Good morning, and welcome to Constellation Energy Group's Second Quarter 2011 Earnings Conference Call. [Operator Instructions] Today's conference is being recorded. If you have any objections, you may disconnect at this time. I will now turn the meeting over to the Director of Investor Relations for Constellation, Ms. Sandra Brummitt. Sandra, you may begin.

Thank you. Welcome to Constellation Energy's second quarter earnings call. We appreciate you being with us this morning. With me here in Baltimore today are Mayo Shattuck, Chairman, President and Chief Executive Officer; and Jack Thayer, Senior Vice President and Chief Financial Officer. Mayo and Jack will provide you their perspectives on our performance for the quarter, as well as our expectations for the future. Following their remarks, we'll take your questions. Please turn your attention to slide 2, a reminder that our comments today will include forward-looking statements, which are subject to certain risks and uncertainties. For a complete discussion of these risks, we encourage you to read our documents on file with the SEC. Our presentation is being webcast, and the slides are available on our website, www.constellation.com. On Slide 3, you will notice we will use non-GAAP financial measures in this presentation to help you understand our operating performance. We have attached an appendix to the charts on the website reconciling non-GAAP measures to GAAP measures. Turning to Slide 4. We will discuss our pending merger with Exelon during this presentation. In connection with the merger, we will mail to our shareholders a joint proxy statement, prospectus and other relevant documents in connection with the proposed merger of Exelon and Constellation Energy. We urge investors to read the joint proxy statement, prospectus and any other relevant documents when they become available because they will contain important information about Exelon, Constellation Energy and the proposed merger. With that, I would like to turn the time over to Mayo.

Thank you, Sandra. Good morning, everyone, and thank you for your participation today. Let me take a few moments to update you on the status of our merger with Exelon. During the quarter, we focused on completing the required regulatory filings and commencing the integration planning process. To date, all material federal and state regulatory filings have been submitted including the S-4, which was filed with the SEC on June 27. In addition, the schedule for the Maryland PSC proceeding was released to the public on June 28. That proceeding is scheduled to conclude by January 5, 2012, within the 225 days allowed by statute. As we look ahead, we expect to complete a number of key milestones in the third and fourth quarters and receive approvals from various stakeholders continuing into the first quarter of 2012. Once the S-4 is effective, we will hold a meeting with our shareholders in the third quarter or early fourth quarter. I commend our employees for remaining focused on safety and our operating objectives as we advance towards the completion of our merger with Exelon to become the nation's #1 competitive energy provider with one of the industry's cleanest and lowest cost power generation fleets and one of the largest customer bases in the United States. Let's turn to Slide 6 where I'll provide an overview of our financial results. This morning, we are pleased to report second quarter adjusted earnings of $0.76 per share, which includes a mark-to-market timing gain of $0.11 per share. Excluding these mark-to-market timing gains, our adjusted earnings would have been $0.65 per share in excess of expected planned results for the quarter. Including one-time items, Constellation reported second quarter GAAP earnings of $0.49 per share. In the first half of 2011, we experienced severe weather and a…

As Mayo mentioned, adjusted earnings for the second quarter of 2011 were $0.76 per share. As you may recall, our adjusted earnings include mark-to-market timing gains and losses that serve as hedges of customer and generation positions. This past quarter, we recorded a mark-to-market timing gain of approximately $0.11 per share. These mark-to-market results will fluctuate on a quarterly basis as underlying commodity prices change. Excluding these mark-to-market timing gains, our adjusted earnings would have been $0.65 per share. Looking now at results by segment. BGE reported adjusted earnings of $0.09 per share, up from $0.07 per share in the second quarter of 2010. The increase is primarily the result of higher electric distribution revenue, which was approved in the Maryland Public Service Commission's 2010 rate case order and increased transmission rates. Our Generation segment reported adjusted earnings of $0.26 per share for the second quarter of 2011, down from the $0.29 per share in the second quarter of 2010. The decrease is primarily the result of increased outage days at CENG, partially offset by the earnings contribution from our Boston Generating acquisition. Our NewEnergy segment reported adjusted earnings of $0.26 per share for the second quarter of 2011 as compared to adjusted earnings of $0.21 per share for the second quarter of 2010. The second quarter of 2011 adjusted earnings include a mark-to-market timing gain of $0.11 per share, which was partially offset by costs associated with residential marketing and our recent acquisitions. Turning to Slide 11, and a discussion of our earnings guidance. You'll note on the slide that we have revised our guidance disclosure to reflect guidance exclusively for 2011, and we are no longer affirming our prior 2012 guidance in light of changes to our plan associated with the pending merger with Exelon. These changes include…

[Operator Instructions] Your first question comes from Ameet Thakkar, Bank of America Merrill Lynch.

Jack, I understand I guess the changes on the disclosure on the 2012 guidance but just kind of given your last couple of comments there on kind of how you're shifting the focus on NewEnergy, perhaps to focus on, it sounds like customer renewals and growing volumes, how is that business kind of performing from a margin perspective right now and how you see that kind of evolving in '12 and '13 from a margin perspective?

So, Ameet, I'd say year-to-date from a margin standpoint, it is both in retail, as well as wholesale performing roughly in line with plan. That said, particularly in the last month or 2 given some of the lower power price volatility that we've seen, we have seen a more competitive environment develop and as we think about both growing the volumes in that business as we move forward with our merger with Exelon, we do potentially see some margin compression as we try and grow those volumes in the business. As I mentioned in the script, we do see this potentially impacting 2012, but we believe the strategy will be positive in 2013.

Okay. And then you had mentioned that you kind of view the additions of MXenergy and StarTex as being kind of modestly accretive in '12 and more so in '13. So I guess that's off of kind of the prior kind of EBIT outlook that you had given prior to this call?

So with respect to outlook given the change in guidance, I can only really speak about 2012 and beyond in less tangible ways. But what I would say is that with the addition of StarTex and MX and the impact of integration costs and the purchase accounting that it is dilutive in 2011. We do see it modestly accretive in '12, and we see it adding fairly materially to 2013 as we complete the integration expenditures and grow the customer base.

All right. And then just real quick -- it looks like your Southwest MAAC coal plant forecasted volumes came down I guess almost another terawatt hour relative to the last quarterly call. And it looks to me like the dark spreads that you're using for the market prices were actually a little bit wider and yet power prices kind of exceed the increase in -- or coal prices actually declined in '13 versus what you showed last time. Is that anyway related to I guess the -- your view of kind of CSAPRs impact on the un-scrubbed coal plants, I guess Crane and Wagner?

We do. I think it's really based on the compression on dark spreads that you have seen out there. There is some impact from the sorbents we'll have to use to comply with CSAPR as well as the credits that we received. So economic models are suggesting we'll run those plants about 800,000-terawatt -- sorry, megawatt hours less in 2013.

Your next question comes from Jay Dobson, Wunderlich Securities.

Could we continue on NewEnergy, just maybe drill a little deeper sort of what's supporting your confidence? I hear you on the 80% is already originated, but I think if I sort of add up the dilution from the merger or the acquisitions you made and your comment a moment ago about margin pressure over the last couple of months, a low volatility environment, I'm just struggling. We've got a lot of earnings to book in the second half of '11 in order to get to a $0.90 to a $1.10 number for NewEnergy in 2011. So, anyway, just if you could walk me through the confidence level there?

Sure. So Jay, I think one of the attractive elements of the origination pattern of this business is it gives us a good degree of visibility on earnings as we progress through the year. As you may recall in prior calls, we spoke to better-than-expected performance on the wholesale load auction front. So auctions like those that occur in New Jersey, Ohio as well as Maryland. Given that success, a lot of that's of the contribution from those contracts does come in the latter half of 2011. And I would say being 80% effectively -- 80% of the backlog already being originated, we have a good degree of confidence in our ability to hit the guidance period.

Okay. And then the MX and StarTex acquisitions, is there others out there on the horizon similar to those or would you suggest that, that probably does it for at last the near term?

Jay, I think we're at the point where the platform is pretty well established both geographically and from the standpoint of sort of channel development and product development. So the company is pretty well established across the country now. I'd like to think that organically, we've got the capacity now sort of to move forward without making any platform acquisitions. I'd say that for years and years and years, we've always bought portfolios and those can be quite additive to us just bringing customers on board but not paying any premium for sort of infrastructure development. So I think we're at a place where we had hoped to be because I think we felt that the residential market was becoming important, that we had to get more of a foothold in that. I don't think anyone has invented really the magic sauce when it comes to the cost to acquire issues. So I think that our tests here both on our own and through our acquisitions really present us with a pretty good portfolio of perfecting the model of how to expand on the new customer front. So I think we feel we're in good shape, no doubt the residential market because of its stickiness. We feel it's important to be there at particularly the early adoption phase in some of these states like New Jersey and Illinois. So I would hope that you'd see us go organically from here, but don't be surprised whether we buy a portfolio now and then.

Got you. And Texas, hold much interest there as far as expansion?

Yes. StarTex gives us a nice foothold there. It's a great model with great people. We're very impressed with the -- both the founders and the employees we have at that company and their approach in Texas has really been sort of a top-drawer customer experience the people. So that's a good position for us.

Mayo, just -- if I might add. As we think about the combination moving forward with Exelon and combining their combined cycle fleet in Texas with our own, that gives us a nice competitive -- load gen balance in the state. And again, with the CSAPR rulings, we have seen heat rates gap out there. So there is the potential for some market volatility to drive some margin improvement relative to what we've been seeing in the last quarter or 2.

And then, Mayo, just lastly on the merger. Just give us a little insight into maybe the Maryland discussions with the governor you've had and just sort of where we happen -- a lot of us watch the filings as they occur but lots of stuff happens behind the scenes and I was hoping you could give us a little insight into sort of how things are going there.

Well, I guess -- I mean, I think it's fair to say that it's a bit of a quiet summer. Obviously, our approach to this merger for those who followed 5 years earlier is substantially different. So that the talk and the debate has been largely around an offer that we've made upfront that I think has been very well received by most of our constituencies. Since we don't -- testimony begins or I should depositions begin shortly and then the hearings don't really take place until the beginning of November. So we're not really expecting the debate to pick up much at all until we get into that hearing timeframe. But I would say number one, Exelon has done a very nice job at putting some of their best people on the ground in Maryland and starting the dialogue as our new partner and I think that the discussions we've had have been very constructive to understand what our constituencies are likely to react to. And lastly, I would say that our mix of things offered in the original offer when we announced the deal, I think has really been well received and touches upon a lot of our constituencies interest. So we're hopeful that when we get into the debate at the PSC that, that all proceeds pretty well and is recognized.

Your next question comes from Ali Agha, SunTrust.

Jack, could you remind us, the full year guidance that you currently have for NewEnergy for the year, given the mark-to-market moves that you've seen so far, particularly the second quarter that you highlighted for us, what are you assuming in the full year numbers as far as mark-to-market either gains or losses are concerned?

Ali, this is Jack. Importantly, our guidance does exclude the mark-to-market timing elements. Just to remind you, in the first quarter, we had a $0.13 loss. In this quarter, it's an $0.11 positive. So through the first half of the year, it's really netted out to be a $0.02 drag to overall earnings but when we think about those -- the guidance that we give you, those mark-to-market timing elements are excluded from that guidance.

Okay. And secondly, given the activity that's going on, on the EPA front and in the market over the last couple of months with the finalization of the CSAPR rules, when you're looking at the forward commodity curves today versus where you were looking at them at the last call, are you kind of surprised by the lack of move or how do you, from your vantage point, look at those old commodity curves and how telling they are on what the state of the market is currently?

So we have seen power prices move with certainly the CSAPR as well as the Draft Air Toxics Rule, particularly in the Texas market. I would say though that where we are seeing those prices increase is generally more in the current year and less further out the curve. And I think that probably just speaks to the perception of low volatility around low gas prices and tepid economic growth. So I believe it's our anticipation that as we get closer to the delivery year, we will see the market heat rates or dark spreads expand. Particularly as you think about CSAPR and you think about the Air Toxics Rule as -- and the price of coal, we really do expect and anticipate that we will see meaningful retirements on the coal side.

Okay. And last question. Mayo, as the merger approval process continues to go forward, you're spending obviously more time with the Exelon forces well in the integration planning, et cetera. Any surprise to you so far in the process versus what your original thoughts were going into this combination?

Well, maybe the surprise is how well I think we all perceive it's going. I think culturally, there are many more similarities than dissimilarities between the 2 companies, and I think we've got a very thoughtful integration planning process underway. Towards the latter part of this year, we're getting into sort of a design phase when we decide on which processes or practices we actually adopt from one side or the other, and I think the dialogue leading up to that has been very, very constructive. So I would say that as the dialogue has increased over these last couple of months, the level of confidence of its sort of strategic relevance and importance as we build the company that will be the most significant in the competitive markets, has become more and more compelling and obvious to people. And I think particularly, if you took a constituency like our own sales force as an example, the merit of matching this generation against the load potential on our side has become more and more apparent. And I think we're eager to get to the finish line here to see how we operate together. And so I feel very good about how the discussion has gone, how people have conducted themselves on both sides and there's a lot of enthusiasm about it.

Great. And last question. Jack, just a clean-up question. To be clear, when you're looking at your first half results this year, you're including the mark-to-market gains and losses because I remember in the conversation in the first quarter, you guys had indicated to us it may make sense to exclude those $0.13 that -- of herd [ph] that you were seeing. But right now, apples-to-apples, you're looking at keeping those losses in there for adjusted earnings in the first quarter, is that correct?

Ali, we actually, as we break it out in the call, we do exclude from our guidance, those mark-to-market timing elements. So as we're thinking about how we're progressing into the $0.90 to $1.10 that we've projected to the -- for the year, we would exclude year-to-date negative $0.02 of mark-to-market timing.

Your next question comes from Steve Fleishman, Bank of America.

I know you're not giving stand-alone guidance given the consistency with Exelon and some of these changes. I'm wondering though if you could just comment on whether the guidance when the merger was initially announced, the breakeven for '12, 5% plus accretive the for '13 is still valid?

So, Steve, those numbers in that guidance is Exelon's but as Mayo mentioned, as we've gone through the analysis phase and the integration and as we've reviewed and vetted some of the synergy numbers that were included in Exelon's projections, we have gained confidence in those synergies and believe that we will be able to perform roughly in line with Exelon's description of the combined entity.

Your next question comes from Jon Cohen, ISI Group.

Just a couple of quick questions on NewEnergy, can you talk about to what degree the recent retail acquisitions were predicated on the combination with Exelon? I mean, it seemed like last year, you worked pretty hard to go out and acquire generation to match your load portfolio and it seems like now you're kind of going the other way. So is that sort of thinking ahead to what the company will look like when you have Exelon's generation assets?

Well, actually we've been working on these acquisitions for not just months but probably a couple of years and with the idea that we needed to create the footprint on the residential side that really mattered. I think we're feeling very comfortable about our commercial industrial presence around the country, but as I said before from time to time, we find some sort of customer portfolio acquisitions that matter. But these 2 in particular have been on our radar screen for quite some time and in fact, had to be cited in the context of our own merger agreement as acquisitions that we had intended to do. And so clearly it had been in our own planning process. I think the other concept that you're raising is still very valid in that we felt that on an independent course, we'd have to keep adding generation to match that increased load obligation that was also very much our intent. Although, recognizing that there's something a lot more opportunistic associated with buying power plants I think that we were very fortunate to be there at the right time with the Boston Generating acquisition. But ultimately, I think that the success on the load generation side and all of the things that we have described before that describe and justify why we jumped further towards the end game here with this merger really has an awful lot to do with making sure that this big front end that we've developed and our presence around the country has an appropriate match on the generation side and as we examine that during the course of this whole integration phase, I would say we're feeling very comfortable with how that match works and also helping to identify where the future opportunities are. As Jack alluded to earlier, I think Texas will be a significant one. So, yes, this has been in the planning process for quite some time. And, yes, we did have to get permission so to speak in the context of the merger agreement to make these acquisitions. So they were anticipated at that time.

Okay. And then I was wondering if you can just talk generically maybe about your approach to valuation on these types of acquisitions? So are you thinking about a certain cost to acquire, cost per customer and in turn, does that presume some level of switching, customer switching in the future for the mass-market customers?

So, Jon, this is Jack. I would say pretty much across the board when we look at anything, we tend to be in the EBITDA and DCF driven shop. So as we looked at these 2 opportunities and value them, the EBITDA multiple that was employed as we thought about it and the price that was paid was generally in the 4 to 6x EBITDA range depending on the year. Obviously embedding that within our own platform and the opportunity to get operating leverage, as well as leverage the benefit of matching the customer with the generation presents, we think, an opportunity for upside. But I'd say that's how we value this much less than a per customer valuation. I know that's somewhat common in the cable industry as well as the telecoms industry, but I'm sure that's just a net result of probably their own approach to EBITDA.

I guess, said another way, your EBITDA multiple should presume, should be based on some DCF, which should, in turn, be based on some life of the customer, right? I mean -- so I guess my question is, we've seen a big land grab now in states like New Jersey and Pennsylvania and Ohio and Illinois that have gone to competitive markets and it's been pretty easy now just because the polar rates created a lot of headroom and it was easy for new entrants to come in but once these markets are established and competition is established, how much switching do you think there will be on sort of a steady-state basis in the residential customer base?

I guess, I'd say that's the $64,000 question. In terms of if you look at market penetration clearly on the commercial and industrial side, you have with the headroom that's existed, you've seen a very significant penetration and switching on the commercial industrial side. I do believe that the opportunity that exists within residential given anywhere from 5% to as much as 30% penetration depending on the market, is significant in part because of the headroom that you described. Getting to critical scale, building the lowest cost delivery platform, marrying that up with low-cost generation, we think could drive meaningful penetration of those residential markets. And as you think about in a post Dodd-Frank world, the collateral efficiency of such a model, it really does in effect, crack the code to how you would think about hedging your generation link in a post Dodd-Frank world where you have to take your hedges to the exchange as opposed to largely bilateral, which is historically what our sector has done.

Your next question comes from Angie Storozynski, Macquarie.

I understand that you're realigning a disclosure with Exelon's and that's why we don't have pretty much any slides that we had in the past. But could you actually at least comment about the latest capacity auction and how much of capacity did you clear or in a ballpark, should we assume that it's a similar amount of capacity like from last -- the previous auction?

Angie, let me try it this way. Clearly, we saw -- I guess first, let me start -- I think we had among the most conservative expectations for where MAAC would clear and as you know, the clearing price was ultimately below our expectations. That said, our entitlements in the rest of pool, the recent 14, 15 results are basically about flat relative to our plan. So with respect to actual clearing volumes, I think at this point, I'd rather not comment on whether any of our historic plans that have cleared in this most recent auction.

Okay. And I'm going back to NewEnergy. You made comments about securing 80% of your backlog for next year. I mean, but on the other hand you mentioned that there are competitive pressures on margin. Clearly NewEnergy at least hasn't performed in line with our expectations year-to-date. So which portion of the business is really outperforming for the second half or going forward? Is that the gas business, is this the trading business, is that, that you actually have signed up so many contracts with improving margins that the margins are going up? I mean, I'm struggling a little bit to see the upside to this business.

So, Angie, just -- I think it's important to note that as we originate new business today, generally that business is to serve roughly on average, about 18 months perspectively. So some of the competitive environment and some of our comments around '12 and '13 that we've spoken to today really are influenced by that more competitive environment that we're seeing but also a strategic decision on our part to grow volumes in anticipation of having more generation against to match with that. And maybe I'll ask Kathi to specifically comment on which businesses have been performing well.

Angie, just to clarify, the 80% referred is relative to this current year 2001 not for 2012. So if you looked at 2012, the amount of backlog that we have today would be less than 80%. And just to remind everybody, the NewEnergy business is a much bigger business than just the retail business. And so to Jack's point, we have been largely on track with margins originated year-to-date versus what we planned. We have seen compression specifically in the past couple of months, we've seen margins compress a little bit more. As we look at this year for 2011, a lot of transactions that we are entering into right now on the retail side of the business will have a forward start date of 3 months, 4 months, 5 months. So what we're doing, what we're originating today isn't necessarily going to impact 2011 so much does in fact impact 2012 and beyond. But the business itself, we've talked about our Wholesale business, and that's been very strong. I think we talked about that at the last quarter. Our upstream gas business has been performing well. We've got our retail gas business has performed well. And just solar business in the retail part of the equation has performed very well. So we've got a wide array of businesses and one of the beauties of this model is that we are in all these various businesses and we have the opportunity to lever that and look at the total.

Angie, I think that's -- I mean, that's the crux of the matter. The diversity of sales channels, the ability to effectively deploy risk capital in support of business activity and where you can earn the highest return on capital speaks to the breath of the business and the unique return elements within Kathi's NewEnergy business.

And lastly, I mean, you mentioned potential expansions in a number of states, among them New Jersey and Ohio. I mean, how should we think about it in the context of your merger with Exelon? Exelon doesn't really have that many assets in those states. So what's the competitive edge that you have or you will gain following the merger to actually win that load in those states?

Angie, I think it's important to remember that Exelon does have plants that are in the eastern part of PJM and our -- Constellation's expertise is in managing the physical delivery of that power across seams and to more constrained zones. So when you marry the 2, there's certainly -- we have a history of selling and winning significant load in New Jersey and the BGS auctions. This will, with the Exelon combination, add to our generation and nuclear footprint in those areas and then again the Constellation expertise is in managing the -- in effect, the shaping elements in a very efficient way. So I would say we feel very, very comfortable with the opportunity to be the low-cost provider in New Jersey and other states particularly when you think about the operating leverage that we have by having almost 1 million customers across an entire retail platform.

Let me just add to that. At the end of the day, we believe it is a scale business and there is this scale associated with the infrastructure, the risk management platform but also things like branding. And I think that particularly as we get into the residential market, the ability to post in all of these markets with a significant branding presence could be pretty important. I mean, the switching rate has accelerated in the course of the last couple of years. I mean, Maryland is now at 15.6%, New Jersey is at 6%, Pennsylvania is at 19%, Illinois is just at 1.7%. So we've got a lot of room here for quite a while as the adoption curve moves forward in each of these states. And if we are present in all these states with a good product offering, with a -- particularly in the commercial and industrial sector, the breath of products which we've alluded to before has certain scale advantages. But as I said, the residential market is still a bit untested and I think that we believe that we found a way to get -- to make money in this business and the real test is going to be how that scale plays itself out with respect to the acquisition and retention of customers. But no doubt, as someone alluded to in the call that the land grab has started and I think we've got a pretty good head start on it.

Your next question comes from Paul Fremont, Jefferies & Co. Paul Fremont - Jefferies & Company, Inc.: In the past, I guess you guys have talked about sort of a normalized wholesale pricing of $3 to $5 per megawatt hour retail, of $5 to $7. Based on what you're seeing now in terms of business that you're booking for the future, would you say that the pricing falls within that range or does it fall below that range -- those ranges?

Paul, I think the way I'd tackle that is within the wholesale side of our business, we have seen margins on that wholesale side come in at the higher end of expectation for us. With respect to the retail side, as we've commented in this lower volatility environment, we're seeing people price less risk into their transactions. Certainly, we haven't returned to the pre-2008, 2009 margins where we saw them heading $3 and south. But it is getting more competitive.

And I'll just clarify. The wholesale ranges were $2 to $4 that we would talk about historically and we are in the higher end of that range. Paul Fremont - Jefferies & Company, Inc.: Okay. But on the retail side then, you will either be at the low end or potentially slightly below the low end?

I think at this point, we probably don't feel that it's prudent to give a range just because as we've mentioned, we're out trying to aggregate share and grow the business and making investments today to harvest later and as we mentioned, we do believe this strategy will be additive in '13. Paul Fremont - Jefferies & Company, Inc.: All right. You said earlier that you -- because you've got a lot obviously already booked in the backlog, you have a pretty clear picture of the timing of the contributions. Since it's very difficult to get your quarter right because we don't know the timing of those contributions, can you give us sort of a percentage, expectation of NewEnergy contribution third quarter versus fourth quarter?

Paul, I think as you know, we've moved away from quarterly guidance. We just don't see it as -- I know it's something that is the bane of the research analyst's existence because as you mentioned, it is hard for us to get it right just depending on the nature of the transactions and offerings in which we've entered. We feel confident with the $0.90 to $1.10 number and we fully expect to meet -- to fall up in that range for 2011. Paul Fremont - Jefferies & Company, Inc.: And I guess my last question is one of your nuclear plants I believe is a Mark 2 containment design, is that correct?

Yes, with Nine Mile, Nine Mile has one Mark 1 and one Mark 2 containment. The Mark 1 containment, ML1 has a hardened vent already and the second containment has I would say semi-hardened vents. There might potentially be some work associated with that based on the outcomes of all of these findings. Paul Fremont - Jefferies & Company, Inc.: And I guess if you were to comply with the NRC task force recommendations, do you have any type of dollar cost estimate as to how much you would need to spend particularly at Unit 2?

The industry is generally not going there yet as I have followed what other companies have said. And I think that that's probably the prudent thing to do. We want to work with the NRC's process, we obviously have digested the 90-day report and are hopeful that we get into a process with industry input and like everyone else, we want these plans to be as safe as possible and to learn the lessons from Fukushima as best they can. I think we have a high level of confidence that these plants are safe and that we also have confidence that they can get better. And so by virtue of working through this, I think we're going to find that there are some cost associated with these sites. Probably unlike 9/11 a little bit more on the capital side as opposed to O&M. But that most people in the industry feel that this is going to be manageable from an aggregate cost standpoint. Paul Fremont - Jefferies & Company, Inc.: And again, I mean, just to sort of generally get a sense of -- I mean, are we talking single-digit millions, are we talking tens of millions, hundreds of millions. I mean, just so that people can get an idea potentially as to how high these costs could go.

Yes, again I don't -- I think it's certainly that the best way to describe it is some degree of confidence that it's manageable within our CapEx budgets and that there will be some incremental cost but not to put a number on it yet. Paul Fremont - Jefferies & Company, Inc.: And then my last question is, have you thought about at all, the likelihood of new plant in New Jersey clearing next year's auction under the New Jersey power plant law and what that would do to wholesale markets in the east if one of those plants were to clear?

Paul, this is Jack. We obviously, PJM and FERC have had meaningful input in how that plant will be bid in from a capacity standpoint. Clearly, it's a constrained zone, and it's something that we have to factor in no different than how as we serve load in New York City. We've had to factor in new plant additions in that in that in-city zone and what happened to capacity prices there. So, obviously, we do factor it into our results and how we forecast, how we're going to serve load and we watch this very carefully and have active participation in both the legislative process but as well as the regulatory process and trying to influence outcomes.

You're last question comes from Julien Dumoulin-Smith, UBS.

Just a last quick question here on the discussion around the new acquisitions. Just -- you've mentioned the accretion, is that more driven by cost this year that are going to fall off or is that more driven by an anticipation to really grow those businesses from a volume/customer perspective? And then within that, what are your volumes/customer expectations for that business if you can share that?

So it's really 2 things. One, it's the integration expense and two, it's the accounting. You have to fair value the expected life and value of a customer and then that is hung up on the balance sheet and amortized in over the expected period. As that rolls off, in '11 and '12 both the integration expense as well as the preponderance of the customer value are complete by 2013. That said, we do see meaningful opportunity to grow that residential business as well as achieve incremental operating synergies. So we're quite excited about these acquisitions and looking forward to seeing how we can really crack the residential market in a big way.

So maybe just to clarify that, those accretion numbers don't necessarily embed any material growth of those businesses from a volume or customers perspective?

We have pretty conservative assumptions around our expectations on how we'll grow the business in our plan. That said, obviously, we're going to be working very diligently to try and grow and exceed those estimates and it will be exciting to see once we integrate with the Exelon fleet how we can really meaningfully move that business forward.

Thank you all for joining us today and when we meet one quarter from now, we'll have, I presume lots of merger and approval type of things to talk about. So we'll look forward to talking to you then. Thank you. [Audio Gap]

This does conclude today's conference. Thank you for attending. You may disconnect at this time.