<PAGE>

                  THIRD SUPPLEMENTAL INDENTURE, dated as of April 1, 1998, by
and between PECO Energy Company, a Pennsylvania corporation (the "Company"), and
First Union National Bank, a national association, as successor Trustee, to an
Indenture, dated as of July 1, 1994 (the "Original Indenture"), by and between
the Company and Meridian Trust Company, the original Trustee, which was
supplemented by a First Supplemental Indenture (the "First Supplemental
Indenture") dated as of December 1, 1995 and a Second Supplemental Indenture
(the "Second Supplemental Indenture") dated as of June 1, 1997 (the Original
Indenture, as supplemented, the "Indenture").

                  WHEREAS, the Company has formed a wholly owned subsidiary,
PECO Energy Capital Corp., which is the general partner of PECO Energy Capital,
L.P., a Delaware limited partnership ("PECO Energy Capital"), to issue in series
from time to time its limited partner interests ("Preferred Securities") and to
loan the proceeds thereof, together with the investment by PECO Energy Capital
Corp. in PECO Energy Capital, to the Company and to effect other similar
arrangements.

                  WHEREAS, the Company has duly executed and delivered to the
Trustee the Original Indenture to provide for the issuance of one or more series
of deferrable interest subordinated debentures (herein sometimes called the
"Debentures"), issuable as in the Indenture provided, and authorized and issued
the initial series of Debentures which were designated therein as the 9%
Deferrable Interest Subordinated Debentures, Series A.

                  WHEREAS, the Company has duly executed and delivered to the
Trustee the First Supplemental Indenture authorizing and providing for the
issuance of the second series of Debentures which were designated the 8.72%
Deferrable Interest Subordinated Debentures, Series B.

                  WHEREAS, the Company has duly executed and delivered to the
Trustee the Second Supplemental Indenture authorizing and providing for the
issuance of the third series of Debentures which were designated the 8%
Deferrable Interest Subordinated Debentures, Series C.

                  WHEREAS, the Company desires to authorize and to effect the
issuance of a fourth series of Debentures in an aggregate principal amount of
$80,520,619 and to designate such series 7.38% Subordinated Deferrable Interest
Debentures, Series D (the "Series D Subordinated Debt Securities") under this
Third Supplemental Indenture.

                  WHEREAS, all things necessary to make the Series D
Subordinated Debt Securities when duly issued and executed by the Company and
authenticated and delivered hereunder, the valid obligations of the Company, and
to make this Third Supplemental Indenture a valid and binding agreement of the
Company, in accordance with its terms, have been done.

<PAGE>

                  NOW THEREFORE:

                  Each of the Company and the Trustee, intending to be legally
bound hereby, agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the Holders of the Series D Subordinated Debt
Securities:


                                    ARTICLE 1
                   DEFINITIONS AND INCORPORATION BY REFERENCE


SECTION 1.01.     Definitions.

                  "Additional Interest", with respect to the Series D
Subordinated Debt Securities, means amounts, if any, which PECO Energy Capital
would be required to pay as taxes, duties, assessments or governmental charges
of whatever nature (other than withholding taxes) imposed by the United States,
or any other taxing authority, with respect to the Series D Subordinated Debt
Securities.

                  "Issue Date" means April 6, 1998.

                  "Series D Subordinated Debt Securities" means any of the
Company's 7.38% Subordinated Deferrable Interest Debentures, Series D issued
under this Third Supplemental Indenture.

                  "Series D Subordinated Debt Securityholder" or "Series D
Holder" means a Person in whose name a Series D Subordinated Debt Security is
registered on the Registrar's books.

                  "Series D Preferred Securities" means the 7.38% Cumulative
Preferred Securities, Series D, representing limited partner interests of PECO
Energy Capital.

                  Unless otherwise defined herein, all other capitalized terms
used herein have the meanings set forth in the Original Indenture.


<PAGE>

                                    ARTICLE 2
                   THE SERIES D SUBORDINATED DEBT SECURITIES


SECTION 2.01.     Form of the Series D Subordinated Debt Securities;
                  Denominations.

                  The Series D Subordinated Debt Securities and the Trustee's
certificate of authentication shall be substantially in the form of Exhibit A
attached hereto. The terms and provisions contained in the Series D Subordinated
Debt Securities, a form of which is annexed hereto as Exhibit A, shall
constitute, and are hereby expressly made, a part of this Third Supplemental
Indenture. The Company and the Trustee, by their execution and delivery of this
Third Supplemental Indenture, expressly agree to such terms and provisions and
to be bound thereby.

                  The Trustee shall authenticate and make available for delivery
the Series D Subordinated Debt Securities for original issuance in the aggregate
principal amount of $80,520,619 to evidence the Company's obligation with
respect to the loan from PECO Energy Capital, upon receipt by the Trustee of a
Board of Directors resolution and a written order of the Company signed by two
Officers of the Company, but without any further action by the Company. Such
order shall specify the amount of the Series D Subordinated Debt Securities to
be authenticated and the date on which the original issuance of Series D
Subordinated Debt Securities is to be authenticated and delivered to evidence
the Company's obligation with respect to the loan from PECO Energy Capital. The
aggregate principal amount of Series D Subordinated Debt Securities outstanding
at any time may not exceed $80,520,619 except as provided in Section 2.09 of the
Original Indenture.

                  The Series D Subordinated Debt Securities shall be issuable
only in registered form without coupons and only in denominations of $1,000 and
any integral multiple thereof.

SECTION 2.09.     Replacement Debentures.

                  If (a) any mutilated Debenture is surrendered to the Company
or the Trustee, or (b) the Company and the Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Debenture, and there is
delivered to the Company and the Trustee such Debenture or indemnity as may be
required by them to save each of them harmless, then, in the absence of notice
to the Company or the Trustee that such Debenture has been acquired by a
protected purchaser, the Company shall execute in exchange for any such
mutilated Debenture or in lieu of any such destroyed, lost or stolen Debenture,
a new Debenture of like tenor and principal amount, bearing a number not
contemporaneously outstanding, and the Trustee shall authenticate and make such
new Debenture available for delivery.

<PAGE>

                  In case any such mutilated, destroyed, lost or stolen
Debenture has become or is about to become due and payable, or is about to be
redeemed by the Company pursuant to Article 3 hereof, the Company in its
discretion may, instead of issuing a new Debenture, pay or purchase such
Debenture, as the case may be.

                  Upon the issuance of any new Debentures under this Section
2.09, the Company may require the payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee) in connection
therewith.

                  Every new Debenture issued pursuant to this Section 2.09 in
lieu of any mutilated, destroyed, lost or stolen Debenture shall constitute an
original additional contractual obligation of the Company whether or not the
mutilated, destroyed, lost or stolen Debenture shall be at any time enforceable
by anyone, and shall be entitled to all benefits of this Indenture equally and
ratable with any and all other Debentures duly issued hereunder.

                  The provisions of this Section 2.09 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Debentures.

                                    ARTICLE 3
                                   REDEMPTION


SECTION 3.01.     Redemption; Notice to Trustee.

                  (a) The Series D Subordinated Debt Securities are subject to
redemption prior to maturity as provided in the form thereof attached hereto as
Exhibit A.

                  (b) If any or all of the Series D Subordinated Debt Securities
are to be redeemed pursuant to paragraph (a) above, in addition to the notices
required by the Original Indenture, the Company shall give notice by first class
mail, postage prepaid, to the Trustee at least 40 days prior to the date of such
redemption. Any such notice of redemption shall state the date and price of
redemption.

<PAGE>

SECTION 3.02.  Compliance with Terms of Indenture.

                  In case the Company shall desire to exercise such right to
redeem all or any part of said Series D Subordinated Debt Securities as
hereinbefore provided, it shall comply with all the terms and provisions of
Article III of the Original Indenture applicable thereto, and such redemption
shall be made under and subject to the terms and provisions of said Article III
and in the manner and with the effect therein provided, but at the time or times
and at the respective redemption rates and upon mailing of notice, all as
hereinbefore set forth in Section 3.01 of this Article.


                                    ARTICLE 4
                                EXTENSION PERIOD


SECTION 4.01.     Limitation on Right of Company to Extend Interest Payment
                  Period.

                  (b) Notwithstanding paragraph (a) of this Section 4.01 or any 
other provision herein to the contrary, the Company shall have the right in its
sole and absolute discretion at any time and from time to time while the
Debentures are outstanding, so long as an Event of Default has not occurred and
is continuing, to extend the interest payment period for up to 60 consecutive
months, provided that such extended interest period shall not extend beyond the
stated maturity date or redemption date of any series of Debentures, and
provided further that at the end of each Extension Period the Company shall pay
all interest then accrued and unpaid (provided that with respect to any series
of Debentures payable other than on a monthly basis, the Company shall, at the
end of each Extension Period, pay all interest then accrued and payable),
together with interest thereon compounded daily to the extent permitted by
applicable law at the rate per annum borne by the Debentures. Prior to the
termination of an Extension Period, the Company may shorten or may further
extend the interest payment period, provided that such Extension Period together
with all such further extensions may not exceed 60 months. The Company shall
give the Trustee notice of its selection of such extended or shortened interest
payment period at least one Business Day prior to the earlier of (i) the date
selected by the Company to make the interest payment or (ii) the date PECO
Energy Capital is required to give notice of the record or payment date of such
related distribution to any national securities exchange on which the Preferred
Securities are then listed or other applicable self-regulatory organization, but
in any event not less than two Business Days prior to such record date fixed by
the Company for the payment of such interest. The Company shall give or cause
the Trustee to give such notice of the Company's selection of such extended
interest payment period to the Holders.

<PAGE>


                                    ARTICLE 5
                             CONCERNING THE TRUSTEE

                  The Trustee hereby reaffirms acceptance of the trust herein
declared and provided and agrees to perform the same upon the terms and
conditions set forth in the Indenture, as supplemented by the First Supplemental
Indenture, the Second Supplemental Indenture and this Third Supplemental
Indenture, and upon the following terms and conditions:

SECTION 5.01.     Not Responsible for Recitals.

                  The Trustee shall not be responsible in any manner whatsoever
for or in respect of the validity or sufficiency of this Third Supplemental
Indenture or the due execution thereof by the Company or for or in respect of
the recitals contained herein, all of which recitals are made solely by the
Company.

SECTION 5.02.     Qualification Under Trust Indenture Act of 1939.

                  The Trustee hereby acknowledges that the Company proposes to
qualify this Third Supplemental Indenture under the Trust Indenture Act of 1939,
as amended.


                                    ARTICLE 6
                                 MISCELLANEOUS


SECTION 6.01.     Trust Indenture Act Controls.

                  If any provision of this Third Supplemental Indenture limits,
qualifies or conflicts with the duties imposed by operation of subsection (c) of
Section 318 of the TIA, the imposed duties shall control. The provisions of
Sections 310 to 317, inclusive, of the TIA that impose duties on any Person
(including provisions automatically deemed included in an indenture unless the
indenture provides that such provisions are excluded) as a part of and govern
this Third Supplemental Indenture, except as, and to the extent, they are
expressly excluded from this Third Supplemental Indenture, as permitted by the
TIA.

SECTION 6.02.     Severability Clause.

                  If any provision in this Third Supplemental Indenture or in
the Series D Subordinated Debt Securities shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

<PAGE>

SECTION 6.03.     Governing Law.

                  This Third Supplemental Indenture and the Series D
Subordinated Debt Securities shall be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania as applied to contracts made
and performed within the Commonwealth of Pennsylvania, without regard to its
principles of conflicts of laws.

SECTION 6.04.     No Recourse Against Others.

                  No director, officer, employee or stockholder, as such, of the
Company shall have any liability for any obligations of the Company under the
Series D Subordinated Debt Securities or this Third Supplemental Indenture or
for any claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Series D Subordinated Debt Security, each Series D
Subordinated Debt Securityholder shall waive and release all such liability. The
waiver and release shall be part of the consideration for the issuance of the
Series D Subordinated Debt Securities.

SECTION 6.05.  Use of Term "Trustee".

                  Unless otherwise clearly required by the context, the term,
"Trustee," or any other equivalent term used in this Third Supplemental
Indenture shall be held and construed to mean the Trustee under the Indenture
for the time being whether the original or a successor Trustee.

SECTION 6.06.  Confirmation of Original Indenture.

                  As supplemented by the First Supplemental Indenture, the
Second Supplemental Indenture and this Third Supplemental Indenture, the
Original Indenture, is in all respects ratified and confirmed, and this Third
Supplemental Indenture shall be read, taken and construed as a part of the
Indenture so that all of the rights, remedies, terms, conditions, covenants and
agreements of the Indenture shall apply and remain in full force and effect with
respect to this Third Supplemental Indenture and to the Series D Subordinated
Debt Securities issued hereunder.

SECTION 6.07.     Successors.

                  All agreements of the Company in this Third Supplemental
Indenture and the Series D Subordinated Debt Securities shall bind its
successors and assigns. All agreements of the Trustee in this Third Supplemental
Indenture shall bind its successors and assigns.

<PAGE>

SECTION 6.08.     Multiple Original Copies of this Indenture.

                  The parties may sign any number of copies of this Third
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. Any signed copy shall be sufficient proof
of this Third Supplemental Indenture.

SECTION 6.09.     Table of Contents; Headings, Etc.

                  The Table of Contents, Cross-Reference Table and headings of
the Articles and Sections of this Third Supplemental Indenture have been
inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions
hereof.

SECTION 6.10.     Benefits of the Indenture.

                  Except as expressly provided in Article 10 of the Original
Indenture, nothing in this Third Supplemental Indenture or in the Series D
Subordinated Debt Securities, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder, the Series D
Holders and the Special Representative, any benefit or any legal or equitable
right, remedy or claim under this Third Supplemental Indenture.

SECTION 6.11.  Date of Indenture.

                  This Third Supplemental Indenture is dated as of April 1,
1998, but was actually executed and delivered on April 6, 1998.

<PAGE>

SECTION 6.12.     Notices.

                  Any notice or communication shall be in writing and delivered
in person or mailed by first-class mail, postage prepaid, addressed as follows:

                           if to the Company:

                                    PECO Energy Company
                                    2301 Market Street
                                    P.O. Box 8699
                                    Philadelphia, Pennsylvania 19101
                                    Attention: Todd D. Cutler, Esq.
                                    Facsimile No.: (215) 841-5743

                           if to the Trustee:

                                    First Union National Bank
                                    Corporate Trust Administration
                                    123 S. Broad Street (PA-1249)
                                    Philadelphia, Pennsylvania 19109-1199

                  The Company or the Trustee, by giving notice to the other, may
designate additional or different addresses for subsequent notices or
communications. The Company shall notify the holder, if any, of Senior
Indebtedness of any such additional or different addresses of which the Company
receives notice from the Trustee.

                  Any notice or communication given to the Debentureholder other
than PECO Energy Capital shall be mailed to the Debentureholder at the
Debentureholder's address as it appears on the Register of the Registrar and
shall be sufficiently given if mailed within the time prescribed.

                  Failure to mail a notice or communication to a Debentureholder
or any defect in it shall not affect its sufficiency with respect to other
Debentureholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not received by the addressee.

                  If the Company mails a notice or communication to the
Debentureholders, it shall mail a copy to the Trustee and each Registrar, Paying
Agent or co-Registrar.




<PAGE>


                                   SIGNATURES

                  IN WITNESS WHEREOF, the undersigned, being duly authorized,
have executed this Third Supplemental Indenture on behalf of the respective
parties hereto as of the date first above written.


                                             PECO ENERGY COMPANY


                                             By: /s/ J. Barry Mitchell          
                                                --------------------------------
                                             Name:     J. Barry Mitchell        
                                                  ------------------------------
                                             Title:    Vice President - Finance 
                                                   -----------------------------

                                             FIRST UNION NATIONAL BANK,
                                             as Trustee


                                             By: /s/ George J. Rayzis           
                                                --------------------------------
                                             Name: George J. Rayzis             
                                                  ------------------------------
                                             Title: Vice President              
                                                   -----------------------------

PECO Energy Capital, L.P.

By its General Partner,
PECO Energy Capital Corp.

By: /s/ J. Barry Mitchell    
   ----------------------------
Name:  J. Barry Mitchell      
     --------------------------
Title:     President          
      -------------------------

<PAGE>

                                    Exhibit A

               7.38% Subordinated Deferrable Interest Debentures,
                                Series D due 2028

No. 1


         PECO Energy Company, a Pennsylvania corporation (the "Company"), which
term includes any successor corporation under the Indenture, as defined herein),
for value received, hereby promises to pay to PECO Energy Capital, L.P. or
registered assigns, the principal sum of Eighty Million Five Hundred Twenty
Thousand Six Hundred Nineteen Dollars ($80,520,619) on April 6, 2028, and to pay
interest on said principal sum from April 6, 1998 (the "Issue Date") or from the
most recent interest payment date (each such date, an "Interest Payment Date")
to which interest has been paid or duly provided for, semiannually in arrears on
April 30 and October 31 of each year commencing April 30, 1998 at the rate of
7.38% per annum plus Additional Interest, if any, until the principal hereof
shall have become due and payable, and on any overdue principal and premium, if
any, and (to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest at the same rate per
annum. If at any time PECO Energy Capital, L.P. ("PECO Energy Capital") would be
required to pay any taxes, duties or other governmental charges (other than
withholding taxes) imposed by the United States or any other taxing authority
then, in any such case, the Company also will pay as Additional Interest such
amounts as shall be required so that the net amounts received and retained by
PECO Energy Capital after paying any such taxes, duties or other governmental
charges will not be less than the amounts PECO Energy Capital would have
received had no such taxes, duties, assessments or other governmental charges
been imposed.

                  All capitalized terms used but not otherwise defined herein
have the meanings set forth in the Indenture (as defined herein).

                  The amount of interest payable on any Interest Payment Date
shall be computed on the basis of a 360-day year of twelve 30-day months. In the
event that any date on which interest is payable on the Series D Subordinated
Debt Securities is not a Business Day, then payment of interest payable on such
date will be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on such date. The interest installment so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in the Indenture, be paid to the person in whose name this
Series D Subordinated Debt Security is registered at the close of business on
the regular record date for such interest installment, which shall be April 15
and October 15 of each year. Any such interest installment not punctually paid
or duly provided for shall forthwith cease to be payable to the registered
holders on such regular record date, and may be paid to the person in whose name
this Series D Subordinated Debt Security is registered at the close of business
on a special record date to be fixed by the Trustee for the payment of such
defaulted interest, notice whereof shall be given to the registered holders of
this series of Debentures not less than ten days prior to such special record
date, as more fully provided in the Indenture. The principal of (and premium, if
any) and the interest on this Series D Subordinated Debt Security shall be
payable at the office or agency of the Company maintained for that purpose in
Wilmington, Delaware in any coin or currency of the United States of America
which at the time of payment is legal tender for payment of public and private
debts; provided however, that payment of interest may be made at the option of
the Company by check mailed to the registered holder at such address as shall
appear in the Debenture Register. Notwithstanding the foregoing, so long as the
holder of this Series D Subordinated Debt Security is PECO Energy Capital, the
payment of the principal of (and premium) and interest (including Additional
Interest, if any) on this Series D Subordinated Debt Security will be made at
such place and to such account as may be designated by PECO Energy Capital.

                                      A-1
<PAGE>

                  The indebtedness evidenced by this Series D Subordinated Debt
Security is, to the extent provided in the Indenture, subordinate and subject in
right of payment to the prior payment in full of all Senior Indebtedness, and
this Series D Subordinated Debt Security is issued subject to the provisions of
the Indenture with respect thereto. Each Holder of this Series D Subordinated
Debt Security, by accepting the same (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on its behalf to take such
action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee its attorney-in-fact for
any and all such purposes. Each Holder hereof, by its acceptance hereof, hereby
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such Holder upon
said provisions.

                  This Series D Subordinated Debt Security is one of a duly
authorized series of Debentures of the Company (herein sometimes referred to as
the "Series D Subordinated Debt Securities"), specified in the Indenture,
limited in aggregate principal amount as specified in the Indenture, issued
under and pursuant to an Indenture dated as of July 1, 1994, between the Company
and Meridian Trust Company, as Trustee, as supplemented by a First Supplemental
Indenture, dated as of December 1, 1995, a Second Supplemental Indenture, dated
as of June 1, 1997 and a Third Supplemental Indenture dated as of April 1, 1998
(as supplemented, the "Indenture") executed and delivered between the Company
and First Union National Bank, as successor Trustee to which reference is made
to the Indenture for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
the holders of the Series D Subordinated Debt Securities. By the terms of the
Indenture, Debentures are issuable in series which may vary as to amount, date
of maturity, rate of interest and in other respects as provided in the
Indenture.

                                      A-2
<PAGE>

                  The Series D Subordinated Debt Securities are subject to
mandatory redemption prior to maturity at 100% of the principal amount thereof
plus accrued interest to the redemption date as follows:

                  (i)      in whole upon the dissolution of PECO Energy Capital;
                           and

                  (ii)     in whole or in part upon a redemption of the
                           Series D Preferred Securities, but if in
                           part, in an aggregate principal amount equal
                           to the aggregate stated liquidation
                           preference of the Series D Preferred
                           Securities redeemed.

                  In the event of redemption of this Series D Subordinated Debt
Security in part only, a new Series D Subordinated Debt Security or Securities
for the unredeemed portion hereof will be issued in the name of the Holder
hereof upon the cancellation hereof.

                  In case an Event of Default shall have occurred and be
continuing, the principal of all of the Debentures may be declared, and upon
such declaration shall become, due and payable, in the manner, with the effect
and subject to the conditions provided in the Indenture.

                  The Indenture contains provisions for defeasance at any time
of the entire indebtedness of this Series D Subordinated Debt Security upon
compliance by the Company with certain conditions set forth therein.

                  Subject to certain exceptions in the Indenture which require
the consent of every Holder, (i) the Indenture or the Series D Subordinated Debt
Securities may be amended with the written consent of the Holders of a majority
in aggregate principal amount of the Series D Subordinated Debt Securities at
the time outstanding, and (ii) certain defaults or noncompliance with certain
provisions may be waived by the written consent of the holders of a majority in
aggregate principal amount of the Series D Subordinated Debt Securities at the
time outstanding. Subject to certain exceptions in the Indenture, without the
consent of any Debentureholder, the Company and the Trustee may amend the
Indenture or the Debentures to cure any ambiguity, defect or inconsistency, to
bind a successor to the obligations of the Indenture, to provide for
uncertificated Debentures in addition to certificated Debentures, to comply with
any requirements of the Debentures or the Securities and Exchange Commission in
connection with the qualification of the Indenture under the TIA, or to make any
change that does not adversely affect the rights of any Debentureholder.
Amendments bind all Holders and subsequent Holders.

                                      A-3
<PAGE>

                  No reference herein to the Indenture and no provision of this
Series D Subordinated Debt Security or of the Indenture shall alter or impair
the obligation of the Company, which is absolute and unconditional, to pay the
principal of and premium, if any, and interest on this Series D Subordinated
Debt Security at the time and place and at the rate and in the money herein
prescribed.

                  So long as an Event of Default has not occurred and is
continuing, the Company shall have the right at any time during the term of the
Series D Subordinated Debt Securities, from time to time to extend the interest
payment period of such Series D Subordinated Debt Securities to up to 60
consecutive months (the "Extended Interest Payment Period"), at the end of which
period the Company shall pay all interest then accrued and payable (together
with interest thereon at the rate specified for the Series D Subordinated Debt
Securities to the extent that payment of such interest is enforceable under
applicable law); provided that, during such Extended Interest Payment Period the
Company shall not declare or pay any dividend on, redeem or purchase any of its
capital stock. Prior to the termination of any such Extended Interest Payment
Period, the Company may further extend such Extended Interest Payment Period,
provided that such Period together with all such further extensions thereof
shall not exceed 60 consecutive months. At the termination of any such Extended
Interest Payment Period and upon the payment of all accrued and unpaid interest
and any additional amounts then due, the Company may select a new Extended
Interest Payment period.

                    As provided in the Indenture and subject to certain
limitations therein set forth, this Series D Subordinated Debt Security is
transferable by the registered holder hereof on the Debenture Register of the
Company, upon surrender of this Series D Subordinated Debt Security for
registration of transfer at the office or agency of the Registrar accompanied by
a written instrument or instruments of transfer in form satisfactory to the
Company or the Trustee duly executed by the registered holder hereof or its
attorney duly authorized in writing, and thereupon one or more new Series D
Subordinated Debt Securities of authorized denominations and for the same
aggregate principal amount and series will be issued to the designated
transferee or transferees. No service charge will be made for any such transfer,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in relation thereto.

                                      A-4
<PAGE>

                  Prior to presentment for registration of transfer of this
Series D Subordinated Debt Security, the Company, the Trustee, any paying agent
and any Debenture Registrar may deem and treat the registered holder hereof as
the absolute owner hereof (whether or not this Series D Subordinated Debt
Security shall be overdue and notwithstanding any notice of ownership or writing
hereon made by anyone other than the Debenture Registrar) for the purpose of
receiving payment of or on account of the principal hereof and premium, if any,
and interest due hereon and for all other purposes, and neither the Company nor
the Trustee nor any payment agent nor any Debenture Registrar shall be affected
by any notice to the contrary.

                  No recourse shall be had for the payment of the principal of
or the interest on this Series D Subordinated Debt Security, or for any claim
based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, stockholder, officer or director, past,
present or future, as such, of the Company or of any predecessor or successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the
issuance hereof, expressly waived and released. Series D Subordinated Debt
Securities issued are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Series D
Subordinated Debt Securities are exchangeable for a like aggregate principal
amount of Series D Subordinated Debt Securities of a different authorized
denomination, as requested by the Holder surrendering the same.

                  This Series D Subordinated Debt Security shall not be valid
until an authorized officer of the Trustee manually signs the Trustee's
Certificate of Authentication below.

                                      A-5

<PAGE>






                  IN WITNESS WHEREOF, the Company has caused this Series D
Subordinated Debt Security to be signed manually or by facsimile by its duly
authorized officers and a facsimile of its corporate seal to be affixed hereto
or imprinted hereon.


                                                PECO ENERGY COMPANY
(Seal)
                                                By: __________________________

                                                Name: ________________________

                                                Title: _______________________

Attest:_______________________

Dated: _______________________


TRUSTEE'S CERTIFICATE OF AUTHENTICATION 
This is one of the Debentures referred
to in the within-mentioned Indenture.

FIRST UNION NATIONAL BANK, as Trustee

By: ___________________________________
    Name:______________________________
    Title:_____________________________


                                      A-6