Exelon Corp. 8-K Summary: PJM Capacity Auction Results
Business Context and Reporting Period
This Form 8-K, filed on May 24, 2018, reports on the results of the PJM Interconnection capacity auction for the 2021-2022 planning year. The results were announced on May 23, 2018, and take effect on June 1, 2021. The filing covers Exelon Corporation and its subsidiary, Exelon Generation Company, LLC.
Key Financial Metrics and Auction Results
The filing details cleared capacity volumes and prices by zone. Total cleared capacity for Exelon is 12,775 MW, comprising 9,950 MW of nuclear and 2,825 MW of fossil/other generation. The filing does not provide specific revenue, profit, cash flow, or debt figures for the reporting period.
| Zone | Nuclear (MW) | Fossil/Others (MW) | Sub Total (MW) | Price ($/MW) |
|---|---|---|---|---|
| COMED | 5,175 | 0 | 5,175 | 196 |
| EMAAC | 3,925 | 2,100 | 6,025 | 166 |
| SWMAAC | 850 | 0 | 850 | 140 |
| MAAC | 0 | 225 | 225 | 140 |
| BGE | 0 | 400 | 400 | 200 |
| RTO | 0 | 100 | 100 | 140 |
| Grand Total | 9,950 | 2,825 | 12,775 | - |
Material Changes and Unusual Items
- Failed Clearances: The Dresden and Three Mile Island nuclear plants did not clear the auction and will not receive capacity revenue for the 2021-2022 period. Additionally, all but a small portion of the Byron nuclear plant failed to clear.
- Operational Status: Despite failing to clear, Dresden and Byron are not at risk of early retirement. They remain committed to honoring capacity obligations through May 2021 and May 2022, respectively.
- Other Plants: Other Exelon nuclear plants in PJM cleared the auction. Oyster Creek did not participate as it is scheduled to retire by October 2018.
Guidance, Outlook, and Risks
The filing contains forward-looking statements subject to risks and uncertainties. Management directs investors to Exelon's 2017 Form 10-K and Q1 2018 Form 10-Q for detailed risk factors, including commitments and contingencies. The company cautions that actual results may differ materially from forward-looking statements and does not undertake an obligation to update these statements.
Investor Verification Checklist
- Verify the financial impact of lost capacity revenue for Dresden, Three Mile Island, and Byron on the 2021-2022 forecast.
- Confirm the specific "small portion" of Byron capacity that cleared the auction.
- Review the 2017 Form 10-K and Q1 2018 Form 10-Q for detailed risk factors regarding capacity market volatility.
- Monitor the operational status of Dresden and Byron to ensure they meet their capacity obligations despite not clearing the auction.