Exelon’s advantage is its competitive integrated business model. It provides a platform to pursue a broad range of opportunities as changing consumer behavior, rapidly evolving technologies, challenges to grid integrity and continued industry consolidation transform the industry.
Each of our component businesses – regulated utilities, merchant generation and competitive retail services – gives us a unique view into the entire energy spectrum. They also provide insight into the technologies and trends that will drive value for our customers and shareholders going forward.
The driving principle behind Exelon’s strategy is to preserve the value of its core assets, while also capitalizing on emerging trends and technologies to diversify the business for growth.
Investing for Growth
Exelon’s proposed merger with Pepco Holdings Inc. (PHI) is a prime example of the company’s plan to invest in core markets with stable growth.
The merger will bring together Exelon’s three electric and gas utilities – BGE, ComEd and PECO – and PHI’s three electric and gas utilities – Atlantic City Electric, Delmarva Power and Pepco – to create the leading mid-Atlantic electric and gas utility.
Over the next several years, Exelon will also drive earnings growth by investing $16 billion in infrastructure and technology to improve reliability and customer service at BGE, ComEd and PECO. Innovating to better serve our customers is one of our core values. All three utilities are currently performing in the top 25 percent for reliability and safety when compared with industry peers.
Exelon has also invested heavily in its generation fleet over the past decade, making it among the most efficient and reliable energy sources in our markets.
- Exelon’s achieved a best-in-class capacity factor of more than 94 percent for its nuclear fleet in 2014, power dispatch match of nearly 97 percent for hydro/fossil and renewables (wind and solar) energy capture of 95 percent.
- Going forward, Exelon’s nuclear assets may benefit from new state and federal policies that favor reliable, carbon-free energy.
Similarly, our competitive businesses create value for customers by providing innovative solutions and reliable, clean and affordable energy. Constellation has an active and growing distributed generation business and is one of the largest commercial solar developers in United States, with more than 200 megawatts installed or under contract. This business provides customers with a variety of on-site generation options, including co-generation facilities (which use gas or heat resulting from other processes to produce energy) biomass, fuel cells and battery storage, among others.
Exelon more than doubled the number of Constellation electricity and natural gas customers through the 2014 acquisition of two Midwest energy marketers – ProLiance and Integrys Energy Services.
Culture of Innovation
To thrive in an industry undergoing fundamental change, Exelon has cultivated a culture of innovation that promotes early adoption of promising new technologies and processes.
Examples include Exelon’s partnership with Bloom Energy to build fuel cell projects at 75 commercial facilities and its investment in NET Power, which is building a demonstration power plant using a new natural gas power system that produces zero atmospheric emissions. In addition, Exelon recently announced it is building two, first-of-their-kind combined-cycle gas turbine power plants in Texas that will be among the cleanest in the nation.
To help identify new opportunities, Exelon has created a multi-tiered technology evaluation platform that brings together various experts within the company to examine new technologies and determine whether to incorporate them into our business.
At its core is the TechEXChange, which is charged with exploring technology that has the potential to form the basis of new businesses. A team of more than 60 experts from throughout the Exelon family of companies has formed relationships with government and industry associations, national labs, top universities, technology companies, and venture capital and private equity firms to unearth innovations that will drive the energy system of the future.
TechEXChange is currently focusing its efforts on five primary areas of development – battery storage, fuel cells, vehicles powered by alternative fuels, water and hydrogen. All are areas that could produce the next enabling technology that will upend energy markets and bring new ways to produce and deliver electricity to customers.
In addition to TechEXChange, our Constellation Technology Ventures group, or CTV, invests in venture stage energy technology companies representing innovations that complement Exelon’s core businesses, with the goal of providing new solutions to Exelon’s customers.
Investments through CTV have touched on a wide range of new technologies, including alternative generation, energy storage, electric vehicles and intelligent buildings.
Exelon believes the energy industry is entering a long transformation. We believe we have the right business model and vision to grow our core markets, capitalize on emerging trends and thrive in this period of change.
The areas of focus that propel our strategy will allow us to reap increasing value from today’s regulated and competitive opportunities while enabling greater value creation as we master new competencies and take advantage of new growth opportunities.