Exelon splits utility and generation units

Exelon's electricity and gas utilities, which serve some 10 million customers in Delaware, the District of Columbia, Illinois, Maryland, New Jersey and Pennsylvania, will become part of the future RemainCo. The parent company for Exelon's generation assets, including over 18,700 MW of capacity from 21 reactors at facilities in Illinois, Maryland, New York and Pennsylvania, will be called SpinCo.

"Our industry is changing at a rapid pace and our customers expect us to continuously innovate to stay ahead of growing demand for clean energy, evolving business conditions and changing technology," Exelon President and CEO Christopher Crane said. "Now is the right time to take this step to best serve our customers, employees, community partners and shareholders. These are two strong, distinct businesses that will benefit from the strategic flexibility to focus on their unique customer, market and community priorities."

SpinCo will be the largest supplier of clean energy and sustainable solutions across the continental USA, Exelon said, producing about 12% of the country's carbon-free energy. As well as operating the nation's largest fleet of nuclear power plants, it also operates some 12,000 MWe of hydroelectric, wind, solar, natural gas and oil generation assets, providing a mix of baseload, intermediate and peak power generation.

"These characteristics make SpinCo uniquely positioned to advance the nation’s clean energy strategy and priorities," Exelon said.

It will retire uneconomic assets that negatively affect its ability to provide a reliable source of clean power to tens of millions of American homes and businesses, it added.

Exelon's six nuclear plants in Illinois generate more than half of that state's electricity and nearly 90% of its carbon-free energy, and it has highlighted their resilience and reliability - they continued to operate at nearly 100% output during recent extreme winter weather. However, the company last year announced the premature closure of two of those plants - two units each at Byron and Dresden - for economic reasons, citing unfavourable market rules. Four further Illinois units, at LaSalle and Braidwood, are also at risk of premature closure for the same reasons.

Exelon aims to complete the separation in the first quarter of 2022, subject to regulatory and other approvals and the satisfaction of other conditions. Crane and the existing management team will continue to lead the company until the public listing of SpinCo.