The companies face market risk from commodity price fluctuations, counterparty credit risk in energy markets, and interest rate risk from refinancing maturing debt. Regulatory proceedings, including rate cases and audits, pose risks of unfavorable outcomes, potentially leading to lower revenues or increased costs. Environmental remediation costs are also a significant risk, with uncertainty about future liabilities. Changes in economic conditions and credit markets could also negatively impact the companies' access to capital.
Financial Upside
Favorable weather conditions can increase energy demand and revenues. Rate increases approved in regulatory proceedings can boost revenues. Successful completion of multi-year rate plans and the recovery of regulatory assets can also contribute to increased income. Securing funding from government programs like the IIJA could provide additional investment opportunities. Exelon's ATM program offers potential for capital raising.
