EXELON CORP (EXC) Risk Factors

Recent key developments

Concrete developments — dated events, named agreements and instruments, legal proceedings — that EXELON CORP surfaced in its latest filing.

• The ICC, PAPUC, MDPSC, DCPSC, DEPSC, and NJBPU impose distribution reliability standards on the Utility Registrants, and non-compliance could result in remediation costs and sanctions including substantial monetary penalties.
• The Registrants are currently involved in several proceedings relating to sites where hazardous substances have been deposited, including remediation costs for MGP operations conducted by predecessor companies.
• ComEd could be required to pay material damages to customers under Illinois law for extended outages affecting large numbers of customers.
• The Registrants and some of their vendors have experienced cybersecurity incidents, though none have resulted in material impact to date.
• Exelon has forecast substantial increases in load driven by increasing use of data processing facilities for cloud services, AI technologies, and other applications.
• As of December 31, 2025, approximately 17%, 11%, and 17% of the Registrants’ available credit facilities were with European, Canadian, and Asian banks, respectively.December 31, 2025
• PJM operating agreements contain collateral provisions tied to credit ratings and market prices, and PECO, BGE, and DPL's natural gas procurement contracts contain collateral provisions tied to credit ratings and forward market prices.
• ComEd, PECO, and BGE transferred generating assets to Constellation, which assumed certain rights and obligations, and each Utility Registrant transferred former generation assets to third parties who assumed obligations and provided indemnities.
• ComEd and PHI have material goodwill balances and perform annual goodwill impairment tests; regulatory actions, changes in discount/growth rate assumptions, or changes in projected operating/capital cash flows could result in impairments.
• A decline in the market value of Exelon's pension and OPEB plan assets would increase funding requirements, and plan liabilities are sensitive to changes in interest rates, demographics, and Social Security/Medicare eligibility.