEd earned interest on its
    contributions to the money pool and paid interest on its
    borrowings from the money pool at a market rate of interest. As
    of January 10, 2006, ComEd suspended participation in the
    money pool and on February 22, 2006, entered into a
    $1 billion senior secured three year revolving credit
    agreement among a group of lenders. See Note 7 
    Debt and Credit Agreements for additional information. 67




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (e)
    
    ComEd has a long-term receivable
    from Generation as a result of the nuclear decommissioning
    contractual construct whereby, to the extent the assets
    associated with decommissioning are greater than the applicable
    ARO at the end of decommissioning, such amounts are due back to
    ComEd for payment to ComEds customers. See Note 11 of
    ComEds Notes to Consolidated Financial Statements within
    ComEds 2005 Annual Report on
    Form 10-K
    for additional information.(f)
    
    ComEd has a short-term payable to
    Generation, primarily representing ComEds legal
    requirements to remit collections of nuclear decommissioning
    costs from its customers to Generation.  Exelon
    and PECO
    Three Months


Six MonthsEnded June 30,


Ended June 30,2006


2005


2006


2005Operating revenues from affiliatesPETT(a)

$
2


$
2


$
4


$
4Interest expense to affiliatesPETT


46



54



95



110PECO Trust III


1



1



3



3PECO Trust IV


2



2



3



3Equity in losses of unconsolidated
    affiliatesPETT


2



4



6



8   June 30,


December 31,2006


2005Investment in affiliatesPETT

$
58


$
63PECO Energy Capital Corp


4



4PECO Trust IV


6



6Payables to affiliates (current)PECO Trust III


1



1Long-term debt to PETT and other
    financing trusts (including due within one year)PETT


2,727



2,975PECO Trust III


81



81PECO Trust IV


103



103     (a)
    
    PECO receives a monthly service fee
    from PETT based on a percentage of the outstanding balance of
    all series of transition bonds. 68




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Three Months


Six MonthsEnded June 30,


Ended June 30,2006


2005


2006


2005Operating revenues from affiliatesGeneration(a)

$
2


$
2


$
4


$
4Purchased power from affiliateGeneration(b)


429



379



845



760FuelGeneration(c)














1Operations and maintenance from
    affiliatesBSC(d)


32



28



63



53Other










1



Capitalized costsBSC(d)


12



6



29



12Cash dividends paid to parent


135



116



251



231   June 30,


December 31,2006


2005Receivable from affiliate (current)BSC

$



$
13Contributions to Exelon
    intercompany money pool(e)






8Receivable from affiliate
    (noncurrent)Generation decommissioning(f)


100



68Payables to affiliates (current)Generation(b)


170



151BSC(d)


33



26Shareholders
    equity  receivable from parent(g)


1,161



1,232     (a)
    
    PECO provides energy to Generation
    for Generations own use.(b)
    
    PECO has entered into a
    full-requirements PPA with Generation. See Note 15 of
    PECOs Notes to Consolidated Financial Statements within
    PECOs 2005 Annual Report on
    Form 10-K
    for more information regarding the PPA.(c)
    
    Effective April 1, 2004, PECO
    entered into a one-year gas procurement agreement with
    Generation.(d)
    
    PECO receives a variety of
    corporate support services from BSC, including legal, human
    resources, financial, information technology, supply management
    services, planning and engineering of delivery systems,
    management of construction, maintenance and operations of the
    transmission and delivery systems and management of other
    support services. All services are provided at cost, including
    applicable overhead. A portion of such services is capitalized.(e)
    
    PECO participates in Exelons
    intercompany money pool. PECO earns interest on its
    contributions to the money pool at a market rate of interest.(f)
    
    PECO has a long-term receivable
    from Generation as a result of the nuclear decommissioning
    contractual construct, whereby, to the extent the assets
    associated with decommissioning are greater than the applicable
    ARO at the end of 69




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  decommissioning, such amounts are
    due back to PECO for payment to PECOs customers. See
    Note 9 of PECOs Notes to Consolidated Financial
    Statements within PECOs 2005 Annual Report on
    Form 10-K
    for additional information.(g)
    
    PECO has a non-interest bearing
    receivable from Exelon related to the 2001 corporate
    restructuring. The receivable is expected to be settled over the
    years 2006 through 2010.  Generation
    Three Months


Six MonthsEnded June 30,


Ended June 30,2006


2005


2006


2005Operating revenues from affiliatesComEd(a)

$
685


$
770


$
1,456


$
1,523PECO(a)


429



379



845



761BSC






1



1



1Fuel from affiliatePECO(b)






1







1Operations and maintenance from
    affiliatesComEd(b)


2



2



3



4PECO(b)


2



1



4



3BSC(c)


74



63



146



127Interest expense to affiliateExelon intercompany money pool(d)










1



2Cash distribution paid to member


157



80



322



319Cash contribution received from
    member














843   June 30,


December 31,2006


2005Receivables from affiliates
    (current)ComEd(a)

$
247


$
242ComEd decommissioning(e)


11



11PECO(a)


170



151BSC(c)






7Payables to affiliates (current)Exelon(f)


6



4BSC(c)


30



Borrowings from Exelon
    intercompany money pool(d)






92Payables to affiliates (noncurrent)ComEd decommissioning(g)


1,516



1,435PECO decommissioning(g)


100



68  70




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     (a)
    
    Generation has entered into PPAs
    with ComEd and PECO, as amended, to provide the full energy
    requirements of ComEd and PECO. See Note 17 of
    Generations Notes to Consolidated Financial Statements
    within Generations 2005 Annual Report on
    Form 10-K
    for additional information regarding the PPAs.(b)
    
    Generation purchases retail
    electric and ancillary services from ComEd and buys power from
    PECO for Generations own use. See Note 17 of
    Generations Notes to Consolidated Financial Statements
    within Generations 2005 Annual Report on
    Form 10-K
    for additional information regarding the PPAs.(c)
    
    Generation receives a variety of
    corporate support services from BSC, including legal, human
    resources, financial, information technology and supply
    management services. All services are provided at cost,
    including applicable overhead. A portion of such services is
    capitalized. Some third-party reimbursements due to Generation
    are recovered through BSC.(d)
    
    Generation participates in
    Exelons intercompany money pool. Generation earns interest
    on its contributions to the money pool, and pays interest on its
    borrowings from the money pool at a market rate of interest.(e)
    
    Generation has a short-term
    receivable from ComEd, primarily representing ComEds legal
    requirements to remit collections of nuclear decommissioning
    costs from its customers to Generation.(f)
    
    In order to facilitate payment
    processing, Exelon processes certain invoice payments on behalf
    of Generation.(g)
    
    Generation has long-term payables
    to ComEd and PECO as a result of the nuclear decommissioning
    contractual construct whereby, to the extent the assets
    associated with decommissioning are greater than the applicable
    ARO, such amounts are due back to ComEd and PECO, as applicable,
    for payment to the customers. See Note 13 of
    Generations Notes to Consolidated Financial Statements
    within Generations 2005 Annual Report on
    Form 10-K
    for additional information.  17.
    Derivative
    Financial Instruments (Exelon, ComEd, PECO and
    Generation)  Interest-Rate
    Swaps (Exelon, ComEd and PECO)
    Fair-Value Hedges. fixed-to-floating Fixed-to-floating
  Cash-Flow Hedges.
   71




---



##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Energy-Related
    Derivatives (Exelon, ComEd and Generation)
    Form 10-K.
  mark-to-market
   72




---



##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    ExelonGeneration








Energy-Cash-Flow


Other


Proprietary











RelatedDerivatives

Hedges


Derivatives


Trading


Subtotal


ComEd


Other(a)


DerivativesCurrent assets

$
356


$
319


$
24


$
699


$



$
38


$
737Noncurrent assets


263



93



117



473







113



586Total
    mark-to-market
    energy contract assets

$
619


$
412


$
141


$
1,172


$



$
151


$
1,323Current liabilities

$
(529
)

$
(327
)

$
(18
)

$
(874
)

$
(5
)

$
(6
)

$
(885
)Noncurrent liabilities


(230
)


(74
)


(116
)


(420
)


(3
)


(81
)


(504
)Total
    mark-to-market
    energy contract liabilities

$
(759
)

$
(401
)

$
(134
)

$
(1,294
)

$
(8
)

$
(87
)

$
(1,389
)Total
    mark-to-market
    energy contract net assets (liabilities)

$
(140
)

$
11


$
7


$
(122
)

$
(8
)

$
64


$
(66
)     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises
    and investments in synthetic fuel-producing facilities.  Normal Operations and Hedging Activities
    (Generation).
  Cash-Flow Hedges (Generation).
  Total Cash-FlowHedge OCI Activity,Three Months Ended June 30, 2006

Net of Income TaxAccumulated OCI derivative loss at
    April 1, 2006

$
(223
)Changes in fair value


117Reclassifications from OCI to net
    income


22Accumulated OCI derivative loss at
    June 30, 2006

$
(84
)   73




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Total Cash-FlowHedge OCI Activity,Six Months Ended June 30, 2006

Net of Income TaxAccumulated OCI derivative loss at
    December 31, 2005

$
(314
)Changes in fair value


163Reclassifications from OCI to net
    income


67Accumulated OCI derivative loss at
    June 30, 2006

$
(84
)   Total Cash-FlowHedge OCI Activity,Three Months Ended June 30, 2005

Net of Income TaxAccumulated OCI derivative loss at
    April 1, 2005

$
(259
)Changes in fair value


(28
)Reclassifications from OCI to net
    income


63Accumulated OCI derivative loss at
    June 30, 2005

$
(224
)   Total Cash-FlowHedge OCI Activity,Six Months Ended June 30, 2005

Net of Income TaxAccumulated OCI derivative loss at
    December 31, 2004

$
(137
)Changes in fair value


(204
)Reclassifications from OCI to net
    income


117Accumulated OCI derivative loss at
    June 30, 2005

$
(224
)       Other Derivatives (Exelon, ComEd and
    Generation). mark-to-market mark-to-market mark-to-market mark-to-market mark-to-market
 74




---



##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Three Months Ended June 30, 2006

Generation


ComEd(a)


Other(b)


ExelonUnrealized
    mark-to-market
    gains

$
30


$
2


$
28


$
60Realized
    mark-to-market
    gains


28



1







29Total net
    mark-to-market
    gains

$
58


$
3


$
28


$
89     (a)
    
    See Energy-Related
    Derivatives above.(b)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises
    and investments in synthetic fuel-producing facilities.  Six Months Ended June 30, 2006

Generation


ComEd(a)


Other(b)


ExelonUnrealized
    mark-to-market
    gains (losses)

$
(26
)

$
(9
)

$
41


$
6Realized
    mark-to-market
    gains


63



1







64Total net
    mark-to-market
    gains (losses)

$
37


$
(8
)

$
41


$
70     (a)
    
    See Energy-Related
    Derivatives above.(b)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises
    and investments in synthetic fuel-producing facilities.  Three Months Ended June 30, 2005

Generation


ComEd


Other(a)


ExelonUnrealized
    mark-to-market
    gains (losses)

$
(28
)

$



$
16


$
(12
)Realized
    mark-to-market
    gains


7











7Total net
    mark-to-market
    gains (losses)

$
(21
)

$



$
16


$
(5
)     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises
    and investments in synthetic fuel-producing facilities.  Six Months Ended June 30, 2005

Generation


ComEd


Other(a)


ExelonUnrealized
    mark-to-market
    gains

$
25


$



$
16


$
41Realized
    mark-to-market
    gains


17











17Total net
    mark-to-market
    gains

$
42


$



$
16


$
58     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises
    and investments in synthetic fuel-producing facilities.  Proprietary Trading Activities
    (Generation). mark-to-market mark-to-market mark-to-market mark-to-market
 75




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##### Table of Contents



EXELON
    CORPORATION AND SUBSIDIARY COMPANIES
    COMMONWEALTH EDISON COMPANY AND SUBSIDIARY COMPANIES
    PECO ENERGY COMPANY AND SUBSIDIARY COMPANIES
    EXELON GENERATION COMPANY, LLC AND SUBSIDIARY COMPANIES
    COMBINED NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Three Months


Six MonthsEnded


EndedJune 30,


June 30,2006


2005


2006


2005Unrealized
    mark-to-market
    gains

$
2


$
5


$
4


$
10Realized
    mark-to-market
    losses


(2
)


(1
)


(4
)


(1
)Total net
    mark-to-market
    gains

$



$
4


$



$
9   Credit
    Risk Associated with Derivative Instruments (Exelon and
    Generation)
   76




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##### Table of Contents



Item 2.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations    General
    
    ComEd,whose business includes the purchase and regulated
    retail and wholesale sale of electricity and distribution and
    transmission services in northern Illinois, including the City
    of Chicago.
    PECO,whose businesses include the purchase and regulated
    retail sale of electricity and distribution and transmission
    services in southeastern Pennsylvania, including the City of
    Philadelphia, and the purchase and regulated retail sale of
    natural gas and distribution services in the Pennsylvania
    counties surrounding the City of Philadelphia.
    Generation,which consists principally of the electric
    generating facilities and wholesale energy marketing operations
    of Generation, the competitive retail sales business of Exelon
    Energy Company and certain other generation projects.     EXELON
    CORPORATION  Executive
    Overview
  Financial Results.
      
    higher margins on Generations wholesale market sales;
    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 the AmerGen
    nuclear plants;
    unrealized
    mark-to-market
    gains on contracts not yet settled;
    a reserve recorded by Generation in 2005 for estimated future
    asbestos-related bodily injury claims;
    increased electric revenues at PECO associated with certain
    scheduled rate increases; and
    increased kilowatthour (kWh) deliveries, excluding the effects
    of weather, reflecting load growth at ComEd and PECO.    
    unfavorable weather conditions in Exelons service
    territories;
    reduced earnings from investments in synthetic fuel-producing
    facilities and the impairment of the associated intangible asset; 77




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##### Table of Contents




    increased depreciation and amortization expense, primarily
    related to competitive transition charge (CTC) amortization at
    PECO;
    higher operating and maintenance expenses, including expenses
    related to stock-based compensation as a result of adopting FASB
    Statement No. 123 (revised 2004), Share-Based
    Payment (SFAS No. 123-R) and the impacts of
    inflation;
    increased interest expense associated with the debt issued in
    March 2005 to fund Exelons pension
    contributions; and
    gains realized in 2005 on AmerGens decommissioning trust
    fund investments related to changes to the investment strategy.  Investment Strategy.
  
    Proposed Merger with Public Service Enterprise Group
    Incorporated (PSEG)  On December 20, 2004,
    Exelon entered into a merger agreement with PSEG (Merger). On
    May 30, 2006, the Nuclear Regulatory Commission approved
    the Merger and transfer of the nuclear plant operating licenses
    from PSEG Nuclear to Generation.      Financing Activities.
  Regulatory and Environmental Developments.
  
    ComEd Procurement Filing  On January 24,
    2006, the Illinois Commerce Commission (ICC) approved
    ComEds procurement case, authorizing ComEd to procure
    power after 2006 through a reverse-auction
    competitive bidding process and to recover the costs from retail
    customers with no markup. The first auction is scheduled to take
    place in September. The ICC order is being appealed.
    ComEd Rate Case (Rate Case)  In 2005, ComEd
    made a rate case filing seeking to review its tariff and to
    adjust ComEds rates for delivering electricity to users in
    its service area, effective January 2007, in order to reflect
    ComEds rising costs and significant capital investment in
    its delivery system. ComEd proposed a 78




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##### Table of Contents




    ComEd Residential Rate Stabilization  On
    May 23, 2006, ComEd filed a residential rate stabilization
    proposal to ease residential customers transition after
    2006 to cost-based rates from frozen rates, which would require
    regulatory approval to implement. Under the proposal,
    residential rate increases would be capped at 8% in 2007, an
    additional 7% in 2008 and an additional 6% in 2009. Costs that
    exceed the caps would be deferred and recovered with carrying
    charges over three years from 2010 to 2012. The plan would
    terminate under a force majeure event or if ComEds senior
    unsecured credit rating for at least one of the three major
    credit rating agencies falls below investment grade. ComEd is
    reviewing this initiative in light of the ICC order in the Rate
    Case.
    Nuclear Fleet Inspection  In February 2006,
    Exelon and Generation launched an initiative across its nuclear
    fleet to systematically assess systems that handle tritium and
    take the necessary actions to minimize the risk of inadvertent
    discharge of tritium into the environment. The initiative is in
    response to the detection of tritium in water samples taken
    related to leaks at the Braidwood, Byron and Dresden nuclear
    generating stations in Illinois. There is no health or safety
    threat to existing drinking water wells or sources based on
    current testing results, and the drinking water tested in
    residential wells meets federal safe drinking water standards.
    Exelon and Generation continue to monitor these matters and are
    working with state and local officials to determine the
    appropriate remediation plans, where necessary. As part of an
    agreement Exelon and Generation reached in May 2006 with the
    Illinois Attorney General, Will County States Attorney and
    Illinois Environmental Protection Agency, in June 2006,
    Generation began remediation of the contaminated groundwater at
    Braidwood. The remediation program could take 12 months or
    longer to complete.  Outlook for 2006 and Beyond.
  
    Exelon expects the Merger will result in synergies, cost savings
    and operating efficiencies. Although Exelon expects to achieve
    these anticipated benefits of the Merger, achieving them is
    subject to a number of uncertainties.
    Certain governmental officials and consumer advocacy groups
    claim that ComEds retail rates for electricity should not
    be based solely on its cost to procure electricity in the
    wholesale market. If the price at which ComEd is allowed to sell
    electricity beginning in 2007 is below ComEds cost to
    procure and deliver electricity, there may be material adverse
    consequences to ComEd and, possibly, Exelon. However, the
    ICCs unanimous approval of the reverse-auction process,
    barring any successful appeals or change in law, should provide
    ComEd with stability and greater certainty that it will be able
    to procure energy and pass 79




---



##### Table of Contents



through the costs of that energy to ComEds customers
    beginning in 2007 through a transparent market mechanism in the
    reverse-auction competitive bidding process.  
    The price of power purchased and sold in the open wholesale
    energy markets can vary significantly in response to market
    conditions. Generally, between 60% and 70% of Generations
    supply currently serves ComEd and PECO customers. Consequently,
    Generation has historically limited its earnings exposure from
    the volatility of the wholesale energy market to the energy
    generated in excess of the ComEd and PECO requirements, as well
    as any other contracted longer term obligations. Following the
    expiration of the purchased power agreement (PPA) with ComEd at
    the end of 2006, approximately 70% to 80% of Generations
    supply will be exposed to energy market prices, increasing the
    volatility of Exelons results. The PPA between Generation
    and PECO expires at the end of 2010. Current market prices for
    electricity have increased significantly over the past few years
    due to the rise in natural gas and fuel prices. As a result,
    Generations margins have improved due to its significant
    capacity of low-cost nuclear generating facilities.
    Generations ability to maintain those margins will depend
    on future fossil fuel prices and its ability to obtain high
    capacity factors at its nuclear plants. As mentioned previously,
    following the expiration of the PPA between ComEd and
    Generation, Exelon will increase the amount of power sold into
    the wholesale energy market. Based on recent increases in market
    prices, power now being sold to ComEd is likely to be sold in
    2007 at higher prices than the prices previously received as
    part of the PPA.
    Federal and state governing bodies have begun to introduce, and
    in some cases approve, legislation mandating the future use of
    renewable and alternative fuel sources, such as wind, solar,
    biomass and geothermal. The extent of the use of these renewable
    and alternative fuel sources varies by state and could change.
    The future requirement to use these renewable and alternative
    fuel sources for some portion of ComEds and PECOs
    distribution sales could result in increased fuel costs and
    capital expenditures.
    Select northeast and mid-Atlantic states are currently
    developing a model rule, via the Regional Greenhouse Gas
    Initiative (RGGI), to regulate carbon emissions from
    fossil-fired generation in participating states starting in
    2009. Federal
    and/or state
    legislation to regulate carbon emissions could occur in the
    future. If these plans become effective, Exelon may incur costs
    to either further limit the emissions from certain of its
    fossil-fuel fired facilities or in procuring emission allowance
    credits issued by various governing bodies. However, Exelon may
    benefit from stricter emission standards due to its significant
    nuclear capacity, which is not anticipated to be affected by the
    proposed emission standards.
    Exelon anticipates that it will be subject to the ongoing
    pressures of rising operating expenses due to increases in costs
    such as medical benefits and rising payroll costs due to
    inflation. Also, Exelon will continue to incur significant
    capital costs associated with its commitment to produce and
    deliver energy reliably to its customers. Increasing capital
    costs may include the price of uranium which fuels the nuclear
    facilities and continued capital investment in Exelons
    aging distribution infrastructure and generating facilities.
    Exelon is determined to operate its businesses responsibly and
    to appropriately manage its operating and capital costs while
    serving its customers and producing value for its shareholders.
    Exelon, through three wholly owned subsidiaries, has investments
    in synthetic fuel-producing facilities. The IRS provides tax
    credits for such facilities under Section 45k (formerly
    Section 29) of the Internal Revenue Code. The
    operators of the synthetic fuel-producing facilities in which
    Exelon has interests idled the facilities in May 2006 primarily
    due to the level and volatility of oil prices. If oil prices
    continue to increase from current levels, Exelon may no longer
    earn tax credits related to the investments for the remainder of
    2006 and 2007. However, Exelon is anticipating to generate
    approximately $120 million of cash over the life of these
    investments. See Note 10 of the Combined Notes to
    Consolidated Financial Statements and Liquidity and Capital
    Resources for further discussion.  Critical
    Accounting Policies and Estimates
  Form 10-K
 80




---



##### Table of Contents



Stock-Based
    Compensation Cost (Exelon, ComEd, PECO and
    Generation)
  SFAS No. 123-R,
  Goodwill
    (Exelon and ComEd)
      New
    Accounting Pronouncements
   81




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##### Table of Contents



Results
    of Operations  Exelon Corporation
  Three
    Months Ended June 30, 2006 Compared To Three Months Ended
    June 30, 2005
  Three MonthsEnded


FavorableJune 30,


(Unfavorable)Exelon Corporation

2006


2005


VarianceOperating revenues

$
3,697


$
3,484


$
213Operating expensesPurchased power and fuel expense


1,073



1,156



83Operating and maintenance expense


881



929



48Depreciation and amortization


371



325



(46
)Taxes other than income


170



177



7Total operating expenses


2,495



2,587



92Operating income


1,202



897



305Other income and deductions


(198
)


(174
)


(24
)Income from continuing
    operations before income taxes


1,004



723



281Income taxes


363



207



(156
)Income from continuing
    operations


641



516



125Income (loss) from discontinued
    operations, net of income taxes


3



(2
)


5Net income

$
644


$
514


$
130Diluted earnings per
    share

$
0.95


$
0.76


$
0.19   Net Income. mark-to-market SFAS No. 123-R. mark-to-market
  Operating Revenues.
  Purchased Power and Fuel
    Expense.
 82




---



##### Table of Contents



Operating and Maintenance
    Expense. mark-to-market SFAS No. 123-R.
  Depreciation and Amortization
    Expense.
  Taxes Other Than Income.
  Other Income and Deductions.
  Effective Income Tax Rate.
  Discontinued Operations.
    Results
    of Operations by Business Segment
    Income
    from Continuing Operations by Business Segment
  Three Months Ended


FavorableJune 30,


(Unfavorable)2006


2005


VarianceComEd

$
127


$
109


$
18PECO


93



110



(17
)Generation


497



297



200Other(a)


(76
)






(76
)Total

$
641


$
516


$
125  83




---



##### Table of Contents



(a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises,
    investments in synthetic fuel-producing facilities and
    intersegment eliminations.  Net
    Income by Business Segment
  Three Months Ended


FavorableJune 30,


(Unfavorable)2006


2005


VarianceComEd

$
127


$
109


$
18PECO


93



110



(17
)Generation


500



296



204Other(a)


(76
)


(1
)


(75
)Total

$
644


$
514


$
130     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises,
    investments in synthetic fuel-producing facilities and
    intersegment eliminations.  Results
    of Operations  ComEd
  Three Months Ended


FavorableJune 30,


(Unfavorable)2006


2005


VarianceOperating revenues

$
1,453


$
1,488


$
(35
)Operating expensesPurchased power


766



858



92Operating and maintenance


218



202



(16
)Depreciation and amortization


106



101



(5
)Taxes other than income


71



73



2Total operating expenses


1,161



1,234



73Operating income


292



254



38Other income and
    deductionsInterest expense


(77
)


(77
)


Equity in losses of unconsolidated
    affiliates


(3
)


(4
)


1Other, net


1



7



(6
)Total other income and deductions


(79
)


(74
)


(5
)Income before income
    taxes


213



180



33Income taxes


86



71



(15
)Net income

$
127


$
109


$
18   Net Income.
 84




---



##### Table of Contents



Operating Revenues.
  Increase(Decrease)Weather

$
(71
)Customer choice


(16
)Volume


22Rate changes and mix


21Retail revenue


(44
)Wholesale and miscellaneous
    revenues


6Mark-to-market
    wholesale contract


3Decrease in operating revenues

$
(35
)   Weather.
  Customer choice.
    Three Months Ended June 30,2006


2005Retail customers purchasing energy
    from an alternative electric supplier:Volume (GWhs)(a)


5,063



4,825Percentage of total retail
    deliveries


24
%


22
%Retail customers purchasing energy
    from an alternative electric supplier or the ComEd PPO:Number of customers at period end


16,100



22,300Percentage of total retail
    customers


(b
)


(b
)Volume (GWhs)(a)


6,552



7,893Percentage of total retail
    deliveries


31
%


36
%     (a)
    
    One GWh is the equivalent of one
    million kilowatthours (kWh).(b)
    
    Less than one percent.  Volume.
  Rate changes and mix. year-over-year
 85




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##### Table of Contents



Wholesale and miscellaneous revenues.
  Mark-to-market
    wholesale
    contract. Market-to-market mark-to-market
  Purchased Power Expense.
  Increase(Decrease)Prices

$
(54
)Weather


(37
)Customer choice


(19
)PJM Interconnection, LLC (PJM)
    transmission


(1
)Volume


15SECA rates


6Other


(2
)Decrease in purchased power expense

$
(92
)   Prices.
  Weather.
  Customer choice.
  PJM transmission.
  Volume.
  Seams Elimination Charge/Cost Adjustment/Assignment (SECA)
    rates.
 86




---



##### Table of Contents



Operating and Maintenance Expense.
  Increase(Decrease)Corporate allocations

$
6Wages and salaries


4Fringe benefits(a)


3Severance-related expenses


3PSEG merger integration costs


2Other


(2
)Increase in operating and
    maintenance expense

$
16     (a)
    
    Reflects increases in various
    fringe benefits including increased stock-based compensation
    expense of $6 million offset by decreased pension and other
    postretirement benefits costs of $3 million.  Depreciation and Amortization
    Expense.
  Increase(Decrease)Depreciation expense associated
    with higher plant balances

$
3Other amortization expense


2Increase in depreciation and
    amortization expense

$
5   Taxes Other Than Income.
  Increase(Decrease)Real estate taxes

$
(3
)Other


1Decrease in taxes other than income

$
(2
)   Interest Expense.
  Other, Net.
  Increase(Decrease)Gain (loss) on disposal of assets
    and investments, net

$
(4
)Other


(2
)Decrease in other, net

$
(6
)   Income Taxes.
 87




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##### Table of Contents



ComEd
    Electric Operating Statistics and Revenue Detail
  Three MonthsEnded June 30,Retail Deliveries  (in GWhs)

2006


2005


Variance


% ChangeFull
    service(a)Residential


6,124



6,235



(111
)


(1.8
)%Small commercial &
    industrial


5,709



5,103



606



11.9
%Large commercial &
    industrial


2,430



2,103



327



15.5
%Public authorities &
    electric railroads


514



521



(7
)


(1.3
)%Total full service


14,777



13,962



815



5.8
%PPOSmall commercial &
    industrial


814



1,433



(619
)


(43.2
)%Large commercial &
    industrial


675



1,635



(960
)


(58.7
)%1,489



3,068



(1,579
)


(51.5
)%Delivery
    only(b)Small commercial &
    industrial


1,291



1,495



(204
)


(13.6
)%Large commercial &
    industrial


3,772



3,330



442



13.3
%5,063



4,825



238



4.9
%Total PPO and delivery only


6,552



7,893



(1,341
)


(17.0
)%Total retail
    deliveries


21,329



21,855



(526
)


(2.4
)%     (a)
    
    Full service reflects deliveries to
    customers taking electric service under tariffed rates.(b)
    
    Delivery only service reflects
    customers electing to receive generation service from an
    alternative electric supplier.  88




---



##### Table of Contents



Three MonthsEnded June 30,Electric Revenue

2006


2005


Variance


% ChangeFull
    service(a)Residential

$
547


$
559


$
(12
)


(2.1
)%Small commercial &
    industrial


452



413



39



9.4
%Large commercial &
    industrial


130



105



25



23.8
%Public authorities &
    electric railroads


32



32







Total full service


1,161



1,109



52



4.7
%PPO(b)Small commercial &
    industrial


61



99



(38
)


(38.4
)%Large commercial &
    industrial


42



93



(51
)


(54.8
)%103



192



(89
)


(46.4
)%Delivery
    only(c)Small commercial &
    industrial


21



27



(6
)


(22.2
)%Large commercial &
    industrial


40



41



(1
)


(2.4
)%61



68



(7
)


(10.3
)%Total PPO and delivery only


164



260



(96
)


(36.9
)%Total electric retail
    revenues


1,325



1,369



(44
)


(3.2
)%Wholesale and miscellaneous
    revenue(d)


125



119



6



5.0
%Mark-to-market
    wholesale contract


3







3



n.m.Total operating
    revenues

$
1,453


$
1,488


$
(35
)


(2.4
)%     (a)
    
    Full service revenue reflects
    deliveries to customers taking electric service under tariffed
    rates which include the cost of energy and the cost of the
    transmission and the distribution of the energy.(b)
    
    Revenues from customers choosing
    the PPO include an energy charge at market rates, transmission
    and distribution charges, and a CTC.(c)
    
    Delivery only revenues reflect
    revenue under tariff rates from customers electing to receive
    generation service from an alternative electric supplier, which
    includes a distribution charge and a CTC.(d)
    
    Wholesale and miscellaneous
    revenues include transmission revenue (including revenue from
    PJM), sales to municipalities and other wholesale energy sales.   89




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##### Table of Contents



Results
    of Operations  PECO
  Three MonthsEnded


FavorableJune 30,


(Unfavorable)2006


2005


VarianceOperating revenues

$
1,148


$
1,044


$
104Operating expensesPurchased power and fuel


577



503



(74
)Operating and maintenance


141



119



(22
)Depreciation and amortization


172



137



(35
)Taxes other than income


53



60



7Total operating expenses


943



819



(124
)Operating income


205



225



(20
)Other income and
    deductionsInterest expense


(67
)


(70
)


3Equity in losses of unconsolidated
    affiliates


(2
)


(4
)


2Other, net


2



6



(4
)Total other income and deductions


(67
)


(68
)


1Income before income
    taxes


138



157



(19
)Income taxes


45



47



2Net income


93



110



(17
)Preferred stock dividends


1



1



Net income on common
    stock

$
92


$
109


$
(17
)   Net Income.
  Operating Revenues.
  TotalIncreaseElectric


Gas


(Decrease)Rate increases

$
59


$
26


$
85Customer choice


16







16Volume


15



(1
)


14Other rate changes and mix


9







9Weather


(10
)


(17
)


(27
)Retail revenue


89



8



97Miscellaneous revenues


7







7Increase in operating revenues

$
96


$
8


$
104  90




---



##### Table of Contents



Rate increases.
  Customer choice.
    Three Months Ended June 30,2006


2005Retail customers purchasing energy
    from an alternative electric supplier:Number of customers at period end


38,300



71,200Percentage of total retail
    customers


3
%


5
%Volume (GWhs)(a)


188



535Percentage of total retail
    deliveries


2
%


6
%     (a)
    
    One GWh is the equivalent of one
    million kilowatthours (kWh).    Volume.
  Other rate changes and mix.
  Weather.
  Miscellaneous revenues.
 91




---



##### Table of Contents



Purchased Power and Fuel Expense.
  TotalIncreaseElectric


Gas


(Decrease)Prices

$
41


$
26


$
67Customer choice


16







16PJM transmission


8







8Volume


5



(1
)


4Weather


(4
)


(14
)


(18
)Other


(2
)


(1
)


(3
)Increase in purchased power and
    fuel expense

$
64


$
10


$
74   Prices.
  Customer choice.
  PJM transmission.
  Volume.
  Weather.
  Operating and Maintenance Expense.
  Increase(Decrease)Contractors(a)

$
11Allowance for uncollectible
    accounts(b)


7Fringe benefits(c)


4PSEG merger integration costs


1Implementation of new customer
    information and billing system


(2
)Other


1Increase in operating and
    maintenance expense

$
22     (a)
    
    Reflects higher professional fees
    associated with tax consulting and various other increases.(b)
    
    Reflects the following factors, all
    of which increased expense in 2006 as compared to 2005:
    (i) higher accounts receivable balances in 2006 compared to
    2005 resulting from increased revenues; (ii) changes in
    PAPUC-approved regulations which relaxed customer payment terms;
    and (iii) an increase in the number of low-income customers
    participating in customer assistance programs, which allow for
    the forgiveness of certain receivables.(c)
    
    Reflects increases in various
    fringe benefits including increased stock-based compensation
    expense of $2 million. 92




---



##### Table of Contents



Depreciation and Amortization
    Expense.
  Taxes Other Than Income.
  Increase(Decrease)State franchise tax adjustment in
    2006(a)

$
(7
)Sales and use tax adjustment in
    2006(a)


(5
)Taxes on utility revenues(b)


5Decrease in taxes other than income

$
(7
)     (a)
    
    Represents the reduction of tax
    accruals in the second quarter of 2006 following settlements
    related to prior year tax assessments.(b)
    
    As these taxes were collected from
    customers and remitted to the taxing authorities and included in
    revenues and expenses, the increase in tax expense was offset by
    a corresponding increase in revenues.  Interest Expense.
  Other, Net.
  Income Taxes.
  PECO
    Electric Operating Statistics and Revenue Detail
    Three MonthsEndedJune 30,Retail Deliveries  (in GWhs)

2006


2005


Variance


% ChangeFull
    service(a)Residential


2,719



2,686



33



1.2
%Small commercial &
    industrial


1,869



1,730



139



8.0
%Large commercial &
    industrial


3,875



3,705



170



4.6
%Public authorities &
    electric railroads


229



205



24



11.7
%Total full service


8,692



8,326



366



4.4
%Delivery
    only(b)Residential


14



74



(60
)


(81.1
)%Small commercial &
    industrial


163



315



(152
)


(48.3
)%Large commercial &
    industrial


11



146



(135
)


(92.5
)%Total delivery only


188



535



(347
)


(64.9
)%Total retail
    deliveries


8,880



8,861



19



0.2
%     (a)
    
    Full service reflects deliveries to
    customers taking electric service under tariffed rates.(b)
    
    Delivery only service reflects
    customers receiving electric generation service from an
    alternative electric supplier.  93




---



##### Table of Contents



Three MonthsEndedJune 30,Electric Revenue

2006


2005


Variance


% ChangeFull
    service(a)Residential

$
392


$
359


$
33



9.2
%Small commercial &
    industrial


236



203



33



16.3
%Large commercial &
    industrial


319



283



36



12.7
%Public authorities &
    electric railroads


22



19



3



15.8
%Total full service


969



864



105



12.2
%Delivery
    only(b)Residential


1



6



(5
)


(83.3
)%Small commercial &
    industrial


9



17



(8
)


(47.1
)%Large commercial &
    industrial


1



4



(3
)


(75.0
)%Total delivery only


11



27



(16
)


(59.3
)%Total electric retail
    revenues


980



891



89



10.0
%Miscellaneous revenues(c)


60



53



7



13.2
%Total electric and other
    revenue

$
1,040


$
944


$
96



10.2
%     (a)
    
    Full service revenue reflects
    revenue from customers taking electric service under tariffed
    rates which includes the cost of energy, the cost of the
    transmission and the distribution of the energy and a CTC.(b)
    
    Delivery only revenue reflects
    revenue from customers receiving generation service from an
    alternative electric supplier, which includes a distribution
    charge and a CTC.(c)
    
    Miscellaneous revenues include
    transmission revenue from PJM and other wholesale energy sales.  PECO
    Gas Sales Statistics and Revenue Detail
    Three MonthsEndedJune 30,Deliveries to customers (in million cubic feet (mmcf))

2006


2005


Variance


% ChangeRetail sales


6,292



7,398



(1,106
)


(14.9
)%Transportation


6,139



6,019



120



2.0
%Total


12,431



13,417



(986
)


(7.3
)% Three MonthsEndedJune 30,Revenue

2006


2005


Variance


% ChangeRetail sales

$
103


$
95


$
8



8.4
%Transportation


4



4







0.0
%Resales and other


1



1







0.0
%Total gas revenue

$
108


$
100


$
8



8.0
%  94




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##### Table of Contents



Results
    of Operations  Generation
  Three Months Ended


FavorableJune 30,


(Unfavorable)2006


2005


VarianceOperating revenues

$
2,214


$
2,105


$
109Operating expensesPurchased power and fuel


843



945



102Operating and maintenance


440



602



162Depreciation and amortization


72



63



(9
)Taxes other than income


41



39



(2
)Total operating expenses


1,396



1,649



253Operating income


818



456



362Other income and
    deductionsInterest expense


(40
)


(29
)


(11
)Equity in gains (losses) of
    unconsolidated affiliates


(1
)


4



(5
)Other, net


14



51



(37
)Total other income and deductions


(27
)


26



(53
)Income from continuing
    operations before income taxes


791



482



309Income taxes


294



185



(109
)Income from continuing
    operations


497



297



200Income from discontinued
    operations, net of income taxes


3



(1
)


4Net income

$
500


$
296


$
204   Net Income.
  Operating Revenues.
  Three MonthsEndedJune 30,Revenue

2006


2005


Variance


% ChangeElectric sales to affiliates

$
1,098


$
1,133


$
(35
)


(3.1
)%Wholesale and retail electric sales


943



783



160



20.4
%Total energy sales revenue


2,041



1,916



125



6.5
%Retail gas sales


91



95



(4
)


(4.2
)%Trading portfolio


3



3







n.m.Other revenue(a)


79



91



(12
)


(13.2
)%Total revenue

$
2,214


$
2,105


$
109



5.2
%  95




---



##### Table of Contents



(a)
    
    Includes sales related to tolling
    agreements, fossil fuel sales and decommissioning revenue from
    ComEd and PECO.  n.m. Not meaningful Three MonthsEndedJune 30,Sales (in GWhs)

2006


2005


Variance


% ChangeElectric sales to affiliates


27,947



28,582



(635
)


(2.2
)%Wholesale and retail electric sales


18,744



18,410



334



1.8
%Total sales


46,691



46,992



(301
)


(0.6
)%     Electric sales to affiliates.
  Wholesale and retail electric sales.
  Increase(Decrease)Price

$
146Volume


14Increase in wholesale and retail
    electric sales

$
160     Retail gas sales.
  Other revenues.
  Purchased Power and Fuel
    Expense.
  Three MonthsEndedJune 30,Supply Source (in GWhs)

2006


2005


Variance


% ChangeNuclear generation(a)


35,442



34,685



757



2.2
%Purchases  non-trading
    portfolio


8,101



9,061



(960
)


(10.6
)%Fossil and hydroelectric generation


3,148



3,246



(98
)


(3.0
)%Total supply


46,691



46,992



(301
)


(0.6
)%  96




---



##### Table of Contents



(a)
    
    Represents Generations
    proportionate share of the output of its nuclear generating
    plants, including Salem, which is operated by PSEG Nuclear, LLC.    Increase(Decrease)Price

$
54Volume


(76
)Mark-to-market


(80
)Decrease in purchased power and
    fuel expense

$
(102
)   Price.
  Volume.
  Mark-to-market. Mark-to-market
    Three Months EndedJune 30,($/MWh)

2006


2005


% ChangeAverage electric revenueElectric sales to affiliates

$
39.29


$
39.64



(0.9
)%Wholesale and retail electric sales


50.31



42.53



18.3
%Total  excluding the
    trading portfolio


43.71



40.77



7.2
%Average electric supply
    cost (a)  excluding the trading portfolio


16.04



18.17



(11.7
)%Average margin 
    excluding the trading portfolio


27.67



22.60



22.4
%     (a)
    
    Average supply cost includes
    purchased power and fuel costs associated with electric sales.
    Average electric supply cost does not include fuel costs
    associated with retail gas sales and other sales.    Three MonthsEndedJune 30,2006

2005Nuclear fleet capacity factor(a)


95.5
%


95.4
%Nuclear fleet production cost per
    MWh(a)

$
12.94


$
11.93     (a)
    
    Excludes Salem, which is operated
    by PSEG Nuclear, LLC.   97




---



##### Table of Contents



Operating and Maintenance Expense.
  Increase(Decrease)Reduction in ARO

$
(149
)2005 accrual for estimated future
    asbestos-related bodily injury claims


(43
)Pension, payroll and benefit costs


33Other


(3
)Decrease in operating and
    maintenance expense

$
(162
)     
    The recognition of operating income of $149 million which
    represents the reduction in the ARO in excess of the existing
    ARO balance for the AmerGen units (see further discussion in
    Note 11 of the Combined Notes to Consolidated Financial
    Statements);
    A $43 million liability established in June 2005 for
    estimated future asbestos-related bodily injury claims (see
    Note 13 to the Combined Notes to Consolidated Financial
    Statements for further discussion); and
    A $33 million increase in various fringe benefits including
    increased stock-based compensation of $8 million and
    increased direct and allocated costs related to payroll, pension
    and other postretirement benefits expense.  Depreciation and Amortization.
  Interest Expense. pre-1983
  Other, Net.
  Effective Income Tax Rate.
 98




---



##### Table of Contents



Discontinued Operations.
  Results
    of Operations  Exelon Corporation
  Six
    Months Ended June 30, 2006 Compared To Six Months Ended
    June 30, 2005
  Six MonthsEnded


FavorableJune 30,


(Unfavorable)Exelon Corporation

2006


2005


VarianceOperating revenues

$
7,559


$
7,045


$
514Operating expensesPurchased power and fuel expense


2,534



2,347



(187
)Operating and maintenance expense


1,906



1,877



(29
)Depreciation and amortization


735



644



(91
)Taxes other than income


364



349



(15
)Total operating expenses


5,539



5,217



(322
)Operating income


2,020



1,828



192Other income and deductions


(415
)


(370
)


(45
)Income from continuing
    operations before income taxes


1,605



1,458



147Income taxes


564



435



(129
)Income from continuing
    operations


1,041



1,023



18Income from discontinued
    operations, net of income taxes


3



12



(9
)Net income

$
1,044


$
1,035


$
9Diluted earnings per
    share

$
1.55


$
1.53


$
0.02   Net Income. mark-to-market SFAS No. 123-R; mark-to-market
 99




---



##### Table of Contents



Operating Revenues. mark-to-market
  Purchased Power and Fuel
    Expense.
  Operating and Maintenance
    Expense. SFAS No. 123-R; mark-to-market
  Depreciation and Amortization
    Expense.
  Taxes Other Than Income.
  Other Income and Deductions. pre-1983
  Effective Income Tax Rate.
  Discontinued Operations.
   100




---



##### Table of Contents



Results
    of Operations by Business Segment
    Income
    from Continuing Operations by Business Segment
  Six MonthsEnded


FavorableJune 30,


(Unfavorable)2006


2005


VarianceComEd

$
181


$
179


$
2PECO


186



239



(53
)Generation


765



601



164Other(a)


(91
)


4



(95
)Total

$
1,041


$
1,023


$
18     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises,
    investments in synthetic fuel-producing facilities and
    intersegment eliminations.  Net
    Income by Business Segment
  Six MonthsEnded


FavorableJune 30,


(Unfavorable)2006


2005


VarianceComEd

$
181


$
179


$
2PECO


186



239



(53
)Generation


768



616



152Other(a)


(91
)


1



(92
)Total

$
1,044


$
1,035


$
9     (a)
    
    Other includes corporate
    operations, shared service entities, including BSC, Enterprises,
    investments in synthetic fuel-producing facilities and
    intersegment eliminations. 101




---



##### Table of Contents



Results
    of Operations  ComEd
  Six Months


FavorableEnded June 30,


(Unfavorable)2006


2005


VarianceOperating revenues

$
2,880


$
2,875


$
5Operating expensesPurchased power


1,628



1,679



51Operating and maintenance


434



404



(30
)Depreciation and amortization


205



198



(7
)Taxes other than income


152



151



(1
)Total operating expenses


2,419



2,432



13Operating income


461



443



18Other income and
    deductionsInterest expense


(153
)


(151
)


(2
)Equity in losses of unconsolidated
    affiliates


(5
)


(8
)


3Other, net


1



13



(12
)Total other income and deductions


(157
)


(146
)


(11
)Income before income
    taxes


304



297



7Income taxes


123



118



(5
)Net income

$
181


$
179


$
2   Net Income.
  Operating Revenues.
  Increase(Decrease)Weather

$
(92
)Volume


46Customer choice


31Rate changes and mix


13Retail revenue


(2
)Wholesale and miscellaneous
    revenues


15Mark-to-market
    wholesale contract


(8
)Increase in operating revenues

$
5   Weather.
  Volume.
 102




---



##### Table of Contents



Customer choice.
    Six MonthsEnded June 30,2006


2005Retail customers purchasing energy
    from an alternative electric supplier:Volume (GWhs)(a)


8,908



9,651Percentage of total retail
    deliveries


21
%


22
%Retail customers purchasing energy
    from an alternative electric supplier or the ComEd PPO:Number of customers at period end


16,100



22,300Percentage of total retail
    customers


(b
)


(b
)Volume (GWhs)(a)


13,428



15,228Percentage of total retail
    deliveries


31
%


35
%     (a)
    
    One GWh is the equivalent of one
    million kilowatt hours (KWh).(b)
    
    Less than one percent.  Rate changes and mix. year-over-year
  Wholesale and miscellaneous revenues.
  Mark-to-market
    wholesale
    contract. Market-to-market mark-to-market
  Purchased Power Expense.
  Increase(Decrease)Prices

$
(83
)Weather


(52
)Volume


28Customer choice


27SECA rates


24PJM transmission


6Other


(1
)Decrease in purchased power expense

$
(51
)   Prices.
 103




---



##### Table of Contents



Weather.
  Volume.
  Customer choice.
  SECA rates.
  PJM transmission.
  Operating and Maintenance Expense.
  Increase(Decrease)Fringe benefits(a)

$
15Wages and salaries


7PSEG merger integration costs


4Corporate allocations


4Severance-related expenses


3Other


(3
)Increase in operating and
    maintenance expense

$
30     (a)
    
    Reflects increases in various
    fringe benefits including increased stock-based compensation
    expense of $14 million primarily due to Exelons and
    ComEds adoption of SFAS No. 123-R on
    January 1, 2006 and increased pension and other
    postretirement benefits costs of $3 million.  Depreciation and Amortization
    Expense.
  Increase(Decrease)Depreciation expense associated
    with higher plant balances

$
5Other amortization expense


2Increase in depreciation and
    amortization expense

$
7  104




---



##### Table of Contents



Taxes Other Than Income.
  Increase(Decrease)Taxes on utility revenues(a)

$
(1
)Other


2Increase in taxes other than income

$
1     (a)
    
    As these taxes were collected from
    customers and remitted to the taxing authorities and included in
    revenues and expenses, the decrease in expense was offset by a
    corresponding decrease in revenues.  Interest Expense.
  Other, Net.
  Increase(Decrease)Gain (loss) on disposition of
    assets and investments, net

$
(6
)Sale of receivable in 2005


(3
)Interest income from intercompany
    money pool


(2
)Other


(1
)Decrease in other, net

$
(12
)   Income Taxes.
 105




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##### Table of Contents



ComEd
    Electric Operating Statistics and Revenue Detail
  Six MonthsEndedJune 30,Retail Deliveries  (in GWhs)

2006


2005


Variance


% ChangeFull
    service(a)Residential


12,921



13,346



(425
)


(3.2
)%Small commercial &
    industrial


11,028



10,211



817



8.0
%Large commercial &
    industrial


4,609



3,883



726



18.7
%Public authorities &
    electric railroads


1,115



1,052



63



6.0
%Total full service


29,673



28,492



1,181



4.1
%PPOSmall commercial &
    industrial


2,322



2,458



(136
)


(5.5
)%Large commercial &
    industrial


2,198



3,119



(921
)


(29.5
)%4,520



5,577



(1,057
)


(19.0
)%Delivery
    only(b)Small commercial &
    industrial


2,185



3,163



(978
)


(30.9
)%Large commercial &
    industrial


6,723



6,488



235



3.6
%8,908



9,651



(743
)


(7.7
)%Total PPO and delivery only


13,428



15,228



(1,800
)


(11.8
)%Total retail
    deliveries


43,101



43,720



(619
)


(1.4
)%     (a)
    
    Full service reflects deliveries to
    customers taking electric service under tariffed rates.(b)
    
    Delivery only service reflects
    customers electing to receive generation service from an
    alternative electric supplier.  106




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##### Table of Contents



Six MonthsEnded June 30,Electric Revenue

2006


2005


Variance


% ChangeFull
    service(a)Residential

$
1,096


$
1,124


$
(28
)


(2.5
)%Small commercial &
    industrial


839



784



55



7.0
%Large commercial &
    industrial


240



193



47



24.4
%Public authorities &
    electric railroads


68



65



3



4.6
%Total full service


2,243



2,166



77



3.6
%PPO(b)Small commercial &
    industrial


163



165



(2
)


(1.2
)%Large commercial &
    industrial


132



171



(39
)


(22.8
)%295



336



(41
)


(12.2
)%Delivery
    only(c)Small commercial &
    industrial


33



58



(25
)


(43.1
)%Large commercial &
    industrial


67



80



(13
)


(16.3
)%100



138



(38
)


(27.5
)%Total PPO and delivery only


395



474



(79
)


(16.7
)%Total electric retail
    revenues


2,638



2,640



(2
)


(0.1
)%Wholesale and miscellaneous
    revenue(d)


250



235



15



6.4
%Mark-to-market
    wholesale contract


(8
)






(8
)


n.m.Total operating
    revenues

$
2,880


$
2,875


$
5



0.2
%     (a)
    
    Full service revenue reflects
    deliveries to customers taking electric service under tariffed
    rates which include the cost of energy and the cost of the
    transmission and the distribution of the energy.(b)
    
    Revenues from customers choosing
    the PPO include an energy charge at market rates, transmission
    and distribution charges, and a CTC.(c)
    
    Delivery only revenues reflect
    revenue under tariff rates from customers electing to receive
    generation service from an alternative electric supplier, which
    includes a distribution charge and a CTC.(d)
    
    Wholesale and miscellaneous
    revenues include transmission revenue (including revenue from
    PJM), sales to municipalities and other wholesale energy sales.  n.m. Not meaningful
 107




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##### Table of Contents



Results
    of Operations  PECO
  Six MonthsEnded


FavorableJune 30,


(Unfavorable)2006


2005


VarianceOperating revenues

$
2,554


$
2,339


$
215Operating expensesPurchased power and fuel


1,389



1,200



(189
)Operating and maintenance


289



253



(36
)Depreciation and amortization


343



273



(70
)Taxes other than income


117



115



(2
)Total operating expenses


2,138



1,841



(297
)Operating income


416



498



(82
)Other income and
    deductionsInterest expense


(136
)


(142
)


6Equity in losses of unconsolidated
    affiliates


(6
)


(8
)


2Other, net


5



9



(4
)Total other income and deductions


(137
)


(141
)


4Income before income
    taxes


279



357



(78
)Income taxes


93



118



25Net income


186



239



(53
)Preferred stock dividends


2



2



Net income on common
    stock

$
184


$
237


$
(53
)   Net Income.
  Operating Revenues.
  TotalIncreaseElectric


Gas


(Decrease)Rate increases

$
103


$
156


$
259Customer choice


37







37Volume


33



(13
)


20Other rate changes and mix


15







15Weather


(42
)


(82
)


(124
)Retail revenue


146



61



207Miscellaneous revenues


13



(5
)


8Increase in operating revenues

$
159


$
56


$
215  108




---



##### Table of Contents



Rate increases.
  Customer choice.
    Six MonthsEndedJune 30,2006


2005Retail customers purchasing energy
    from an alternative electric supplier:Number of customers at period end


38,300



71,200Percentage of total retail
    customers


3
%


5
%Volume (GWhs)(a)


406



1,222Percentage of total retail
    deliveries


2
%


7
%     (a)
    
    One GWh is the equivalent of one
    million kilowatthours (kWh).    Volume.
  Other rate changes and mix.
  Weather.
  Miscellaneous revenues.
 109




---



##### Table of Contents



Purchased Power and Fuel Expense.
  TotalIncreaseElectric


Gas


(Decrease)Prices

$
73


$
156


$
229Customer choice


37







37PJM transmission


17







17Weather


(18
)


(68
)


(86
)Volume


11



(13
)


(2
)Other


(2
)


(4
)


(6
)Increase in purchased power and
    fuel expense

$
118


$
71


$
189   Prices.
  Customer choice.
  PJM transmission.
  Weather.
  Volume.
  Other.
  Operating and Maintenance Expense.
  Increase(Decrease)Allowance for uncollectible
    accounts(a)

$
20Fringe benefits(b)


15PSEG merger integration costs


2Environmental reserve(c)


(4
)Contractors


(2
)Other


5Increase in operating and
    maintenance expense

$
36     (a)
    
    Reflects the following factors, all
    of which increased expense in 2006 as compared to 2005:
    (i) higher accounts receivable balances in 2006 compared to
    2005 resulting from increased revenues; (ii) changes in
    PAPUC-approved regulations which relaxed customer payment terms;
    and (iii) an increase in the number of low-income customers
    participating in customer assistance programs, which allow for
    the forgiveness of certain receivables. 110




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##### Table of Contents



(b)
    
    Reflects increases in various
    fringe benefits including increased stock-based compensation
    expense of $7 million primarily due to Exelons and
    PECOs adoption of SFAS No. 123-R on
    January 1, 2006 and increased pension and other
    postretirement benefits costs of $3 million.(c)
    
    Represents a settlement related to
    one Superfund site in the first quarter of 2006. See
    Note 13 of the Combined Notes to Consolidated Financial
    Statements for additional information.  Depreciation and Amortization
    Expense.
  Increase(Decrease)CTC amortization

$
68Other


2Increase in depreciation and
    amortization expense

$
70     Taxes Other Than Income.
  Increase(Decrease)Taxes on utility revenues(a)

$
10Real estate tax adjustment in
    2005(b)


6State franchise tax adjustment in
    2006(c)


(7
)Sales and use tax adjustment in
    2006(c)


(5
)Other


(2
)Increase in taxes other than income

$
2     (a)
    
    As these taxes were collected from
    customers and remitted to the taxing authorities and included in
    revenues and expenses, the increase in tax expense was offset by
    a corresponding increase in revenues. Includes a $3 million
    adjustment for the period 2001 through 2005.(b)
    
    Represents the reduction of a real
    estate tax accrual in the first quarter of 2005 following
    settlements related to prior year tax assessments. See
    Note 13 of the Combined Notes to Consolidated Financial
    Statements for additional information.(c)
    
    Represents the reduction of tax
    accruals in the second quarter of 2006 following settlements
    related to prior year tax assessments.  Interest Expense.
  Other, net.
  Income Taxes.
 111




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##### Table of Contents



PECO
    Electric Operating Statistics and Revenue Detail
    Six MonthsEndedJune 30,Retail Deliveries  (in GWhs)

2006


2005


Variance


% ChangeFull
    service(a)Residential


5,917



5,955



(38
)


(0.6
)%Small commercial &
    industrial


3,753



3,462



291



8.4
%Large commercial &
    industrial


7,576



7,214



362



5.0
%Public authorities &
    electric railroads


472



431



41



9.5
%Total full service


17,718



17,062



656



3.8
%Delivery
    only(b)Residential


32



178



(146
)


(82.0
)%Small commercial &
    industrial


345



712



(367
)


(51.5
)%Large commercial &
    industrial


29



332



(303
)


(91.3
)%Total delivery only


406



1,222



(816
)


(66.8
)%Total retail
    deliveries


18,124



18,284



(160
)


(0.9
)%     (a)
    
    Full service reflects deliveries to
    customers taking electric service under tariffed rates.(b)
    
    Delivery only service reflects
    customers receiving electric generation service from an
    alternative electric supplier.  Six MonthsEndedJune 30,Electric Revenue

2006


2005


Variance


% ChangeFull
    service(a)Residential

$
795


$
744


$
51



6.9
%Small commercial &
    industrial


446



386



60



15.5
%Large commercial &
    industrial


614



546



68



12.5
%Public authorities &
    electric railroads


43



40



3



7.5
%Total full service


1,898



1,716



182



10.6
%Delivery
    only(b)Residential


2



13



(11
)


(84.6
)%Small commercial &
    industrial


18



35



(17
)


(48.6
)%Large commercial &
    industrial


1



9



(8
)


(88.9
)%Total delivery only


21



57



(36
)


(63.2
)%Total electric retail
    revenues


1,919



1,773



146



8.2
%Miscellaneous revenues(c)


118



105



13



12.4
%Total electric and other
    revenue

$
2,037


$
1,878


$
159



8.5
%     (a)
    
    Full service revenue reflects
    revenue from customers taking electric service under tariffed
    rates which includes the cost of energy, the cost of the
    transmission and the distribution of the energy and a CTC.(b)
    
    Delivery only revenue reflects
    revenue from customers receiving generation service from an
    alternative electric supplier, which includes a distribution
    charge and a CTC.(c)
    
    Miscellaneous revenues include
    transmission revenue from PJM and other wholesale energy sales. 112




---



##### Table of Contents



PECO
    Gas Sales Statistics and Revenue Detail
    Six MonthsEndedJune 30,Deliveries to Customers (in million cubic feet (mmcf))

2006


2005


Variance


% ChangeRetail sales


31,213



37,532



(6,319
)


(16.8
)%Transportation


13,019



13,564



(545
)


(4.0
)%Total


44,232



51,096



(6,864
)


(13.4
)% Six MonthsEndedJune 30,Revenue

2006


2005


Variance


% ChangeRetail sales

$
507


$
445


$
62



13.9
%Transportation


8



9



(1
)


(11.1
)%Resales and other


2



7



(5
)


(71.4
)%Total gas revenue

$
517


$
461


$
56



12.1
%   Results
    of Operations  Generation
  Six MonthsEnded


FavorableJune 30,


(Unfavorable)2006


2005


VarianceOperating revenues

$
4,434


$
4,125


$
309Operating expensesPurchased power and fuel


1,817



1,753



(64
)Operating and maintenance


1,108



1,211



103Depreciation and amortization


139



125



(14
)Taxes other than income


84



74



(10
)Total operating expenses


3,148



3,163



15Operating income


1,286



962



324Other income and
    deductionsInterest expense


(82
)


(58
)


(24
)Equity in gains (losses) of
    unconsolidated affiliates


(5
)


4



(9
)Other, net


20



69



(49
)Total other income and deductions


(67
)


15



(82
)Income from continuing
    operations before income taxes


1,219



977



242Income taxes


454



376



(78
)Income from continuing
    operations


765



601



164Income from discontinued
    operations, net of income taxes


3



15



(12
)Net income

$
768


$
616


$
152   Net Income.
 113




---



##### Table of Contents



Operating Revenues.
  Six MonthsEndedJune 30,Revenue

2006


2005


Variance


% ChangeElectric sales to affiliates

$
2,270


$
2,251


$
19



0.8
%Wholesale and retail electric sales


1,689



1,443



246



17.0
%Total energy sales revenue


3,959



3,694



265



7.2
%Retail gas sales


340



284



56



19.7
%Trading portfolio


5



9



(4
)


(44.4
)%Other revenue(a)


130



138



(8
)


(5.8
)%Total revenue

$
4,434


$
4,125


$
309



7.5
%     (a)
    
    Includes sales related to tolling
    agreements, fossil fuel sales and decommissioning revenue from
    ComEd and PECO.  Six MonthsEndedJune 30,Sales (in GWhs)

2006


2005


Variance


% ChangeElectric sales to affiliates


57,870



57,035



835



1.5
%Wholesale and retail electric sales


33,052



35,420



(2,368
)


(6.7
)%Total sales


90,922



92,455



(1,533
)


(1.7
)%     Electric sales to affiliates.
  Wholesale and retail electric sales.
  Increase(Decrease)Price

$
344Volume


(98
)Increase in wholesale and retail
    electric sales

$
246  114




---



##### Table of Contents



Retail gas sales.
  Other revenues.
  Purchased Power and Fuel
    Expense.
  Six MonthsEndedJune 30,Supply Source (in GWhs)

2006


2005


Variance


% ChangeNuclear generation(a)


68,933



67,465



1,468



2.2
%Purchases  non-trading
    portfolio


15,870



18,607



(2,737
)


(14.7
)%Fossil and hydroelectric generation


6,119



6,383



(264
)


(4.1
)%Total supply


90,922



92,455



(1,533
)


(1.7
)%     (a)
    
    Represents Generations
    proportionate share of the output of its nuclear generating
    plants, including Salem, which is operated by PSEG Nuclear, LLC.    Increase(Decrease)Price

$
253Volume


(194
)Mark-to-market


5Increase in purchased power and
    fuel expense

$
64   Price.
  Volume.
  Mark-to-market. Mark-to-market
 115




---



##### Table of Contents



Six MonthsEndedJune 30,($/MWh)

2006


2005


% ChangeAverage electric revenueElectric sales to affiliates

$
39.23


$
39.47



(0.6
)%Wholesale and retail electric sales


51.10



40.74



25.4
%Total  excluding the
    trading portfolio


43.54



39.95



9.0
%Average electric supply
    cost(a)  excluding the trading portfolio


16.23



16.04



1.2
%Average margin 
    excluding the trading portfolio


27.31



23.91



14.2
%     (a)
    
    Average supply cost includes
    purchased power and fuel costs associated with electric sales.
    Average electric supply cost does not include fuel costs
    associated with retail gas sales and other sales.    Six MonthsEndedJune 30,2006

2005Nuclear fleet capacity factor(a)


93.3
%


92.7
%Nuclear fleet production cost per
    MWh(a)

$
14.19


$
13.24     (a)
    
    Excludes Salem, which is operated
    by PSEG Nuclear, LLC.      Operating and Maintenance Expense.
  Increase(Decrease)Reduction in ARO

$
(149
)2005 accrual for estimated future
    asbestos-related bodily injury claims


(43
)Pension, payroll and benefit costs


76Other


13Decrease in operating and
    maintenance expense

$
(103
)  116




---



##### Table of Contents




    The recognition of operating income of $149 million which
    represents the reduction in the ARO in excess of the existing
    ARO balance for the AmerGen units (see further discussion in
    Note 11 of the Combined Notes to Consolidated Financial
    Statements);
    A $43 million liability established in June 2005 for
    estimated future asbestos-related bodily injury claims (see
    Note 13 to the Combined Notes to Consolidated Financial
    Statements for further discussion); and
    A $76 million increase in various fringe benefits including
    increased stock-based compensation of $22 million primarily
    as a result of Exelons adoption of
    SFAS No. 123-R as of January 1, 2006 and
    increased direct and allocated costs related to payroll, pension
    and other postretirement benefits expense.  Depreciation and Amortization.
  Taxes Other Than Income.
  Interest Expense. pre-1983
  Other, Net.
  Effective Income Tax Rate.
  Discontinued Operations.
  Liquidity
    and Capital Resources
   117




---



##### Table of Contents



Form 10-K
    Cash
    Flows from Operating Activities
       118




---



##### Table of Contents



Six MonthsEnded June 30,2006


2005


VarianceNet income

$
1,044


$
1,035


$
9Add (subtract):Non-cash operating activities(a)


1,091



1,547



(456
)Income taxes


300



24



276Changes in working capital and
    other noncurrent assets and liabilities(b)


(346
)


(393
)


47Pension  and non-pension
    postretirement benefits


99



(1,927
)


2,026Net cash flows provided by (used
    in) operations

$
2,188


$
286


$
1,902     (a)
    
    Represents depreciation,
    amortization and accretion, deferred income taxes, pension and
    non-pension postretirement benefit costs, equity in losses of
    unconsolidated affiliates, impairment charges and other non-cash
    charges.(b)
    
    Changes in working capital and
    other noncurrent assets and liabilities exclude the changes in
    commercial paper, income taxes and the current portion of
    long-term debt.      Six MonthsEnded June 30,2006


2005Exelon

$
2,188


$
286ComEd


575



(128
)PECO


562



301Generation


1,072



380       Exelon
  
    During the six months ended June 30, 2006 and June 30,
    2005, Exelon recorded impairment charges of $117 million
    and $0, respectively. As Exelon does not anticipate earning
    sufficient future tax credits to support the value of the
    intangible asset associated with Exelons investment in
    synthetic fuel-producing facilities, Exelon recorded an
    impairment charge of $115 million ($69 million after tax)
    during the second quarter of 2006. See Note 10 of the
    Combined Notes to Consolidated Financial Statements for further
    information regarding Exelons investment in synthetic
    fuel-producing facilities. 119




---



##### Table of Contents



ComEd
  
    At June 30, 2006 and December 31, 2005, ComEd had
    accrued payments to Generation under the PPA of
    $247 million and $242 million, respectively. At
    June 30, 2005 and December 31, 2004, ComEd had accrued
    payments to Generation under the PPA of $331 million and
    $189 million, respectively.  Generation
  
    During the three months ended June 30, 2006 and 2005,
    Generation had net collections and net disbursements of
    counterparty collateral of $183 million and
    $13 million, respectively. The increase in cash flows was
    primarily due to changes in collateral requirements resulting
    from increased activity within exchange-based markets for energy
    and fossil fuel.
    In January 2005, Exelon received a $102 million Federal
    income tax refund for capital losses generated in 2003 related
    to Generations previously owned investment in Sithe, which
    were carried back to prior periods. In the first quarter of
    2006, Exelon remitted a $98 million payment to the IRS in
    connection with the settlement of the IRSs challenge of
    the timing of the above-described deduction. This payment
    included $6 million of interest which was recognized as
    interest expense in the first quarter of 2006. Exelon expects to
    receive, in either the fourth quarter of 2006 or the first
    quarter of 2007, approximately $92 million related to this
    same deduction in connection with the filing of its 2005 tax
    return.  Cash
    Flows from Investing Activities
    Six MonthsEnded June 30,2006


2005Exelon

$
(1,360
)

$
(1,143
)ComEd


(461
)


(104
)PECO


(157
)


(58
)Generation


(666
)


(592
)     Six Months Ended


ProjectedJune 30, 2006


2006ComEd

$
465


$
925PECO


164



333Generation


512



1,115Other(a)


15



68Total Exelon capital expenditures

$
1,156


$
2,441     (a)
    
    Other includes corporate operations
    and shared service entities, including BSC.    ComEd and PECO.
 120




---



##### Table of Contents



Generation.
    Exelon
  
    Exelon contributed $53 million and $56 million to its
    investments in synthetic fuel-producing facilities during the
    six months ended June 30, 2006 and 2005, respectively.  ComEd
  
    As a result of its prior contributions to the Exelon
    intercompany money pool, $287 million was returned to ComEd
    during the six months ended June 30, 2005.  PECO
  
    As a result of its prior contributions to the Exelon
    intercompany money pool, $8 million and $34 million
    were returned to PECO during the six months ended June 30,
    2006 and 2005, respectively.
    During the six months ended June 30, 2005, there was a net
    decrease in restricted cash that provided $28 million of
    cash.  Generation
  
    On January 31, 2005, subsidiaries of Generation completed a
    series of transactions that resulted in Generations sale
    of its investment in Sithe. Specifically, subsidiaries of
    Generation acquired Reservoir Capital Groups 50% interest
    in Sithe for cash payments of $97 million and sold 100% of
    Sithe to Dynegy, for net cash proceeds of $103 million. See
    Note 4 of the Combined Notes to Consolidated Financial
    Statements for further discussion of the sale of Sithe.
    During the six months ended June 30, 2005, Generation
    received approximately $33 million from Generations
    nuclear decommissioning trust funds for reimbursement of
    expenditures previously incurred for nuclear plant
    decommissioning activities related to the retired units.  Acquisition of the Remaining Interest of Southeast Chicago
    Energy Project, LLC (SCEP). 20-year
   121




---



##### Table of Contents



Cash
    Flows from Financing Activities
    Six Months EndedJune 30,2006


2005Exelon

$
(686
)

$
903ComEd


(118
)


339PECO


(417
)


(268
)Generation


(416
)


241   Debt.
  Form 10-K
    Dividends.
  Six Months EndedJune 30,2006


2005Exelon

$
535


$
535ComEd






245PECO


253



233Generation


322



319   Form 10-K
 122




---



##### Table of Contents



Intercompany Money Pool.
  Commercial Paper.
  Retirement of Long-Term Debt to Financing
    Affiliates.
  Six Months Ended June 30,2006


2005Exelon

$
(422
)

$
(397
)ComEd


(174
)


(190
)PECO


(248
)


(207
)   Contributions from
    Parent/Member.
  Six Months Ended June 30,2006


2005ComEd

$



$
834PECO


71



180Generation






843   Other.
  
    Exelon purchased treasury shares totaling $53 million and
    $8 million during the six months ended June 30, 2006
    and 2005, respectively.
    Exelon received proceeds from employee stock plans of
    $107 million and $156 million during the six months
    ended June 30, 2006 and 2005, respectively.
    There was $29 million and $0 of excess tax benefits
    included as a cash inflow in other financing activities during
    the six months ended June 30, 2006 and 2005, respectively. 123




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##### Table of Contents



Credit
    Matters
  Exelon Credit Facilities.
    Aggregate Bank


Available


OutstandingBorrower

Commitment(a)


Capacity(b)


Commercial PaperExelon(c)

$
200


$
200


$
10ComEd


1,000



957



339PECO(c)


500



500



227Generation(c)


1,750



1,658



309     (a)
    
    Represents the total bank
    commitments to the borrower under credit agreements to which the
    borrower is a party.(b)
    
    Available capacity represents the
    unused bank commitments under the borrowers credit
    agreements net of outstanding letters of credit. The amount of
    commercial paper outstanding does not reduce the available
    capacity under the credit agreements.(c)
    
    Exelon, PECO and Generation are
    parties to two credit agreements with aggregate bank commitments
    of $1.5 billion. The credit agreements contain separate
    sublimits for Exelon, PECO and Generation, which are reflected
    in the table, which sublimits may be changed upon written
    notification to the bank group. Generation is also party to
    bilateral credit agreements with various banks with aggregate
    bank commitments of $950 million, which are reflected in
    the table above.        Exelon

ComEd

PECO

GenerationCredit agreement threshold

2.65 to 1

2.25 to 1

2.25 to 1

3.25 to 1       Intercompany Money Pool.
 124




---



##### Table of Contents







|           |  |             |     |  |          |   |     |             |  |   |   | 
|---------- |  | ----------- | --- |  | -------- | - | --- | ----------- |  | - | - | 
|           |  |             |     |  |          |   |     | June 30,    | 
|           |  |             |     |  |          |   |     | 2006        | 
|           |  | Maximum     |     |  | Maximum  |   |     | Contributed | 
|           |  | Contributed |     |  | Borrowed |   |     | (Borrowed)  | 
|          
|ComEd(a)   |  | $           |    |  |          | $ | 140 |             |  | $ |  | 
|PECO       |  |             | 21  |  |          |   | 83  |             |  |   |  | 
|Generation |  |             | 83  |  |          |   | 206 |             |  |   |  | 
|BSC        |  |             | 105 |  |          |   | 134 |             |  |   |  | 
|UII, LLC   |  |             | 4   |  |          |   |    |             |  |   |  | 
|Exelon     |  |             | 248 |  |          |   |    |             |  |   |  | 









|    |  |                                                                                                                                                                                                                     
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) |  | As of January 10, 2006, ComEd
    suspended participation in the intercompany money pool. During
    the first quarter of 2006, ComEd repaid $140 million that
    it had borrowed from the intercompany money pool.



Security Ratings.
















|                    |  |         |  |        
|------------------- |  | ------- |  | -------
|                    |  |         |  | Fitch  
|                    |  | Moodys |  | Ratings
|                   
|Senior Secured Debt |  | Baa2    |  | BBB+   
|Commercial Paper    |  | P-3     |  |        









Investments
    in Synthetic Fuel-Producing Facilities










125



---



##### Table of Contents



Contractual
    Obligations and Off-Balance Sheet Arrangements




Form 10-K




Exelon




| |   |                                                                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Letters of credit increased $61 million and guarantees
    decreased $85 million, respectively, primarily as a result
    of Generations energy trading activities.



ComEd




| |   |                                                                                          
| | - | -----------------------------------------------------------------------------------------
| |  | Letters of credit increased $16 million.                                                 
|
| |  | ComEd issued $325 million First Mortgage 5.90% Bonds,
    Series 103, due March 15, 2036.



Generation




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Letters of credit increased $45 million and guarantees
    decreased $62 million, respectively, primarily as a result
    of Generations energy trading activities.                                                                                                                                                                                                                                                                                                 
|
| |  | Pursuant to U.S. Environmental Protection Agency
    regulations that will impose limits on certain future emissions
    by generation stations, the co-owners of the Keystone generating
    station formally approved on June 30, 2006 a capital plan
    to install environmental controls at the station for which
    Exelons share, based on its 20.99% ownership
    interest, would be approximately $150 million over the life
    of the control project.





126



---



##### Table of Contents



COMMONWEALTH
    EDISON COMPANY  General
    Executive
    Overview
  Form 10-Q.
  Results
    of Operations
  Form 10-Q.
  Liquidity
    and Capital Resources
      Cash
    Flows from Operating Activities
  Form 10-Q.
  Cash
    Flows from Investing Activities
  Form 10-Q.
  Cash
    Flows from Financing Activities
  Form 10-Q.
  Credit
    Matters
  Form 10-Q.
  Contractual
    Obligations and Off-Balance Sheet Arrangements
  Form 10-Q.
 127




---



##### Table of Contents



PECO
    ENERGY COMPANY  General
    Executive
    Overview
  Form 10-Q.
  Results
    of Operations
  Form 10-Q.
  Liquidity
    and Capital Resources
      Cash
    Flows from Operating Activities
  Form 10-Q.
  Cash
    Flows from Investing Activities
  Form 10-Q.
  Cash
    Flows from Financing Activities
  Form 10-Q.
 128




---



##### Table of Contents



Credit
    Matters
  Form 10-Q.
  Contractual
    Obligations and Off-Balance Sheet Arrangements
  Form 10-Q.
 129




---



##### Table of Contents



EXELON
    GENERATION COMPANY  General
    Executive
    Overview
  Form 10-Q.
  Results
    of Operations
  Form 10-Q.
  Liquidity
    and Capital Resources
      Cash
    Flows from Operating Activities
  Form 10-Q.
  Cash
    Flows from Investing Activities
  Form 10-Q.
  Cash
    Flows from Financing Activities
  Form 10-Q.
 130




---



##### Table of Contents



Credit
    Matters
  Form 10-Q.
  Contractual
    Obligations and Off-Balance Sheet Arrangements
  Form 10-Q.
 131




---



##### Table of Contents



Item 3.
    Quantitative
    and Qualitative Disclosures About Market Risk    Commodity
    Price Risk (Exelon, ComEd and Generation)
    ComEd
    Generation
  Form 10-K.
  Normal Operations and Hedging
    Activities.
 132




---



##### Table of Contents



around-the-clock
    Proprietary Trading
    Activities. mark-to-market Value-at-Risk value-at-risk
  Trading and Non-Trading Marketing
    Activities.
  mark-to-market mark-to-market
  TotalTotal
    mark-to-market
    energy contract net liabilities at January 1, 2006

$
(540
)Total change in fair value during
    2006 of contracts recorded in earnings


(23
)Reclassification to realized at
    settlement of contracts recorded in earnings


60Reclassification to realized at
    settlement from OCI


112Effective portion of changes in
    fair value  recorded in OCI


269Purchase/sale/disposal of existing
    contracts or portfolios subject to
    mark-to-market


Total
    mark-to-market
    energy contract net liabilities at June 30, 2006

$
(122
)  133




---



##### Table of Contents



mark-to-market
  June 30,


December 31,2006


2005Current assets

$
699


$
916Noncurrent assets


473



286Total
    mark-to-market
    energy contract assets


1,172



1,202Current liabilities


(874
)


(1,282
)Noncurrent liabilities


(420
)


(460
)Total
    mark-to-market
    energy contract liabilities


(1,294
)


(1,742
)Total
    mark-to-market
    energy contract net liabilities

$
(122
)

$
(540
)   over-the-counter, over-the-counter
  mark-to-market mark-to-market mark-to-market
  Maturities Within2011 and


Total Fair(In millions)

2006


2007


2008


2009


2010


Beyond


ValueNormal Operations, qualifying
    cash-flow hedge contracts(a):Actively quoted prices

$



$



$



$



$



$



$
Prices provided by other external
    sources


(140
)


(22
)


22















(140
)Total

$
(140
)

$
(22
)

$
22


$



$



$



$
(140
)Normal Operations, other
    derivative contracts (b):Actively quoted prices

$
(56
)

$
(12
)

$
12


$



$



$



$
(56
)Prices provided by other external
    sources


53



29



(7
)














75Prices based on model or other
    valuation methods


(17
)


15



1















(1
)Total

$
(20
)

$
32


$
6


$



$



$



$
18     (a)
    
    Mark-to-market
    gains and losses on contracts that qualify as cash-flow hedges
    are recorded in OCI.(b)
    
    Mark-to-market
    gains and losses on other non-trading and trading derivative
    contracts that do not qualify as cash-flow hedges are recorded
    in earnings. 134




---



##### Table of Contents



Total Cash-Flow Hedge OCI Activity,Net of Income TaxPower Team Normal


Interest-Rate


TotalOperations and


and Other


Cash-Flow(In millions)

Hedging Activities


Hedges


HedgesAccumulated OCI derivative loss at
    January 1, 2006

$
(314
)

$
(4
)

$
(318
)Changes in fair value


163



2



165Reclassifications from OCI to net
    income


67







67Accumulated OCI derivative loss at
    June 30, 2006

$
(84
)

$
(2
)

$
(86
)   Credit
    Risk (Exelon and Generation)
  Generation
      Total








Number of


Net Exposure ofExposure








Counterparties


CounterpartiesBefore Credit


Credit


Net


Greater than 10%


Greater than 10%Rating as of June 30, 2006(a)

Collateral


Collateral


Exposure


of Net Exposure


of Net ExposureInvestment grade

$
700


$
139


$
561



1


$
93Non-investment grade


12



2



10







No external ratingsInternally rated 
    investment grade


45



17



28







Internally rated 
    non-investment grade


5



4



1







Total

$
762


$
162


$
600



1


$
93     (a)
    
    This table does not include
    accounts receivable exposure.  135




---



##### Table of Contents



Maturity of Credit Risk ExposureExposure


Total ExposureLess than





Greater than


Before CreditRating as of June 30, 2006(a)

2 Years


2-5 Years


5 Years


CollateralInvestment grade

$
631


$
69


$



$
700Non-investment grade


12











12No external ratingsInternally rated 
    investment grade


45











45Internally rated 
    non-investment grade


5











5Total

$
693


$
69


$



$
762     (a)
    
    This table does not include
    accounts receivable exposure.  Collateral.
  ISOs.
  Exelon
    Interest-Rate
    Risk (Exelon, ComEd, PECO and Generation)
  Variable Rate Debt.
 136




---



##### Table of Contents



Equity
    Price Risk (Exelon and Generation)
  Form 10-K
 137




---



##### Table of Contents



Item 4.
    Controls
    and Procedures     PART II 
    OTHER INFORMATION  Item 1.
    Legal
    Proceedings  Form 10-K
  Item 1A.
    Risk
    Factors    The
    Registrants may incur substantial costs to fulfill their
    obligations related to environmental and other
    matters.
  clean-up
 138




---



##### Table of Contents



Exelon
    may have difficulty in successfully completing required
    divestitures following completion of the Merger.
  Form 10-K
  The IRS
    might successfully challenge certain leveraged lease
    transactions entered into by PSEG, which could have a material
    adverse impact on the combined companys operating
    results.
  Form 10-K.
  Item 2.
    Unregistered
    Sales of Equity Securities and Use of Proceeds  Exelon
    Maximum Number(or ApproximateTotal Number of


Dollar Value) ofShares Purchased


Shares that MayTotal Number





As Part of Publicly


Yet Be Purchasedof Shares


Average Price


Announced Plans


Under the PlansPeriod

Purchased(a)


Paid per Share


or Programs(b)


or ProgramsApril 1  April 30,
    2006


19,697


$
52.84







(b
)May 1  May 31, 2006


1,592



52.64







(b
)June 1  June 30,
    2006


1,503



56.83







(b
)Total


22,792



53.30







(b
)  139




---



##### Table of Contents



(a)
    
    Shares other than those purchased
    as part of a publicly announced plan primarily represent
    restricted shares surrendered by employees to satisfy tax
    obligations arising upon the vesting of restricted shares.(b)
    
    In April 2004, Exelons Board
    of Directors approved a discretionary share repurchase program
    that allows Exelon to repurchase shares of its common stock on a
    periodic basis in the open market. The share repurchase program
    is intended to mitigate, in part, the dilutive effect of shares
    issued under Exelons employee stock option plan and
    Exelons Employee Stock Purchase Plan (ESPP). The aggregate
    shares of common stock repurchased pursuant to the program
    cannot exceed the economic benefit received after
    January 1, 2004 due to stock option exercises and share
    purchases pursuant to Exelons ESPP. The economic benefit
    consists of direct cash proceeds from purchases of stock and tax
    benefits associated with exercises of stock options. The share
    repurchase program has no specified limit and no specified
    termination date.  Item 4.
    Submission
    of Matters to a Vote of Security Holders  Exelon
      Votes For


Votes WithheldM. Walter DAlessio


538,146,661



10,393,962Rosemarie B. Greco


538,573,356



9,967,267John M. Palms, Ph.D.


538,075,920



10,464,703John W. Rogers, Jr.


537,978,858



10,561,765Richard L. Thomas


537,741,898



10,798,725         Item 5.
    Other
    Information  ComEd
    PECO
   140




---



##### Table of Contents



Item 6.
    Exhibits  ExhibitNo.

Description10-1


Hold Separate Stipulation and
    Order dated as of June 22, 2006 in U.S. v. Exelon
    Corporation and Public Service Enterprise Group Incorporated,
    U.S. Dist. Ct. for the District of Columbia (File
    No. 001-16169,
    Form 8-K
    dated June 22, 2006, Exhibit 99.1)10-2


Proposed Final Judgment dated as
    of June 22, 2006 in U.S. v. Exelon Corporation and
    Public Service Enterprise Group Incorporated, U.S. Dist.
    Ct. for the District of Columbia (File
    No. 001-16169,
    Form 8-K
    dated June 22, 2006, Exhibit 99.2)   Rule 13a-14(a) 15d-14(a) 10-Q
  31-1




Filed by John W. Rowe for Exelon
    Corporation31-2




Filed by John F. Young for Exelon
    Corporation31-3




Filed by Frank M. Clark for
    Commonwealth Edison Company31-4




Filed by Robert K. McDonald for
    Commonwealth Edison Company31-5




Filed by John L. Skolds for PECO
    Energy Company31-6




Filed by John F. Young for PECO
    Energy Company31-7




Filed by John L. Skolds for Exelon
    Generation Company, LLC31-8




Filed by John F. Young for Exelon
    Generation Company, LLC   Form 10-Q
  32-1




Filed by John W. Rowe for Exelon
    Corporation32-2




Filed by John F. Young for Exelon
    Corporation32-3




Filed by Frank M. Clark for
    Commonwealth Edison Company32-4




Filed by Robert K. McDonald for
    Commonwealth Edison Company32-5




Filed by John L. Skolds for PECO
    Energy Company32-6




Filed by John F. Young for PECO
    Energy Company32-7




Filed by John L. Skolds for Exelon
    Generation Company, LLC32-8




Filed by John F. Young for Exelon
    Generation Company, LLC  141




---



##### Table of Contents



SIGNATURES   EXELON
    CORPORATION  /s/  John
    W. RoweJohn
    W. Rowe 
    Chairman, Chief Executive Officer and President
    (Principal Executive Officer)

/s/  John
    F. YoungJohn
    F. Young
    Executive Vice President, Finance and Markets
    and Chief Financial Officer
    (Principal Financial Officer)/s/  Matthew
    F.
    HilzingerMatthew
    F. Hilzinger
    Senior Vice President and Corporate Controller
    (Principal Accounting Officer)      COMMONWEALTH
    EDISON COMPANY  /s/  Frank
    M. ClarkFrank
    M. Clark
    Chairman and Chief Executive Officer
    (Principal Executive Officer)

/s/  J.
    Barry
    MitchellJ.
    Barry Mitchell
    President/s/  Robert
    K. McDonaldRobert
    K. McDonald
    Senior Vice President, Chief Financial Officer, Treasurer and
    Chief Risk Officer
    (Principal Financial Officer)

/s/  Matthew
    F.
    HilzingerMatthew
    F. Hilzinger
    Senior Vice President and Corporate 
    Controller, Exelon
    (Principal Accounting Officer)    142




---



##### Table of Contents



PECO
    ENERGY COMPANY  /s/  John
    L. SkoldsJohn
    L. Skolds
    President, Exelon Energy Delivery
    (Principal Executive Officer)

/s/  Denis
    P.
    OBrienDenis
    P. OBrien
    President/s/  John
    F. YoungJohn
    F. Young
    Executive Vice President, Finance and Markets
    and Chief Financial Officer, Exelon, and
    Chief Financial Officer
    (Principal Financial Officer)

/s/  Matthew
    F.
    HilzingerMatthew
    F. Hilzinger
    Senior Vice President and Corporate Controller,
    Exelon
    (Principal Accounting Officer)      EXELON
    GENERATION COMPANY, LLC  /s/  John
    L. SkoldsJohn
    L. Skolds
    President
    (Principal Executive Officer)

/s/  John
    F. YoungJohn
    F. Young
    Executive Vice President, Finance and Markets
    and Chief Financial Officer, Exelon, and
    Chief Financial Officer
    (Principal Financial Officer)/s/  Jon
    D. VeurinkJon
    D. Veurink
    Vice President and Controller
    (Principal Accounting Officer)    143