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Retirement Benefits (All Registrants) | 12 Months Ended
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Dec. 31, 2018
Retirement Benefits [Abstract] |
Retirement Benefits (All Registrants) | (All Registrants) Exelon sponsors defined benefit pension plans and other postretirement benefit plans for essentially all current employees. Substantially all non-union employees and electing union employees hired on or after January 1, 2001 participate in cash balance pension plans. Effective January 1, 2009, substantially all newly-hired union-represented employees participate in cash balance pension plans. Effective February 1, 2018, most newly-hired Generation and BSC non-represented, non-craft, employees are not eligible for pension benefits, and will instead be eligible to receive an enhanced non-discretionary employer contribution in an Exelon defined contribution savings plan. Effective January 1, 2018, most newly-hired non-represented, non-craft, employees are not eligible for OPEB benefits and employees represented by Local 614 are not eligible for retiree health care benefits. Effective January 1, 2019, Exelon is merging the Exelon Corporation Cash Balance Pension Plan (CBPP) into the Exelon Corporation Retirement Program (ECRP). The merging of the plans is not changing the benefits offered to the plan participants and, thus, has no impact on Exelon's pension obligation. However, beginning in 2019, actuarial losses and gains related to the CBPP and ECRP will be amortized over participants’ average remaining service period of the merged ECRP rather than each individual plan. The table below shows the pension and other postretirement benefit plans in which employees of each operating company participated at December 31, 2018:
|  | Operating Company(e)
Name of Plan: |  | Generation |  | ComEd |  | PECO |  | BGE |  | BSC |  | PHI |  | Pepco |  | DPL |  | ACE
Qualified Pension Plans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Exelon Corporation Retirement Program(a) |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  |  |  |
Exelon Corporation Cash Balance Pension Plan(a) |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  | X
Exelon Corporation Pension Plan for Bargaining Unit Employees(a) |  | X |  | X |  |  |  |  |  | X |  |  |  |  |  |  |  |
Exelon New England Union Employees Pension Plan(a) |  | X |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Exelon Employee Pension Plan for Clinton, TMI and Oyster Creek(a) |  | X |  | X |  | X |  |  |  | X |  |  |  |  |  |  |  |
Pension Plan of Constellation Energy Group, Inc.(b) |  | X |  | X |  | X |  | X |  | X |  | X |  |  |  | X |  |
Pension Plan of Constellation Energy Nuclear Group, LLC(c) |  | X |  | X |  |  |  | X |  | X |  | X |  |  |  |  |  |
Nine Mile Point Pension Plan(c) |  | X |  |  |  |  |  |  |  | X |  |  |  |  |  |  |  |
Constellation Mystic Power, LLC Union Employees Pension Plan Including Plan A and Plan B(b) |  | X |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pepco Holdings LLC Retirement Plan(d) |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  | X
Non-Qualified Pension Plans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Exelon Corporation Supplemental Pension Benefit Plan and 2000 Excess Benefit Plan(a) |  | X |  | X |  | X |  |  |  | X |  | X |  |  |  |  |  |
Exelon Corporation Supplemental Management Retirement Plan(a) |  | X |  | X |  | X |  | X |  | X |  | X |  |  |  |  |  |
Constellation Energy Group, Inc. Senior Executive Supplemental Plan(b) |  | X |  |  |  |  |  | X |  | X |  |  |  |  |  |  |  |
Constellation Energy Group, Inc. Supplemental Pension Plan(b) |  | X |  |  |  |  |  | X |  | X |  |  |  |  |  |  |  |
Constellation Energy Group, Inc. Benefits Restoration Plan(b) |  | X |  | X |  |  |  | X |  | X |  | X |  |  |  |  |  |
Constellation Energy Nuclear Plan, LLC Executive Retirement Plan(c) |  | X |  |  |  |  |  |  |  | X |  |  |  |  |  |  |  |
Constellation Energy Nuclear Plan, LLC Benefits Restoration Plan(c) |  | X |  |  |  |  |  |  |  | X |  |  |  |  |  |  |  |
Baltimore Gas & Electric Company Executive Benefit Plan(b) |  | X |  |  |  |  |  | X |  | X |  |  |  |  |  |  |  |
Baltimore Gas & Electric Company Manager Benefit Plan(b) |  | X |  | X |  |  |  | X |  | X |  |  |  |  |  |  |  |
Pepco Holdings LLC 2011 Supplemental Executive Retirement Plan(d) |  |  |  |  |  |  |  |  |  | X |  | X |  | X |  | X |  | X
Conectiv Supplemental Executive Retirement Plan (d) |  | X |  |  |  |  |  |  |  | X |  | X |  |  |  | X |  | X
Pepco Holdings LLC Combined Executive Retirement Plan (d) |  |  |  |  |  |  |  |  |  | X |  | X |  | X |  |  |  |
Atlantic City Electric Director Retirement Plan (d) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | X
|  | Operating Company(e)
Name of Plan: |  | Generation |  | ComEd |  | PECO |  | BGE |  | BSC |  | PHI |  | Pepco |  | DPL |  | ACE
Other Postretirement Benefit Plans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
PECO Energy Company Retiree Medical Plan(a) |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  | X
Exelon Corporation Health Care Program(a) |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  |  |  | X
Exelon Corporation Employees’ Life Insurance Plan(a) |  | X |  | X |  | X |  | X |  | X |  |  |  |  |  |  |  |
Exelon Corporation Health Reimbursement Arrangement Plan(a) |  | X |  | X |  | X |  | X |  | X |  |  |  |  |  |  |  |
Constellation Energy Group, Inc. Retiree Medical Plan(b) |  | X |  | X |  | X |  | X |  | X |  |  |  |  |  |  |  |
Constellation Energy Group, Inc. Retiree Dental Plan(b) |  | X |  |  |  |  |  | X |  | X |  |  |  |  |  |  |  |
Constellation Energy Group, Inc. Employee Life Insurance Plan and Family Life Insurance Plan(b) |  | X |  | X |  | X |  | X |  | X |  |  |  |  |  |  |  |
Constellation Mystic Power, LLC Post-Employment Medical Account Savings Plan(b) |  | X |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Exelon New England Union Post-Employment Medical Savings Account Plan(a) |  | X |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Retiree Medical Plan of Constellation Energy Nuclear Group LLC(c) |  | X |  |  |  |  |  | X |  | X |  |  |  |  |  |  |  |
Retiree Dental Plan of Constellation Energy Nuclear Group LLC(c) |  | X |  |  |  |  |  | X |  | X |  |  |  |  |  |  |  |
Nine Mile Point Nuclear Station, LLC Medical Care and Prescription Drug Plan for Retired Employees(c) |  | X |  |  |  |  |  |  |  | X |  |  |  |  |  |  |  |
Pepco Holdings LLC Welfare Plan for Retirees(d) |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  | X |  | X
______________________
(a) | These plans are collectively referred to as the legacy Exelon plans.
(b) | These plans are collectively referred to as the legacy Constellation Energy Group (CEG) Plans.
(c) | These plans are collectively referred to as the legacy CENG plans.
(d) | These plans are collectively referred to as the legacy PHI plans.
(e) | Employees generally remain in their legacy benefit plans when transferring between operating companies.
Exelon’s traditional and cash balance pension plans are intended to be tax-qualified defined benefit plans. Exelon has elected that the trusts underlying these plans be treated as qualified trusts under the IRC. If certain conditions are met, Exelon can deduct payments made to the qualified trusts, subject to certain IRC limitations. Benefit Obligations, Plan Assets and Funded Status Exelon recognizes the overfunded or underfunded status of defined benefit pension and OPEB plans as an asset or liability on its balance sheet, with offsetting entries to AOCI and regulatory assets (liabilities), in accordance with the applicable authoritative guidance. The measurement date for the plans is December 31. During the first quarter of 2018, Exelon received an updated valuation of its pension and OPEB to reflect actual census data as of January 1, 2018. This valuation resulted in an increase to the pension and OPEB obligations of $23 million and $14 million, respectively. Additionally, accumulated other comprehensive loss decreased by $18 million (after-tax) and regulatory assets and liabilities increased by $61 million and $1 million, respectively. In connection with the acquisition of FitzPatrick in 2017, Exelon recorded pension and OPEB obligations for FitzPatrick employees of $16 million and $17 million, respectively. See Note 5 — Mergers, Acquisitions and Dispositions for additional information of the acquisition of FitzPatrick. The following tables provide a rollforward of the changes in the benefit obligations and plan assets for the most recent two years for all plans combined:
| Pension Benefits |  | Other Postretirement Benefits
Exelon | 2018 |  | 2017 |  | 2018 |  | 2017
Change in benefit obligation: |  |  |  |  |  |  |
Net benefit obligation at beginning of year | $ | 22,337 |  |  | $ | 21,060 |  |  | $ | 4,856 |  |  | $ | 4,457 |
Service cost | 405 |  |  | 387 |  |  | 112 |  |  | 106 |
Interest cost | 802 |  |  | 842 |  |  | 175 |  |  | 182 |
Plan participants’ contributions | — |  |  | — |  |  | 45 |  |  | 53 |
Actuarial (gain) loss(a) | (1,561 | ) |  | 1,182 |  |  | (540 | ) |  | 350 |
Plan amendments | (4 | ) |  | 9 |  |  | — |  |  | — |
Acquisitions(b) | — |  |  | 16 |  |  | — |  |  | 17 |
Settlements | (48 | ) |  | (34 | ) |  | (4 | ) |  | — |
Gross benefits paid | (1,239 | ) |  | (1,125 | ) |  | (275 | ) |  | (309 | )
Net benefit obligation at end of year | $ | 20,692 |  |  | $ | 22,337 |  |  | $ | 4,369 |  |  | $ | 4,856 |
| Pension Benefits |  | Other Postretirement Benefits
Exelon | 2018 |  | 2017 |  | 2018 |  | 2017
Change in plan assets: |  |  |  |  |  |  |
Fair value of net plan assets at beginning of year | $ | 18,573 |  |  | $ | 16,791 |  |  | $ | 2,732 |  |  | $ | 2,578 |
Actual return on plan assets | (945 | ) |  | 2,600 |  |  | (136 | ) |  | 346 |
Employer contributions | 337 |  |  | 341 |  |  | 46 |  |  | 64 |
Plan participants’ contributions | — |  |  | — |  |  | 45 |  |  | 53 |
Gross benefits paid | (1,239 | ) |  | (1,125 | ) |  | (275 | ) |  | (309 | )
Settlements | (48 | ) |  | (34 | ) |  | (4 | ) |  | — |
Fair value of net plan assets at end of year | $ | 16,678 |  |  | $ | 18,573 |  |  | $ | 2,408 |  |  | $ | 2,732 |
__________
(a) | The pension actuarial gain in 2018 primarily reflects an increase in the discount rate. The OPEB actuarial gain in 2018 primarily reflects an increase in the discount rate and favorable health care claims experience. The pension and OPEB actuarial losses in 2017 primarily reflect a decrease in the discount rate.
(b) | Exelon recorded pension and OPEB obligations associated with its acquisition of Fitzpatrick on March 31, 2017.
Exelon presents its benefit obligations and plan assets net on its balance sheet within the following line items:
| Pension Benefits |  | Other Postretirement Benefits
Exelon | 2018 |  | 2017 |  | 2018 |  | 2017
Other current liabilities | $ | 26 |  |  | $ | 28 |  |  | $ | 33 |  |  | $ | 31 |
Pension obligations | 3,988 |  |  | 3,736 |  |  | — |  |  | — |
Non-pension postretirement benefit obligations | — |  |  | — |  |  | 1,928 |  |  | 2,093 |
Unfunded status (net benefit obligation less plan assets) | $ | 4,014 |  |  | $ | 3,764 |  |  | $ | 1,961 |  |  | $ | 2,124 |
The funded status of the pension and other postretirement benefit obligations refers to the difference between plan assets and estimated obligations of the plan. The funded status changes over time due to several factors, including contribution levels, assumed discount rates and actual returns on plan assets. The following tables provide the projected benefit obligations (PBO), accumulated benefit obligation (ABO), and fair value of plan assets for all pension plans with a PBO or ABO in excess of plan assets.
PBO in excess of plan assets | Exelon
| 2018 |  | 2017
Projected benefit obligation | $ | 20,692 |  |  | $ | 22,337 |
Fair value of net plan assets | 16,678 |  |  | 18,573 |
ABO in excess of plan assets | Exelon
| 2018 |  | 2017
Projected benefit obligation | $ | 20,692 |  |  | $ | 22,337 |
Accumulated benefit obligation | 19,656 |  |  | 21,153 |
Fair value of net plan assets | 16,678 |  |  | 18,573 |
On a PBO basis, the Exelon plans were funded at 81% and 83% at December 31, 2018 and 2017, respectively. On an ABO basis, the Exelon plans were funded at 85% and 88% at December 31, 2018 and 2017, respectively. The ABO differs from the PBO in that the ABO includes no assumption about future compensation levels. Components of Net Periodic Benefit Costs The majority of the 2018 pension benefit cost for the Exelon-sponsored plans is calculated using an expected long-term rate of return on plan assets of 7.00% and a discount rate of 3.62%. The majority of the 2018 other postretirement benefit cost is calculated using an expected long-term rate of return on plan assets of 6.60% for funded plans and a discount rate of 3.61%. A portion of the net periodic benefit cost for all plans is capitalized within the Consolidated Balance Sheets. The following tables present the components of Exelon’s net periodic benefit costs, prior to capitalization, for the years ended December 31, 2018, 2017 and 2016 and PHI's net periodic benefit costs, prior to capitalization, for the predecessor period of January 1, 2016 to March 23, 2016.
| Pension Benefits |  | Other Postretirement Benefits
Exelon | 2018 |  | 2017(a) |  | 2016(b) |  | 2018 |  | 2017(a) |  | 2016(b)
Components of net periodic benefit cost: |  |  |  |  |  |  |  |  |  |  |
Service cost | $ | 405 |  |  | $ | 387 |  |  | $ | 354 |  |  | $ | 112 |  |  | $ | 106 |  |  | $ | 107 |
Interest cost | 802 |  |  | 842 |  |  | 830 |  |  | 175 |  |  | 182 |  |  | 185 |
Expected return on assets | (1,252 | ) |  | (1,196 | ) |  | (1,141 | ) |  | (173 | ) |  | (162 | ) |  | (162 | )
Amortization of: |  |  |  |  |  |  |  |  |  |  |
Prior service cost (credit) | 2 |  |  | 1 |  |  | 14 |  |  | (186 | ) |  | (188 | ) |  | (185 | )
Actuarial loss | 629 |  |  | 607 |  |  | 554 |  |  | 66 |  |  | 61 |  |  | 63 |
Settlement and other charges(c) | 3 |  |  | 3 |  |  | 2 |  |  | 1 |  |  | — |  |  | — |
Net periodic benefit cost | $ | 589 |  |  | $ | 644 |  |  | $ | 613 |  |  | $ | (5 | ) |  | $ | (1 | ) |  | $ | 8 |
__________
(a) | FitzPatrick net benefit costs are included for the period after acquisition.
(b) | PHI net periodic benefit costs for the period prior to the merger are not included in the table above.
(c) | 2016 amount includes an additional termination benefit for PHI.
| Predecessor
| Pension Benefits |  | Other Postretirement Benefits
PHI | January 1, 2016 to March 23, 2016 |  | January 1, 2016 to March 23, 2016
Components of net periodic benefit cost: |  |  |
Service cost | $ | 12 |  |  | $ | 1 |
Interest cost | 26 |  |  | 6 |
Expected return on assets | (30 | ) |  | (5 | )
Amortization of: |  |  |
Prior service cost (credit) | — |  |  | (3 | )
Actuarial loss | 14 |  |  | 2 |
Net periodic benefit cost | $ | 22 |  |  | $ | 1 |
Components of AOCI and Regulatory Assets Under the authoritative guidance for regulatory accounting, a portion of current year actuarial gains and losses and prior service costs (credits) is capitalized within Exelon’s Consolidated Balance Sheets to reflect the expected regulatory recovery of these amounts, which would otherwise be recorded to AOCI. The following tables provide the components of AOCI and regulatory assets (liabilities) for the years ended December 31, 2018, 2017 and 2016 for all plans combined and the components of PHI's predecessor AOCI and regulatory assets (liabilities) for the period January 1, 2016 to March 23, 2016.
| Pension Benefits |  | Other Postretirement Benefits
Exelon | 2018 |  | 2017 |  | 2016(a) |  | 2018 |  | 2017 |  | 2016(a)
Changes in plan assets and benefit obligations recognized in AOCI and regulatory assets (liabilities): |  |  |  |  |  |  |  |  |  |  |
Current year actuarial (gain) loss | $ | 635 |  |  | $ | (222 | ) |  | $ | 644 |  |  | $ | (232 | ) |  | $ | 166 |  |  | $ | (101 | )
Amortization of actuarial loss | (629 | ) |  | (607 | ) |  | (554 | ) |  | (66 | ) |  | (61 | ) |  | (63 | )
Current year prior service cost (credit) | (4 | ) |  | 9 |  |  | (60 | ) |  | — |  |  | — |  |  | — |
Amortization of prior service (cost) credit | (2 | ) |  | (1 | ) |  | (14 | ) |  | 186 |  |  | 188 |  |  | 185 |
Settlements | (3 | ) |  | (3 | ) |  | — |  |  | — |  |  | — |  |  | — |
Acquisitions | — |  |  | — |  |  | 994 |  |  | — |  |  | — |  |  | 94 |
Total recognized in AOCI and regulatory assets (liabilities) | $ | (3 | ) |  | $ | (824 | ) |  | $ | 1,010 |  |  | $ | (112 | ) |  | $ | 293 |  |  | $ | 115 |
Total recognized in AOCI | $ | 3 |  |  | $ | (401 | ) |  | $ | 51 |  |  | $ | (55 | ) |  | $ | 168 |  |  | $ | 20 |
Total recognized in regulatory assets (liabilities) | $ | (6 | ) |  | $ | (423 | ) |  | $ | 959 |  |  | $ | (57 | ) |  | $ | 125 |  |  | $ | 95 |
| Predecessor
| Pension Benefits |  | Other Postretirement Benefits
PHI | January 1, 2016 to March 23, 2016 |  | January 1, 2016 to March 23, 2016
Changes in plan assets and benefit obligations recognized in AOCI and regulatory assets (liabilities): |  |  |
Current year actuarial loss (gain) | $ | — |  |  | $ | — |
Amortization of actuarial loss | (14 | ) |  | (2 | )
Amortization of prior service (cost) credit | — |  |  | 3 |
Total recognized in AOCI and regulatory assets (liabilities) | $ | (14 | ) |  | $ | 1 |
Total recognized in AOCI | $ | (1 | ) |  | $ | — |
Total recognized in regulatory assets (liabilities) | $ | (13 | ) |  | $ | 1 |
__________
(a) | 2016 amounts include PHI for the period of March 24, 2016 through December 31, 2016.
The following table provides the components of gross accumulated other comprehensive loss and regulatory assets (liabilities) that have not been recognized as components of periodic benefit cost at December 31, 2018 and 2017, respectively, for all plans combined:
| Exelon |  |  | Exelon
| Pension Benefits |  |  | Other Postretirement Benefits
| 2018 |  | 2017 |  |  | 2018 |  | 2017
Prior service (credit) cost | $ | (29 | ) |  | $ | (24 | ) |  |  | $ | (337 | ) |  | $ | (522 | )
Actuarial loss | 7,558 |  |  | 7,556 |  |  |  | 531 |  |  | 829 |
Total | $ | 7,529 |  |  | $ | 7,532 |  |  |  | $ | 194 |  |  | $ | 307 |
Total included in AOCI | $ | 3,899 |  |  | $ | 3,896 |  |  |  | $ | 70 |  |  | $ | 125 |
Total included in regulatory assets (liabilities) | $ | 3,630 |  |  | $ | 3,636 |  |  |  | $ | 124 |  |  | $ | 182 |
Average Remaining Service Period For pension benefits, Exelon amortizes its unrecognized prior service costs and certain actuarial gains and losses, as applicable, based on participants’ average remaining service periods. The average remaining service period of Exelon's defined benefit pension plan participants was 12.0 years, 11.8 years and 11.9 years for the years ended December 31, 2018, 2017 and 2016, respectively. For other postretirement benefits, Exelon amortizes its unrecognized prior service costs over participants’ average remaining service period to benefit eligibility age and amortizes certain actuarial gains and losses over participants’ average remaining service period to expected retirement. The average remaining service period of postretirement benefit plan participants related to benefit eligibility age was 8.8 years, 8.8 years and 9.0 years for the years ended December 31, 2018, 2017 and 2016, respectively. The average remaining service period of postretirement benefit plan participants related to expected retirement was 9.5 years, 9.6 years and 9.7 years for the years ended December 31, 2018, 2017 and 2016, respectively. Assumptions The measurement of the plan obligations and costs of providing benefits under Exelon’s defined benefit and other postretirement plans involves various factors, including the development of valuation assumptions and inputs and accounting policy elections. The measurement of benefit obligations and costs is impacted by several assumptions and inputs, including the discount rate applied to benefit obligations, the long-term EROA, Exelon’s expected level of contributions to the plans, the long-term expected investment rate credited to employees participating in cash balance plans and the anticipated rate of increase of health care costs. Additionally, assumptions related to plan participants include the incidence of mortality, the expected remaining service period, the level of compensation and rate of compensation increases, employee age and length of service, among other factors. When developing the required assumptions, Exelon considers historical information as well as future expectations. Expected Rate of Return. In selecting the EROA, Exelon considers historical economic indicators (including inflation and GDP growth) that impact asset returns, as well as expectations regarding future long-term capital market performance, weighted by Exelon’s target asset class allocations. Mortality. The mortality assumption is composed of a base table that represents the current expectation of life expectancy of the population adjusted by an improvement scale that attempts to anticipate future improvements in life expectancy. Exelon’s mortality assumption is supported by an actuarial experience study of Exelon's plan participants and utilizes the IRS's RP–2000 base table projected to 2012 with improvement scale AA and projected thereafter with generational improvement scale BB two-dimensional adjusted to a 0.75% long-term rate reached in 2027. There were no changes to the mortality assumption in 2016, 2017 or 2018. The following assumptions were used to determine the benefit obligations for the plans at December 31, 2018, 2017 and 2016. Assumptions used to determine year-end benefit obligations are the assumptions used to estimate the subsequent year’s net periodic benefit costs.
| Pension Benefits |  | Other Postretirement Benefits |
Exelon | 2018 |  | 2017 |  | 2016(f) |  | 2018 |  | 2017 |  | 2016(f) |
Discount rate | 4.31 | % | (a) | 3.62 | % | (b) | 4.04 | % | (c) | 4.30 | % | (a) | 3.61 | % | (b) | 4.04 | % | (c)
Investment Crediting Rate | 4.46 | % |  | 4.00 | % |  | 4.46 | % |  | N/A |  | N/A |  | N/A |  |
Rate of compensation increase |  | (d) |  | (d) |  | (e) |  | (d) |  | (d) |  | (e)
Mortality table | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |
Health care cost trend on covered charges | N/A |  | N/A |  | N/A |  | 5.00% with ultimate trend of 5.00% in 2017 |  | 5.00% with ultimate trend of 5.00% in 2017 |  | 5.00% decreasing to ultimate trend of 5.00% in 2017 |
__________
(a) | The discount rates above represent the blended rates used to determine the majority of Exelon’s pension and other postretirement benefits obligations as of December 31, 2018. Certain benefit plans used individual rates ranging from 4.13% - 4.36% and 4.27% - 4.38% for pension and other postretirement plans, respectively.
(b) | The discount rates above represent the blended rates used to determine the majority of Exelon’s pension and other postretirement benefits obligations as of December 31, 2017. Certain benefit plans used individual rates ranging from 3.49% - 3.65% and 3.57% - 3.68% for pension and other postretirement plans, respectively.
(c) | The discount rates above represent the blended rates used to determine the majority of Exelon’s pension and other postretirement benefits obligations as of December 31, 2016. Certain benefit plans used individual rates ranging from 3.66% - 4.11% and 4.00% - 4.17% for pension and other postretirement plans, respectively.
(d) | 3.25% through 2019 and 3.75% thereafter.
(e) | The legacy Exelon, CEG and CENG pension and other postretirement plans used a rate of compensation increase of 3.25% through 2019 and 3.75% thereafter, while the legacy PHI pension and other postretirement plans used a weighted-average rate of compensation increase of 5% for all periods.
(f) | Obligation was not remeasured for the PHI predecessor for the period from January 1, 2016, to March 23, 2016.
The following assumptions were used to determine the net periodic benefit costs for the plans for the years ended December 31, 2018, 2017 and 2016, as well as for the PHI predecessor period January 1, 2016 to March 23, 2016:
| Pension Benefits |  | Other Postretirement Benefits |
Exelon | 2018 |  | 2017 |  | 2016 |  | 2018 |  | 2017 |  | 2016 |
Discount rate | 3.62 | % | (a) | 4.04 | % | (b) | 4.29 | % | (c) | 3.61 | % | (a) | 4.04 | % | (b) | 4.29 | % | (c)
Investment Crediting Rate | 4.00 | % |  | 4.46 | % |  | 5.31 | % |  | N/A |  |  | N/A |  |  | N/A |  |
Expected return on plan assets | 7.00 | % | (d) | 7.00 | % | (d) | 7.00 | % | (d) | 6.60 | % | (d) | 6.58 | % | (d) | 6.71 | % | (d)
Rate of compensation increase |  |  | (e) |  | (f) |  | (f) |  |  | (e) |  | (f) |  | (f)
Mortality table | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |  | RP-2000 table projected to 2012 with improvement scale AA, with Scale BB-2D improvements (adjusted) |
Health care cost trend on covered charges | N/A |  | N/A |  | N/A |  | 5.00% with ultimate trend of 5.00% in 2017 |  | 5.00% with ultimate trend of 5.00% in 2017 |  | 5.50% decreasing to ultimate trend of 5.00% in 2017 |
| Predecessor
| Pension Benefits |  | Other Postretirement Benefits
PHI | January 1, 2016 to March 23, 2016 |  | January 1, 2016 to March 23, 2016
Discount rate | 4.65%/4.55% |  | (g) | 4.55 | %
Investment crediting rate | 2.89 | % |  | N/A |
Expected return on plan assets(h) | 6.50 | % |  | 6.75 | %
Rate of compensation increase | 5.00 | % |  | 5.00 | %
Mortality table | RP-2014 table with improvement scale MP-2015 |  | RP-2014 table with improvement scale MP-2015
Health care cost trend on covered charges | N/A |  | 6.33% pre-65 and 5.40% post-65 decreasing to ultimate trend of 5.00% in 2020
__________
(a) | The discount rates above represent the blended rates used to establish the majority of Exelon’s pension and other postretirement benefits costs for the year ended December 31, 2018. Certain benefit plans used individual rates ranging from 3.49%-3.65% and 3.57%-3.68% for pension and other postretirement plans, respectively.
(b) | The discount rates above represent the blended rates used to establish the majority of Exelon's pension and other postretirement benefits costs for the year ended December 31, 2017. Certain benefit plans used individual rates ranging from 3.66%-4.11% and 4.00%-4.17% for pension and other postretirement plans, respectively.
(c) | The discount rates above represent the blended rates used to establish the majority of Exelon’s pension and other postretirement benefits costs for the year ended December 31, 2016. Certain benefit plans used the individual rates ranging from 3.68%-4.14% and 4.32%-4.43% for pension and other postretirement plans, respectively.
(d) | Not applicable to pension and other postretirement benefit plans that do not have plan assets.
(e) | 3.25% through 2019 and 3.75% thereafter.
(f) | The legacy Exelon, CEG and CENG pension and other postretirement plans used a rate of compensation increase of 3.25% through 2019 and 3.75% thereafter, while the legacy PHI pension and other postretirement plans used a weighted-average rate of compensation increase of 5% for all periods.
(g) | The discount rate for the qualified and non-qualified pension plans was 4.65% and 4.55%, respectively.
(h) | Expected return on other postretirement benefit plan assets is pre-tax.
Contributions The following tables provide contributions to the pension and other postretirement benefit plans:
| Pension Benefits |  | Other Postretirement Benefits
| 2018(a) |  | 2017(a) |  | 2016(a) |  | 2018 |  | 2017 |  | 2016
Exelon | $ | 337 |  |  | $ | 341 |  |  | $ | 347 |  |  | $ | 46 |  |  | $ | 64 |  |  | $ | 50 |
Generation | 128 |  |  | 137 |  |  | 140 |  |  | 11 |  |  | 11 |  |  | 12 |
ComEd | 38 |  |  | 36 |  |  | 33 |  |  | 4 |  |  | 5 |  |  | 5 |
PECO | 28 |  |  | 24 |  |  | 30 |  |  | — |  |  | — |  |  | — |
BGE | 40 |  |  | 39 |  |  | 31 |  |  | 14 |  |  | 14 |  |  | 18 |
BSC(b) | 41 |  |  | 38 |  |  | 39 |  |  | 5 |  |  | 2 |  |  | 3 |
Pepco | 6 |  |  | 62 |  |  | 24 |  |  | 11 |  |  | 10 |  |  | 8 |
DPL | — |  |  | — |  |  | 22 |  |  | — |  |  | 2 |  |  | — |
ACE | 6 |  |  | — |  |  | 15 |  |  | — |  |  | 20 |  |  | 2 |
PHISCO (c) | 50 |  |  | 5 |  |  | 17 |  |  | 1 |  |  | — |  |  | 2 |
| Pension Benefits |  | Other Postretirement Benefits
| Successor |  |  | Predecessor |  | Successor |  |  | Predecessor
| 2018 |  | 2017 |  | March 24, 2016 to December 31, 2016 |  |  | January 1, 2016 to March 23, 2016 |  | 2018 |  | 2017 |  | March 24, 2016 to December 31, 2016 |  |  | January 1, 2016 to March 23, 2016
PHI | $ | 62 |  |  | $ | 67 |  |  | $ | 74 |  |  |  | $ | 4 |  |  | $ | 12 |  |  | $ | 32 |  |  | $ | 12 |  |  |  | $ | — |
__________
(a) | Exelon's and Generation's pension contributions include $21 million and $25 million related to the legacy CENG plans that was funded by CENG as provided in an Employee Matters Agreement (EMA) between Exelon and CENG for the years ended December 31, 2017 and 2016, respectively. There were no pension contributions for the year ended December 31, 2018.
(b) | Includes $2 million, $4 million, and $6 million of pension contributions funded by Exelon Corporate, for the years ended December 31, 2018, 2017, and 2016, respectively.
(c) | PHISCO’s pension contributions for the year ended December 31, 2016 include $4 million of contributions made prior to the closing of Exelon’s merger with PHI on March 23, 2016.
Management considers various factors when making pension funding decisions, including actuarially determined minimum contribution requirements under ERISA, contributions required to avoid benefit restrictions and at-risk status as defined by the Pension Protection Act of 2006 (the Act), management of the pension obligation and regulatory implications. The Act requires the attainment of certain funding levels to avoid benefit restrictions (such as an inability to pay lump sums or to accrue benefits prospectively), and at-risk status (which triggers higher minimum contribution requirements and participant notification). The projected contributions below reflect a funding strategy of contributing the greater of (1) $300 million until all the qualified plans are fully funded on an ABO basis, and (2) the minimum amounts under ERISA to meet minimum contribution requirement and/or avoid benefit restrictions and at-risk status. This level funding strategy helps minimize volatility of future period required pension contributions. Unlike the qualified pension plans, Exelon’s non-qualified pension plans are not funded, given that they are not subject to statutory minimum contribution requirements. While other postretirement plans are also not subject to statutory minimum contribution requirements, Exelon does fund certain of its plans. For Exelon's funded OPEB plans, contributions generally equal accounting costs, however, Exelon’s management has historically considered several factors in determining the level of contributions to its other postretirement benefit plans, including liabilities management, levels of benefit claims paid and regulatory implications (amounts deemed prudent to meet regulatory expectations and best assure continued rate recovery). The amounts below include benefit payments related to unfunded plans. The following table provides all registrants' planned contributions to the qualified pension plans, planned benefit payments to non-qualified pension plans, and planned contributions to other postretirement plans in 2019:
| Qualified Pension Plans |  | Non-Qualified Pension Plans |  | Other Postretirement Benefits
Exelon | $ | 301 |  |  | $ | 25 |  |  | $ | 44 |
Generation | 135 |  |  | 7 |  |  | 13 |
ComEd | 65 |  |  | 1 |  |  | 2 |
PECO | 25 |  |  | 1 |  |  | — |
BGE | 34 |  |  | 1 |  |  | 15 |
BSC | 41 |  |  | 7 |  |  | 2 |
PHI | 1 |  |  | 8 |  |  | 12 |
Pepco | — |  |  | 2 |  |  | 10 |
DPL | — |  |  | 1 |  |  | — |
ACE | — |  |  | — |  |  | 1 |
PHISCO | 1 |  |  | 5 |  |  | 1 |
Estimated Future Benefit Payments Estimated future benefit payments to participants in all of the pension plans and postretirement benefit plans at December 31, 2018 were:
| Pension Benefits |  | Other Postretirement Benefits
2019 | $ | 1,196 |  |  | $ | 255 |
2020 | 1,221 |  |  | 263 |
2021 | 1,258 |  |  | 269 |
2022 | 1,284 |  |  | 274 |
2023 | 1,302 |  |  | 282 |
2024 through 2028 | 6,770 |  |  | 1,483 |
Total estimated future benefit payments through 2028 | $ | 13,031 |  |  | $ | 2,826 |
Allocation to Exelon Subsidiaries All registrants account for their participation in Exelon’s pension and other postretirement benefit plans by applying multi-employer accounting. Employee-related assets and liabilities, including both pension and postretirement liabilities, for the legacy Exelon plans were allocated by Exelon to its subsidiaries based on the number of active employees as of January 1, 2001 as part of Exelon’s corporate restructuring. The obligation for Generation, ComEd and PECO reflects the initial allocation and the cumulative costs incurred and contributions made since January 1, 2001. Historically, Exelon has allocated the components of pension and other postretirement costs to the subsidiaries in the legacy Exelon plans based upon several factors, including the measures of active employee participation in each plan. Pension and other postretirement benefit contributions were allocated to legacy Exelon subsidiaries in proportion to active service costs recognized and total costs recognized, respectively. Beginning in 2015, Exelon began allocating costs related to its legacy Exelon pension and other postretirement benefit plans to its subsidiaries based on both active and retired employee participation and contributions are allocated based on accounting cost. The impact of this allocation methodology change was not material to any Registrant. For legacy CEG, legacy CENG, FitzPatrick, and legacy PHI plans, components of pension and other postretirement benefit costs and contributions have been, and will continue to be, allocated to the subsidiaries based on employee participation (both active and retired). The amounts below represent the Registrants’ as well as BSC's and PHISCO's pension and OPEB costs. As a result of new pension guidance effective on January 1, 2018, certain balances have been reclassified on Exelon’s Consolidated Statements of Operations and Comprehensive Income for the years ended December 31, 2017 and 2016. For Exelon, the service cost component is included in Operating and maintenance expense and Property, plant and equipment, net, for the years ended December 31, 2018, 2017 and 2016, while the non–service cost components are included in Other, net and Regulatory assets for year ended December 31, 2018 and in Other, net and Property, plant and equipment, net, for the years ended December 31, 2017 and 2016. For Generation and the Utility Registrants, the service cost and non–service cost components are included in Operating and maintenance expense and Property, plant and equipment, net on their consolidated financial statements for the years ended December 31, 2018, 2017 and 2016.
For the Years Ended December 31, | Exelon |  | Generation(a) |  | ComEd |  | PECO |  | BGE |  | BSC(b) |  | Pepco(c) |  | DPL(c) |  | ACE(c) |  | PHISCO(c)(d)
2018 | $ | 583 |  |  | $ | 204 |  |  | $ | 177 |  |  | $ | 18 |  |  | $ | 60 |  |  | $ | 57 |  |  | $ | 15 |  |  | $ | 6 |  |  | $ | 12 |  |  | $ | 34 |
2017 | 643 |  |  | 227 |  |  | 176 |  |  | 29 |  |  | 64 |  |  | 53 |  |  | 25 |  |  | 13 |  |  | 13 |  |  | 43 |
2016 | 621 |  |  | 218 |  |  | 166 |  |  | 33 |  |  | 68 |  |  | 48 |  |  | 31 |  |  | 18 |  |  | 15 |  |  | 47 |
| Successor |  |  | Predecessor
PHI | For the Year Ended December 31, 2018 |  | For the Year Ended December 31, 2017 |  | March 24, 2016 to December 31, 2016 |  |  | January 1, 2016 to March 23, 2016
Pension and Other Postretirement Benefit Costs | $ | 67 |  |  | $ | 94 |  |  | $ | 88 |  |  |  | $ | 23 |
__________
(a) | FitzPatrick net benefit costs are included for the period after acquisition.
(b) | These amounts primarily represent amounts billed to Exelon’s subsidiaries through intercompany allocations. These amounts are not included in the Generation, ComEd, PECO, BGE, PHI, Pepco, DPL or ACE amounts above.
(c) | Pepco's, DPL's, ACE's and PHISCO's pension and postretirement benefit costs for the year ended December 31, 2016 include $7 million, $4 million, $3 million and $9 million, respectively, of costs incurred prior to the closing of Exelon’s merger with PHI on March 23, 2016.
(d) | These amounts represent amounts billed to Pepco, DPL and ACE through intercompany allocations. These amounts are not included in Pepco, DPL or ACE amounts above.
Plan Assets Investment Strategy. On a regular basis, Exelon evaluates its investment strategy to ensure that plan assets will be sufficient to pay plan benefits when due. As part of this ongoing evaluation, Exelon may make changes to its targeted asset allocation and investment strategy. Exelon has developed and implemented a liability hedging investment strategy for its qualified pension plans that has reduced the volatility of its pension assets relative to its pension liabilities. Exelon is likely to continue to gradually increase the liability hedging portfolio as the funded status of its plans improves. The overall objective is to achieve attractive risk-adjusted returns that will balance the liquidity requirements of the plans’ liabilities while striving to minimize the risk of significant losses. Trust assets for Exelon’s other postretirement plans are managed in a diversified investment strategy that prioritizes maximizing liquidity and returns while minimizing asset volatility. Actual asset returns have an impact on the costs reported for the Exelon-sponsored pension and other postretirement benefit plans. The actual asset returns across Exelon’s pension and other postretirement benefit plans for the year ended December 31, 2018 were (4.86)% and (4.66)%, respectively, compared to an expected long-term return assumption of 7.00% and 6.60%, respectively. Exelon used an EROA of 7.00% and 6.67% to estimate its 2019 pension and other postretirement benefit costs, respectively. Exelon’s pension and other postretirement benefit plan target asset allocations at December 31, 2018 and 2017 asset allocations were as follows: Pension Plans
|  |  | Exelon
|  |  | Percentage of Plan Assets at December 31,
Asset Category | Target Allocation |  | 2018 |  | 2017
Equity securities | 35 | % |  | 32 | % |  | 35 | %
Fixed income securities | 37 | % |  | 38 |  |  | 39 |
Alternative investments(a) | 28 | % |  | 30 |  |  | 26 |
Total |  |  | 100 | % |  | 100 | %
Other Postretirement Benefit Plans
|  |  | Exelon
|  |  | Percentage of Plan Assets at December 31,
Asset Category | Target Allocation |  | 2018 |  | 2017
Equity securities | 47 | % |  | 44 | % |  | 47 | %
Fixed income securities | 28 | % |  | 28 |  |  | 28 |
Alternative investments(a) | 25 | % |  | 28 |  |  | 25 |
Total |  |  | 100 | % |  | 100 | %
__________
(a) | Alternative investments include private equity, hedge funds, real estate, and private credit.
Concentrations of Credit Risk. Exelon evaluated its pension and other postretirement benefit plans’ asset portfolios for the existence of significant concentrations of credit risk as of December 31, 2018. Types of concentrations that were evaluated include, but are not limited to, investment concentrations in a single entity, type of industry, foreign country, and individual fund. As of December 31, 2018, there were no significant concentrations (defined as greater than 10% of plan assets) of risk in Exelon’s pension and other postretirement benefit plan assets. Fair Value Measurements The following tables present pension and other postretirement benefit plan assets measured and recorded at fair value in the Registrants' Consolidated Balance Sheets on a recurring basis and their level within the fair value hierarchy at December 31, 2018 and 2017: Exelon
December 31, 2018(a) | Level 1 |  | Level 2 |  | Level 3 |  | Not subject to leveling |  | Total
Pension plan assets |  |  |  |  |  |  |  |  |
Cash equivalents | $ | 350 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 350 |
Equities(c) | 3,364 |  |  | — |  |  | 2 |  |  | 1,980 |  |  | 5,346 |
Fixed income: |  |  |  |  |  |  |  |  |
U.S. Treasury and agencies | 996 |  |  | 173 |  |  | — |  |  | — |  |  | 1,169 |
State and municipal debt | — |  |  | 59 |  |  | — |  |  | — |  |  | 59 |
Corporate debt | — |  |  | 3,716 |  |  | 216 |  |  | — |  |  | 3,932 |
Other(c) | — |  |  | 329 |  |  | — |  |  | 613 |  |  | 942 |
Fixed income subtotal | 996 |  |  | 4,277 |  |  | 216 |  |  | 613 |  |  | 6,102 |
Private equity | — |  |  | — |  |  | — |  |  | 1,219 |  |  | 1,219 |
Hedge funds | — |  |  | — |  |  | — |  |  | 1,608 |  |  | 1,608 |
Real estate | — |  |  | — |  |  | — |  |  | 1,029 |  |  | 1,029 |
Private credit | — |  |  | — |  |  | 268 |  |  | 798 |  |  | 1,066 |
Pension plan assets subtotal | $ | 4,710 |  |  | $ | 4,277 |  |  | $ | 486 |  |  | $ | 7,247 |  |  | $ | 16,720 |
December 31, 2018(a) | Level 1 |  | Level 2 |  | Level 3 |  | Not subject to leveling |  | Total
Other postretirement benefit plan assets |  |  |  |  |  |  |  |  |
Cash equivalents | $ | 22 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 22 |
Equities | 537 |  |  | 2 |  |  | — |  |  | 508 |  |  | 1,047 |
Fixed income: |  |  |  |  |  |  |  |  |
U.S. Treasury and agencies | 11 |  |  | 56 |  |  | — |  |  | — |  |  | 67 |
State and municipal debt | — |  |  | 126 |  |  | — |  |  | — |  |  | 126 |
Corporate debt | — |  |  | 48 |  |  | — |  |  | — |  |  | 48 |
Other | 183 |  |  | 72 |  |  | — |  |  | 170 |  |  | 425 |
Fixed income subtotal | 194 |  |  | 302 |  |  | — |  |  | 170 |  |  | 666 |
Hedge funds | — |  |  | — |  |  | — |  |  | 411 |  |  | 411 |
Real estate | — |  |  | — |  |  | — |  |  | 132 |  |  | 132 |
Private credit | — |  |  | — |  |  | — |  |  | 132 |  |  | 132 |
Other postretirement benefit plan assets subtotal | $ | 753 |  |  | $ | 304 |  |  | $ | — |  |  | $ | 1,353 |  |  | $ | 2,410 |
Total pension and other postretirement benefit plan assets(e) | $ | 5,463 |  |  | $ | 4,581 |  |  | $ | 486 |  |  | $ | 8,600 |  |  | $ | 19,130 |
December 31, 2017(a)(b) | Level 1 |  | Level 2 |  | Level 3 |  | Not subject to leveling |  | Total
Pension plan assets |  |  |  |  |  |  |  |  |
Cash equivalents | $ | 585 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 585 |
Equities(c) | 3,565 |  |  | — |  |  | 2 |  |  | 3,077 |  |  | 6,644 |
Fixed income: |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury and agencies | 1,150 |  |  | 159 |  |  | — |  |  | — |  |  | 1,309 |
State and municipal debt | — |  |  | 64 |  |  | — |  |  | — |  |  | 64 |
Corporate debt | — |  |  | 3,931 |  |  | 232 |  |  | — |  |  | 4,163 |
Other(c) | — |  |  | 447 |  |  | — |  |  | 756 |  |  | 1,203 |
Fixed income subtotal | 1,150 |  |  | 4,601 |  |  | 232 |  |  | 756 |  |  | 6,739 |
Private equity | — |  |  | — |  |  | — |  |  | 1,034 |  |  | 1,034 |
Hedge funds | — |  |  | — |  |  | — |  |  | 1,770 |  |  | 1,770 |
Real estate | — |  |  | — |  |  | — |  |  | 884 |  |  | 884 |
Private credit(d) | — |  |  | — |  |  | 224 |  |  | 695 |  |  | 919 |
Pension plan assets subtotal | $ | 5,300 |  |  | $ | 4,601 |  |  | $ | 458 |  |  | $ | 8,216 |  |  | $ | 18,575 |
December 31, 2017(a)(b) | Level 1 |  | Level 2 |  | Level 3 |  | Not subject to leveling |  | Total
Other postretirement benefit plan assets |  |  |  |  |  |  |  |  |
Cash equivalents | $ | 29 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 29 |
Equities | 523 |  |  | 2 |  |  | — |  |  | 764 |  |  | 1,289 |
Fixed income: |  |  |  |  |  |  |  |  |
U.S. Treasury and agencies | 13 |  |  | 56 |  |  | — |  |  | — |  |  | 69 |
State and municipal debt | — |  |  | 136 |  |  | — |  |  | — |  |  | 136 |
Corporate debt | — |  |  | 47 |  |  | — |  |  | — |  |  | 47 |
Other | 225 |  |  | 71 |  |  | — |  |  | 185 |  |  | 481 |
Fixed income subtotal | 238 |  |  | 310 |  |  | — |  |  | 185 |  |  | 733 |
Hedge funds | — |  |  | — |  |  | — |  |  | 430 |  |  | 430 |
Real estate | — |  |  | — |  |  | — |  |  | 124 |  |  | 124 |
Private credit | — |  |  | — |  |  | — |  |  | 123 |  |  | 123 |
Other postretirement benefit plan assets subtotal | $ | 790 |  |  | $ | 312 |  |  | $ | — |  |  | $ | 1,626 |  |  | $ | 2,728 |
Total pension and other postretirement benefit plan assets(e) | $ | 6,090 |  |  | $ | 4,913 |  |  | $ | 458 |  |  | $ | 9,842 |  |  | $ | 21,303 |
__________
(a) | See Note 11—Fair Value of Financial Assets and Liabilities for a description of levels within the fair value hierarchy.
(b) | Effective March 31, 2017, Exelon became sponsor of FitzPatrick's defined benefit pension and other postretirement benefit plans, and assumed FitzPatrick's benefit plan obligations.
(c) | Includes derivative instruments of less than $1 million and $6 million, which have a total notional amount of $5,991 million and $3,606 million at December 31, 2018 and 2017, respectively. The notional principal amounts for these instruments provide one measure of the transaction volume outstanding as of the fiscal years ended and do not represent the amount of the company’s exposure to credit or market loss.
(d) | Prior year amounts reflect a reclassification from Not subject to leveling into Level 3.
(e) | Excludes net liabilities of $44 million and net assets of $2 million at December 31, 2018 and 2017, respectively, which are required to reconcile to the fair value of net plan assets. These items consist primarily of receivables or payables related to pending securities sales and purchases, interest and dividends receivable.
The following table presents the reconciliation of Level 3 assets and liabilities measured at fair value for pension and other postretirement benefit plans for the years ended December 31, 2018 and 2017: Exelon
| Fixed Income |  | Equities |  | Private Credit |  | Total
Pension Assets |  |  |  |  |  |  |
Balance as of January 1, 2018 | $ | 232 |  |  | $ | 2 |  |  | $ | 224 |  |  | $ | 458 |
Actual return on plan assets: |  |  |  |  |  |  |  |
Relating to assets still held at the reporting date | (14 | ) |  | — |  |  | 9 |  |  | (5 | )
Relating to assets sold during the period | (1 | ) |  | — |  |  | — |  |  | (1 | )
Purchases, sales and settlements: |  |  |  |  |  |  |  |
Purchases | 19 |  |  | — |  |  | 35 |  |  | 54 |
Sales | (8 | ) |  | — |  |  | — |  |  | (8 | )
Settlements(b) | (12 | ) |  | — |  |  | — |  |  | (12 | )
Balance as of December 31, 2018 | $ | 216 |  |  | $ | 2 |  |  | $ | 268 |  |  | $ | 486 |
| Fixed income |  | Equities |  | Private Credit (a) |  | Total
Pension Assets |  |  |  |  |  |  |
Balance as of January 1, 2017 | $ | 206 |  |  | $ | 2 |  |  | $ | 229 |  |  | $ | 437 |
Actual return on plan assets: |  |  |  |  |  |  |  |
Relating to assets still held at the reporting date | 11 |  |  | — |  |  | 29 |  |  | 40 |
Purchases, sales and settlements: |  |  |  |  |  |  |  |
Purchases | 31 |  |  | — |  |  | 5 |  |  | 36 |
Sales | (16 | ) |  | — |  |  | — |  |  | (16 | )
Settlements(b) | — |  |  | — |  |  | (39 | ) |  | (39 | )
Balance as of December 31, 2017 | $ | 232 |  |  | $ | 2 |  |  | $ | 224 |  |  | $ | 458 |
__________
(a) | Prior year amounts reflect a reclassification from Not subject to leveling into Level 3.
(b) | Represents cash settlements only.
There were no significant transfers between Level 1 and Level 2 during the year ended December 31, 2018 for the pension and other postretirement benefit plan assets. Valuation Techniques Used to Determine Fair Value Cash equivalents. Investments with original maturities of three months or less when purchased, including certain short-term fixed income securities and money market funds, are considered cash equivalents. The fair values are based on observable market prices and, therefore, are included in the recurring fair value measurements hierarchy as Level 1. Equities. Equities consist of individually held equity securities, equity mutual funds and equity commingled funds in domestic and foreign markets. With respect to individually held equity securities, the trustees obtain prices from pricing services, whose prices are generally obtained from direct feeds from market exchanges, which Exelon is able to independently corroborate. Equity securities held individually, including real estate investment trusts, rights and warrants, are primarily traded on exchanges that contain only actively traded securities due to the volume trading requirements imposed by these exchanges. Equity securities are valued based on quoted prices in active markets and are categorized as Level 1. Certain private placement equity securities are categorized as Level 3 because they are not publicly traded and are priced using significant unobservable inputs. Equity commingled funds and mutual funds are maintained by investment companies, and certain investments are held in accordance with a stated set of fund objectives, which are consistent with the plans’ overall investment strategy. The values of some of these funds are publicly quoted. For mutual funds which are publicly quoted, the funds are valued based on quoted prices in active markets and have been categorized as Level 1. For equity commingled funds and mutual funds which are not publicly quoted, the fund administrators value the funds using the NAV per fund share, derived from the quoted prices in active markets of the underlying securities and are not classified within the fair value hierarchy. These investments typically can be redeemed monthly with 30 or less days of notice and without further restrictions. Fixed income. For fixed income securities, which consist primarily of corporate debt securities, U.S government securities, foreign government securities, municipal bonds, asset and mortgage-backed securities, commingled funds, mutual funds and derivative instruments, the trustees obtain multiple prices from pricing vendors whenever possible, which enables cross-provider validations in addition to checks for unusual daily movements. A primary price source is identified based on asset type, class or issue for each security. With respect to individually held fixed income securities, the trustees monitor prices supplied by pricing services and may use a supplemental price source or change the primary price source of a given security if the portfolio managers challenge an assigned price and the trustees determine that another price source is considered to be preferable. Exelon has obtained an understanding of how these prices are derived, including the nature and observability of the inputs used in deriving such prices. Additionally, Exelon selectively corroborates the fair values of securities by comparison to other market-based price sources. Investments in U.S. Treasury securities have been categorized as Level 1 because they trade in highly-liquid and transparent markets. Certain private placement fixed income securities have been categorized as Level 3 because they are priced using certain significant unobservable inputs and are typically illiquid. The remaining fixed income securities, including certain other fixed income investments, are based on evaluated prices that reflect observable market information, such as actual trade information of similar securities, adjusted for observable differences and are categorized as Level 2. Other fixed income investments primarily consist of fixed income commingled funds and mutual funds, which are maintained by investment companies and hold certain investments in accordance with a stated set of fund objectives, which are consistent with Exelon’s overall investment strategy. The values of some of these funds are publicly quoted. For mutual funds which are publicly quoted, the funds are valued based on quoted prices in active markets and have been categorized as Level 1. For fixed income commingled funds and mutual funds which are not publicly quoted, the fund administrators value the funds using the NAV per fund share, derived from the quoted prices in active markets of the underlying securities and are not classified within the fair value hierarchy. These investments typically can be redeemed monthly with 30 or less days of notice and without further restrictions. Derivative instruments consisting primarily of futures and swaps to manage risk are recorded at fair value. Over-the-counter derivatives are valued daily based on quoted prices in active markets and trade in open markets, and have been categorized as Level 1. Derivative instruments other than over-the-counter derivatives are valued based on external price data of comparable securities and have been categorized as Level 2. Private equity. Private equity investments include those in limited partnerships that invest in operating companies that are not publicly traded on a stock exchange such as leveraged buyouts, growth capital, venture capital, distressed investments and investments in natural resources. Private equity valuations are reported by the fund manager and are based on the valuation of the underlying investments, which include unobservable inputs such as cost, operating results, discounted future cash flows and market based comparable data. The fair value of private equity investments is determined using NAV or its equivalent as a practical expedient, and therefore, these investments are not classified within the fair value hierarchy. Hedge funds. Hedge fund investments include those seeking to maximize absolute returns using a broad range of strategies to enhance returns and provide additional diversification. The fair value of hedge funds is determined using NAV or its equivalent as a practical expedient, and therefore, hedge funds are not classified within the fair value hierarchy. Exelon has the ability to redeem these investments at NAV or its equivalent subject to certain restrictions which may include a lock-up period or a gate. Real estate. Real estate funds are funds with a direct investment in pools of real estate properties. These funds are valued by investment managers on a periodic basis using pricing models that use independent appraisals from sources with professional qualifications. These valuation inputs are not highly observable. The fair value of real estate investments is determined using NAV or its equivalent as a practical expedient, and therefore, these investments are not classified within the fair value hierarchy. Private credit. Private credit investments primarily consist of limited partnerships that invest in private debt strategies. These investments are generally less liquid assets with an underlying term of 3 to 5 years and are intended to be held to maturity. The fair value of these investments is determined by the fund manager or administrator and include unobservable inputs such as cost, operating results, and discounted cash flows. Private credit investments are categorized as Level 3 because they are based largely on inputs that are unobservable and utilize complex valuation models. The fair value of private credit funds are determined using NAV or its equivalent as a practical expedient, and therefore, these investments are not classified within the fair value hierarchy. Defined Contribution Savings Plan (All Registrants) The Registrants participate in various 401(k) defined contribution savings plans that are sponsored by Exelon. The plans are qualified under applicable sections of the IRC and allow employees to contribute a portion of their pre-tax and/or after-tax income in accordance with specified guidelines. All Registrants match a percentage of the employee contributions up to certain limits. The following table presents matching contributions to the savings plan for the years ended December 31, 2018, 2017 and 2016:
For the Year Ended December 31, | Exelon(a) |  | Generation(a) |  | ComEd |  | PECO |  | BGE |  | BSC(b) |  | Pepco(c) |  | DPL(c) |  | ACE |  | PHISCO(c)(d)
2018 | $ | 179 |  |  | $ | 86 |  |  | $ | 37 |  |  | $ | 9 |  |  | $ | 12 |  |  | $ | 22 |  |  | $ | 3 |  |  | $ | 2 |  |  | $ | 2 |  |  | $ | 6 |
2017 | 128 |  |  | 55 |  |  | 31 |  |  | 10 |  |  | 10 |  |  | 9 |  |  | 3 |  |  | 2 |  |  | 2 |  |  | 6 |
2016 | 164 |  |  | 79 |  |  | 34 |  |  | 10 |  |  | 12 |  |  | 19 |  |  | 3 |  |  | 2 |  |  | 2 |  |  | 6 |
| Successor |  |  | Predecessor
PHI | For the Year Ended December 31, 2018 |  | For the Year Ended December 31, 2017 |  | March 24, 2016 to December 31, 2016 |  |  | January 1, 2016 to March 23, 2016
Saving Plan Matching Contributions | $ | 13 |  |  | $ | 13 |  |  | $ | 10 |  |  |  | $ | 3 |
__________
(a) | Includes $13 million related to CENG for the year ended December 31, 2016.
(b) | These amounts primarily represent amounts billed to Exelon’s subsidiaries through intercompany allocations. These costs are not included in the Generation, ComEd, PECO, BGE, PHI, Pepco, DPL or ACE amounts above.
(c) | Pepco's, DPL's and PHISCO's matching contributions include $1 million, $1 million and $1 million, respectively, of costs incurred prior to the closing of Exelon's merger with PHI on March 23, 2016, which is not included in Exelon's matching contributions for the year ended December 31, 2016.
(d) | These amounts primarily represent amounts billed to Pepco, DPL, and ACE through intercompany allocations. These amounts are not included in Pepco, DPL or ACE amounts above.

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