Chicago (October 21, 2004) – Exelon Corporation’s (Exelon) third quarter 2004 consolidated earnings prepared in accordance with GAAP were $568 million, or $0.85 per diluted share, compared with a loss of $102 million, or $0.16 per diluted share, in third quarter 2003.

Exelon’s adjusted (non-GAAP) operating earnings for the third quarter of 2004 were $608 million, or $0.91 per diluted share, compared with $535 million, or $0.81 per diluted share, for the same period in 2003.  The 12% adjusted (non-GAAP) operating earnings per share improvement was due to a number of factors, including the acquisition of the second half of AmerGen in late 2003, retail volume growth, cost savings related to The Exelon Way program, and favorable mark-to-market adjustments in energy contracts, partially offset by mild summer weather. 

Adjusted (non-GAAP) operating earnings is a non-GAAP financial measure.  Adjusted (non-GAAP) operating earnings for the third quarter of 2004 do not include the following items that are included in reported GAAP earnings:

• After-tax charges totaling $64 million, or $0.10 per diluted share, for premiums paid on and other charges associated with debt repurchases related to ComEd’s accelerated liability management plan.
• After-tax severance and severance-related costs related to The Exelon Way of $19 million, or $0.03 per diluted share.
• An after-tax gain of $25 million, or $0.04 per diluted share, from the reimbursement of costs for prior years under the DOE Settlement related to spent nuclear fuel storage.
• After-tax earnings of $18 million, or $0.03 per diluted share, from investments in synthetic fuel producing facilities.

Adjusted (non-GAAP) operating earnings for the third quarter of 2003 did not include the following items that were included in reported GAAP earnings:

• An after-tax charge of $573 million, or $0.87 per diluted share, for the impairment of the Boston Generating (BG) assets as a result of management’s decision to transition out of ownership of those assets.
• After-tax severance and severance-related costs related to The Exelon Way of $104 million, or $0.16 per diluted share.
• An after-tax charge of $36 million, or $0.05 per diluted share, for Exelon’s investment in Sithe Energies, Inc. (Sithe).
• An after-tax gain of $29 million, or $0.04 per diluted share, associated with the sale of certain businesses of InfraSource, Inc.
• An after-tax gain of $47 million, or $0.07 per diluted share, related to the reduction of certain real estate tax reserves.

“I could not be more pleased with our third quarter results,” said John W. Rowe, Exelon Chairman and CEO.  “Despite one of the more mild summers in recent years, especially in our ComEd territory, we increased operating earnings per share by 12% from last year, reflecting continued strong core growth in our delivery business, higher wholesale margins and continued operational improvements through The Exelon Way.  We remain comfortable with our previously increased full year operating earnings guidance of $2.75 to $2.90 per share.”

Adjusted (non-GAAP) operating earnings guidance excludes earnings from investments in synthetic fuel producing facilities, debt retirement charges associated with ComEd’s accelerated liability management plan, reimbursements from the DOE for prior period spent fuel storage costs, the cumulative effect of adopting FIN 46-R, any profit or loss related to BG, and severance and severance-related costs related to The Exelon Way.  Fourth quarter adjusted (non-GAAP) operating earnings are expected to be between $0.55 and $0.70 per share.  Earnings guidance is based on the assumption of normal weather for the last quarter of 2004. 

Common Dividend Increase

“I am also pleased to announce that because we have sufficient cash flow to both complete our 2004 balance sheet strengthening program on schedule, and accelerate our next planned dividend increase, the Board of Directors has declared a dividend of $0.40 per share on Exelon’s common stock, payable December 10, 2004, to shareholders of record at 5:00 p.m. New York time on November 15, 2004,” said Mr. Rowe.  “This latest increase is in line with our previously announced policy of targeting a dividend payout ratio of 50 to 60% of ongoing earnings, which is consistent with our peer group and appropriate for our business mix.  Moreover, the dividend increase reflects our confidence in the sustainability of recent earnings and cash flow improvements and demonstrates our continued commitment to return cash to our shareholders after making the necessary investments in our core business.”  Payment of future dividends is subject to approval and declaration by the Board. 

Third Quarter Highlights

• Nuclear Operations   Exelon Generation’s nuclear fleet produced 35,303 GWhs (including 5,151 GWhs for AmerGen) in the third quarter of 2004, compared with 30,152 GWhs output (excluding AmerGen) in the third quarter of 2003.  The fleet, including AmerGen, achieved a capacity factor of 95.8% for the third quarter of 2004, compared with 95.3% for the third quarter of 2003.  Exelon Generation’s nuclear group did not have any outages scheduled during July and August of 2004 or 2003.  They began one scheduled outage in September of this year and two in September 2003.
• Enterprises Transactions   During the third quarter of 2004, Exelon Enterprises completed the sale of five of its businesses, the Aladdin operations of Thermal, three businesses of Exelon Services, Inc. and F&M’s New Jersey office.  The net proceeds and net loss from these transactions were not significant.  The divestiture of these businesses supports Exelon’s Path to Exit strategy from Enterprises and Exelon’s focus on its core integrated utility businesses.  Exelon expects to complete the sale of substantially all Enterprises businesses by year-end 2004.  Enterprises' book value at year end, excluding cash and debt, is expected to be approximately $70 million, primarily deferred tax assets and working capital partly offset by pension/post-retirement liability.
• ComEd Liability Management Plan   In July and August 2004, ComEd repaid $618 million of first mortgage bonds and notes of various series under its accelerated liability management plan (Plan).  Under this Plan, ComEd expects to retire approximately $1.2 billion of its long-term debt in 2004, excluding the retirement of transition debt.  Year to date through September, ComEd has retired or redeemed debt totaling $768 million under the Plan.
• DOE Settlement    On August 10, Exelon announced that Exelon and the U.S. Department of Justice, in close consultation with the U.S. Department of Energy (DOE), had reached a settlement under which the government will reimburse Exelon for costs associated with storage of spent fuel at the company's nuclear stations pending the DOE fulfilling its contractual obligation to accept commercial spent nuclear fuel.  Under the agreement, Exelon received $80 million in gross reimbursements during the third quarter for storage costs already incurred ($53 million net, after considering amounts due from Exelon to co-owners of certain nuclear stations), with additional amounts to be reimbursed annually for future costs.  If a national repository opens by 2010 and the DOE begins accepting spent nuclear fuel as the DOE has said it would, gross reimbursements to Exelon would eventually total about $300 million (inclusive of the immediate $80 million gross reimbursement and net of approximately $43 million that Exelon must refund to the DOE for past credits to the Nuclear Waste Fund).  Exelon anticipates that the settlement with the DOE will increase 2004 net income by approximately $0.05 per diluted share, $0.04 relating to reimbursement of costs incurred in prior years and $0.01 relating to reimbursement of costs incurred in 2004.  The ongoing impact of the settlement in future periods is expected to be an increase to net income of approximately $0.01 to $0.02 per diluted share per year.
• Sithe Purchase to Facilitate Sale of 100% Interest   On September 29, Exelon Generation exercised its call option to acquire Reservoir Capital Group's (Reservoir) 50% interest in Sithe for $97 million.  The closing of the call is subject to state and Federal regulatory approvals.  At the call closing, Exelon expects that distributable cash at Sithe would be used to fund the majority of the call price.  Exelon began consolidating Sithe on March 31, 2004 pursuant to its implementation of FIN No. 46-R.  Exelon does not expect that the exercise of the call or the call closing will affect this consolidation accounting or materially affect Exelon's balance sheet or net income.  Sithe's remaining operating assets included in this transaction total approximately 1,300 MWs.  At the call closing, Exelon will acquire the 50% share of these assets owned by Reservoir.  Exelon remains committed to and is actively pursuing a sale of its ultimate 100% investment in Sithe and believes that exercising its call option is the most efficient and timely means to exit Sithe.

BUSINESS UNIT RESULTS

Exelon Energy Delivery consists of the retail electricity transmission and distribution operations of ComEd and PECO and the natural gas distribution business of PECO.  Energy Delivery’s net income in the third quarter of 2004 was $262 million compared with net income of $303 million in the third quarter of 2003.  Third quarter 2004 net income included an after-tax charge of $64 million related to debt retirement charges associated with ComEd’s liability management plan, and third quarter 2003 net income included an after-tax benefit to PECO of $38 million related to the reduction of certain real estate tax reserves.  Third quarter 2004 and 2003 net income included after-tax severance and severance-related costs related to The Exelon Way of $12 million and $66 million, respectively.  Excluding these items, Energy Delivery’s net income increased $7 million compared to the same quarter last year, primarily due to an increase in weather-normalized kWh deliveries, Exelon Way savings, lower interest costs and lower taxes other than income, partially offset by mild summer weather in both the ComEd and PECO service territories and increased depreciation and amortization expense, primarily competitive transition charge amortization at PECO.

Cooling degree-days for the third quarter of 2004 in the ComEd service territory were down 27% relative to the same period in 2003 and were 30% below normal.  In the PECO service territory, cooling degree-days were down 16% compared with 2003 and were 5% below normal.  Retail kWh deliveries decreased 2% for ComEd, with a 9% decrease in deliveries to the residential customer class.  PECO’s retail kWh deliveries decreased 1% overall, with residential deliveries down 1%.  Energy Delivery’s third quarter 2004 revenues were $2,844 million, down 1% from $2,886 million in 2003.  The impact of cooler weather decreased third quarter 2004 earnings per share by approximately $0.09 relative to 2003, and decreased third quarter 2004 earnings per share by approximately $0.08 relative to the normal weather that was incorporated in our earnings guidance.

Exelon Generation consists of Exelon’s electric generation operations, competitive retail sales and power marketing and trading functions.  Generation’s 2003 results have been adjusted to include Exelon Energy, which was transferred to Generation as of January 1, 2004.  Third quarter 2004 net income was $319 million compared with a net loss of $431 million in the third quarter of 2003.  Third quarter 2004 net income included after-tax earnings of $25 million related to the spent nuclear fuel storage cost reimbursements from the DOE for prior years and severance and severance-related after-tax charges associated with The Exelon Way of $6 million.  Third quarter 2003 net income included a $573 million after-tax charge for the impairment of the BG assets, an additional after-tax impairment loss of $36 million on the investment in Sithe, severance and severance-related after-tax charges associated with The Exelon Way of $30 million, and a $9 million after-tax benefit for the reduction of an accrual for Pennsylvania property taxes.  Third quarter 2004 net income also included an unrealized mark-to-market gain, excluding Sithe, of $34 million after-tax from non-trading activities compared with a $6 million after-tax unrealized mark-to-market gain, excluding BG, in the third quarter of 2003.  Excluding the impact of the items listed above, Generation’s net income increased by $73 million compared with the same quarter last year, primarily due to the acquisition of the remaining 50% of AmerGen and The Exelon Way savings, partially offset by higher depreciation and amortization expense.

Energy sales, exclusive of trading volumes, totaled 51,934 GWhs for the third quarter of 2004 compared with 62,290 GWhs in 2003, reflecting the adoption of a new accounting standard (EITF 03-11) that required certain energy transactions to be netted within revenues, lower sales to Energy Delivery and lower market sales, partially offset by the acquisition of the remaining 50% of AmerGen.  The new standard resulted in a reduction of 6,919 GWhs for the third quarter of 2004.  The remaining GWh variance was primarily driven by lower sales to PECO and ComEd due to cooler than normal weather.  Generation’s third quarter 2004 revenues were $2,253 million, down 14% from third quarter 2003 revenues of $2,630 million due to the sale of BG, the adoption of EITF 03-11 and decreased revenues from Energy Delivery.  These drivers were partially offset by the acquisition of the remaining 50% of AmerGen and the consolidation of Generation’s investment in Sithe Energies, Inc. as of March 31, 2004.  The adoption of EITF 03-11 resulted in reductions in revenues, purchased power expense and fuel expense of $272 million, $271 million and $1 million, respectively, but had no impact on net income.  Earnings from prior periods were not affected.

Generation’s revenue, net of purchased power and fuel expense, increased by $193 million in the third quarter of 2004 compared with the third quarter of 2003 excluding the mark-to-market impact in both years.  The incremental 2004 revenue net fuel contribution, excluding mark-to-market, from AmerGen and Sithe was $237 million, and 2003 included $46 million from BG.  Excluding these impacts, revenue, net of purchased power and fuel expense, was relatively flat quarter over quarter.  A drop in sales volumes to ComEd and PECO, primarily due to cooler summer weather in 2004, was offset by higher average realized margins, driven by lower capacity payments to Midwest Generation and effective hedging of fossil fuel costs.  Generation’s average realized margin on all sales, excluding trading activity, was $16.47 per MWh in the third quarter of 2004 compared with $10.50 per MWh in the third quarter of 2003. 

Exelon Enterprises consists of the electrical contracting business of F&M Holdings, Inc. and other minor investments, most of which are in the process of being sold or shut down.  Enterprises’ 2003 results have been adjusted to exclude Exelon Energy, which was transferred to Generation as of January 1, 2004.  Enterprises’ third quarter 2004 net loss was $20 million, primarily as a result of a revised valuation of several investments due to a change in accounting principle and an impairment related to a planned disposition of certain investments.  Enterprises’ third quarter 2003 net income was $19 million, which included an after-tax gain of $29 million related to the sale of certain businesses of InfraSource.  Enterprises reported significant decreases in revenues, purchased power and fuel expense, and operating and maintenance expense mainly due to the sale of InfraSource, Inc. late in the third quarter of 2003 and the sale or wind-down of other Enterprises businesses. 

Adjusted (non-GAAP) Operating Earnings

Adjusted (non-GAAP) operating earnings, which generally exclude non-operational items as well as significant one-time charges or credits that are not normally associated with ongoing operations, are provided as a supplement to results reported in accordance with GAAP.  Management uses such adjusted (non-GAAP) operating earnings measures internally to evaluate the company’s performance and manage its operations.  A reconciliation of GAAP to adjusted (non-GAAP) operating earnings for historical periods is attached.  Additional Earnings Release Attachments, which include  this reconciliation on page 7 , are posted on Exelon’s web site: www.exeloncorp.com and have been filed with the Securities and Exchange Commission on Form 8-K on October 21, 2004.

Conference call information: Exelon has scheduled a conference call for 11 AM ET (10 AM CT) on October 21, 2004.  The call-in number in the U.S. is 888-802-8581 and the international call-in number is 973-935-8515.  No password is required.  Media representatives are invited to participate on a listen-only basis.  The call will be web-cast and archived on Exelon’s web site: www.exeloncorp.com .  (Please select the Investor Relations page.)

Telephone replays will be available until November 5th.  The U.S. call-in number for replays is 877-519-4471 and the international call-in number is 973-341-3080.  The confirmation code is 5234844.

Certain of the matters discussed in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. The factors that could cause actual results to differ materially from the forward-looking statements made by a registrant include those discussed herein as well as those discussed in Exelon Corporation’s 2003 Annual Report on Form 10-K in (a) ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Business Outlook and the Challenges in Managing Our Business for Exelon, ComEd, PECO and Generation and (b) ITEM 8. Financial Statements and Supplementary Data: Exelon—Note 19, ComEd—Note 15, PECO—Note 14 and Generation—Note 13, and (c) other factors discussed in filings with the Securities and Exchange Commission (SEC) by Exelon Corporation, Commonwealth Edison Company, PECO Energy Company and Exelon Generation Company, LLC (Registrants). Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this press release. None of the Registrants undertakes any obligation to publicly release any revision to its forward-looking statements to reflect events or circumstances after the date of this press release.