Joyce Carson - Vice President of Investor Relations John Young - EVP and CFO Frank Clark - Chairman and CEO of ComEd John Rowe - Chairman, President and CEO Jack Skolds - EVP and President of EED and Exelon Generation Darryl Bradford - General Counsel of ComEd Ian McLean - President of Exelon Power Team Bob McDonald - SVP

Greg Gordon - Citigroup John Kiani - Deutsche Bank Paul Fremont - Jefferies Hugh Wynne - Sanford Bernstein Ashar Khan - SAC Capital Michael Lapides - Goldman Sachs Jonathan Arnold - Merrill Lynch Daniele Seitz - Dahlman Rose Paul Patterson - Glenrock Associates Paul Ridzon - KeyBanc Capital Markets Nathan Judge - Atlantic Equities Zach Schreiber - Duquesne Capital

Good morning. My name is Jacque and I will be your conference operator today. At this time, I would like to welcome everyone to the Exelon Corporation Fourth Quarter 2006 Earnings Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer period. [Operator Instructions]. Thank you. It is now my pleasure to turn the floor over to your host, Joyce Carson, Vice President of Investor Relations. Madam, you may begin your conference.

Thank you, Jacque. Good morning and welcome to the Exelon's fourth quarter and yearend 2006 earnings review and update conference call. Thank you all for joining us today. We issued our earnings release this morning. If you haven't received it, the release is available on the Exelon website, at "www.exeloncorp.com," or you can call (inaudible) at 312-394-5222, and she will fax or e-mail the release to you. This call is being recorded and will be available through February the 6th by dialing 877-519-4471. The international call-in number is 973-341-3080. The confirmation code is 8292439. In addition, the call will be archived on the Exelon website. Before we begin today's discussions, let me remind you that the earnings release and other materials we discuss in today's call may contain forward-looking statements and estimates that are subject to various risks and uncertainties. Please refer to our SEC filings for discussions of factors that may cause results to differ from management's projections, forecasts and expectations. In our press release and during this call, we will discuss adjusted non-GAAP operating earnings that exclude the earnings impact of mark-to-market adjustments from non-trading activity; investments in synthetic fuel-producing facilities; certain costs associated with the terminated merger with PSEG; significant impairments of intangible assets, including goodwill; significant changes in decommissioning obligation estimates; severance and severance-related charges; previously incurred severance costs to be recorded by ComEd as approved in the December 28th 2006 amended ICC order; previously incurred losses on extinguishments of long-term debt to be recorded by ComEd as approved in the July 26 ICC order; and other unusual items, including any future changes to GAAP. We believe these adjusted operating earnings are representative of the underlying operational results of the Company. In today's earnings release, we provide a reconciliation between GAAP earnings and adjusted non-GAAP operating earnings. With me today are John Rowe, Chairman, President and CEO of Exelon; John Young, Executive Vice President, Finance and Markets and Chief Financial Officer of Exelon; Frank Clark, Chairman and CEO of ComEd; and other members of our Exelon and ComEd's senior management team, who will be available to answer your questions. Today's call will focus on fourth quarter and full year 2006 financial and operational results, our 2007 outlook, and an update on key issues facing the Company. We have scheduled an hour for this call. We will spend about 30 minutes on prepared remarks and use the remaining time for Q&A. In order to effectively manage this call, we would appreciate it if you would limit yourself to one question during the Q&A. I will now turn the call over to John Young, who will begin with a discussion of Exelon's financial results. John?

What if there was a way to promote your company to a perfectly targeted group of potential customers, partners, acquirers and investors? What if you could tailor your pitch to them at the moment of maximum interest? And what if you could do this for a no-brainer price?:

Company sponsors partner's transcript: Company sponsors competitor's transcript: Issuer-sponsored research firm sponsors client's transcript:

IR firm sponsors transcript of micro-cap company: Consulting company sponsors company's transcript in sector of interest: Your company's name and promotion could have been on this transcript! Learn more, or email Zack Miller for details.

Thank you, Joyce. Good morning and Happy New Year to everyone. I hope you were able to spend some quality time with family and friends over the holidays. We enjoyed seeing many of you in Chicago at our December investor conference and hope you found the meeting and materials informative. Today, I will discuss Exelon's fourth quarter and full year 2006 financial results and briefly recap our financial outlook for 2007, which was covered in detail at our investor conference. Then, I will turn the call over to Frank Clark, who will provide an update on recent and upcoming activities in Illinois and at ComEd. John Rowe will conclude our prepared remarks with an operational update and provide his thoughts on two key industry issues, in terms of wholesale markets and normal climate change. We will wrap up the call with Q&A. Turning now to earnings. As you can see from the materials we released this morning, we had a solid fourth quarter and a strong year. Exelon announced fourth quarter adjusted non-GAAP operating earnings of $487 million, or $0.72 per diluted share, a slight decrease from the fourth quarter of 2005 operating earnings of $495 million, or $0.73 per diluted share. Our full year 2006 operating earnings were $3.22 per diluted share compared to 2005 operating earnings of $3.10 per diluted share. I'll quickly review our fourth quarter and then return to our full year earnings. Similar to the first three quarters of 2006, higher wholesale margins at Exelon Generation and higher electric revenues at PECO continued to be major positive year-over-year earnings drivers in the fourth quarter. These positive drivers offset by unfavorable items, including the effects of unfavorable weather conditions as compared to in the fourth quarter of last year at both ComEd and PECO; higher operating and maintenance expenses, driven by continued inflationary pressures, and two favorable onetime items that occurred at Exelon Generation during the fourth quarter of 2005; and increased depreciation and amortization, including the scheduled higher CTC amortization at PECO, and increased costs associated with recognition of stock compensation expenses across all our operating companies. We estimated that the unfavorable weather had about $0.04 of negative impact on the fourth quarter earnings for our delivery companies relative to normal weather. Weather normalized earnings for the fourth quarter would have been $0.76 per share, a 6% increase over weather normalized earnings of $0.72 for the fourth quarter of 2005. On a GAAP basis, Exelon reported consolidated earnings of $592 million, or $0.87 per share, for the fourth quarter of 2006. The main difference between GAAP and non-GAAP operating earnings during the quarter was related to a onetime benefit of $0.14 per diluted share associated with the previously incurred severance costs, which were addressed in ComEd's December 20th 2006 amended order. Please refer to the tables in the Company's earnings release for additional details regarding our fourth quarter results, including a full reconciliation of our fourth quarter reported GAAP earnings and adjusted non-GAAP operating earnings. Now, I'll briefly recap our 2006 full year results and 2007 outlook for the consolidated company and by individual operating companies. Exelon's full year 2006 operating earnings were $3.22 per diluted share, a 4% increase over 2005 operating earnings of $3.10 per share, and in the center of our revised guidance of $3.15 to $3.30 per share. The major drivers of year-over-year growth in operating earnings for the full year were higher generation margins and continued strong operational performance partially offset by higher operating costs. These drivers were essentially the same as what we told you in our original guidance at the beginning of 2006 and have been a continuing theme throughout the year. For the year, we estimate that unfavorable weather had about $0.07 per share of negative impact on the earnings of our delivery companies relative to normal weather and about $0.18 per share of negative impact compared to 2005. Weather normalized earnings of 2006 are $3.29 per share, a 10% increase over weather normalized earnings of 2005. For 2006, Exelon Generation contributed $1.88 of operating earnings per diluted share, a 13% increase over 2005 operating earnings of $1.66 per share. Generation's full year earnings were in line with our full year 2006 guidance range of $1.85 to $1.95. In 2007, we expect Generation's operating earnings to increase considerably, primarily due to expiration of the below market ComEd PPA. 2007 operating earnings guidance for Generation is $3.40 per share to $3.60 per share. ComEd's contribution to operating earnings of $0.78 per Exelon's share for 2006 were flat when compared to 2005 and in the center of our full year guidance for 2006 of $0.75 to $0.80 per share. We estimate that unfavorable weather had about a penny per share negative impact on the full year 2006 earnings of ComEd's relative to normal weather and about $0.11 per share negative impact compared to 2005. As a reminder, we expect ComEd's operating earnings in 2007 to decrease significantly from 2006 levels due to the factors we discussed previously. 2007 operating earnings guidance for ComEd is $0.10 to $0.20 per share, which reflects the full impact of the December 20th ICC rate order in the rehearing of ComEd's delivery service case. The amended order allowed for $74.3 million of increase in the [DST] revenue requirement, reflecting increase in allowed administrative and general expenses and debt return on the 2004 pension contribution. A portion of the A&G expense is tied to recovery of previously incurred severance costs of $158 million pre-tax, which will now be amortized over the next 7.5 years, reducing the pre-tax benefit of the revenue increase by about $21 million per year. In December, we provided you with the 2007 operating earnings guidance for ComEd of $65 million to $125 million. The range assumed various outcomes for the DST case rehearing. With the $74 million increase, less the $21 million amortization, the midpoint of the range moves only modestly. Therefore, while the rehearing did give us additional clarity regarding delivery revenues, we are maintaining our guidance at this time given the continuing issues in Illinois and the ongoing risk that ComEd still faces. PECO's contribution to operating earnings for 2006 was $0.67 per share, representing a 15% decrease from 2005 operating earnings. PECO's earnings were slightly higher than our 2006 guidance of $0.60 to $0.65 due to change in our estimate for electric unbilled revenues and the successful R&D tax refund plan. We estimate that unfavorable weather had about $0.06 per share of negative impact on the full year 2006 earnings at PECO relative to normal weather and about $0.07 per share negative impact compared to 2005. Looking to 2007 and through the balance of the Pennsylvania transition period, we expect continued modest year-over-year decreases in PECO's earnings were slightly higher than our 2006 guidance of $0.60 to 0.65 due to the change in estimate for electric unbilled revenues and the successful R&D tax refund plan. We estimate that unfavorable weather had about $0.06 per share negative impact on the full year 2006 earnings at PECO relative to normal weather, and about a $0.07 per share negative impact compared to 2005. Looking to 2007 and through balance of the Pennsylvania transition period, we expect continued modest year-over-year decreases in PECO’s operating earnings, driven by the increased amortization of CTC and higher operating expenses including pension and benefits. 2007 operating earnings guidance for PECO is $0.60 to 0.65 per share. As a remainder, our earnings guidance assumes normal weather. As highlighted during our investor conference, we continue to be focused on creating shareholder value. Our strong 2006 results set the table for continued strong performance in 2007 and beyond. We are reaffirming Exelon’s non-GAAP operating earnings guidance range for 2007 at $4 to $4.30 per share and we are reaffirming our GAAP earnings guidance of $4.10 to $4.40 per share. The expected uplift in earnings from 2006 to 2007 will provide continued strong cash flows creating an increasingly strong balance sheet. We remain committed to returning available cash to our shareholders through our new value return policy, while maintaining financial flexibility to take advantage of opportunities as they may arise. In accordance with that value return policy, we set the first quarter of 2007 dividend at $0.44 per share, a 10% increase over the dividend for the fourth quarter of 2006. This dividend is payable on March 10, 2007 to Exelon’s shareholders of record on February 15, 2007. In our earnings release, we have provided much more detail regarding our financial and operating results in addition to details on the effects to our balance sheet applying FASB new accounting standards for pension and other post-employment benefit plans. With that, I will turn the call over to Frank Clark.

Good morning. I am Frank Clark, Chairman and CEO of ComEd. If you please allow me to provide you with a brief update on the status of electricity rates in Illinois, the latest legislative session in Illinois Springfield ended in a stalemate; this is ceptable result for ComEd. The 94th Illinois General Assembly ended its session on January 9 without taking action on either a three year rate freeze bill or a compromise phase-in plan. The House bill, which would have rolled back frozen electric rates at pre-2007 levels for at least three more years, was not called for a vote of the Senate. And Senate bill, which would have phased in electric rate increases for residential customers with no interest was not called in the House. This means our new rate approved by the Illinois Commerce Commission remains in effect. The first bills reflecting these new rates have been mailed to customers. Last month, the ICC issued its final order in re-hearing of ComEd delivery service rate case. ComEd received an additional modest increase. Even with this adjustment, ComEd rates will still remain lower than they were in 1995. Also in December, the ICC approved ComEd voluntary phase-in plan. The plan allows residential customers the choice to cap their electric bill increases at 10% a year through 2009. Customers will pay deferred amount from 2010 to 2012 at a below market interest rate of 3.25% per year. Customers can start enrolling in that plan now. Despite the fact that the new rates and phase-in plans have taken effect, the fight on this issue is not over. The rate freeze extension bill could be revisited by the House in the future. With the new legislature in place, all bills must begin the process anew and be reintroduced. The General Assembly will be back in Springfield on February 6th. Illinois State Senator, James Clayborne has recently sought to bring together the utilities and various parties to determine if the compromise position would be appropriate. We applaud these efforts. ComEd has always said that we are open to discussions to help customers transition to the new rates. We welcome an opportunity to meet with policymakers, consumer groups, and other parties to achieve the lasting solution. Nevertheless, we have entered into binding contracts to supply electricity for more than 3 million customers. We remain committed to the Illinois auction, which gives us the lowest available market price per customer. We will continue to provide regular updates on the status here in Illinois. And now, I will turn the call over to John Rowe.

Thank you, Frank. Thank you, John. Good morning, everyone. This morning I will add a little perspective to 2006 and offer some thoughts on our strategy going forward especially as it is affected by the national spate from competitive market and global climate change. As you all know 2006 was very a demanding year at Exelon. We faced serious regulatory challenges in both Missouri and Illinois. Arguably we lost in New Jersey but we kept our commitment to financial discipline as we have promised we would. In Illinois, the ComEd team has been successful in making Illinois Restructuring Act work. I think it’s clear to say that we have discussed the Illinois core solution to good use almost when we could. The real story for 2006 at Exelon is that we continue to be one of most successful companies in our industry. For the sixth consecutive year, we have improved our operating performance and our operating earnings. As John Young has already reported our year-over-year operating earnings per share increased 4% from 3.10 to 3.22, in spite of relatively unfavorable weather. On weather normalized basis, operating earnings would have been up about 10%. Over the past six years, operating earnings have increased by almost 9% per year. This success is the product of unrelenting focus on operating performance, disciplined financial management, and sound approaches to regulation, the continuing basics of our business. In the nuclear area, Chris Crane and his team achieved a new fleet generation record for the fourth consecutive year, producing over 131,000 gigawatt hours in 2006. Nuclear achieved 93.9% capacity factor for the full year, the second highest ever recorded by the fleet compared with 93.5% for 2005. It also set a summer capacity record at 98.1%. Our average refueling outage duration was 24 days, an improvement over 2005 and significantly better than the 2006 industry average of 39 days. Exelon executed four of the five shortest refueling outages in country in 2006. Totally with all these accomplishments, Nuclear also recorded its best worker safety record in the company’s history. The Salem and Hope Creek site also set a new combined site capacity factor of 95.7% for 2006 with refueling outage duration averaging 25 days. As many of you know, the site management is being transitioned back to PSEG under the termination provision of the nuclear operating service contract. The three senior leaders of Exelon's on-site team were hired by PSEG effective January 1 and Exelon Generation is transitioning out of management of the site. We are committed to a smooth transition and to continued safe operation. In our fossil area, Mark Schiavoni and his team have delivered a great year. Our fossil and hydro fleet finished the year with commercial and equivalent availability factor of 93.5% and 95% respectively, the highest commercial availability ever achieved by a fossil team. Power team, led by Ian MacLean, delivered another distinguished performance in turning our operational prowess into commercial success. Despite somewhat lower gas and power prices and lower load volumes, Power team hedged and optimized our portfolio to again deliver above budget growth and profitability. I am especially grateful to Ian McLean and their team’s efforts this year. At ComEd, a competitive auction was successfully conducted in Illinois to meet ComEd's continuing load obligation. The end result of the auction and ComEd's delivery service rate case was our overall rate towards customers that's as less than, I think, was approved by regulators in 1995, 12 years ago. Seems fairly clear that competition is working in Illinois in spite of what some would say. And PECO, although challenged by twice as many storms as would be more typical, still had one of its best years in non-storm reliability. We expect PECO to recover from the severe weather and again show improvement in reliability. As a consequence of our continued financial and operating performance, you have again rewarded us by making us the most highly valued company in the industry. Our stock grew more than 16% in 2006 from $53.14 on December 30 to $61.89 on December 29, 2006. Our yearend market capitalization exceeded $41 billion and is a little over $40 billion as we speak. As I discussed at length at our Annual Investor Conference, our strategy going forward has two components. First, we must protect the value that we have created, which requires delivering continued superior operating performance and constantly improving it, it requires supporting competitive markets, it requires protecting the market value of our generation and building healthy self-sustaining delivery companies. It is often said that the best defense is a good offense. In the utility business, it's often the other way around. In this case, what works for the (inaudible). Second, as we look forward, we will be dedicated to growing future value by improving even more our performance, continuing to use our financial discipline, evaluating new growth opportunities, and advancing our environmental strategy. I should also say that the value return policy we announced last fall is also part of this. The components of our strategy are increasingly affected by two overarching policy debates. One is about this continued viability of wholesale markets and the other is about climate change. In our view, the evidence is simply overwhelming that competition at the wholesale level has delivered huge public benefits. Even apart from ComEd's recent experience with the auction in Illinois, studies by PJM, CERA, GAO, and [SYNOP] have all confirmed that wholesale competition has; one, improved the operating performance of existing generating units; two, reduced their cost of operations; three, resulted in the construction of significant new generation; and four, pass along significant price reductions to customers. CERA recently estimated the savings for residential consumers at $34 billion between 1997 and 2004. In spite of this record, competitive model is being challenged. This is because public reacts to price increases under any model. In competitive jurisdictions, there have been price increases over the past several years, in some cases because of reliance on natural gas, and in other cases because of timing. In a number of states, Illinois included, the increase coincides with the end of restructuring transition periods during which customers receive significant savings of rate reductions and accompanying rate freezes. Massachusetts customers recently saw a 28% increase. In Delaware there was a larger 59% increase. And Maryland recently announced a 47% increase. These all compare to 23% increase in Illinois. (Inaudible). Now what is truly remarkable is that folks blame competition for the current price increases rather than rising fuel costs. In fact, the states that have traditional cost based regulation have also seen double-digit rate increases. For example, Louisiana saw a 67% increase between 2000 and 2005, Mississippi 53%, Oklahoma 47%, Colorado 43%, and Georgia 37%. As we all know, people resent it when electricity prices go up. Increasingly we hear a chorus of naysayers, including some in our industry, some regulators, some public power figures, and even those who support to represents industrial customers saying that wholesale competition isn't working. The irony is of course that industrial customers were in the forefront of efforts to inject competition in the industry a few years ago. And those who think rate based means keeping price increases have very short memory. We at Exelon do not intend to stay on the sidelines in this case. In the coming months we will redouble our advocacy for the competitive model both at federal level and in the states. We will look for then active support from the investment community. The question is quite literally whether we will affirm the obvious benefits of competition or whether we will again revert to planning regime and the inward search for a lower cost or market solution that doesn't work for anyone. This competitive issue is particularly critical as we confront the second major policy, climate change. Any one who picks up a newspaper or watches TV news tells that climate is an issue whose time is now. The evidence that the atmosphere is warming is compelling, and in the judgment of most scientists, warming is predominantly caused by human activity. I read one review this morning that suggested that Exelon would use this forum as a vehicle to campaign for carbon legislation. We hardly need to do that. There are others far more effective who will do that. At the regional and state levels, we see the RGGI initiative -- R-G-G-I -- in the Northeast and California's recent adoption of a bill known as AB 32. At the national level, there has been a flurry of activity in the bipartisan (indiscernible) for the Senate resolution last summer. Speaker Pelosi has just announced a new committee on that. I think no one can predict the details of ultimate legislation, but it seems obvious that climate legislation will receive a great deal of attention this next presidential election. We at Exelon are not strangers to this place. We have been working on it for a very long time. I was recently reminded that I first testified before Congress about carbon taxes in 1992. In the late '90s, one of the reasons we sold our fossil plants was we believed that carbon legislation would be coming in due course. More recently, I have been active as Co-Chair of the National Commission on Energy Policy, a bipartisan group of academics, environmentalists and some from the industry which has worked some response. After much discussion, the commission concluded that effectively dealing with climate change requires both a carefully crafted regulatory regime, one that will effectively address carbon without an impossible economic burden, and the development of innovative, low carbon energy alternatives. NCEP recommended a cap-and-trade system with an exclusive safety valve to protect the economy, the tightening of CAFE standards, and more support for energy efficiency cleaner coal and new nuclear plants. There is no single technological answer to climate change. While increased R&D is required, we believe that a competitive market within a proper regulatory regime will provide more innovative responses. In a very real sense, preserving and protecting competition is essential to successfully addressing climate change. In months ahead, we will be advocating both. Whatever the fate, however, of climate legislation, it is clear that Exelon is uniquely positioned with our large nuclear fleet to continue our earnings performance in a carbon-constrained world. So let me just wrap up and turn to your questions by saying we had a tough 2006, but we had a good 2006. I am very proud of what the Exelon team has delivered in the past year and look forward to a better year this year. We have delivered outstanding operating results and continued outstanding earnings performance and overcome significant regulatory challenges. We shall keep marching along on our course. Thank you very much. And we'll proceed to Q&A.

Thank you. (Operator Instructions) Your first question is from Greg Gordon of Citigroup.

Greg, welcome. Greg Gordon - Citigroup: Good afternoon, gentlemen. Looking at your numbers, this is sort of a back-to-the-future type question. You know, it's has been a while since you guys talked about the concept of the Exelon Way, which was your efficiency program. And the reason I ask is because when I look at the earnings for the year, you know, there were $0.14 of increased O&M. Some of that I know was at ComEd where hopefully you ultimately get fair and equable cost recovery. But just in the fourth quarter alone, there was $0.07 of increase going out at Exelon Generation. You're not the only company who runs merchant nuclear plants that's showing an increase in costs. So I'm wondering is this -- what are the issues that are driving that? Was it just a timing issue or are you actually seeing a fundamental increase in your cost structure? And is there a way to address that?

I'll start with a short answer, and then refer this to Jack Skolds who can do better than I. But we believe that through the Exelon Way program, we were able to stem cost increases for a number of years, but we didn't reinvent the whole world. And operating these nuclear fleets does require continued expenditure. We're starting to see this now both in the operating area and the pension area. And while we keep looking, we haven't found new ways to overcome those trends on a going-forward basis. Jack, do you want to --?

The only other thing I will add on the generation and specifically the nuclear side are the costs to conduct our outages is going up substantially. And we have been dealing with some, as the rest of the industry has, some metallurgical issues, which have been expensive to deal with in the fourth quarter. Other than that, there are I will call them unremarkable kind of onetime events that normally occur during a given year. But in the Generation area, the refueling outage costs are what is driving the increase. Greg Gordon - Citigroup: Can you go into just a little bit more detail on what these -- the drivers are there and what these metallurgical issues are as well, please?

The metallurgical issues deal our steam generators on the pressurized water reactors, our reactor coolant system piping and on the boiling water reactors, the vessels. That kind of work is just becoming more expensive. There is nothing out of the ordinary from the rest of the industry. It's just these types of efforts are becoming more expensive. Other than that, in a refueling outage it is people, it is parts and it is basically the contracting costs that we are managing right now. Greg Gordon - Citigroup: Thanks. I will honor the one question rule. Thank you.

Thank you. Your next question is from John Kiani of Deutsche Bank. John Kiani - Deutsche Bank: Good morning.

Good morning. John Kiani - Deutsche Bank: You've already discussed a certain level of stock buyback that's assumed in your '07 guidance. Can you provide an update on your post '07 use or monetization of your expected excess balance sheet capacity?

The philosophy is very simple. If we have excess cash and we do not have acquisition opportunity that we think we can convince you is a very good place to put your money, we'll give the money back to you. Beyond that, let me defer to John.

Yes, we gave you some kind of insight into what might be available for 2007 in December. John Kiani - Deutsche Bank: Right.

We further gave you if you look back at that presentation kind of an idea of what might be available actually through the entire planning period and our objective there is to probably -- you should plan on a review of that on an annual basis from our perspective. We're not going to sit here and say we've got a multiyear commitment we're going to make. But we're going to kind of take that a year at a time is how we deal with it. But the one year looked or the five year looked like almost five times what the one year looked like. So it's pretty symmetrical throughout the planning period. John Kiani - Deutsche Bank: Great. Thank you.

Thank you. Your next question is from Paul Fremont of Jefferies. Paul Fremont - Jefferies: Thank you. Can you provide us with an update on the AG Supreme Court challenge to the auction? And given CUB's opposition to the auction process, do you accord a lower probability of being able to reach a compromise through Senator Claiborne's efforts?

I think I should defer that to Frank. Let me say that the CUB is going to oppose the auction process all it wants. The contracts are signed, and they have no magic wand to make them go away.

Let me start by addressing the effort led by Senator Claiborne and then ask Darryl, ComEd's General Counsel, to comment on the AG's continued legal action. The president of the Senate, Emil Jones, has made it very clear and stated it publicly in a number of venues that he does not support a rate increase legislation in any form. And he has instructed Senator Claiborne to get the parties together, the consumer groups, all of the parties that are willing to sit down at the table with the utilities to see if we can find a way to help transition the customer. This is my interpretation to help transition customers to the new rate. And there are consumer initiatives that we are currently willing to talk about that they help customers better understand how they can manage their -- control their energy bills. We stated earlier and I will repeat it now, ComEd is fully committed both to the auction, and of course, we have already entered into a binding contract for the supply to our 3.7 million customers. Darryl, would you comment on the AG?

The Attorney General filed an emergency motion for a stay to require ComEd to roll back and freeze its rates both in the Illinois Appellate Court and the Illinois Supreme Court. Those were denied by the Illinois Appellate Court in late December and by the Illinois Supreme Court in early January. The Attorney General has an appeal of the underlying Illinois Commerce Commission order authorizing the auction still pending in the Illinois Appellate Court Second District. That appeal has been debriefed since early November and will be decided by the court when it so chooses.

Thank you, Darryl. Paul Fremont - Jefferies: And in terms of a final decision, when would you expect the court to rule?

The court -- I don't have an expectation on that. The courts generally rule within for most of their cases three to six months of a case being fully briefed. But it is totally at the discretion of the court as to when it will render its decision on that issue. Paul Fremont - Jefferies: Thank you.

Thank you. Your next question is from Hugh Wynne of Sanford Bernstein. Hugh Wynne - Sanford Bernstein: Hey. I had question about your cost numbers. The adjusted results for the fourth quarter of '06 when compared to adjusted non-GAAP results for the fourth quarter of '05 show a very substantial improvement, a reduction in your purchase power and your fuel costs. The net reduction is -- in fuel and purchased power expense seems to exceed $300 million. And it's equivalent to about 20% of the fuel in purchased power expense that you incurred in the fourth quarter of 2005. I was wondering if you could comment on that and explain what it's attributable to and whether it's likely to continue?

Yes, it's Ian MacLean. Would you like me to take that?

Yes. Go ahead, Ian.

Okay. It's simply the fact that if you remember we had the effects of Katrina back in '05 that sort of flew through till early '06. And literally as spot prices became cheaper and cheaper, you know, it became less expensive for us to buy the power to follow the load to serve the load. So that was -- it is as simple as that. And yes, you won't see that because we no longer have in '07 the ComEd contract to serve. So we don't have all that load to serve. The load we are serving more or less is served out of our own unit. So we won't have that differential going forward to that extent. Hugh Wynne - Sanford Bernstein: So that would explain the $90 million reduction in purchase power expense. Then you have in addition to that a $212 million reduction in fuel off of a base of $770 million in the fourth quarter of '05. Is that just an anomaly of some kind or does represent an ongoing rate?

No. That's mainly gas. Gas came down -- you know, came down substantially. But as you know, gas -- typically the gas that we buy is based on a spot spread. So you know, it's based on where we sell the power. So although you saw -- you will see the purchase costs go down, typically the sales costs revenues go down as well commiserate to that. Hugh Wynne - Sanford Bernstein: Great. Thank you, Ian. I appreciate it.

Thank you. Your next question is from Ashar Khan of SAC Capital. Ashar Khan - SAC Capital: Good morning. When should we expect the next ComEd rate case filing?

We are looking to file a rate case, a delivery service rate case, in the early part of 2007. I'm looking at -- I don't recall exactly when it is happening.

We said -- this is Bob McDonald. We have said we will file a delivery services rate case before the end of the second quarter. Ashar Khan - SAC Capital: Before the end of the second quarter?

Yes. Ashar Khan - SAC Capital: Okay. So that would mean that the rates might get affected somewhere around May of next year, right? Because of the 11 month period?

11 months, Ashar, is probably safe. Ashar Khan - SAC Capital: Okay. Thank you.

Thank you. Your next question is from Michael Lapides of Goldman Sachs. Michael Lapides - Goldman Sachs: Hi, guys Michael Lapides here. When we think about post 2007, can you talk a little bit besides buybacks about what the drivers of earnings growth would be for '08 and '09?

Okay. And this will go back to our December 12 data. The drivers are the regulatory recovery plan at Commonwealth Edison, the DST case that Frank and Bob just talked about. There is also a transmission case that will be filed here in the next 60 days I believe at Commonwealth Edison. So you have the normal rate based growth regulatory recovery that's going on there. Then the other drivers are whatever market prices move from repricing our hedges year-over-year. And you know, we will reprice a significant amount of the portfolio year-over-year. And then the drivers are going to be cost management beyond that. Those are the kind of 8 and 9 timeframe; the next big driver is going to be the 2011 underwater EPA repricing at PECO. Michael Lapides - Goldman Sachs: Right.

And in between there is all the market fundamentals of market prices, whether capacity prices start reflecting their reduced reserve margins, where fuel prices go, all the environmental issues that John talked about and how quickly carbon may enter the picture. Those are kind of the mid-term and long-term drivers for Exelon as we go forward. Michael Lapides - Goldman Sachs: Okay. Thank you.

Thank you. Your next question is from Jonathan Arnold of Merrill Lynch. Jonathan Arnold - Merrill Lynch: Good morning, everyone.

Good morning, Jon. Jonathan Arnold - Merrill Lynch: I had a quick question picking up on the last one around the December meeting you gave us a sense of where your overall portfolio stood versus market. You broke out the PECO piece and then your other contracts, is there any -- get any chance of an update as to how those numbers look today versus how they looked then?

No, they will look very similar to what we gave you then. I don't think we have plans on updating that until probably sometime in the mid year. Jonathan Arnold - Merrill Lynch: Okay. Thank you.

Thank you. Your next question is from Daniele Seitz of Dahlman Rose. Daniele Seitz - Dahlman Rose: Thank you. I just wondering on which do you attribute to the new capacity charges to the potential upside in '07 and '08? Have you quantified that?

Daniele, I think Ian should answer that.

Daniele, are you referring to RPM? Is that? Daniele Seitz - Dahlman Rose: Yes.

Yes. Well, I think we talked at the investor conference. We have some baked into that. I don't remember the exact numbers. I know it was over the period of the four or five years, I think it was about $200 million. I don't see any big upside that's going to change our plan in '07 and '08. And you know, I think there is going to be a court challenge to that. So you have to take it for what it's worth today, which is we've put in value for it. We think the value is about right. It's not really big numbers yet. Daniele Seitz - Dahlman Rose: Okay. Great. I'll go back in after. Bye.

Thank you.

Thank you. Your next question is from Paul Patterson of Glenrock Associates. Paul Patterson - Glenrock Associates: Good morning, guys. I wanted to touch base with you on the generating business and just to, sort of, follow up on some of the earlier questions on 2008 versus 2007 in terms of the hedges rolling off. Ian, if you could just give us a feel for what 2008 looks like now versus your hedge causes for 2007 if you were to, sort of, contract here at what the forward curve is for 2008?

Yes. I think for 2007, I think we have discussed we're sort of mid to just above mid 90s hedged for 2008 at reasonably nice prices. So we're happy with that. 2008 we are up to about financially about 90% hedged for 2008. They are also at reasonable prices. And you know, we were sort of encouraged by the fact that despite gas coming off fairly significantly in '07, the '08 market didn't really reflect that full drop in prices for '08. So a lot of it is risk there, right now the differential isn't that huge for '08. Paul Patterson - Glenrock Associates: So if directionally speaking would 2008 be, sort of, equal to 2007 or would it be lower or --?

Yes. I mean -- my guess would be right now a guess would be it might be a little lower but it depends where the prices go in that balance of 10%. Paul Patterson - Glenrock Associates: But the 90% that you've hedged and the upper 90s that you hedged in '07 --

Much similarly based, yes. Paul Patterson - Glenrock Associates: Similarly. Okay. Thank you.

Thank you. Your next question is from Paul Ridzon of KeyBanc. Paul Ridzon - KeyBanc: John Rowe, I was just wondering if you have had any updated thoughts on M&A in the sector and your commitment to potentially build a nuclear plant, whether Yucca Mountain is still the big obstacle there and whether there's any work around.

Well, we keep wire brushing our whole set of M&A options, but as you know, doing anything is a matter of when the time is right for us and when the time is right for a potential partner and those things are both inherently unpredictable. I think the operative wording here are patience and discipline. We have lots of bright ideas, but which ones are possible and when they are possible is something my lawyers would not let me talk about if I did have an answer. I really want to emphasize the patience and discipline though. We have plenty of work to do here at home at this moment. And on the nuclear plant, commitment and new nuclear plant don't really belong in the same sentence at the moment. I think the Yucca Mountain project has been in big trouble for some time. The election I think makes it virtually impossible for there to be progress on Yucca Mountain in the near future. I expect to become Chairman of a Nuclear Energy Institute at its spring annual meeting. And I think it is fair to say that NEI is searching for ways to compromise with now majority leader Reid on some combination of new forms of ways of meeting the adequate assurance, finding and perhaps something like regional surface storage facilities or something like that. Yucca Mountain is not going to go ahead against the wishes of the majority leader of the United States Senate. And so I think what you'll see now is the entire nuclear industry looking for ways to compromise with Senator Reid on some part of interim storage solutions. Just speaking for ourselves, I continue to believe that there has to be some solution other than just hopes and dreams before one proceeds on a new nuclear plant. And we've made it very clear in our exploratory processes in Texas that it would have to be either a state or a federal approach to dealing with this before we go forward. Paul Ridzon - KeyBanc: John, would you stand by as potential competitors who didn't share your kind of view -- if you just went ahead and built plants?

I would stand by with great cheer if there are those who are braver than I. This nation needs new nuclear plants. It needs it for climate and a whole lot of other reasons. If other people are braver with their investor's money than I am, I will cheer for them and bask in your confidence at the same time. Paul Ridzon - KeyBanc: Thank you very much.

Thank you. Your next question is from Nathan Judge of Atlantic Equities. Nathan Judge - Atlantic Equities: Hi. On the Illinois issue, when do you think there will be a resolution to this issue and what needs to happen for a full and durable resolution?

When is an impossible question to answer? I am not at the present time certain there will be one. This stalemate may be the resolution and if so, the Illinois Commerce Commission is adequately and effectively implementing the existing law. As Frank made also so clear, the various Exelon companies would like to come out with a harmonious and more durable resolution that affects our interests and your rights as investors in our unregulated generation properties, and we have tried to be adaptable, flexible, creative, and we will continue to try to do that. But, frankly, you've can't have a resolution beyond stalemate without something that makes Senate President Jones happy, the Governor happy, the Speaker of the House, Mr. Madigan happy. And I can't foresee what that would be, but because except for the rate freeze, which we can't bear and your rights won't bear, I do not know what might make Speaker Madigan happy. Frank, want to add to that?

I'd only comment that the politics in Illinois are complicated, but I would ask you to remember that all of the regulatory and legal processes that we have been engaged in over the last year have actually worked out in a manner that is very acceptable. There was a question about the most recent legal challenge by the Attorney General, but as I recall there's been quite a few other challenges including the Illinois Supreme Court none of which are available. The (technical difficulty) exercises responsibility and issued an order first approving the auction and retail the auction. We (technical difficulty) 16 or so suppliers. Those contracts are binding. I would love to have an opportunity to resolve what I consider some of the social issues around raising rates that have been frozen for a decade, but not in the manner that we jeopardize the financial integrity of ComEd. So Senator Claiborne to the extent that it is been asked by President Jones to get the parties together, we welcome that and we will participate in that. But the contracts we entered into are binding. The auction model I believe works very well and will offer or continue to offer the lowest available prices to consumers in Illinois.

Thank you.

I'd just like to pick up one other thing just to sort of wrap up because we're running out of time. Joyce says we have time maybe for one more question, but I want to get one more answer in even if there is not that question. One of you in a prior call was kind enough to say that Exelon is appropriately priced at today's market values for energy and that implies an almost free option on whatever the benefits of carbon regulation maybe for a nuclear fleet. I will leave words like free for other people to use, but I simply want to reemphasize that as you look at these pressures of carbon, I don’t see where you have an investment play better than our nuclear fleet. And as you think about some of the other things that affect what has historically been a cyclical industry issues like whatever the future of the dividend taxation maybe, again I think you'll look and you'll find your investment in us pretty well-positioned for dealing with those uncertainties. What I would say is we'll try to continue to do going forward as we have in the past, which is to tell you in as far advance as we can where our problems and issues are and then to deal with them as effectively as we can. But I think if you look at us on a relative basis in this industry, we're positioned even better going forward than we have been over the past few years. Joyce, do you still have time for one more question?

One more question, more.

Okay.

Thank you. Your final question is from Mr. Zach Schreiber of Duquesne Capital. Zach Schreiber - Duquesne Capital: Hey, John. It’s Zach Schreiber from Duquesne. Can you hear me?

I seem to remember you Zach, yes. Zach Schreiber - Duquesne Capital: Yes, Sir. I seem to remember a lot of this discussion on carbon and I definitely like it as well. Just a question on the market fundamentals and this is a question for you from your vantage point and John Young and Ian from theirs, just what they're seeing in the markets. Heat rates, sort of the shape of the NI Hub curve relative to gas prices and just some of those power market supply/demand fundamentals, what are you seeing? And related to that on the capacity price, clearly a lot of that’s dedicated in '07 but that $200 million, what did that relate to? And what is that worth economically and over what period of time? I'm just trying to -- I think investors have all gotten very comfortable understanding sort of the gas price sensitivity in your company and comps, but we're probably a little less educated on some of the heat rate and capacity values in those markets. Thank you.

There are two things that John and Ian and Jack don't let me deal with. One is buttons and the other is numbers. So I will leave those for my colleagues. But just let me say that we have obviously seen the sort of heady gas peak tail and probably they've tailed a lot more because we have a winter without a winter right now. But I think as we look forward you can see that Ian has dealt with that problem pretty effectively with his hedging strategy and we are seeing a tightening in capacity need all across this country. New Jersey is basically base load capacity short. The rest of PJM East is slowly getting tight on base load capacity. And while the Midwest, like Illinois, still has enough, it will need more new peaking capacity within a reasonable amount of time. And what this tells me is that the potential feature for power prices both have to reflect the price of gas under more normal weather conditions and an increasingly tight capacity market. So that’s my lead in. John, Jack, Ian, which one of you wants to pick up and answer his real question?

Well, I’ll address it and I think Ian can add some color to this, but generically or generally we see still the phenomenon where total electric prices at the wholesale level are in a energy or fuel kind of driven era where we are not seeing the capacity values whether it comes from heat rate or capacity prices or whatever that are needed to address the reserve margin issues that are coming -- that are either here or in New Jersey or coming as they cascade across the system. We do from time-to-time and I think we reviewed this with you see the heat rate anomalies where heat rate becomes very low or becomes more appropriately valued in the market and that’s what has occurred as this gas price drop that we saw over the last few months, market prices remain fairly stable in all that through a heat rate expansion. But we do see that there will be capacity values in the planning horizon and I will just quote some of the numbers we gave you. This year because of our hedge situation, a $1 movement in gas is about $25 million for us. 500 BTUs per kilowatt-hour or our heat rate move is about $35 million for us. Then capacity values if they increase by $10 that’s worth another $10 million to us. But in 2011, a more kind of open position for us, those numbers are dramatically different, where $1 of gas is almost $400 million. You can go get the exact numbers out of the December 12th presentation. The carbon that John referred to is a significant contributor or even larger than that. And heat rate is quantified as almost $300 or $400 million less for that same 500 BTUs per kilowatt hour. So none of that in our value right now but those are kind of the broad sensitivities and Ian might give you some of the specifics on where the market is right now.

Yes. I think Zach, you are probably well aware, you know, the heat rates in the Midwest tend to be low. It’s nuclear, coal driven energy economy. In the East, which we consider PJM East is they are very high and they are very volatile and you've got low capacity there, excess capacity. You'd expect that. I think the interesting market for me is ERCOT. ERCOT currently shows a backwardated heat rate and then it climbs as you head out towards 2010 and 2011. That’s a market that I think people have to watch carefully, because I think that heat rate is really just following the energy price -- sorry, the gas price and the backwardated gas curve, and I think that could be a volatile market. Overall, I think Mr. Rowe is right that heat rates are going to go up. Its unless somebody starts building or we don’t stop using electricity, they are just going to continue to climb. Zach Schreiber - Duquesne Capital: On the ERCOT heat rate, you said it’s going to be interesting. Is it with more upside or more downside?

I just think it’s going to be interesting on the upside, because it just sort of begs the question why would you have a market with large load growth and no capacity being built currently with a backwardated heat rate? I just find that intriguing. Zach Schreiber - Duquesne Capital: Yeah. Interesting, thank you.

Thank you, Zach. Zach Schreiber - Duquesne Capital: Thank you, guys.

Thank you, everybody. And again, let me say that we would have liked a little more December in December. But we are very pleased with last year. And on the carbon front, I was looking at the newspapers late last week, watching the announcements from the US Cap Group, which consists of GE and my friend Jim Rogers at Duke and Lew Hay at FPL and [Peter Darby] at -- I growl to Betsy Moler, who heads our Washington office -- "how come I've been working on this for four years and they get all the credit?" And Betsy looks at me and said, "Well, John, there are show horses and work horses and you are just stuck. You're always going to be a workhorse." So my message is admire the Arabians, invest in the Clydesdales.

Thank you very much.

Thank you. This concludes today's Exelon Corporation fourth quarter 2006 earnings release conference. You may now disconnect.

Company sponsors partner's transcript: Company sponsors competitor's transcript: Issuer-sponsored research firm sponsors client's transcript:

IR firm sponsors transcript of micro-cap company: Consulting company sponsors company's transcript in sector of interest: Your company's name and promotion could have been on this transcript! Learn more, or email Zack Miller for details.