Amy L. Blauman Assistant General Counsel EP1132 701 Ninth Street NW Washington, DC 20068-0001 Office 202.872.2122 Fax 202.331.6767 delmarva.com alblauman@pepcoholdings.com May 16, 2016 Ms. Kimberly D. Bose Secretary Federal Energy Regulatory Commission 888 First Street, N.E. Room 1A Washington, DC 20426 Re: Delmarva Power & Light Company ( Delmarva ) Informational Filing of 2016 Formula Rate Annual Update in Docket No. ER09-1158 and Pursuant to Approved Settlement Agreements in Docket Nos. ER05-515, EL13-48, EL15-27 and ER16-456, et al. Dear Ms. Bose, Delmarva hereby submits electronically, for informational purposes, its 2016 Annual Formula Rate Update. On November 3, 2015, the Commission approved an uncontested settlement agreement ( Settlement ) filed in Docket Nos. EL13-48, et al. 1. Formula rate implementation protocols contained in the Settlement provide that: [o]n or before May 15 of each year, Delmarva [Delmarva Power & Light Company] shall recalculate its Annual Transmission Revenue Requirements, producing an Annual Update for the upcoming Rate Year, and: (i) cause such Annual Update to be posted at a publicly accessible location on PJM s internet website; (ii) cause notice of such posting to be provided to PJM s membership; and (iii) file such Annual Update with the FERC as an informational filing. 2 The same information contained in this informational filing has been transmitted to PJM for posting on its website as required by the formula rate implementation protocols. Thus, all interested parties should have ample notice of and access to the 1 Baltimore Gas and Electric Company, et al., 153 FERC 61,140 (2015) 2 See Settlement, Exhibit A containing PJM Tariff Attachment H3-E, Section 2.b.
Page 2 Annual Update. The protocols provide specific procedures for notice, review, exchanges of information and potential challenges to aspects of the Annual Update. Consequently, and as the Commission has concluded, there is no need for the Commission to notice this informational filing for comment. 3 Delmarva s 2016 Annual Update contains no expenses or costs that have been alleged or judged in any administrative or judicial proceeding to be illegal, duplicative, or unnecessary costs that are demonstrably the product of discriminatory employment practices, as defined in 18 C.F.R. 35.13(b)(7). Delmarva has made no accounting changes as defined in the Settlement (and any accounting change is discussed in applicable disclosure statements filed within the Securities and Exchange Commission Form 10-K and within the FERC Form No. 1). 4 Delmarva has made no change to Other Post-Employment Benefits ( OPEB ) charges that exceed the filing threshold set forth in the Settlement. 5 Thank you for your attention to this informational filing. Please direct any questions to the undersigned. Very truly yours, /s/ Amy L. Blauman Amy L. Blauman Enclosures cc: All parties on Service Lists in Docket Nos. ER05-515, EL13-48 and EL15-27. 3 See Letter Order Re: Annual Update to Formula Rate in Docket No. ER09-1158 (February 17, 2010). 4 See Settlement, Exhibit A containing PJM Tariff Attachment H3-E, Section 2.f.(iii).(d). 5 See Settlement, Exhibit A containing PJM Tariff Attachment H3-E, Section 2.h.
ATTACHMENT H-3D Delmarva Power & Light Company Formula Rate - Appendix A Notes FERC Form 1 Page # or Instruction 2015 Shaded cells are input cells Allocators Wages & Salary Allocation Factor 1 Transmission Wages Expense p354.21.b $ 2,768,309 2 Total Wages Expense p354.28b $ 37,790,367 3 Less A&G Wages Expense p354.27b $ 3,407,632 4 Total (Line 2-3) 34,382,735 5 Wages & Salary Allocator (Line 1 / 4) 8.0515% Plant Allocation Factors 6 Electric Plant in Service (Note B) p207.104g (see attachment 5) $ 3,430,855,851 7 Common Plant In Service - Electric (Line 24) 88,071,964 8 Total Plant In Service (Sum Lines 6 & 7) 3,518,927,815 9 Accumulated Depreciation (Total Electric Plant) p219.29c (see attachment 5) $ 892,238,236 10 Accumulated Intangible Amortization (Note A) p200.21c $ 9,955,634 11 Accumulated Common Amortization - Electric (Note A) p356 14,161,633 12 Accumulated Common Plant Depreciation - Electric (Note A) p356 $ 51,400,525 13 Total Accumulated Depreciation (Sum Lines 9 to 12) 967,756,028 14 Net Plant (Line 8-13) 2,551,171,787 15 Transmission Gross Plant (Line 29 - Line 28) 1,229,396,887 16 Gross Plant Allocator (Line 15 / 8) 34.9367% 17 Transmission Net Plant (Line 39 - Line 28) 897,303,360 18 Net Plant Allocator (Line 17 / 14) 35.1722% Plant Calculations Plant In Service 19 Transmission Plant In Service (Note B) p207.58.g $ 1,207,860,962 20 For Reconciliation only - remove New Transmission Plant Additions for Current Calendar Year For Reconciliation Only Attachment 6 - Enter Negative 21 New Transmission Plant Additions for Current Calendar Year (weighted by months in service) Attachment 6 0 22 Total Transmission Plant In Service (Line 19-20 + 21) 1,207,860,962 23 General & Intangible p205.5.g & p207.99.g (see attachment 5) 179,406,848 24 Common Plant (Electric Only) (Notes A & B) p356 88,071,964 25 Total General & Common (Line 23 + 24) 267,478,812 26 Wage & Salary Allocation Factor (Line 5) 8.05145% 27 General & Common Plant Allocated to Transmission (Line 25 * 26) 21,535,925 28 Plant Held for Future Use (Including Land) (Note C) p214 0 29 TOTAL Plant In Service (Line 22 + 27 + 28) 1,229,396,887 Accumulated Depreciation 30 Transmission Accumulated Depreciation (Note B) p219.25.c $ 322,619,784 31 Accumulated General Depreciation p219.28.c (see attachment 5) $ 42,147,246 32 Accumulated Intangible Amortization (Line 10) 9,955,634 33 Accumulated Common Amortization - Electric (Line 11) 14,161,633 34 Common Plant Accumulated Depreciation (Electric Only) (Line 12) 51,400,525 35 Total Accumulated Depreciation (Sum Lines 31 to 34) 117,665,038 36 Wage & Salary Allocation Factor (Line 5) 8.05145% 37 General & Common Allocated to Transmission (Line 35 * 36) 9,473,743 38 TOTAL Accumulated Depreciation (Line 30 + 37) 332,093,527 39 TOTAL Net Property, Plant & Equipment (Line 29-38) 897,303,360 Adjustment To Rate Base Accumulated Deferred Income Taxes 40 ADIT net of FASB 106 and 109 Attachment 1-250,466,040 41 Accumulated Investment Tax Credit Account No. 255 Enter Negative (Notes A & I) p266.h -3,168,121 42 Net Plant Allocation Factor (Line 18) 35.17% 43 Accumulated Deferred Income Taxes Allocated To Transmission (Line 41 * 42) + Line 40-251,580,338 43a Transmission Related CWIP (Current Year 12 Month weighted average balances) (Note B) p216.43.b as Shown on Attachment 6-43b Unamortized Abandoned Transmission Plant Attachment 5 - Transmission O&M Reserves 44 Total Balance Transmission Related Account 242 Reserves Enter Negative Attachment 5-3,471,170 Prepayments 45 Prepayments (Note A) Attachment 5 14,729,128 46 Total Prepayments Allocated to Transmission (Line 45) 14,729,128 Materials and Supplies 47 Undistributed Stores Exp (Note A) p227.6c & 16.c $ 1,270,092 48 Wage & Salary Allocation Factor (Line 5) 8.051% 49 Total Transmission Allocated (Line 47 * 48) 102,261 50 Transmission Materials & Supplies p227.8c 2,649,667 51 Total Materials & Supplies Allocated to Transmission (Line 49 + 50) 2,751,928 Cash Working Capital 52 Operation & Maintenance Expense (Line 85) 23,011,797 53 1/8th Rule x 1/8 12.5% 54 Total Cash Working Capital Allocated to Transmission (Line 52 * 53) 2,876,475 Network Credits 55 Outstanding Network Credits (Note N) From PJM 0 56 Less Accumulated Depreciation Associated with Facilities with Outstanding Network Credits (Note N) From PJM 0 57 Net Outstanding Credits (Line 55-56) 0 58 TOTAL Adjustment to Rate Base (Line 43 + 43a + 44 + 46 + 51 + 54-57) -234,693,978 59 Rate Base (Line 39 + 58) 662,609,383
O&M Transmission O&M 60 Transmission O&M p321.112.b (see attachment 5) $ 18,064,154 61 Less extraordinary property loss Attachment 5 $ - 62 Plus amortized extraordinary property loss Attachment 5 $ - 63 Less Account 565 p321.96.b $ - 64 Plus Schedule 12 Charges billed to Transmission Owner and booked to Account 565 (Note O) PJM Data $ - 65 Plus Transmission Lease Payments (Note A) p200.3.c $ - 66 Transmission O&M (Lines 60-63 + 64 + 65) 18,064,154 Allocated General & Common Expenses 67 Common Plant O&M (Note A) p356 0 68 Total A&G p323.197.b (see attachment 5) $ 66,358,630 68a For informational purposes: PBOB expense in FERC Account 926 (Note S) Attachment 5-648,858 69 Less Property Insurance Account 924 p323.185b 414,475 70 Less Regulatory Commission Exp Account 928 (Note E) p323.189b 3,651,224 71 Less General Advertising Exp Account 930.1 p323.191b 161,759 72 Less DE Enviro & Low Income and MD Universal Funds p335.b 6,586,524 73 Less EPRI Dues (Note D) p352-353 136,301 74 General & Common Expenses (Lines 67 + 68) - Sum (69 to 73) 55,408,347 75 Wage & Salary Allocation Factor (Line 5) 8.0515% 76 General & Common Expenses Allocated to Transmission (Line 74 * 75) 4,461,176 Directly Assigned A&G 77 Regulatory Commission Exp Account 928 (Note G) p323.189b 340,687 78 General Advertising Exp Account 930.1 (Note K) p323.191b 0 79 Subtotal - Transmission Related (Line 77 + 78) 340,687 80 Property Insurance Account 924 p323.185b 414,475 81 General Advertising Exp Account 930.1 (Note F) p323.191b 0 82 Total (Line 80 + 81) 414,475 83 Net Plant Allocation Factor (Line 18) 35.17% 84 A&G Directly Assigned to Transmission (Line 82 * 83) 145,780 85 Total Transmission O&M (Line 66 + 76 + 79 + 84) 23,011,797 Depreciation & Amortization Expense Depreciation Expense 86 Transmission Depreciation Expense p336.7b&c 28,875,685 86a Amortization of Abandoned Transmission Plant Attachment 5 0 87 General Depreciation p336.10b&c 6,962,923 88 Intangible Amortization (Note A) p336.1d&e 136,005 89 Total (Line 87 + 88) 7,098,928 90 Wage & Salary Allocation Factor (Line 5) 8.0515% 91 General Depreciation Allocated to Transmission (Line 89 * 90) 571,567 92 Common Depreciation - Electric Only (Note A) p336.11.b 3,738,403 93 Common Amortization - Electric Only (Note A) p356 or p336.11d 0 94 Total (Line 92 + 93) 3,738,403 95 Wage & Salary Allocation Factor (Line 5) 8.0515% 96 Common Depreciation - Electric Only Allocated to Transmission (Line 94 * 95) 300,996 97 Total Transmission Depreciation & Amortization (Line 86 + 91 + 96) 29,748,247 Taxes Other than Income 98 Taxes Other than Income Attachment 2 7,823,974 99 Total Taxes Other than Income (Line 98) 7,823,974 Return / Capitalization Calculations Long Term Interest 100 Long Term Interest p117.62c through 67c $ 50,839,789 101 Less LTD Interest on Securitization Bonds (Note P) Attachment 8 0 102 Long Term Interest "(Line 100 - line 101)" 50,839,789 103 Preferred Dividends enter positive p118.29c - Common Stock 104 Proprietary Capital p112.16c 1,227,904,110 105 Less Preferred Stock enter negative (Line 114) 0 106 Less Account 216.1 enter negative p112.12c 2,177,779 107 Common Stock (Sum Lines 104 to 106) 1,230,081,889 Capitalization 108 Long Term Debt p112.17c through 21c 1,273,230,000 109 Less Loss on Reacquired Debt enter negative p111.81c -10,083,973 110 Plus Gain on Reacquired Debt enter positive p113.61c 0 111 Less ADIT associated with Gain or Loss enter negative Attachment 1 4,090,232 112 Less LTD on Securitization Bonds (Note P) enter negative Attachment 8 0 113 Total Long Term Debt (Sum Lines Lines 108 to 112) 1,267,236,259 114 Preferred Stock p112.3c 0 115 Common Stock (Line 107) 1,230,081,889 116 Total Capitalization (Sum Lines 113 to 115) 2,497,318,148 117 Debt % Total Long Term Debt (Line 113 / 116) 50.74% 118 Preferred % Preferred Stock (Line 114 / 116) 0.00% 119 Common % Common Stock (Line 115 / 116) 49.26% 120 Debt Cost Total Long Term Debt (Line 102 / 113) 0.0401 121 Preferred Cost Preferred Stock (Line 103 / 114) 0.0000 122 Common Cost Common Stock (Note J) Fixed 0.1050 123 Weighted Cost of Debt Total Long Term Debt (WCLTD) (Line 117 * 120) 0.0204 124 Weighted Cost of Preferred Preferred Stock (Line 118 * 121) 0.0000 125 Weighted Cost of Common Common Stock (Line 119 * 122) 0.0517 126 Total Return ( R ) (Sum Lines 123 to 125) 0.0721 127 Investment Return = Rate Base * Rate of Return (Line 59 * 126) 47,758,681
Composite Income Taxes Income Tax Rates 128 FIT=Federal Income Tax Rate 35.00% 129 SIT=State Income Tax Rate or Composite (Note I) 8.56% 130 p (percent of federal income tax deductible for state purposes) Per State Tax Code 0.00% 131 T T=1 - {[(1 - SIT) * (1 - FIT)] / (1 - SIT * FIT * p)} = 40.56% 132 T/ (1-T) 68.24% ITC Adjustment (Note I) 133 Amortized Investment Tax Credit enter negative Attachment 1-86,997 134 T/(1-T) (Line 132) 68.24% 135 Net Plant Allocation Factor (Line 18) 35.1722% 136 ITC Adjustment Allocated to Transmission (Line 133 * (1 + 134) * 135) -51,480 137 Income Tax Component = CIT=(T/1-T) * Investment Return * (1-(WCLTD/R)) = [Line 132 * 127 * (1-(123 / 126))] 23,385,692 138 Total Income Taxes (Line 136 + 137) 23,334,212 REVENUE REQUIREMENT Summary 139 Net Property, Plant & Equipment (Line 39) 897,303,360 140 Adjustment to Rate Base (Line 58) -234,693,978 141 Rate Base (Line 59) 662,609,383 142 O&M (Line 85) 23,011,797 143 Depreciation & Amortization (Line 97) 29,748,247 144 Taxes Other than Income (Line 99) 7,823,974 145 Investment Return (Line 127) 47,758,681 146 Income Taxes (Line 138) 23,334,212 147 Gross Revenue Requirement (Sum Lines 142 to 146) 131,676,911 Adjustment to Remove Revenue Requirements Associated with Excluded Transmission Facilities 148 Transmission Plant In Service (Line 19) 1,207,860,962 149 Excluded Transmission Facilities (Note M) Attachment 5 0 150 Included Transmission Facilities (Line 148-149) 1,207,860,962 151 Inclusion Ratio (Line 150 / 148) 100.00% 152 Gross Revenue Requirement (Line 147) 131,676,911 153 Adjusted Gross Revenue Requirement (Line 151 * 152) 131,676,911 Revenue Credits & Interest on Network Credits 154 Revenue Credits Attachment 3 7,441,484 155 Interest on Network Credits (Note N) PJM Data - 156 Net Revenue Requirement (Line 153-154 + 155) 124,235,427 Net Plant Carrying Charge 157 Net Revenue Requirement (Line 156) 124,235,427 158 Net Transmission Plant (Line 19-30) 885,241,178 159 Net Plant Carrying Charge (Line 157 / 158) 14.0341% 160 Net Plant Carrying Charge without Depreciation (Line 157-86) / 158 10.7722% 161 Net Plant Carrying Charge without Depreciation, Return, nor Income Taxes (Line 157-86 - 127-138) / 158 2.7413% Net Plant Carrying Charge Calculation per 100 Basis Point increase in ROE 162 Net Revenue Requirement Less Return and Taxes (Line 156-145 - 146) 53,142,534 163 Increased Return and Taxes Attachment 4 76,583,858 164 Net Revenue Requirement per 100 Basis Point increase in ROE (Line 162 + 163) 129,726,392 165 Net Transmission Plant (Line 19-30) 885,241,178 166 Net Plant Carrying Charge per 100 Basis Point increase in ROE (Line 164 / 165) 14.6544% 167 Net Plant Carrying Charge per 100 Basis Point increase in ROE without Depreciation (Line 163-86) / 165 11.3925% 168 Net Revenue Requirement (Line 156) 124,235,427 169 True-up amount Attachment 6 (7,305,738) 170 Plus any increased ROE calculated on Attachment 7 other than PJM Sch. 12 projects Attachment 7 559,389 171 Facility Credits under Section 30.9 of the PJM OATT and Facility Credits to Vineland per settlement in ER05-515 Attachment 5-171a MAPP Abandonment recovery pursuant to ER13-607 Attachment 5-172 Net Zonal Revenue Requirement (Line 168 + 169 +170+ 171+171a) 117,489,078 Network Zonal Service Rate 173 1 CP Peak (Note L) PJM Data 4,114 174 Rate ($/MW-Year) (Line 172 / 173) 28,558 175 Network Service Rate ($/MW/Year) (Line 174) 28,558
Notes A Electric portion only B Exclude Construction Work In Progress and leases that are expensed as O&M (rather than amortized). New Transmission plant that is expected to be placed in service in the current calendar year weighted by number of months it is expected to be in-service. New Transmission plant expected to be placed in service in the current calendar year that is not included in the PJM Regional Transmission Plan (RTEP) must be separately detailed on Attachment 5. For the Reconciliation, new transmission plant that was actually placed in service weighted by the number of months it was actually in service CWIP will be linked to Attachment 6 which shows detail support by project (incentive and non-incentive). C Transmission Portion Only D All EPRI Annual Membership Dues E All Regulatory Commission Expenses F Safety related advertising included in Account 930.1 G Regulatory Commission Expenses directly related to transmission service, RTO filings, or transmission siting itemized in Form 1 at 351.h. I The currently effective income tax rate, where FIT is the Federal income tax rate; SIT is the State income tax rate, and p = "the percentage of federal income tax deductible for state income taxes". If the utility includes taxes in more than one state, it must explain in Attachment 5 the name of each state and how the blended or composite SIT was developed. Furthermore, a utility that elected to use amortization of tax credits against taxable income, rather than book tax credits to Account No. 255 and reduce rate base, must reduce its income tax expense by the amount of the Amortized Investment Tax Credit (Form 1, 266.8.f) multiplied by (1/1-T). A utility must not include tax credits as a reduction to rate base and as an amortization against taxable income. The ROE is 10.5% which includes a base ROE of 10.0% ROE per FERC order in Docket No. EL13-48 and a 50 basis point RTO membership adder as authorized by FERC: provided, that the projects identified in Docket Nos. J ER08-686 and ER08-1423 have been awarded an additional 150 basis point adder and, thus, their ROE is 12.0%. K Education and outreach expenses relating to transmission, for example siting or billing L As provided for in Section 34.1 of the PJM OATT and the PJM established billing determinants will not be revised or updated in the annual rate reconciliations per settlement in ER05-515. M Amount of transmission plant excluded from rates per Attachment 5. N Outstanding Network Credits is the balance of Network Facilities Upgrades Credits due Transmission Customers who have made lump-sum payments (net of accumulated depreciation) towards the construction of Network Transmission Facilities consistent with Paragraph 657 of Order 2003-A. Interest on the Network Credits as booked each year is added to the revenue requirement to make the Transmisison Owner whole on Line 155. O Payments made under Schedule 12 of the PJM OATT that are not directly assessed to load in the Zone under Schedule 12 are included in Transmission O&M. If they are booked to Acct 565, they are included in on line 64 P Securitization bonds may be included in the capital structure per settlement in ER05-515. Q ACE capital structure is initially fixed at 50% common equity and 50% debt per settlement in ER05-515 subject to moratorium provisions in the settlement. R Per the settlement in ER05-515, the facility credits of $15,000 per month paid to Vineland will increase to $37,500 per month (prorated for partial months) effective on the date FERC approves the settlement in ER05-515. S See Attachment 5 - Cost Support, section entitled "PBOP Expense in FERC Account 926" for additional information per FERC orders in Docket Nos. EL13-48, EL15-27 and ER16-456.
Delmarva Power & Light Company Attachment 1 - Accumulated Deferred Income Taxes (ADIT) Worksheet Tax Detail Only Transmission Plant Labor Total Related Related Related ADIT ADIT-282 - (804,963,127) - (804,963,127) ADIT-283 (3,835,851) (3,542,121) (76,293,870) (83,671,842) ADIT-190 4,312,000 106,126,789 7,307,458 117,746,247 Subtotal 476,149 (702,378,458) (68,986,412) (770,888,722) Wages & Salary Allocator 8.0515% Gross Plant Allocator 34.93669% ADIT 476,149 (245,387,782) (5,554,407) (250,466,040) Total Note: ADIT associated with Gain or Loss on Reacquired Debt is included in Column A here and included in Cost of Debt on Appendix A, Line 111 Amount (4,090,232) In filling out this attachment, a full and complete description of each item and justification for the allocation to Columns C-F and each separate ADIT item will be listed. Dissimilar items with amounts exceeding $100,000 will be listed separately. A B C D E F G ADIT-190 Total Gas, Prod Only Or Other Transmission Plant Labor Distribution Related Related Related Related Justification Allowance for Doubtful Accounts 8,228,112 8,228,112 - - - Charitable Contributions 1,354,595 1,354,595 - - - Claims Reserve 1,098,178 153,745-944,433 - Deferred ITC 1,698,120 237,737-1,460,383 - Environmental Expense 1,354,432 1,354,432 - - - Merrill Creek 6,099,285 6,099,285 - - - Under the Tax Reform Act of 1986, taxpayers were required to switch from the reserve method for bad debts to the specific write-off method. The amounts previously accumulated in a reserve were required to be included in taxable income over a four year period. The reserve method is used for book purposes. Related to all revenues. PHI's consolidated return is in an NOL situation, therefore, Pepco's charitable contributions are carried forward until such time as PHI is in a taxable income position. For book purposes, the contributions are expensed when incurred. Related to all functions. These deferred taxes are the result of a deduction taken for book purposes to set aside a reserve for General and Auto liability claims. For tax no deduction is permitted until the "all events" test is met, typically when payment is made. Pursuant to the requirements of FAS 109, DPL s accumulated deferred taxes must encompass all timing differences regardless of whether the difference is normalized or flowed-through. These balances primarily represent the deferred taxes on prior flow-through items, including the amount of the required gross-up necessary for full recovery of the prior flow-through amount. Related to all plant. These items are removed below. These deferred taxes are the result of a deduction taken for book purposes to set aside a reserve for environmental site clean-up expenses. For tax no deduction is permitted until the "all events" test is met, typically when economic performance has occurred. These deferred taxes are the result of rent being recorded ratably over the life of the lease for book purposes. For tax, rent is deductible when economic performance occurs. This asset is Generation related. This contra account represents an adjustment to the Merrill Creek Rent deferred tax generated relating to rent deductible for tax purposes upon economic performance. This represents deferred tax generated as a result of an extraordinary charge deducted for books relating to impaired assets due to the effects of deregulation. For tax purposes, the impairment did not give rise to a tax deduction. Deductions for tax are nondeductable. This contra account represents an adjustment to the Merrill Creek Excess Capacity deferred tax generated relating to impaired assets due to the effects of deregulation. OPEB 7,544,899 1,056,286 - - FAS No. 106 requires accrual basis instead of cash basis accounting for post retirement health care and life insurance benefits for book purposes. Amounts paid to participants or funded through the VEBA or 401(h) accounts are currently deductible for tax purposes. Affects company personnel 6,488,613 across all functions. Other (190) 1,228,032 499,423-6,296 722,313 Related to Gas, Production or Other. Other Labor Related Accruals 7,657,146 1,072,000 - - 6,585,146 Affects company personnel across all functions. Reg Liab - FERC Formula Adj. 4,312,000-4,312,000 - When a regulatory asset/liability is established, books credit/debit income, which for tax purposes needs to be reversed along with the associated - amortization. Reg Liab - Other 5,382,025 5,382,025 - - - Represents various costs which we are, or will be through a future rate case, getting recovery through rate base. Renewable Energy Credits 4,958,289 4,958,289 - - - Relates to accruals for the purchase of state renewable energy credits. FAS 109 Deferred Taxes - 190 821,761 115,047-706,715 - Pursuant to the requirements of FAS 109, DPL s accumulated deferred taxes must encompass all timing differences regardless of whether the difference is normalized or flowed-through. These balances primarily represent the deferred taxes on prior flow-through items, including the amount of the required gross-up necessary for full recovery of the prior flow-through amount. Related entirely to plant. These items are removed below. Federal and State NOL 122,297,744 17,121,684-105,176,060 PHI's consolidated return is in an NOL situation, therefore NOLs are carried forward until such time as PHI is in a taxable income position. DPL also - has stand alone state taxable losses for 2008 forward. Also includes MD NOL of 6.6M that was created from an amended return. Subtotal - p234 174,034,618 47,632,660 4,312,000 108,293,887 13,796,071 Less FASB 109 Above if not separately removed 2,519,882 352,783-2,167,098 - Less FASB 106 Above if not separately removed 7,544,899 1,056,286 - - 6,488,613 Total 163,969,838 46,223,591 4,312,000 106,126,789 7,307,458 Instructions for Account 190: 1. ADIT items related only to Non-Electric Operations (e.g., Gas, Water, Sewer) or Production are directly assigned to Column C 2. ADIT items related only to Transmission are directly assigned to Column D 3. ADIT items related to Plant and not in Columns C & D are included in Column E 4. ADIT items related to labor and not in Columns C & D are included in Column F 5. Deferred income taxes arise when items are included in taxable income in different periods than they are included in rates, therefore if the item giving rise to the ADIT is not included in the formula, the associated ADIT amount shall be excluded 6. Re: Form 1-F filer: Sum of subtotals for Accounts 282 and 283 should tie to Form No. 1-F, p.113.57.c
Delmarva Power & Light Company Attachment 1- Accumulated Deferred Income Taxes (ADIT) Worksheet A B C D E F G ADIT- 282 Total Gas, Prod Only Or Other Transmission Plant Labor Justification Distribution Related Plant Related - APB 11 Deferred Taxes (900,322,918) (95,359,791) - (804,963,127) - This deferred tax balance relates to our plant and results from life and method differences. Related to both T & D plant. CIAC - Non Rate Base 37,050,973 37,050,973 - - - Leased Vehicles - Non Rate Base (12,985,797) (12,985,797) - - - Other Plant Related - FAS109 Deferred Taxes (12,327,854) (11,276,335) - (1,051,518) - Transmission FAS 109 AFUDC Equity Deferred Taxes (3,351,176) - (3,351,176) - - Contributions in Aid of Construction (CIAC) are a reduction to Plant for book accounting purposes, but are included in taxable income and depeciated for income tax purposes. This different book/tax treatment results in deferred income taxes which must be recorded in accordance with SFAS 109. The company collects an income tax gross-up from the customer which is reimbursement for the time value of money on the additional tax liability inccurred until such time as the amounts are fully depreciated for tax purposes. The deferred income tax asset on CIAC's is excluded from Rate Base because the underlying plant is not included in Rate Base. The Company leases its vehicles under arrangements that are treated as Operating Leases for book purposes, but financing leases for tax purposes. The differing income tax treatment between Rent Expense deducted for book purposes and tax depreciation expense deducted for income tax purposes, results in deferred income taxes being recorded on the books. Since Leased Vehicles are not included in Rate Base, the deferred income taxes are being excluded as well. Pursuant to the requirements of FAS 109, DPL s accumulated deferred taxes must encompass all timing differences regardless of whether the difference is normalized or flowed-through. These balances primarily represent the deferred taxes on prior flow-through items, including the amount of the required gross-up necessary for full recovery of the prior flow-through amount. Related to all plant. These items are removed below. Under SFAS 109, deferred income taxes must be provided on all book/tax temporary differences, including AFUDC-Equity. Deferred income taxes on AFUDC-Equity are not recognized for Regulatory purposes and are excluded from Rate Base. Transmission FAS 109 1/1/2005 Deferred Tax Balance (7,189,568) - (7,189,568) - Pursuant to the requirements of FAS 109, DPL s accumulated deferred taxes must encompass all timing differences regardless of whether the difference is normalized or flowed-through. These balances primarily represent the deferred taxes on prior flow-through items, including the amount of the - required gross-up necessary for full recovery of the prior flow-through amount. Related to all plant. These items are removed below. Subtotal - p275 (899,126,339) (82,570,950) (10,540,743) (806,014,645) - Less FASB 109 Above if not separately removed (22,868,597) (11,276,335) (10,540,743) (1,051,518) - Less FASB 106 Above if not separately removed - Total (876,257,742) (71,294,615) - (804,963,127) - Instructions for Account 282: 1. ADIT items related only to Non-Electric 2. ADIT items related only to Transmission are directly assigned to Column D 3. ADIT items related to Plant and not in Columns C & D are included in Column E 4. ADIT items related to labor and not in Columns C & D are included in Column F 5. Deferred income taxes arise when items are 6. Re: Form 1-F filer: Sum of subtotals for Accounts 282 and 283 should tie to Form No. 1-F, p.113.57.c Delmarva Power & Light Company Attachment 1- Accumulated Deferred Income Taxes (ADIT) Worksheet A B C D E F G ADIT-283 Total Gas, Prod Only Or Other Transmission Plant Labor Distribution Related Related Related Related Justification When a regulatory asset/liability is established, books credit/debit income, which for tax purposes needs to be reversed along with the associated Blueprint for the Future (7,490,422) (7,490,422) - - - amortization. Difference between actual fuel expense as compared to the fuel expense computed in accordance with fuel adjustment clause formulas as deferred on books. In accordance with Section 162 Ordinary and Necessary Business Expenses and Section 461 Rules for Taxable year of Deduction, fuel costs are deductible in the year incurred for federal tax purposes. Rate surcharges are includible in the taxable year the underlying monthly bill is adjusted. Refunds are deductible in the taxable year that the liability is fixed and economic performance has occurred. These deferred taxes are the result of this book/tax difference. Generation Related. Deferred Fuel (4) (4) - - - Materials Reserve (531,251) (74,375) - (456,876) - Merger Costs (6,569,280) (6,569,280) - - - Pension (83,174,536) (11,644,435) - - (71,530,101) Affects company personnel across all functions. Property Taxes (3,587,494) (502,249) - (3,085,245) - Reacquired Debt (4,090,232) (4,090,232) - - Reg Asset - DSM (32,489,449) (32,489,449) - - - Reg Asset - FERC Formula Rate Adj. (2,711,404) - (2,711,404) - - Reg Asset- Other Reg Assets (53,064,651) (48,300,882) - - (4,763,769) Represents various costs which we are, or will be through a future rate case, getting recovery through rate base. Reg Asset - Transmission MAPP (1,124,447) - (1,124,447) - - Reg Asset- COPCO Acquisition Adjustment (5,350,329) (5,350,329) - - - This represents deferred tax generated as a result of a deduction taken for amounts set aside in a reserve for book purposes. For tax no deduction is permitted until economic performance takes place. These reserves are related to deregulation of Energy. Reflects deferred taxes generated on Delmarva Power & Light Company /Atlantic City Electric Company merger costs deducted for tax purposes. For books these costs were capitalized. Pension related and therefore labor related. For book purposes, certain real estate taxes were expensed. For tax purposes, those taxes were capitalized and are being depreciated. Unregulated related. Reflects the deferred taxes generated as a result of the tax deductions taken for the cost to reacquire debt. For book purposes, these amounts were recorded as an asset in account 189 and are amortized over future periods. For books, Demand Side Management Costs are deferred. For tax these costs are expensed when paid. These deferred taxes are the result of this book/tax difference which is retail in nature. When a regulatory asset/liability is established, books credit/debit income, which for tax purposes needs to be reversed along with the associated amortization. Represents deferred taxes on MAPP abandonment costs that are currently deductible for income tax purposes, versus amounts included in the MAPP Regulatory Asset that are amortized to book expense over a longer time period Amortization of COPCO acquisition adjustment. Beginning unamortized balance $40,456,550.00 represents recovery of the regulatory asset per Docket 9093, Order 81518, refers to MD Docket 8583, Order 71719; offset account 114000 Plant Acq Adj. Amortizing monthly. Fully amortized in 2010. FAS 109 Deferred Taxes - 283 (8,392,474) (1,174,946) - (7,217,528) - FAS 109 Deferred Taxes - 283 (AFUDC Equity) (2,286,861) (320,161) (1,966,700) - - Pursuant to the requirements of FAS 109, DPL s accumulated deferred taxes must encompass all timing differences regardless of whether the difference is normalized or flowed-through. These balances primarily represent the deferred taxes on prior flow-through items, including the amount of the required gross-up necessary for full recovery of the prior flow-through amount. Related to all plant. These items are removed below. Under SFAS 109, deferred income taxes must be provided on all book/tax temporary differences, including AFUDC-Equity. Deferred income taxes on AFUDC-Equity are not recognized for Regulatory purposes and are excluded from Rate Base. FAS 109 Deferred Taxes - 283 (1/1/2005 Balance) (4,906,201) (686,868) (4,219,333) - Pursuant to the requirements of FAS 109, DPL s accumulated deferred taxes must encompass all timing differences regardless of whether the difference is normalized or flowed-through. These balances primarily represent the deferred taxes on prior flow-through items, including the amount of the - required gross-up necessary for full recovery of the prior flow-through amount. Related to all plant. These items are removed below. Subtotal - p277 (Form 1-F filer: see note 6, below) (215,769,036) (118,693,633) (10,021,885) (10,759,649) (76,293,870) Less FASB 109 Above if not separately removed (15,585,536) (2,181,975) (6,186,033) (7,217,528) - Less FASB 106 Above if not separately removed - Total (200,183,500) (116,511,658) (3,835,851) (3,542,121) (76,293,870) Instructions for Account 283: 1. ADIT items related only to Non-Electric 2. ADIT items related only to Transmission are directly assigned to Column B 3. ADIT items related to Plant and not in Columns C & D are included in Column E 4. ADIT items related to labor and not in Columns C & D are included in Column F 5. Deferred income taxes arise when items are 6. Re: Form 1-F filer: Sum of subtotals for Accounts 282 and 283 should tie to Form No. 1-F, p.113.57.c
Delmarva Power & Light Company Attachment 1- Accumulated Deferred Income Taxes (ADIT) Worksheet ADITC-255 Item Balance Amortization Rate Base Treatment Balance to line 41 of Appendix A Total 3,168,121 420,441 Post 1980 Amortization Amortization to line 133 of Appendix A Total 524,786 86,997 Pre 1981 Total 3,692,906 507,438 Total Form No. 1 (p 266 & 267) 3,692,906 507,438 Difference /1 check 0 - /1 Difference must be zero
Delmarva Power & Light Company Attachment 2 - Taxes Other Than Income Worksheet Page 263 Allocated Other Taxes Col (i) Allocator Amount Plant Related Gross Plant Allocator 1 Real property (State, Municipal or Local) 21,648,240 2 Personal property 3 Federal/State Excise 19,273 4 5 6 Total Plant Related 21,667,513 34.9367% 7,569,912 Labor Related Wages & Salary Allocator 7 Federal FICA & Unemployment 3,028,471 8 Unemployment 127,015 9 10 11 Total Labor Related 3,155,486 8.0515% 254,062 Other Included Gross Plant Allocator 12 Miscellaneous - 13 14 Total Other Included 0 34.9367% 0 Total Included 24,822,999 7,823,974 Excluded 15 State Franchise Tax 8,347,550 16 Gross Receipts 198,386 17 Sales and Use 1,534,826 18 Utility Tax for Delmarva 7,138,680 19 City License 20 21 Total "Other" Taxes (included on p. 263) 42,042,441 22 Total "Taxes Other Than Income Taxes" - acct 408.10 (p. 114.14) 42,042,441 23 Difference - Criteria for Allocation: A Other taxes that are incurred through ownership of plant including transmission plant will be allocated based on the Gross Plant Allocator. If the taxes are 100% recovered at retail they will not be included B Other taxes that are incurred through ownership of only general or intangible plant will be allocated based on the Wages and Salary Allocator. If the taxes are 100% recovered at retail they will not be included C Other taxes that are assessed based on labor will be allocated based on the Wages and Salary Allocator D Other taxes except as provided for in A, B and C above, that are incurred and (1) are not fully recovered at retail or (2) are directly or indirectly related to transmission service will be allocated based on the Gross Plant Allocator; provided, however, that overheads shall be treated as in footnote B above E Excludes prior period adjustments in the first year of the formula's operation and reconciliation for the first year
Delmarva Power & Light Company Attachment 3 - Revenue Credit Workpaper Account 454 - Rent from Electric Property 1 Rent from Electric Property - Transmission Related (Note 3) 1,007,245 2 Total Rent Revenues (Sum Line 1) 1,007,245 Account 456 - Other Electric Revenues (Note 1) 3 Schedule 1A $ 1,471,091 4 Net revenues associated with Network Integration Transmission Service (NITS) for which the load is not included in the divisor (difference between NITS credits from PJM and PJM NITS charges paid by Transmission Owner) (Note 4) - 5 Point to Point Service revenues for which the load is not included in the divisor received by Transmission Owner (Note 4) 1,244,037 6 PJM Transitional Revenue Neutrality (Note 1) 7 PJM Transitional Market Expansion (Note 1) - 8 Professional Services (Note 3) - 9 Revenues from Directly Assigned Transmission Facility Charges (Note 2) 4,427,009 10 Rent or Attachment Fees associated with Transmission Facilities (Note 3) - 11 Gross Revenue Credits (Sum Lines 2-10) 8,149,383 12 Less line 17g (707,899) 13 Total Revenue Credits 7,441,484 Revenue Adjustment to determine Revenue Credit 14 Note 1: All revenues related to transmission that are received as a transmission owner (i.e., not received as a LSE), for which the cost of the service is recovered under this formula, except as specifically provided for elsewhere in this Attachment or elsewhere in the formula will be included as a revenue credit or included in the peak on line 173 of Appendix A. 15 Note 2: If the costs associated with the Directly Assigned Transmission Facility Charges are included in the Rates, the associated revenues are included in the Rates. If the costs associated with the Directly Assigned Transmission Facility Charges are not included in the Rates, the associated revenues are not included in the Rates. 16 Note 3: Ratemaking treatment for the following specified secondary uses of transmission assets: (1) right-of-way leases and leases for space on transmission facilities for telecommunications; (2) transmission tower licenses for wireless antennas; (3) right-of-way property leases for farming, grazing or nurseries; (4) licenses of intellectual property (including a portable oil degasification process and scheduling software); and (5) transmission maintenance and consulting services (including energized circuit maintenance, high-voltage substation maintenance, safety training, transformer oil testing, and circuit breaker testing) to other utilities and large customers (collectively, products). Company will retain 50% of net revenues consistent with Pacific Gas and Electric Company, 90 FERC 61,314. Note: in order to use lines 17a - 17g, the utility must track in separate subaccounts the revenues and costs associated with each secondary use (except for the cost of the associated income taxes). 17a Revenues included in lines 1-11 which are subject to 50/50 sharing. 1,007,245 17b Costs associated with revenues in line 17a Attachment 5 - Cost Support 408,552 17c Net Revenues (17a - 17b) 598,693 17d 50% Share of Net Revenues (17c / 2) 299,347 17e Costs associated with revenues in line 17a that are included in FERC accounts recovered through the formula times the allocator used to functionalize the amounts in the FERC account to the transmission service at issue. - 17f Net Revenue Credit (17d + 17e) 299,347 17g Line 17f less line 17a (707,899) 18 Note 4: If the facilities associated with the revenues are not included in the formula, the revenue is shown here but not included in the total above and is explained in the Cost Support; for example revenues associated with distribution facilities. In addition, Revenues from Schedule 12 are not included in the total above to the extent they are credited under Schedule 12. 4,551,839 19 Amount offset in line 4 above 125,899,891 20 Total Account 454, 456 and 456.1 138,601,113 21 Note 4: SECA revenues booked in Account 447.
Delmarva Power & Light Company Attachment 4 - Calculation of 100 Basis Point Increase in ROE Return and Taxes with 100 Basis Point increase in ROE A 100 Basis Point increase in ROE and Income Taxes (Line 127 + Line 138) 76,583,858 B 100 Basis Point increase in ROE 1.00% Return Calculation 59 Rate Base (Line 39 + 58) 662,609,383 Long Term Interest 100 Long Term Interest p117.62c through 67c 50,839,789 101 Less LTD Interest on Securitization Bonds Attachment 8 0 102 Long Term Interest "(Line 100 - line 101)" 50,839,789 103 Preferred Dividends enter positive p118.29c - Common Stock 104 Proprietary Capital p112.16c 1,227,904,110 105 Less Preferred Stock enter negative (Line 114) 0 106 Less Account 216.1 enter negative p112.12c 2,177,779 107 Common Stock (Sum Lines 104 to 106) 1,230,081,889 Capitalization 108 Long Term Debt p112.17c through 21c 1,273,230,000 109 Less Loss on Reacquired Debt enter negative p111.81c -10,083,973 110 Plus Gain on Reacquired Debt enter positive p113.61c 0 111 Less ADIT associated with Gain or Loss enter negative Attachment 1 4,090,232 112 Less LTD on Securitization Bonds enter negative Attachment 8 0 113 Total Long Term Debt (Sum Lines Lines 108 to 112) 1,267,236,259 114 Preferred Stock p112.3c 0 115 Common Stock (Line 107) 1,230,081,889 116 Total Capitalization (Sum Lines 113 to 115) 2,497,318,148 117 Debt % Total Long Term Debt (Line 113 / 116) 50.74% 118 Preferred % Preferred Stock (Line 114 / 116) 0.00% 119 Common % Common Stock (Line 115 / 116) 49.26% 120 Debt Cost Total Long Term Debt (Line 102 / 113) 0.0401 121 Preferred Cost Preferred Stock (Line 103 / 114) 0.0000 122 Common Cost Common Stock (Note J from Appendix A) Appendix A % plus 100 Basis Pts 0.1150 123 Weighted Cost oftotal Long Term Debt (WCLTD) (Line 117 * 120) 0.0204 124 Weighted Cost ofpreferred Stock (Line 118 * 121) 0.0000 125 Weighted Cost ofcommon Stock (Line 119 * 122) 0.0566 126 Total Return ( R ) (Sum Lines 123 to 125) 0.0770 127 Investment Return = Rate Base * Rate of Return (Line 59 * 126) 51,022,437 Composite Income Taxes Income Tax Rates 128 FIT=Federal Income Tax Rate 35.00% 129 SIT=State Income Tax Rate or Composite 8.56% 130 p (percent of federal income tax deductible for state purposes) Per State Tax Code 0.00% 131 T T=1 - {[(1 - SIT) * (1 - FIT)] / (1 - SIT * FIT * p)} = 40.56% 132 T/ (1-T) 68.24% ITC Adjustment 133 Amortized Investment Tax Credit enter negative Attachment 1 (86,997) 134 T/(1-T) (Line 132) 68% 135 Net Plant Allocation Factor (Line 18) 35.1722% 136 ITC Adjustment Allocated to Transmission (Note I from Appendix A) (Line 133 * (1 + 134) * 135) -51,480 137 Income Tax Component = CIT=(T/1-T) * Investment Return * (1-(WCLTD/R)) = 25,612,901 138 Total Income Taxes (Line 136 + 137) 25,561,421
Delmarva Power & Light Company Electric / Non-electric Cost Support Attachment 5 - Cost Support Form 1 Amount Electric Portion Plant Allocation Factors 10 Accumulated Intangible Amortization (Note A) p200.21c 28,654,568 9,955,634 18,698,934 11 Accumulated Common Amortization - Electric (Note A) p356 17,457,635 14,161,633 3,296,002 12 Accumulated Common Plant Depreciation - Electric (Note A) p356 63,363,565 51,400,525 11,963,040 Plant In Service 24 Common Plant (Electric Only) (Notes A & B) p356 108,569,975 88,071,964 20,498,011 Accumulated Deferred Income Taxes 41 Accumulated Investment Tax Credit Account No. 255 (Notes A & I) p266.h 3,692,906 3,340,468 352,438 Materials and Supplies 47 Undistributed Stores Exp (Note A) p227.6c & 16.c 1,309,738 1,270,092 39,646 Allocated General & Common Expenses 65 Plus Transmission Lease Payments (Note A) p200.3.c 67 Common Plant O&M (Note A) p356 0 0 0 Depreciation Expense 88 Intangible Amortization (Note A) p336.1d&e 136,005 136,005 0 92 Common Depreciation - Electric Only (Note A) p336.11.b 3,738,403 3,738,403 0 93 Common Amortization - Electric Only (Note A) p356 or p336.11d 0 0 0 Non-electric Portion See Form 1 See Form 1 See Form 1 See Form 1 See Form 1 96.973% Electric, 3.027% Non-Electric See FERC Form 2, Page 337, Line 1, Column h for non-electric portion. See Form 1, electric only. See Form 1, electric only. Details Transmission / Non-transmission Cost Support Form 1 Amount Transmission Related Non-transmission Related Details 28 Plant Held for Future Use (Including Land) (Note C) p214 3,240,849 0 3,240,849 CWIP & Expensed Lease Worksheet 1 2 3 4 5 Specific identification based on plant records: The following plant investments are included: CWIP In Form 1 Amount Expensed Lease in Form 1 Amount Form 1 Amount Plant Allocation Factors 6 Electric Plant in Service (Note B) p207.104g 3,431,003,839 0 0 Plant In Service 19 Transmission Plant In Service (Note B) p207.58.g 1,207,860,962 0 0 24 Common Plant (Electric Only) (Notes A & B) p356 88,071,964 0 0 Accumulated Depreciation 30 Transmission Accumulated Depreciation (Note B) p219.25.c 322,619,784 0 0 Details See ARO Exclusion - Cost Support section below for Electric Plant in Servie without AROs See Form 1 See Form 1 EPRI Dues Cost Support Form 1 Amount EPRI Dues Details Allocated General & Common Expenses 73 Less EPRI Dues (Note D) p352-353 136,301 136,301 See Form 1
Delmarva Power & Light Company Attachment 5 - Cost Support Regulatory Expense Related to Transmission Cost Support Transmission Related Non-transmission Related Form 1 Amount Details Allocated General & Common Expenses 70 Less Regulatory Commission Exp Account 928 (Note E) p323.189b 3,651,224 340,687 3,310,537 FERC Form 1 page 351 lines 7 (h) and 8 (h) Directly Assigned A&G 77 Regulatory Commission Exp Account 928 (Note G) p323.189b 3,651,224 340,687 3,310,537 FERC Form 1 page 351 lines 7 (h) and 8 (h) Safety Related Advertising Cost Support Form 1 Amount Safety Related Non-safety Related Directly Assigned A&G 81 General Advertising Exp Account 930.1 (Note F) p323.191b 161,759 0 161,759 Details None MultiState Workpaper State 1 State 2 State 3 State 4 State 5 Income Tax Rates MD PA VA DE NJ 129 SIT=State Income Tax Rate or Composite (Note I) 8.56% 8.25% 9.990% 6% 8.7% 6.50% Education and Out Reach Cost Support Form 1 Amount Education & Outreach Other Directly Assigned A&G 78 General Advertising Exp Account 930.1 (Note K) p323.191b 161,759 0 161,759 Details Enter Calculation Apportioned: PA 0.0043%, VA 0.0109%, DE 5.9121%, MD 2.628%, NJ 0.0005% Details None Excluded Plant Cost Support Excluded Transmission Facilities Adjustment to Remove Revenue Requirements Associated with Excluded Transmission Facilities 149 Excluded Transmission Facilities (Note M) Attachment 5 0 Instructions: Enter $ 1 Remove all investment below 69 kv or generator step up transformers included in transmission plant in service that are not a result of the RTEP Process 2 If unable to determine the investment below 69kV in a substation with investment of 69 kv and higher as well as below 69 kv, Or the following formula will be used: Example Enter $ A Total investment in substation 1,000,000 B Identifiable investment in Transmission (provide workpapers) 500,000 C Identifiable investment in Distribution (provide workpapers) 400,000 D Amount to be excluded (A x (C / (B + C))) 444,444 Description of the Facilities General Description of the Facilities None Add more lines if necessary Outstanding Network Credits Cost Support Outstanding Network Credits Network Credits Enter $ 55 Outstanding Network Credits (Note N) From PJM 0 Description of the Credits General Description of the Credits None 56 Less Accumulated Depreciation Associated with Facilities with Outstanding Network Credits (Note N) From PJM 0 None Add more lines if necessary
Delmarva Power & Light Company Attachment 5 - Cost Support Transmission Related Account 242 Reserves Total Allocation Transmission Related 44 Transmission Related Account 242 Reserves (exclude current year environmental site related reserves) Enter $ Amount Directly Assignable to Transmission - 100% - Labor Related, General plant related or Common Plant related 33,460,936 8.051% 2,694,091 Plant Related 2,224,249 34.937% 777,079 Other 0.00% - Total Transmission Related Reserves 35,685,185 3,471,170 Details Prepayments 45 Prepayments Allocator To Line 45 Pension Liabilities, if any, in Account 242-6.846% - Description of the Prepayments Prepayments $ 10,086,110 6.846% 690,510 Prepaid Pensions if not included in Prepayments $ 205,058,619 6.846% 14,038,618 Prepaid Pension is recorded in FERC account 186 (see FERC Form 1 page 233). 215,144,729 6.85% 14,729,128 5 Wages & Salary Allocator 8.051% Electric vs Gas 85% Based on Modified Wisconsin Method Modified Wages & Salaries Allocator 6.846% Add more lines if necessary Extraordinary Property Loss Amount Number of years Amortization w/ interest 61 Less extraordinary property loss Attachment 5 $ - 62 Plus amortized extraordinary property loss Attachment 5 5 $ - $ - Interest on Outstanding Network Credits Cost Support Interest on Network Credits Revenue Credits & Interest on Network Credits 155 Interest on Network Credits (Note N) PJM Data 0 Enter $ Description of the Interest on the Credits General Description of the Credits None Add more lines if necessary Facility Credits under Section 30.9 of the PJM OATT and Facility Credits to Vineland per settlement in ER05-515 Amount Net Revenue Requirement 171 Facility Credits under Section 30.9 of the PJM OATT and Facility Credits to Vineland per settlement in ER05-515 Attachment 5 - Description & PJM Documentation PJM Load Cost Support 1 CP Peak Network Zonal Service Rate 173 1 CP Peak (Note L) PJM Data 4,114.0 Description & PJM Documentation See Form 1 Statements BG/BH (Present and Proposed Revenues) Customer Billing Determinants Current Rate Proposed Rate DPL zone Current Revenues Proposed Revenues Change in Revenues Total
Delmarva Power & Light Company Attachment 5 - Cost Support Abandoned Tranmission Plant A Beginning Balance of Unamortized Transmission Plant Per FERC Order B Months Remaining in Amortization Period Per FERC Order C Monthly Ammortization A/B D Months in Year to be Amortized E Amortization in Rate Year C*D Line 86a F Deductions G End of Year Balance in Unamortized Transmission Plant A-E-F Line 43b MAPP Abandonment recovery pursuant to ER13-607 DPL Pepco Total 171a 2013-14 rate period $ 9,750,649 $ 12,725,412 $ 22,476,061 171a 2014-15 rate period $ 14,666,395 16,524,210 $ 31,190,605 171a 2015-16 rate period $ 12,208,522 14,624,812 $ 26,833,334 Total $ 36,625,566 $ 43,874,434 $ 80,500,000 Supporting documentation for FERC Form 1 reconciliation Compliance with FERC Order on the Exelon Merger Form 1 Amount Merger Costs Non Merger Related 60 Transmission O&M p321.112.b 18,074,774 10,620 18,064,154 68 Total A&G p323.197.b 69,386,052 3,027,422 66,358,630 ARO Exclusion - Cost Support Form 1 Amount ARO's Non-ARO's Form 1 Amount ARO's Non-ARO's 6 Electric Plant in Service p207.104g 3,431,003,839 147,988 3,430,855,851 9 Accumulated Depreciation (Total Electric Plant) p219.29c 892,324,561 86,325 892,238,236 23 General & Intangible p205.5.g & p207.99.g 179,554,836 147,988 179,406,848 31 Accumulated General Depreciation p219.28.c 42,233,571 86,325 42,147,246 PBOP Expense in FERC 926 Total A&G Form 1 Amount Account 926 Form 1 Amount PBOP in FERC 926 current rate year PBOP in FERC 926 prior rate year Explanation of change in PBOP in FERC 926 68 Total A&G The actuarially determined amount of OPEB expense in FERC 926 increased $.486 million from the prior year; the increase Total: p.323.197.b Account 926: p.323.187.b and c 69,386,052 12,445,382 (648,858) reflects a $1.4 million increase in amortization of unrecognized gain/loss from assumption change in mortality table and decrease in the discount rate, offset by ($0.9 million) in amortization of prior service cost from plan amendment. This increase was offset by a (704,728) $.430 million increase in OPEB costs directly charged to capital or other income deduction accounts (i.e. below the line). Attachment 3 - Revenue Credit Workpaper 17b Costs associated with revenues in line 17a $ 408,552 Revenue Subject to 50/50 sharing (Attachment 3 - line 17a) $ 1,007,245 Federal Income Tax Rate 35.00% Federal Tax on Revenue subject to 50/50 sharing 352,536 Net Revenue subject to 50/50 sharing 654,709 Composite State Income Tax Rate 8.556% State Tax on Revenue subject to 50/50 sharing 56,016 Total Tax on Revenue subject to 50/50 sharing $ 408,552
Delmarva Power & Light Company Attachment 6 - Estimate and Reconciliation Worksheet Step 9 - Reconciliation adjustment to reflect ROE Settlement in FERC Docket Nos. EL13-48, EL15-27 and ER16-456 Attachment 5 - Cost Support True-up amount - calculated at 11.3% ROE (Reconciliation Steps 1-9) 5,783,309 (a) True-up amount - calculated at 10.5% ROE (Reconciliation Steps 1-9) 1,610,297 (b) # of days in rate year at 11.3% ROE (June 1, 2015 to March 7, 2016) 281 (c) # of days in rate year at 10.5% ROE (March 8, 2016 to May 31, 2016) 85 (d) 366 (e) 11.3% ROE proration factor 76.7760% (f) 10.5% ROE proration factor 23.2240% (g) Prorated true-up amount at 11.3% ROE 4,440,191 (a) x (f) Prorated true-up amount at 10.5% ROE 373,976 (b) x (g) Adjusted true-up for prorated ROE's 4,814,167 (1) ROE Settlement refund per Article II section 2.2 (11,902,175) (h) Interest associated with rate-year monthly amortization (217,730) (i) Total ROE Settlement refund (12,119,905) (2) Total true-up amount (7,305,738) (1) + (2) True-up per attachment 6 (step 9-11.3% ROE) 5,783,309 Attachment 6 True-up adjustment (carry to Attachment 6 - step 9) (13,089,047) Attachment 6 True-up Summary: Prorated true-up amount at 11.3% ROE 4,440,191 Prorated true-up amount at 10.5% ROE 373,976 Total refund per ROE Settlement (12,119,905) Total true-up amount (7,305,738)
Attachment 5a - Allocations of Costs to Affiliate Delmarva Power & Light Company Delmarva Atlantic Power City Pepco Non - Regulated Total Executive Management $ 11,622,846 $ 9,931,814 $ 19,914,849 $ 5,363,748 $ 46,833,257 Procurement & Administrative Services 6,803,279 4,747,615 9,948,927 397,985 21,897,805 Financial Services & Corporate Expenses 14,392,550 11,405,597 20,949,763 2,548,058 49,295,968 Insurance Coverage and Services 2,936,213 2,443,681 3,976,915 972,086 10,328,895 Human Resources 4,702,235 3,243,502 7,277,658 960,297 16,183,692 Legal Services 2,445,274 2,313,475 6,008,550 2,088,341 12,855,641 Audit Services 950,754 845,150 1,487,115 241,906 3,524,925 Customer Services 61,881,891 53,570,456 52,835,175 7,688 168,295,210 Utility Communication Services 266,488 200,497 415,547-882,532 Information Technology 16,532,766 12,290,845 32,565,022 400,519 61,789,153 External Affairs 3,064,379 2,353,071 4,767,843 916,269 11,101,562 Environmental Services 2,147,139 1,834,467 1,986,566 111,504 6,079,676 Safety Services 367,769 465,172 587,283-1,420,224 Regulated Electric & Gas T&D 36,940,868 28,738,421 49,154,897 402,956 115,237,143 Internal Consulting Services 553,737 364,355 854,552-1,772,645 Interns 239,606 108,950 125,236-473,792 Cost of Benefits 13,366,740 8,288,720 22,656,508 1,048,369 45,360,337 Building Services - 117,184 4,297,944-4,415,128 Total $ 179,214,534 $ 143,262,973 $ 239,810,349 $ 15,459,727 $ 577,747,583