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Exelon Finance

To power a cleaner future by delivering safe, reliable energy while advancing innovative financial solutions that drive sustainable growth and shareholder value

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To power a cleaner future by delivering safe, reliable energy while advancing innovative financial solutions that drive sustainable growth and shareholder value

Strengths

  • SCALE: Largest electric utility in US with 10M+ customers
  • INFRASTRUCTURE: $34B capital plan investing in grid modernization
  • RELIABILITY: Top quartile in customer service reliability metrics
  • REGULATION: Constructive regulatory frameworks across jurisdictions
  • SUSTAINABILITY: Strong ESG profile with path to net-zero by 2050

Weaknesses

  • LEGACY: Aging infrastructure requiring significant capital investment
  • TECHNOLOGY: Digital transformation lagging behind industry standards
  • DEBT: 42% debt-to-total capital ratio above utility sector average
  • DIVERSITY: Limited geographic diversification in operations
  • COSTS: Above-industry-average O&M expenses at 2.4% increase YoY

Opportunities

  • POLICY: Federal IRA and IIJA funding for grid modernization projects
  • ELECTRIFICATION: Growing EV adoption increasing electricity demand
  • RENEWABLES: Implementing clean energy to meet state renewable goals
  • SMART GRID: Expanding investment in grid digitalization technologies
  • RATES: Regulatory approvals for customer rate adjustments to fund capex

Threats

  • REGULATION: Potential policy shifts affecting rate case outcomes
  • INTEREST: Rising interest rates increasing cost of capital for projects
  • WEATHER: Extreme weather events threatening grid reliability
  • COMPETITION: Distributed energy resources disrupting utility model
  • CYBERSECURITY: Increasing sophistication of threats to grid security

Key Priorities

  • INVESTMENT: Accelerate grid modernization capital deployment
  • EFFICIENCY: Implement cost reduction initiatives to improve margins
  • DIGITAL: Enhance technology platforms for operational excellence
  • CLIMATE: Execute on clean energy transition to meet regulatory targets
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To power a cleaner future by delivering safe, reliable energy while advancing innovative financial solutions that drive sustainable growth and shareholder value

OPTIMIZE CAPITAL

Maximize returns on our $34B infrastructure investment

  • ALLOCATION: Implement AI-powered capital optimization model for 15% improved ROI on grid projects
  • TRACKING: Deploy real-time capital tracking dashboard for all projects >$5M with 99% accuracy
  • FINANCING: Secure $3B in green bonds at favorable rates to fund clean energy initiatives
  • EFFICIENCY: Reduce capital deployment cycle time by 20% through streamlined approval process
DRIVE EFFICIENCY

Create sustainable cost advantage through transformation

  • AUTOMATION: Implement RPA for 15 financial processes, saving 12,000+ hours annually
  • RESTRUCTURE: Complete finance organization redesign reducing operational costs by $15M
  • PROCUREMENT: Optimize vendor relationships to achieve 7% reduction in third-party spending
  • ANALYTICS: Establish financial data lake enabling $22M in cost-saving opportunities
MODERNIZE SYSTEMS

Build next-gen financial technology infrastructure

  • PLATFORM: Complete phase 1 of financial systems modernization covering 40% of functions
  • INTEGRATION: Connect 85% of operational data sources to financial reporting systems
  • INTELLIGENCE: Deploy predictive analytics models for 95% accurate earnings forecasting
  • SECURITY: Implement enhanced financial controls reducing compliance risk by 35%
LEAD TRANSITION

Enable financing for our clean energy future

  • FRAMEWORK: Develop comprehensive financial strategy for funding net-zero transition
  • INCENTIVES: Secure $350M in federal clean energy tax credits and incentives
  • REPORTING: Implement enhanced ESG financial reporting meeting all TCFD standards
  • INNOVATION: Create $100M dedicated fund for clean energy technology investments
METRICS
  • ADJUSTED OPERATING EARNINGS: $2.45-2.60 per share
  • CAPITAL DEPLOYMENT EFFICIENCY: 92% on-time, on-budget project completion
  • O&M COST MANAGEMENT: 3% YoY reduction in controllable expenses
VALUES
  • Safety First
  • Integrity & Accountability
  • Innovation & Excellence
  • Diversity, Equity & Inclusion
  • Environmental Stewardship
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Align the learnings

Exelon Finance Retrospective

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To power a cleaner future by delivering safe, reliable energy while advancing innovative financial solutions that drive sustainable growth and shareholder value

What Went Well

  • EARNINGS: Exceeded quarterly EPS guidance at $0.63 vs $0.58 estimate
  • CAPEX: Successfully executed on $1.2B in capital investments on schedule
  • REGULATORY: Secured favorable outcomes in ComEd and PECO rate cases
  • RELIABILITY: Achieved 99.98% service reliability across all territories
  • SUSTAINABILITY: Made significant progress toward carbon reduction targets

Not So Well

  • COSTS: O&M expenses increased 2.4% YoY, exceeding budget projections
  • INTEREST: Higher borrowing costs impacted financial performance by $28M
  • WEATHER: Mild winter decreased heating demand impacting revenue by $42M
  • PROJECTS: Delays in several technology implementation initiatives
  • CYBERSECURITY: Increased spending required to address emerging threats

Learnings

  • HEDGING: More sophisticated interest rate hedging strategies needed
  • AGILITY: Budget planning must better account for weather variability
  • TECHNOLOGY: Earlier identification of IT implementation challenges
  • PROCUREMENT: Enhanced vendor management could reduce cost overruns
  • ANALYTICS: Better data integration would improve forecasting accuracy

Action Items

  • IMPLEMENT: Comprehensive O&M cost reduction program targeting 5% savings
  • DEVELOP: Enhanced capital allocation methodology to optimize ROI
  • ACCELERATE: Financial systems modernization program for efficiency
  • DESIGN: Weather-normalized financial forecasting models for planning
  • ESTABLISH: Cross-functional data analytics team within finance
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To power a cleaner future by delivering safe, reliable energy while advancing innovative financial solutions that drive sustainable growth and shareholder value

Strengths

  • DATA: Extensive operational data from 10M+ customer meters
  • PILOTS: Several successful AI pilots in predictive maintenance
  • SKILLS: Recently established AI Center of Excellence team
  • LEADERSHIP: C-suite commitment to digital transformation
  • PARTNERSHIPS: Strategic technology alliances with major vendors

Weaknesses

  • SILOS: Data fragmentation across legacy operational systems
  • TALENT: Limited specialized AI/ML expertise within finance team
  • INVESTMENT: Underfunding of AI initiatives compared to peers
  • ADOPTION: Slow integration of AI into core financial processes
  • LEGACY: Outdated financial systems limiting advanced analytics

Opportunities

  • FORECASTING: AI-powered financial modeling for improved accuracy
  • OPTIMIZATION: Machine learning for capital allocation efficiency
  • AUTOMATION: RPA for routine financial tasks saving 12,000+ hours
  • INSIGHT: Advanced analytics for regulatory strategy optimization
  • RISK: Enhanced predictive models for financial risk management

Threats

  • COMPETITION: Peer utilities accelerating AI investments
  • COMPLEXITY: Regulatory requirements complicating AI deployment
  • GOVERNANCE: Data privacy concerns with sensitive financial info
  • DISRUPTION: Rapid AI advancement requiring constant adaptation
  • BIAS: Potential for biased AI outcomes in financial planning

Key Priorities

  • PLATFORM: Build integrated financial data and AI infrastructure
  • CAPABILITY: Upskill finance team with AI competencies
  • AUTOMATION: Deploy intelligent automation in financial processes
  • ANALYTICS: Implement predictive analytics for strategic planning