ML20070L698

Baltimore Gas & Electric Annual Rept,1990

ML20070L698
Person / Time
Site:	Calvert Cliffs
Issue date:	12/31/1990
From:	Ringsdorf J BALTIMORE GAS & ELECTRIC CO.
To:	NRC OFFICE OF INFORMATION RESOURCES MANAGEMENT (IRM)
References
NUDOCS 9103200173
Download: ML20070L698 (57)

Text

_ _ _ _ _ _ _ _ _ _ _ _ _ _ - - - _ _ _, _ _ _ _ _ _ _ _.

l+

14.-

I

/- # ALTlyORE

.I OASAND

- ELECTRIC

. CHARLES CENTER

• P.O. DOX 1475

• BALTIMORE. MARYLAND 2120 1 1475 ACCOUNTING DEPARTWENT Marc;i 15, 1991 4

-U.--S. Nuclear Regulatory Commission Attnt-Document Control Desk d

Washington,-DC 20555'

' Gentlemen:

In accordanceywith the requirements of 10 CFR 50.71

.(b), and-10 CFRj50.4 enclosed please find a copy of the

Baltimore Gas and Electric ~ Company's.1990 Annual'Roport to its shareholders.

Very;trul youro..

/,

'{.ht44 L' J. ~ E. Rinc}cdorf[, J Supervisor!

Financial Reporting

-_cc :

R.

E. Nagel-B. R Watkins

'-E. P.-Wilson 9103200173 901231 PDR ADOCK 05000317

$ [] /

i PDR l j

=

n-n

~ ~ -.

O

. s.l

-. ;,e

+

'e

- ; v_. t,..*t.,:.

.a

[~,

I

• l

.,;:N s b ' _ '. ' ' -

<T

.s

(_

.sl

'3

. (,.

h... e.

• '&;/'

,l.

,,. ~...

4...

/. y,,,. ;. C :./.,..

• = -

r

- ' ;l i'

• 4 l {' i

. f 7.',.... c.S

' 'y :

,aj

.y J.,.,'

' ~-

}:f )}p " 4;:.: ;. 9{ } 9. z.,..

A ' f,

'c

,* y~_,,-'

...=;

- a

. e.

g;-

-,v

,r 7 _.. _

y;..

s D

. J.

,n,}'.,,^;..,., H i P

4..

.h.

- ( _ ll, I.-

t E.-

,c

-},.

[,.

,* 1,

?

-7.

. -g i

.'y'

,,.4 i...i

~. *.

.a-J.

i.t -;-

?.

• g...-

se p

.; f.

}t.} }.'. ;;;

T-

..s...

q.

~

Q '._ _ ',". :

..J.

[ :-

(.}

_~.

?. :* '. ) '..,,.:..<.

). ' } " '

'_ ' : 2

1, M.

.[ Q

- ;f.,,. '

• 3..;,

,.,. 9,( ',. L

• 1,.

,,: f,'.....i n; y +,.+:

9

.','.J';

ll *,f M.'sg -,. : ~.,,

+

^,

.}

.<.,"'.;.dl. N?, %.... '

'.n g-d ; hl....y....

.. e

.ys f, ag.,. ' ' ;.

o.

s

,?

- = -. i v.,. 7 y.,,.

ei c.

c:. ;.,..: '

4 p +M9. "

i.

i l

l

,e

' 4 A. ; L" hfS( *, h;l.l,,. h: ;.,.

["..

.-[

\\: [?

• " ~

j

'l'

, '7

-l

.k? '..I

. +)r

-[

(.'h,.*

"s j

q - hq.,

(,. f

';y

. 'i.

p,-

l Jf

,/. -

?. ' a,Jq q ;? q,1

,w

'l

[4 Q '

.f'~f.t l'

' l

• y.

L

._... ?,: : _'.

'*[ 17'

. ~ ;.9. '

h...* ' '

J'

.. v's a$s%.. p. ht

' ?.,' _l uQ ;) ' 4 *L $

• A N,.

• f' '

W

?

j..,',,,.=t

., 'e.

• (

c;.:

y4, d Q' P

l(

. /+ ~.

~.,

.n :,

}

• _ - 9 } _. *.

4 p ;..

..y

,f,

. :l 5

}.,

. [ G f,,*,,' Q ; p y L'.;;.( (; j.', ;- _

'y '; ; _

y..s

• ~

'c,

' ' ' '.,,t#

'.,.'c q.' i

4..(i r

q', a. i f

..e

- / ;,-. -

4

.,[,'.

t

),

. \\

h. /, '* g ', '  :: ',

. *if

.-,g.-

. wie 3

j,,.

s.

fi.

'. ' y[... * '

,p. ',. <\\ }. ..,

'E 4-y p l I

l. ',s a.

,*,i.c-1.

[,.. :y -

.,,f*

g

-.i,

.,e g..

j f '[ ;f, g.-

+

g,.

..- 4 1*f ', 4;{.[:,' ?

" i

~*

?- a.wg gg 4

"3 l Y ~'

' f,

' ' j.'

'^

y' ; ::.

.,.1p n,.4. :. 'y Qf R f y,,

7.

i

. A.,. fg... -,...#

_.- s,.

g a ', m

,s a.

... e fg.n

... u.4,. c. Y

.e..n v:

c... -

y.8 n.

)

c.

a.,,

e u,h :,.

s un

..*\\

t

.'e.-

?

w.e s

'[.

l. '

l' f

,.[.,..

. l i.

'^

i, w +.

( _... _

-.R )Q '}..l**

4, -}a,

,0 v

, ' 't '

...3 g

h, ;...,..

{l. ;

....y _

._-[. l [ j. f..

r y; [:'

l'.[.. l;.

f fQfj.hh.p]f+GShl[.

.n

. %f % m;g ; L :l ) n: & : } A w, h :Yyi 9.

kg c n. $. ( ? - l.:l -; % l h.'. }

j.

'.'

• b & -

a (.~

~

nl:&w.m.

l 4 M h Mll &

A.Q.

lf 7

)J.y...

7 m W R, s@ Q (., m,j

' f a

am x, ~h...,W,

,h,,.a h 'M N a.;? o; ;.

. _ n

. n _ h _'j [

h.,....y

. h..y.... ).

.s -.

(.k,.).,.,p4hk.,).u.

[-r,

[f.

,y,., t A.

,,,. h. '. -. s. 7

. u. 4 Q,..

,.. p... m.cc.

-g * <... ::..ye f i.

...y.;,,

e,

, at

.: 'o. / g., i. :..

...gs,

.s y...,

.c.

p.. g.

• . '. ~

p.,.:.tl.

n.

i'u.

. [',

'N ' [. <

.... l?'

[

T l

.q,'.; ;. y::.-

.l

... y[h -

- ^

ff, _ y c. o.a n& s&n. n./:,,0.:y ~... f. h.

y

.7l,h..

.?;

l:.if,,, f.;,1[I. : s... /)..s ;e.:.

f 2

.a.

'.,jQ Qfli[Y:p Y..., &::L..'.l..

~f.({.]

• G; plp, ;;.:W:..::4'{.

'z:b[ V'.

c.r,<:.[n.o l> &.j.

h,*i&:Q::.y j

% CH: y,...w Q.?.,911 hp; Q aWJM:..:i:n;67,:; s.%_ z. b.?.;; L g...% i : m & y.y

.. wn.., m.t.s. ac

. g., :.+ y:p\\g ; yJ: :,l.:

...c'..

v

...> x g p.

?::l 3:y

\\;;>

...y.

A-a l

CONTFNrs HIcHuaiITs x,s, aa, od nu,,, c.,,,y,,,,,a s.,,s,.,,,,,

Ae A

J 1

{ (in ruilhoniexcept per share amount 0 CORPop4Tt Peo LL j

399g g

.- t CouMON Sux1 Dur L*

Q*

- t Earnings Per Share

=CilAIRMAN's RtPonT Util.y Opera:iom...............

...... $ 1.92' 5 2.81 (31.7 %

to SilARulOLMRS lA Divenified Adivities,,

.18

...24 (25.6)%

It i

Total.,

5 2.10 5 3.05 (31.1)%

MNctu IMn, Dividends Declared Per Share...,,

. 5 2.10 5 2,075 1.2 %

Average Shares Outstanding..

- 82,4 80.0 3.0 %

,s 12' 8

Retun, on Average Common Equity....

8.4%

12.6 %

-lj Bo k Value Per Share-Yeat End..,

524.87-524.91

- (0.2)%

g.i m m is Market Price Per Share-Year End Close..

28 34 %

(18.8)%

. IN RmAntuTY e

~I2' t

! IN ANCI A1. D AI A.

~

A Revenues Tiit FIRsr 75 YEARS.

'1a Electric.,..

51,684 51,519 10.9 %

,I9 tt Cn..

373 412

- (9.3)% -

FINANCIAL CORITNT5 DiveniOrd Activities.

102 7) 39,2 %

Total..

52,159

$2,004 7.7 %

~

48

^

_7 Net income.......

5 213 5 276 (22.8)%

~ COP.PGRATE AND ~

Earnings Applicable to Common Suick.,......,..,, $ 173

$ 244 (29.I)%

UnuTY Onicins 3

Assets i+

Utility.......

55.669 55.149 10.1 ' %

~

49 i$

Diversified..

... E81

_E 24.5 %

BOARD Ol' DIRICIVRs To:cl..

56,710

$5.986 12.1 %

11-Utihty Construction Expenditures.......

..., 5 535 5 447 19.7 %

. go,

~

1-BC&E Investment in CONNT!!ATioN Constellation Companies...,,..

.., 5 253

$ 251 0.5 %

Sim$1 DIARIES

'A Unun SAtn. DuA

'3~1; Electric Sales-megawatthoun..

24.6 24.8 -

(0.7)%

.A SmRunoim.R 1

Gas Sales-dekatherms......

102.6 110.7 (7.3)%

INF0kMA110N

A

'Indudes a provision for pouible fuel cost disallowance and the etTecu of the accounting change for unbilled revenues.

a

.. t

>a o

Lt 5t t

os ouR covtn Anniversaries are a time for reflection on the past - nostalgia for "the good old days" makes m t

long for a time when life seemed simpler. But this bok into "BGNE's attic" reminds us how it sometimes diflicult it was to cook our food, dean our clothes and homes, and keep ounelves t

. warm. These artifacts represent attempts to inake life casier than it had been "in the good old

.y

,t days," Gas and electric appliances took the drudgery out of daily household chores. Many of

't~

' these items - gas space heaten, gas irons, refrigeraton, and stoves - were sold in BGRE's merchandisc stores over the years. The drawings, meten, and equipment were found in collec.

L J?

t tions throughout the Company. Some iterm are actually from our " attic." but many were lent for This npir uwprimed :

. the photograph by employees and customers. We hope you enjoy reminiscing in BGRE's artict a cculed key identifying these artifacts appean inside our back cover.

entirdy 6 ruyddpa r.

t t

tt Ac O.,

A

+

o A

a Ao r

p

+

9

^

4 9

+

+

6

+

i 0 ne hundred and snrno.-fiveyears ago - bef a

before n>en the completion o.fthe National Road connecting the i

East Coast to the Mst - artist, shoivman, entrepreneur and visionary, Rnnbrandt Peale, started the Gas Light Gunpany ofBaltimore t

A to light the st rets and homes ofthe cio: It tuas thefirst gas utility in the a

Nn: World, and ur are its direct descendant. Afier inyears, ourgas t

business is stilloffering our customers innovative options to improve their f

lives. Our chctric side, although the dominant element today, is a rebuitr nnecomer to our story.

g

~

6 Longpmiliarig has robbed enngy ofits toonder in.,'>e eyes ofits a

consumers, but not in ours. As urplan corporate strategiesJbr the decade f rin van m1mni-

• 3 "" ' ' ' "" '

ahead, we dream oftechnological marvelsfor the century tofidhnu - and know that one day, we willbuild them.

V, uw"nm. Ran**or Vnn l8 ui nu nnu a etmuc nnioNnaanOstn A Gb t tGil nNG IN lhlTI-s

)

I d MOiR Ai til5 MU51UM ON i

1

$ ID111DA\\ $110lT - THE i 0114 5I IWilDINt. IN lill g,

4 V !Si thN lil MIM'HUR ks CONSTHUCIFO 5N13f M1A11Y y

s u

.. As unnumux

' g.

(

V,1-j' * " *..

Q

[ IUNL NM. m YMN q,f j g, f i n & nu,x n.

g

'g

• 3- '

e nOxme c~ununr C

A-Ge EIKH1)C lkOf f.AND 5

Pa)TI R CO\\lPANi - TN g.I; e g;

4 unua sAsu orac e.-

4 4

( ruero A suuums nw A

'Jit COMMt.MOKAllM. Till O

A (VE N~l. Tlih MM PitOlO' op.p. a, '4 g.? g' '

A Ga Am, PAgr Or_A con tc.

e

<, w, g e w,e, 1 o _ normn, s

g,, g f. 3. %.

. 4

. emu uma-m m

2 nAcs-mmNum g

Y A

hhWIMt r;Ull:RI CetiM

. oo mm mou -m i

^

A A

I

^

+

1

ColwonNot Pn6nur

]altimore Gas and Electric Company is an investor-owned company that i

. Jcombines its core utility business with diversi6ed non-utility operations. As the Brst gas utility and one of the first electric utilities in the United States, we have a long tradition of superior service and reliability, Our utility strategy for the future focuses on maintaining both that tradition and our position as one of the lowest-cost producers in the mid-Atlantic region. Our diversi6ed activities, under the direction of Constellation Holdings, are designed to provide meaningful carnings support to the Company while allowing us to take advantage of new business opportunities that use our expertise and experience. Constellation Holdings holds the stock of three companies that are involved in power generation projects, real estate development, senior living and heahh care, and investments and financial services.

BNG, Inc., another wholly owned subsidiary of the Company, invests in natural gas reserves and obtains gas frorn nontraditional sources.

The Company and its wholly owned subsidiaries have over 9,000 employees.

[

, m_ im _ _

q ARu imwna lun tuolu

<c i

.j

~

p s.

CirY ann Al1 OR PAR 1 of

• • • Ob d4% S,.

3 X[e.

-h

.) r$'

, [,

-(

N!Nr ClNTHA1 MrkitANn cnusursmo e suun n

m w

h

( kb d

kN.

?

p gg g

malls 2,K0 NQUARI Mit t A

' f kiU '

k'd h

-A Nd b wf d.;.-

a

1. f ). ((h. -hjhgm,'

- b s3 WITH 1,.671Um Rt.slDDn %

f. ' g.m. g,7+%g@ 1d,s

()f a

h a; unn nuAxu nvn, T.t eix

. w f n {,.w > +,a% m:rcs *u' wv.

1

,e' VT1H gas INCt Upt s 6:5 l*'

a hQUAEL MH (S WIIH A Q."

• g#

'**] { _

lorul AitoN 01-1 A8s,w.a

/,.

%,] P zp.

> i ygg-t/[

g e

.c,%. Ah,).

II-p

• g-4.,g n

-g yd..

K,%

qwo.

g' p, p,f, lps-(

p,.o 4 7-et

%f s

s;

'M, ry v,^4 -

Q f;3 O ;, E.?

.+

x rk; ' i' yLy L'?

y y g W.s,....

g,,71 ;[,

2

I I-I Urum On uxrtoss Baltimore Gus and Eletric Company i -

G6 Eucnuc 2

the lowest cost electricity generated by BGNE. We also maintain shared ownership of three generating facilities in Pennsylvania:

e j

l f<' -

two minemouth plants and Safe llador Water Power Corpora-tion. a pmducer of hydmelectric power, In addition, we belong to the Pennsylvania-New Jersey Maryland Interconnection that 6,'

alTords us access to pooled capacity on favorable terms.

• • (

We meet virtually all our customers' gas requirements through l

purchases from pipeline uppliers and natural gas pnxlucers. As a l

entral Marylad enjoys a divene economy that provides a supplement to this supply of natural ga we maintain facilities at l

broad base for our bminess. To serve its electric needs, three plants in Central Maryland for the pmduction and storage

{

BC&E operates to electric generating plants in Central Marylandc ofliquified natural ga substitute natural gas, and propane.

l

- including the Calvert Clitis Nuclear Power Plant, which pmduces Other business includes the sale of gas and electric appliances.

?

Di\\TR$1FIEn Acrivtrlis Const.-llation Holdings ENEncy AND

- Ihat Es1 A t t INva IMt N n ENVIRONMf NI Al-y

-w y

u

.g ye j#nj ranging from completed ofIice buildings and shopping

{, -

-r E

centers to land auemblages will provide a blend of on-O F

going rental income as well as gains on future sales.

b Our Real Estate Group is also involved in pmjects g

associated specifically with the rapidly gmwing over-65 4.pp f

, - J.M segment of our population. Theough joint ventures, we g

j ;gg{.,

• have brought our financial strength and stability to the senior-living and health-care market. I camed with a j'

"'he operating companies in the Constellation group focus on nationally known provider of health. care services, we own five four major business lines. Through our ownership position in nursing homes and two retirement communities.

4 power generation projects and involvement in i8 contracts for Our positions in invenments and financial services let us l

operations and maintenance services, we are not only pmducing blend current income with the long term capital appreciation-

. current income but are also gaining valuable experience in the type projects in our other business lines to pnxluce the desired wholesale power generation market, total corporate result. The bioadly diversified investment l

Our a real estate projects aie heavuy concentrated within portfolio provides year-to-year eme inmme for all the mid. Atlantic region. This gmwing and diversified portfolio Constellation activities.

l l

l r

CilAlllMAN'S RE' PORT TO SilAREHOI.DERS

+

I f

ihe past year proved to be as difDeuh as we thought it would be, and our financial performance reflects that characterization. Our i990 resuhs were in0uenced by factors that are largely short term in nature, rather than i

fundamental changes in out business. Foremost were the unavailability of our Calvert Cliffs Nuclear Power Plant (br most of the year and the resulting higher fuel and energy costs incurred by the Company. At the same time, we significantly increased our resources at Calvert Cliffs to assure its safe and eflicient long-term

[

operation. The downturn in the economy depressed growth in our diversified busi-I nesses and, along with warmer-than-normal temperatures during the heating season, L

halted the growth in electric and gas sales experienced during recent years. Most of l

these conditions were neither unanticipated nor unmanageable. We had expected that 1989 and 1990 would be difficult years.

u! mum -

p Consolidated earnings were ss.io per share, a 3i%

decline from 19 9. Utility operations contributed $192, 8

ar.2mma misam an s.8 decrease from the previous year, while diversified geWi 1

9 business activities added sa8, a s.o6 decline. The floard l,

of Directors has maintained the common stock dividends p

at the annual rate of suo per share, This is the 8ist l

J consecutive year of uninterrupted cash dividends on our

.r commaa shares.

l In the 1990 financial results, we established a sn million provision for a possible fuel cost disallowance u

associated with the Calvert Cliffs Nuclear Power Plant.

m This provision reduced 1990 net income by s.28 per 3 -

common share. The action was taken as a result ofour

. l'..

concerns that the Public Service Commission of Mary-Gionut v. McGowa Gairman ofr6< Bwd land (PSC) may not allow recovery of the full amount of replacement energy cost -

av/onf&amiuottiur related to 'the Calvert Cliffs outages. The latest indication was the view expressed in the PSC's December 1990 base-rate order that some of the Unit i work conducted during ig89-r990 was avoidable. While we disagree with the Commission's conclu-I sion with respect to that work, we determined the prudent course of action was to set up a reserve in the event a part of the replacement energy cost is subsequently 4

t

~

"The moderniunion ofCah,ert Cli[Js, the expansion ofourgas business, and the installation o[our new customer information enm])nter system represent investments in service and reliability that will produce resuhs in the decades ahead. "

)

t It W M H li)\\ l) () (: \\\\

disallowed. Also in 1990, we changed our revenue recognition policy to

% y g, n m, ;,.

provide for the accrual of revenue for utility service rendered but not yet uwm won m n o s billed to customers as of the end of each month. This change, which j

conforms with the predominant practice within the utility industry, increased earnings approximately 5 3 per common share.

8 Electric sales for i990 decreased by i%, re0ccting the effects of mihl wmter weather and a reduction in usage by our largest industriil customer. The rate of growth in electric residential sales <lackened, mirroring a decline in home building. which had increased dramatically during the lauer half of

... ;.' /

the '80s. Although we are successfully expanding our gas market, total 1990 gas sales for the year j

E declined 7% for similar reasons.

i s.

,6 Constellation's growth, too, has been slower w

~

than we originally anticipated, since economic h{h

,O., %f...

lc ne conditions have inhibited the sale of several s

3..

?

mature real estate projects and depressed the Y

N earnings ofirrGnancial investments. Constella-

i. *

(

tion's Energy Group, however, has had a busy

'3,.

3

,g=

W and productive year. Constellation will focus k

A

.n.

i' more on the power generation business for the long term. It is, after all, our business, and

/ -

i 917 /

~

"[

Constellation's acuvities form a strong j

1.

'E Complement to those of otir cnre utility.

~~

~'

lwvt ll,t !!lt:

Certainly, our short. term results have been disappointing. Ilut, just as certainly, g.

g, after 17$ years in this business, we're not here for the short run. The modernization tsam/na Nm f.nazim o

of Calvert Clifts, the expansion of our gas business, and the installation of our C"*

• Iil'""" * -

nwasma,w?in nv.si new customer information computer system represent investments in service and g g reliability that will produce resuhs in the decades ahead. You can read more about Isnu m as a s these projects later in this report.

$"l""j$.

s

ir lwristont's wusiis While 1991 - our 175th anniversary -

w H a s be a demanding yeat we do h

tc t

M,un Asris Ntw Catuo.

expect improvement in operations and iIN r earnings. Calvert CliEs again should be i i urn-stoiu oiuom nu sui our largest producer of electricity. We'll oIt N also be receiving additional revenue from so a

ow-im. im sr,ueu mu the s77 million annual base-rate increase 5

- crsrxxrt Ax tenuur" authorized in December by the Public y" -

st6 unnox ANwau y IN "1

Service Commission of Maryland, as well Nrw a nsoulc cRonn.

as om esI24 m n.ne-ra e ncrease AT Cu vrx t Ctn rs Nua tan

.Porrn Ptasr su r1v n von that will become efTective in June. This nau coscogs is t" latter increase Provides rate recognition for nuxa wr on Ika a uen.

our investment and operating expenses at sicus cmens as to. Tac os a vam mront wonuso the 6 0-megawatt Brandon Shores Unit 2, 4

osarrmwuuuuartu.

Tur nuun n tur or A which will produce annual fuel savings of smtsi To rauim wm more than 550 million. In addition, the PSC authorized the Company to apply for BEroRt IT RtAtitrS Tur a sso million surcharge efTective October 1991 to recover contractual capacity

'sTusi a steron.

purchases beginning at that time.

- M

~

We're pleased that the PSC recognized our future capacity

~.. '

. needs and the prudence of the Brandon Shores plant. But we 6

are concerned with the long-range implications of the decision.

/

m, to deny cost recovery of certain nuclear operating and mainte-F {i -

nance expenses. These costs were required for safecy improve-

.f ments and normal maintenance. We believe it is important to s.

receive proper ru recognition on these items, and we've t

~

• asked the PSC for a rehearing on these issues.

M'Q'.

I'd like to take some time now to tell you about Calvert f ^ 'i 1-Cliffs. Many of you, I know, have questions about the events

- 1 i*

of the past two years. Unit 1 operated briefly in April and

,y finally went back in normal service in October 1990. We expect 3

'N -

('

Unit 2 back on-line in the first quarter of this year. This will

. j f complete Calvert Cliffs' return to normal production levels.

s, 6

u

4 The question on most peopin minds is, "Why have the units been off-lire for so long?" The short answer is safety. In the nuclear power industry, safety must be considered in everything we do. In May 1989, during a normal refueling outage, we discovered evidence ofleakage from a wmponent of Unit 2's reactor coolant system - the pressurirer. This system is a key line of defense in nuclear safety. We had to find out if there was a similar problem on Unit 1, and so we shut it down the following day, May 6,19 9. We determined fairly quickly that there was no 8

immediate evidence ofleakage on Unit t, a3 4 Remember that Calvert Cliffs is our lowest-cost P

- T-source of generation. We wanted to get it back on.

!~v line as soon as possible, but we had to understand Y

-1 why we had leaks on Unit 2 and not on Unit i 1 ~

+

I.k

.,[

~

when the designs were identical. Safety was the 4

paramount issue. Consequenth, we began an

~

A

- t *!R

g exhaustive analysis to answer that question.

( e.,.

6

-: v

_,. I We also decided to make efficient use of the c

n'

/:

4,

..~

"9 '

downtime by doing dditional inspections, as well

,.q V, k

rb p

j as repair and modification work, jobs that could A

c'.

N a

a not be done while the units were operating. In the c

t.i '

w, process, we discovered other problems, and we stoaua usu wn ewts dealt with them -in spite of the fact that the work extended the already lengthy wvrusm m nuo outage into 199o. Again, safety was the main consideration.

y "WDW m t" w i lRlM %Q'lPint Al WR Complicating the issue was the fact that we knew we had to shut down Unit t in gxy c ymm yn m the spring ofi990 to conduct some required periodic surveillance tests and safety Nmu a a un is itu Hi s t M is ! PLu AN INUki Ab inspections. Many inspection intervals are based on calendar time, not necessarily ist.mmonuvr unu is os operating time. We seriously considered combining the outages, but we decided ate a un '9m l'=

m eno wmx un courm there was one important reason to get Unit i back on-line and operate it for as long m yy m,o u osvu w>x as possible before the inspection outage. Having been ofi-line for so long with m a tw CraiN" G sHDI Ni HAD M RY1 f) As A gas major work accomplished, the unit needed a trial period of opera-um u ww. emt us 1 S, tion to identify other problem un M m9"" =

operation. That's why we decided to bring the unit on-line temim aexusannu 4-7

i IWAN! U L% Hu tN briefly. As events unfolded, we were only able to operate it for a few days in April before the surveillance outage j

began. During the surveillance and testiny. outage, we also s.

did unplanc.ed work on systems that had remained in service during the earlier shutdo,vn. As before, when we discovered new problems, we had to deal with them. Unit i returned to service in October.

While this activity was going on with Unit i, we were also

,ym c%

"M repairing the pressuriier sleeves that had caused leakage in mm,i Unit 2. We had determined that the cause of the problem was a fabrication technique that had only been used in Unit 2. Once we understood the cause, we designed the repair process.

Ahhough the iob was lengthy and complicated, the process went smoothly, and the repair was completed in July 1990. Since then we have been performing mantenance and safety corrections on Unit 2 similar to the work that we did earlier on Unit i. Near the end of1990, we completed refueling on Unit 2, and it should be generating full power in the nor future.

That is why the plant has been out of service for so long. As the licensee, the Company - not its regulators - is ultimately responsible for safety, and the modifications we've made over the past two years as well as the ongoing maintenance program Tuc M Asmurn um will keep Calvert Cliffs running safely and productively for croun mou ncuiry" many years to come.1.ater in this report, I hope you'll read about the modernization ItKAITD IN CAI HORNIA.

cownuAnnN F3n nuy of the management systems at Calvert Cliffs that has been a parallel effort to our n: 4 nro uan cnurr 1,,ork on the physical plant, amrs na st avia ota Wa AhD MWHAWD AN The American energy industry is moving in a number of exciting directions.

en nun is m nwnw Competition in the bulk power market and the expansion of non-utility generators ncmanomn em.

serve to increase the options for all of us. As we pursue those options in an effort to supply the energy needs of our territory, we have to answer several basic questions facing our industry: How do we produce and market energy in an environmentally conscious world? What will the fuels of the futur" be? And who is going to build the 8

"... certainly, after 1yS years in this business, we're not herefor the short run "

plants of the future? Our planning in the past and the work we accomplished this year put us in an excellent position to deal with those issues.

l'erhaps the most encouraging indicators of our future are the people who work for BG&l' today. A recent survey indicated that the overwhelming majority of our people feel pers mily responsible for helping the Company w

J operate safely and productively. That kind of commitment

, i translates into quality service for our customers, and service is the bedrock of success.

/

We have good reason to celebrate our t75th anniversary and

[

look ihrward to the r.;ilestones ahead. This report marks the occasion by combining an illustrated time line that recalls key J

~

events in our corporate and community history with a discus-g sion of1990's strategic projects. As I look both to the past and

[

the future, I see a continuum of values: a beliefin managing

[

' - N p,

'. - ~

prudently while preparing for change, a commitment to serving our investors and our customers well, and a sense of caring about our employees and our community. Those f

values have supported our achievements for the better part r

E~

~~

of two centuries, and they are the foundation for many e

accomplishments to come.

Tiiisru n Oi naaNw m Sitoie Aid it i N ifi10 FROM ills DitL Dr UN[I A tu i TN il Y CO\\1G l 11 D liiGH-1 I f idl % ) ( Oi 3! IN I L Pu ! H, IINil T h sClli ICl t l) 10 BL

-.g,.,

mm - oo

- mu or om s

/

GEonct V. McGoWAN Chairman ofthe Board and ChiefExecutier Officer FEBRUAR'- 19 1991 f

9

~.

-~.

Y a.

e

'f,'

FINANCIAL REVIEW 1

EARNINGS j

Consolidated earnings per share for 199o were $2.io, a decline of 3t% from the 53.o5 earned in 1989. This decline resulted from lower earnings from both BG&E's utility businew and its diversified business activities. Earnings per share are summarized below:

1990 1989 Utility operations f........

si.92 s2.8 t DiversiGed activities.....

.18

.2

_4 Total..............

.................................. s 2.1o 5j.o5 The decline in the utility's i990 earnings was primarily

Earnings and Dividends Dedared the result of higher operations and maintenance expenses, Per Share of Common $ tot.k particularly at the Calvert Cliffs Nuclear Power Plant, higher fmancing costs, and the effects on sales ofleu favor.

8050 able weather as compared to last year. Also contributing to

- sten -

lower utility earnings were increased costs resulting from -

suo the purchase of additional generating capacity and from noo lower sales of high voltage transmission capability. Finally,

,no the 199o decline renects the recording of a provision for goo the possible disallowance of certain replacement energy

_ costs. The decrease in utility earnings was partially offset by the effect of the change in the Company's accounting policy Rir unbilled revenues.

i,si z ass ; ie i,s( i,as. i,s6 i987 i,8s i,s, i,,o.

Earnings from diversiGed' activities represent prirnarily.

umani runiop ron.ot;an d> -

the results of operations of Constellation Holdings. Inc.

o idena Ded'"d and its subsidiaries. The decline in Consteliation's 1990 n

T.arning (Consolidated) earnings was due to softness in the real cuate market and lower earnings from 6nancialinvestments.

nst stcy n4 son s2.so nn su7 sq7 nos suo

. DNidends Dalared During 1990. common stock dividends were declared su25 suo sq6 sus sus 75 nns na,5 nos no 5 suo

-at the quarterly rate of 52% cents per share, equivalent to an annual rate of stro per share, RATE MATTERS On December 17 199o, the Public Service Commission of Maryland (Maryland '

Commission) issued an order authorizing Baltimore Gas and Electric Company an agcYommon Equity immediate electric base rate increase of 577 million annually, equivalent to 4 7% of total electric revenues. In addition the Maryland Commission authorized a st24 million base rate increme to provide rate recognition for the Company's investment and operating

- expenses at the 6 o MW coal-Gred Brandon Shores Unit 2 upon that Unit's commercial L

4 operation in May 199t. This second increase in base rates will be accompanied by a reduction g.

in the fuel rate to redect the currently estimated $p million of expected annual fuel cost

' 80

-5 savings resulting from the commercial operation of Brandon Shores Unit 2. The Maryland Commission also authorized the Company to apply for a surcharge to base rates for approxi.

o "86 87 '988

89 '

rnately s50 million of purchased capacity costs heginning when the expenses are incurred

. Actual up &2% ruw u.s s.o IO

~_

9 o,-

Common Stock Market l' rite and Ikiok Value an-ua in October 199t. Based on the Company's financial performance at that time, the Maryland Commission has agreed to authorite the surcharge ifit determines that the

'"~ ~~-

Company would otherwise be unable to achieve its authoriied return, m.

PROVISION IUR PO21N L ITil Cost DisAROWANCL pg -

In its 1990 fmancial results, the Company established a 53s million pmvision, equivalent to 28e per share, for a ;mssible fuel cost disallowance awociated with its Calvert Cliffs Nuclear Power Plant. This action was taken as a result of concerns that the Maryland Commission n-may not allow the Company to recover all such costs resuiting from outages at the Calvert a

Cliffs Nuclear Power Plant. The latest indication was the view expressed in the Maryland iv u '9 7 iva i9av im 8

Commission's December i99o Base Rate Order that some of the work conducted at Unit i during 19 9999o we avoidable. While the Company disagrees with the Maryland Commis-8 M lha Value (Year isul)

'stons conclus,on with respect to that work,it determmed the prudent course of action was i

- to set up a reserve in the event a part of the replacement energy cost is subsequenth disal.

si,,L,,p,g, lowed. The Company has filed a request tbr rehearing of the Maryland Commission's bue snw u,m mw s e sa-

- rate decision regarding the Calvert Clifh issues.

iwot y,io,

'N"*

AccomuNa CHANGl During 199o, BGRE changed its utility revenue recognition policy to provide for the accrual htartet to twok Raiio of revenue for utility service rendered but unbilled as of the end of each month. Prior to i99o, utility revenues were recognized at the time customers' meters were read on a monthly buis. This change, which wu made to provide a better matching of revenues and expenses and to conform with the predominant practice within the utility industry, increased t990's earnings per comnion share by 3 cents.

{ti1i'buoion f.xpenditures 8

UrunT CONS'1 Rl'CI'lON EXI4NI)n t'RLN g

.g The utility's construction expendimres totaled 5535 million in i990, including ss3 million am in Allow:mce for Funds Used During Comtruction (AFC). Electric expenditures-

- primarily for construction of Brandon Shores Unit 2 and improvements to the transminion

- and distribution system - accounted for 54 1 million of the 1990 total. Gas expenditures 8

4*-

totaled s53 million.

y, It is currently estimated that the utility's 199i construction expenditures will amount to ss33 million, including s33 million in AFC.

""' ~ ~ ~ ^ ~

flNANCING

" " " ~ ' - ~ '

During 199o,long-term fmancings relating to utility operations consisted of saco million in o.

debt, s6s million of redeemable preference stock, and s87 million of common stock. During

" " 7 " "' '" Z.

the year, ss3 million oflong term debt and $7 million of redeemable preference stock were e c, retired. Standard & Poor's Corporation (S&P) and Moody's investors Service downgraded ung yc their ratings on BG&E's debt, preferred stock, and preference stock. S&P aho downgraded the Company's commercial paper fmm A-l+ to A 1, conuniainn Corporate long term horrowings by Constellation Holdings. Inc. increased by

"" "4 "' "" 48 2 ""

$$s million during t990.

^I'C m su un in mm Total nu im sn8 up sm sm

+

9 4

• l'at. rinsr_ i;5 viwns

$ INVESTMENTS IN REIIABillTY t

t e

t 3

u t

o

~

t t

f 9

n 1990, we invested heavily in the future: planning our electric supply for the A

1816 -

nud. and latter-90s, continuing the nmdernization of our Cahen Cliffs A,

e os jest u, RtunRAxoT-t Nuclear Power Plant, expanding and reinforcing our distribution and PLALE Dr.MONSlMllS

• Dil ^

i transmisstoli systemi broadening the scope ol our gas business, and strength-RING lu30T WITH GEM 5 Of a

t!GITI' AT.H!5 MUsi;UM IN 9 ening Constellation's involvement in power generation. The benefits of these

^

BArnMoRt. ON JuNr n, activities do not appear in 1990 results. Ours is a long-term business, and these PIAU AND WilllAM GwmN rORwnir cAs-t eff rts are intended to ensure that we can deliver in the next century the same A

llGHT COMPANY OF DALTl+ j reliable, quality service that has been our trademark for 175 years. The following

) uoRr. ON Just i9, MAY ij Wh a bme in dai%.

EDWARD JOHNSON slGNS -

A G1 Nt RAIING CAPACIIV IU

~THE oRD!NANCf GivlNG d CF y

p'754 c

- T HANdHlif AND A ;

'[ 9; ^

log 1 H[ '90s:

Tilt Nf 4 COMPANY A k

1" t

(,, A t yr g [ (-,,[ j g s q _ CONTRACr To UGf rr Tile sTRLT.TS OF BALTIMORE.

8 bor lilo5t of die paSt l$

A years, our Calvert Cliffs

[..)y(

A Nuclear Power Plant has sg.

been the heart of our

' %,a.8

e 4$

b

-3 3

't generation supply, and it

.rw w - 1 g

will continue to fill that

^

/

. c m#d>hv." d, O

h s

role well into the 2isi 1t128 -

A

{'

7

g century. F,or the past three CHARLE5 CARRol.L. A b*

4 i

+

years, weve been, volved

~

m l(

slGNER OF THI f

DECLARADON OF 2

in an overhaul of the managemeist systems and lNDE PENDENCL, lays *IHE tiklLW tiLD W LE! AND D processes that have been in use at the plant since its IuNNnHutTN( i A!u CORNERSTONE OF 1}{L A

uu n a m na i oo\\

stan-up in the mid 70s. This is a vital effort, ho RAnRoAD, rut A

o During the is. year period since the plant came on-

' nRsT ruauC RAa oPER^-

+

wnnouu m mnn nos iN AMERKM.

A map x; o r;q Gu i nair g

g g gg coum ornuwouuno evolved from an emphasis on results to an 186o 9 u m A. m m w. < si o i m

$ "n"e m^""n's^w"u" ?roa s emphasis on operational processes. Each f

Tiit MARviANo Ltcrsta; s

TURF CllARTERS A RIVAL A

new plant was requjred to operate under g

y,g,;g,;y g g b=

g % gg-y g g.g gp GA3 COMPANY' h oPlfs A

the latest requirements when it was first G4s LicuT COMPANY.

^

a m um o n o w :no J

^

placed in service.130th we and the 186:

Nuclear Regulatory Commission (NRC)

L THE AMtRuaN Civa WAR ntcrNs Arn R Tilt CONrup I tu > w o o

(.

ERACYllRrs oNI? ORT A

l SUND ER ON APRi!. IL A

g7 A

A

-_----7---

^

A

^

1865

.s U.s. Cn u WAR 1 NDs.

A mv. lwa s, num

^

1871

^

Tur Go lacin CoueANy A

01 lhLllMoRf AGRiis To A

OlvlDL Tut CITY 41Til Tut recognized that we had to upgrade our methods of

^

PloroS Ge lacul doing work at Calvert Clifts to meet current expecta-couPANv.

,s h

tions. Our strategy for the modernization is described in a docu-

^

mCut Called "Calvert Cliff 5 Performance Improvement Plan, which we submitted 38 9 7

to the NRC in 19 9. We've completed about half of that plan, and the NRr 8

a TnouovuonoN A

continues to monitor our progress. We've also encouraged an atmosphere of succusi vuv This Tm a

I1RsT Cut'MI RCIAllY twsC-intense self-assessment at the plant - an attitude more important than ever.

^

m A llCA1 INCANDEM LN! LAM.

today's nuclear environment. This is a long-term efTort, and safety remains our 1880 81 a

uppermost concern.

^

lutTmont's c u courma s

'/

I NI w GENI RA11NG p

AR1, 40 RC.LO To I 0U,1 l ut

^

Cons oaxtu>Gu A

(AP\\ CITY A

COMPA'ty. Tur Gud HRST u l CTRIC CoMPAMt s, UkUsn Central Maryland is one

~

~ -

.m A

y==== W,..

i F.u cnuc Ucon,.osu ANY e

of many areas in the

. '. I Q

A AND h 3: UNn1DS1 sus 3

4 f F.uenue uuur ANo country that will need

.~

i3

^ PO41 R Cshti ANr APPTAR 3dditional generating

'],

j i DN TnE sLENE.

i" y]-

A yr s.

A capacity in the near j

i V

future. Our Integrated

\\

1898 4

A Resource Plan, a is-year f.y m.~ M"M W Y,j h, b N ' N " Shf Y ^

S""""'^""'~""

3i SurRrut court notns

, ~..

' " " { : i 4 4 ASHER. i i ')"

i TusT Tut CoNsTrrtrnow strategy detailing the best 0

e.

w >-

combination of resources

~ * "*a 4 g n

A mmus RrumATons To

^ Au OW A "I' AIR RI TURN"

%i mi,ss e s w ( i iu n s to meet projected energy requirements, provides

^

onm vm or TmNc.s combination of demandide-management and conser-

^

o aum a,-

tuet ort n (N,nr cuenc vation programs, new plants, and purchased power to

[' ( j

{

I WN""

meet that need. Later this spring. Brandon Shores

^

m m n m um u Unit 2, a 6 o-megawatt coal-fired plant, will beg.n I [J,

^

4 no u.sc e

,e operation. We've implemented new demand-side t

^

m,y

,om-A programs, such as cool storage, radio-controlled water-

' f t" ln=

m[

m n, heater switches, and standard time-of-use rates for new wt mo%

^

wn

" "* *"*" i*

f~"" " "'""#* " "

residential customers, in addition to an aggressive iuuia>.mo s

4 i

i9o4 conservation plan described later in this report. The

^

s.m Tut GarAT thiTiMoRE FIRI flexibih.ty of our purchased-powe r agreement with o

A Pennsylvania Power & Light Company will permit us to

.,,Lc,ys gy g, gy sy <yg,

^

Rum oon) s rRn T. 86 cnv l\\1oCKS t)N 140 ACRIs ARL I NTIRI 1 Y DDTRoYED.

I3 m

A

t t

t ipo6 A

' COMPANY hitAlt} not DLRs RAT 11Y AN AGRrrMfWTlo.

A

..l-oRM A FUtlY IN11GRAT1D g

gas AND ttrCTRIC siRVICL t

CE*lORAlloN To BL KNoTN As Tilt CoNsou-t twsT.o G As EucrRic t

schedule the addition of Ne n

4 9'

A IJGirl AND Pow!R 1

our planned. loo-MW i-e coutANY or furnMoRt.

4 cT-t combined cycle units at 0

^

A 1910 f

Perryman around the 4

Tilt Pusuc SLRvict -

t effects of these dertiarid-

,t side programs. I.he couunyoN or M ARY1AND li CRIATED.

t objective of our Af Integrated Resource Rg^

Plan is simply this: to r

A r

develop the lowest cost

'g -

q reliable power supply ggy4 QJ N'N

^

f for our territory.

3

,y g, i

silOM O t \\1 i n H 11M M1 '

j COMI' LYING WIIil 'llli Cli AN AIR ACI Ol 1990

.l,utNrw1.r m croN sn i al i gnmi xi to ini r In the next decade, IlG&E's fuel mix for electric un u no nu un a m

^

BUlullNG BFCoML511:L A

g, g 3, g

g gerieration will he approxiniately.63% iiuclear,52%

courANY ntAnovantrRs:

1inis n inwao n m

. rr is now xNows As TnE t

coal, and 2% hydro, with the remainder a combination ou un m e a ny or on o

gas ann Eurnuc

^

n, en om ou u m f 11, gas, and mher niinor sources 'l.his mix not only Buiuiisc. ls Tut uit a

mos, itArnMoRr's uRiiAN t

. helps to insulate tis from volatility iii the stipply and ni n w s s n,, no on%

^

.ntmwAt etANs cruin price of fuel, it gives us greater flexibility in meeting Ton Tut pruouTioN or on umn s m som di nur uvr untorscs IN:

the requirements of the federal Clean Air Act of1990.

^

+

- Tm u AcRr nowmowN 1

Wive begun evaluating emission control options and AREA. Now A CirY uNt>

w rk.mg with state and federal agencies on the plams that may be alTected. Never-

' MARK, Tm GsE auttniNu wAs sana tor ris ARcui.

.1 theless, reducing sulfur dioxide and nitrogen oxide emissions to the new levels will TECTuRAt QUAttrL increase the price of electricity in the '90s and beyond.

^

t C )N SL RVA l l()N 3

[^

' f[y [t luiproVing air quality is only one aspect of environmental 1911 o

^

proteciton. linergy conservatiott is another global priority, d.

Tile COMPANY $tTs trS

^

h Our Gnm ma pgrani h a mnpank ngy to

. ioo.cooni ti.irTRic

• METER.

t Conserve energy. protect the elivliotilnenti and reduce our g

A 1917-1918 f

dependence on foreign oil by increasing the energy

^

UNrrt.D S TA r05 (NVotVLD 1

b du W Y h u "!'

\\'

IN WoRLD WAR I.

^

t i.;

A

/-

i

t t-t f' -

t t

t Hek A \\V.opre 1925 e

A 9

etliciency of our j Tin mumWmn e.

RAnio s1 ArioN, WilA).,

k. -

customers homes,

{ con gg.1Hr AIR. IN IM

~

.. go.,pf, '.#

' v.#% ;

oflices, factories, and

^ Hir COMPANY Tis rr To '

. f',(. ~

- My@.

'5

- - h t Aut RicAN itAnio Ni ws

j..j transportation. Our

w

'a' 1

~

4 CoRronATioN.

4 t

o k,,w thrust for 1991 Celltern t

'I y

- j

~ -

on a rebate program to k'93' 4.l

"- ypgr

• promote imtallation o{

f CONSoMDATI D ADns '

' '.,i '

? ("J.

? -

e0 CICIlt CommerCld!

A HYDRolll CrRICrlY lo ITs

-- A' GrNIMTioN MIX BY j {:. is r 'k 'j - lighting, cooling, and ' slGNING A THRrr-PARIT , ( ' f, g. E..'. ,._.Pr A .1 g gg heating systems along gA. sh TWO-THIRDS or THE o with energy-savitig t caraciTY ANo rNERcY e A bukidirig materials. We're IRoM llit SAIL HARBOR l.oDM,01 R ( hTIulF A. WAR R l'o41R COMPANY. Mtrinsio usi Munt xN also investigating higli-eRiciency custortier energy t y 7y, MATi RIM-n sND!!W. tWLKt I $~ g TRt'CD 1 t ) M AK! Olt ins i Al-a 1 5 tion to focusing on a Variety of developing gas applica. 8 (A{b)N DI tu!)-V O W illii I' 1m.uoasuns uniu u

• tions, particulariv in transportation and climate-control Cit N !. MUDLRN l

1R sWOMMI 84 Ri Du I systems. .t W

a. %

'IRANilOh\\uRCM!Ti(OWi o CONMRV) I UU Wils. Ep a nur nnuet un u unna DISTRIBUTION t. UNMTD STATM INVolVUi' I ^ Tmmmm .lN W RLD TAR 11, NLV U M R U LNG CAPM,rfy. 0.. To maintain reliable service to our u!- t i95o customers, we're expanding and reinforcing both our bulk R j THf COMPANY CoM1'LLTrN power transmission system and our distribution network. After

• 6 THE gas coNvinsioN i

WhTLION A PRoJLCT, i ULLY Rt PLACING years oflegal and regulatory delays, we are proceed, ig with the f MANuracTvRmcAswuH ma ci Oa i completion of the soo-Kv loop, which will increase our ability 9 NrTuxAt cAs. i A to import power to our service territory and provide additional transmission access 1 l 195o-1953 + to and from Calvert CliH's. The two segments of this project, jointly funded and t g UNiTro STAU$ INYoLVED constructed with neighboring Potomac Electric Power Company, are scheduled for g is gggt33 w3g, a 1994 completion. t in response to customer growth in the northern part ofour territory, we are '9f' upgrading our transmission system from us KV to 230 Kv. In 1990, we finished the $ THE TWEN1Y YEAR A PRoltcr To coNyt nr first of several phases of this Northern Ring project, in December, we energized the ,;'. DoWNroWN lhtTIMoRL first leg of the 23o Kv transmission lines to and from our Perryman plant. This utou THE onsotrTr oc $ SYSTEM To AC CURREKi'15 t coMeurito. 15 t t t

. - -.. ~ _ -. -. t t t A ,y e q_ '.A 1-p< o _]Q3J-. S.UE% uni 5 A a. AT1HE ANNUAL MEEUNG j ew april vr, DIE, [ CONsOIJDATED gas - i EtICTRIC IJGirr AND/ h phase also included construction of the Raphael Road switching station and the POW 1 R COMPANY OF A BALUMoRE is REN AMED 4 Otter Point masta substation in the rapidly gmwing Harford County area. These BALTIMORE gas AND t m jor additions will serve the northern and northeastern parts of our territory well E'ICIRic COMPANY. into the 21u century. Aoj We added five new substations and 1956 [' U - expanded capacity at live others in BGNEstGNs AcomRAcr 1 ~i 3* A'*," e A 4 Tnt SEVEN OTHER ELic-A. g6M' Q. 1990 to meet load growth on otir N 'I

1. 8E TRICnY DISTRIBUTORS TO A

F rORM Uit PowNsYt.vANiA. f- ~ . " ~ - 4 distribution system and maintain NEW JERSEY-M ARYLAND t reliable local supply. This pattern will g (P)M) IPTF.RCONNF(" TION, .8 E Y% I* - ONE OF THE WORLD'$ - 't / q i "/ O 3* LARGI,sT FUt.LY d %{" g tNTEGRAT ED I LECTRIC' a*

• o

.j ,t }sps Y 9 BG&E began as a gas company, and ROWER eoOts, i p gas is resummg a prominent role in our 1 g-y tf business. Several factors make gas an i 1957 A THE LAST. 1 attractive finel for the '90s: it is domes. P' UCally aVailable, competitively priced e SURVIVING GAS STREl'T A l' UGlff IN BALTIMORE is Compared with oil and coal, and is a

EXTINGUlsHED ON AUGUST $

iL N Clean fuel. o shw 14TH BY M AYOR 'I,HOMAs A D'ALESANDRO, J R. 'N IN UN ot D DML A G WMi n M For certain industrial customers, gas g a en n man o un o"4 has always been a preferred fuel, And the Clean Air Act 6 ^ wonu m aoor uns 19 4 5 IVh Mlill AI UI U I!M). of1990 provides a spur to develop new technologies to BG&E'S NEW CHARLLs A unu;ecoqnn w, broaden the applicabih.ty of gas beyond a.s trad..ioonal CENTER BUILDING is. ' 1 CMH o WI OWY :m m itses in heating and processing. High-elTiciency gas STARTED ON J ANUARY 20TH iool t (WT f Hr MO t to io Pi - AND OCCUPIED IN 1963. technologies play important roles in Conserve 200o. A Mh"MHUWU" " A - n n o, n. n o m n u w it, 6 h B " ' *"'m - n rm m Baltimore is a major non-attainment area for ozone-19 W N rehded pollution, where fleet vehicles will have to begin g ivr 4 con cm ne'- U.S. INVOLVED IN HOsTlu* A BES IN VIETNAM, operating on Clean-burning filel beIhre the end ofIbe 9 century. Our pilot programs with natural gas-fueled vans and buses will help _ 6 --19 7 prepare us for that eventuality. A BGNE ANNOUNCLs PLANS TO BUILD MARytAND's ? Gas ir c nditioning is elfective in large-scale A FIRsT NUCLIAR POWERED ] applications, and we promote it among oltr GENERATING PLAYr ON ITS [ CAlvERT CurFS sTIE, ' i I. n .Hi nis ABOUT 60 mites SOLTrH or 1 i 9 16 ^ A

a ta {; "?" A p-4* A' t $90s Wis tlNuln 4Si Do IMM i k i A industrial and commercial customers, llut advances in technology I A. Inay soot) make ga5 cooling systems an economical Choice Ihr rehj,

BullMoRl

. AT 'llth 11M1 4

• ^ Tlit TV o UNirs Rt PRI-dential Customers as Well. Both to expand our gas heating market and io prepare 1or

- u xrn> rnt u R a sT a yeareund business, we are extending our gas mains into growth areas. In addi-f sisou isvisuu si or m.,.

- PRIVAll CAtli At l'VI R tion, we are now using natural gas reu.-

A coMu n nr m. dentialinstallations that allow two j 6 pounds per square inch of pressure ^ '9 9 instead of the usual one-quarter 2 FiRsiurxtasoosTut 2 su>ow oN JuiY 20. pound. Using flexible copper tub.ing instead of the usual cumbersome pipe, A 197s - a two-day iristallation noW takes (Wo i UNO I of THt CAtVIRT hours. This considerah!c cost savings { Currs Nuctt AR l' owr R -- j l't ANT LNitRs St RVICt. 4 makes natural gas a more appealing a c. 2 Aso, m trs nRsr iuu ^ option for builders. During 1990, for TiaR or stRvicr, + example, we. installed natural gas in ss X PRonucts MoRtTitAs A 1 Ten onne coNU'ANY's. new home developments and added ( Torrt cixrRAnox, 4,500 new gas-heat customers. We i k"

• N" '"' ' "1 k^T E

^ - AniuvrMrsi enwot To expect our aggressive markenng to W

t. cUSToMLRS SY Mort result in a steady increase in customers,

'h,h t rnAs sso Miutos. + T n; 14ni ot T M o nitei 1 b CuslosuR SEnvicl-N"""I"^"'""""*"" fulikiW ilCHNR AU S l AR + CMVUIT Cuns dNrT 1 Reliability is as important in the cusmmer end of,our yox,mun ano.Hou- - f nms asrmma tuc. business as it is in the supply end. We've installed a new TRicrrY AT FUU POWtR. A$ ^ x, aim s iim 4 n am ui ti a-A Rnum cmTm Rs et b,ustomer information bystem - one of die most M.pso-g i un ;isu a y - u A. sophisticated computer systems ofits type in the i Piuci PtR wiowATTitouR; ""^**'"*'" N i Nt % (U WH M1' ' A hndustry - tbat gkves us Ykrdla [ ull nl Ie eX t[ } -s% M;\\ OpH, % Q1 k ' A k """"' and responsivene.ss to our customers, while lowering " " " ' " ^ " " " " t m 14 u in Ha s -V. l i M h in i - A labor and system maintcaanCe costs, This invesunent 4 i979

30. e mrummm 1

in quality service will support our growing needs BGN F. noNrtRrrnt for decades. j BArnuoRt Funfusnio HF tP low-INCoMr cUYloMtRs PAY TilttR CONS 1i!! AlloN 3 un finis Tilt PROGRAM A A DlfoMts A MontL f oR Emerging as a maior domestic company in the power generation business, g A our nu CoUNMY, ,7 ^ A

9 ,g-l t s

1. -

4 ?t t .198o / t .Hansonciaci ortus os Juth. A MRUToNF IN ~ Bumuoat'31ssrn-t

- HArdoh REDIVt-lorMLNT, 't

$ Constellation Energy will increas-A 8$ ingly focus on power supply in the k,- i coxvrRL5CT10N of THL A (~ '90s ConMellation holds positions -U". p-td t, . rmssios amur San t in 4 power p ams, wd td 1 5 capacity exceeding 700 megawatts. 8 y[

H Akiton nyDaot Lt.( rnic -

A nunct mass os @y io, Axo is couru.Ttn ^ These include biomass, solar, coal, 0- ,K os Arna n,ips. e 8 hydro, and geothermal plants. In M-3 4 1 addition, Constellation, mainly msmaemmff n ,y x n%4q [ 2g W :^ through partnerships, has 4 1 contracted to operate i8 power g -t plants, io of which are owned by T 4 e 2 other companies. +

39g4 Although several of Constellation 3 G,,,G g,,,, g,, 0,y y

. BRANDoS Sn*Okis 2 investments' holdings did not meet earnings expecta- - or Bu nuom ^No Hon 6 g, ,g ,g uans m 1990, several others exceeded our plan. O, verall, ^ Usir i A 6sw c6At-g og L aummc rtdricogts:

the subsidiary's diversi6ed investment program provided w s ha r i aum n u N1 w

. os.um, vinTurux one a wom n. nn uann n n } imp nant I.ntuid.ay and the maiority of. C,onstellan,on NATwo niit courasy's - ,,y,g, w ononucN on ! l 2 Holdings' net income, ur ouon nu vonm n ut m om ni imws Tnoue t Dun.ng i990, Constellan.on Real E. state made s. igm 6-gg gg, _,93g

cant progress on existing projects. It opened two high-ou Mn

nm. no 4 CoNstrugoN s n vi x 19 nu. u o nse oth buildings - Constellan.on C, entre and One

Hounsos n ionano os.j ce g

,g, J Axurny i.~

2 National Business Park - and two other buildings at Twnw - M os ma M

< oa n was or woon ce j N.inonal Business Park. Piney Orchard, a m.ixed use 3 1989L BC$Ennmrrsoxt-21 development ir. Anne Arundel County, opened last mmon> Bu uuom cov e ogn, n, n r gn y MIllIoNrH CUSTOMER year as we}. dh}mugh plans to sell selected real estate WM^t ~ g -1 suffered from a lack of market in 1990, we're confident a uunu nuunoi '~ that our d. i HI opn,n,u oNt e -s lit ct 19915 ij-j iversified portfolio of quality projects holds ,,,,,, y 4 Irrim sramc, Busnos - ; significant hene6ts for us as the Bahimore-Washington nu i u unu num or int ~ tuwmomuu-om - $ltonts UNif 2, A 64o-uw t real estate picture improves m coming years. y, g,, CoM.-HURNmG etANT, Wlu; # Constellation deahh Services Continued u m BuNnNanD. ENTER sERvlCr. t to expand selectively in the senior-living market. It added leases at its 4 1 two retirefliellt Centers arid purLhased ari iiiterest iri an additiorial 6 nursing home. a ( MM Y t. W I ! t i s ii 4 4o t 18 'A

8' A'_ 5 FINANCIAL CONTENTS t $ 20 Sales of dectricity Sales of Gas t U11ti1Y $ : OPIRATING stall $11CS Bbm of Kalcunivun MJbw eft 44.trivnm tI g _11 - a6 - no -- g SitICILD l'INANCIAL DNI A q ,,o 11 son.__ $ gg 10 - - - $ ggg3cg3gggy*h DISCttislON 9o. ^ it - - - - ,o, AND ANALY$l$ i6 - - t 16 70- ~ t. Rtgigy og: M AN AclatlNi - 6o-io.. 10 ' ~ ~ ~ ~ 26 3 40- ] RfPORT Ol' .e. so - L 1' INDI.PINDIRTAUDiluks 4 ao-a- 80 - A - ~CONsOllDATID - o ~ ~ ^ $986'i9 ~a9u a9 9 99o i9 6 i9p e9xa n9 9 i990 9 ~ I bIAllall E Of INCUhll 8 8 8 M Resi&ntial Re idential M Commenial M Commersial t ; CON 50llDATID -- and induivi.il and Indmirial A. lb.1ANCl; Silln$ t~3o-Residential _ Residential ,, a s

• 6 WI dm N8 *> o A

~ ~ - ~ ~ - 1 4 i 14 1 ) 1.1 4 b Toul To:al A 31' 97 4 lug ki)1 no ' am 6 21,2 IL6 4o 48 46 CONSOlIDATI,0 tj STATIAllNr5 Of COAthtON-t SilAntitut.DERs' Eqttr1T 32 -- 1 CON 50LIDA1TD STArulINTS 2 Dilling Degree Days - Billing Degree Days - Occtric l'eak Inad (One limr)

OF CAPITAllZATI'ON Cocang lican,ng Mmuuaan

$; bb 8N 0000 6.000- . $5-CON 50LIDATI D - ' STAtutLNTs Or Tdxts - soo.1-.ww.1_*_*_ a 4, 6co. _ tooo. 4 ^ 4ool 2,ooo. A '. IINANCIAl STATIAllNTS S ,,oco. y.' b. g a '; - 400 i, coo. ~ CORPORATE AND 89 6 i981 _ 9 8 i,39 #990 i9%~s9tf7 ivM i~t9tl9 stN' ~ R 8 M Actual M Actual Summer Peak ^ I

---

Normal bo Yw Amm)

Normal (io be Amay M Wiiter Peak Actual . Actual Summer I%k ^ 1NST tion ^ 9rrf 94, 9tj 3-*9 83 43u 4.66: 4 813 4. it amo 4si3 u90

1. W i uo4 5. I'7 4

^ Norm.it uo Year Aicrage) Normd ue Year Average) \\rinter I'cak N -Mua tIos !ke a v, go5 so., $ 'm 4326 4?tt 4 -'M i?(4 4.u'.p n 44os 991 4 (>8r A {2 $ StIARIHO!DLR int'ORNIATION %p. /v,wy.s mi I( l 1() ^ ^

UTiuTy OPERN!'ING STATISTICS Mimm Gas adIktne Compnr adSs,Mharin

-i i _ 1920 _ _1989 ly88 _ {p87 J 9M i flectric Operating Statistics = Resenues (in Thousands) Residemial.......,..... $ 723,406 $ 648,884 $ 620,660 $ 594.283 $ 575,774 Small Com mercial........................ m -221,588 194,573 178,727 175,322 177,667 large Commercial and inJustrial................. 735,1 to 666.042 626,300 - 615.723 626.022 O t h e r... m...................-..,.... __4g50 _ p,Z95. _ _ 8,875 _ _ J 107 8,788 Tbt al.'........... m. ,,$ I,684M4 . $ 16 IL2R4,,J l ci)4,562_ $ b39A7J5, _,j W88,25 I; Sales - MWii Residential..................... 9.417,504 9,450.984 9.196,433 H,521,381 - 7,797,858 Small Commercial................... 2.579,929 2,460,592 2,292,764 2,139,164 2,007,040 large Commercial and indmitial............... 12,622,645 12,879,486 12A91.505 11.9_14.420 11.430,725 Total...........................................m - 24,620.078 24,791,062 23.980 3 2 22,574p65 ' _21.235,623 Customers Residential................................m 930,880 913.910 895,881 876.826 853,976 ~ Small Commercial............ 92,102 90.647 87,049 83,247 80384 large Commercial and Indmtrial.............. 7,991 7,587 8.175 8,395 7.954 To tal.................. .m... m.... m....,...... _My0,9]). _l,012M4 99 h10.5 96M@_,_142114 [ Average use per Residential Customer - KWIl... 10,209 10A38 10.362 9,837 _9.255- - Average Rate per KWil - t.......... ......m.. 6.82 6.09 5.95 6.14 6.50 - Peak 1.nad (one-hour) - MW.........-m 5,477 5,304 5.381 5,190 4.618-Capability at Summer hak - MW.,. 6,159 6,164 5.930 5.888 5.797 Gas Operating Statistics = Revenues (in Thousands) -

Residem ial.............,,..............................,

$ 224,589 $ 242,389 $ 225,035 $ 242,240 $ 258,975 ( Small Commercial.'. 35,699 40,011 36.394 38,538 39,659 .m.,........ large Commercial ana % iustrial Excluding Delivery Service,,,, e o....,,.. -90,306 90,983 92,637 103,765 123,356 Delivery Service.......... .m........ 21,057 27,069 19,364 23.492 18A25

Other m....

1,7J8 ' _ -11349 8,106 7A21 5.354 L Total... $ - 373,419 $ - 411,801 $ 381,536 $ -415A56 $ 445,769 ........m.,. .o.. 15 ales - DTH - Residential..............m. 36,032,159 39,805,853 40,140,800 38,142,183 38.629,757 ' Small Commercial....m.... 6,349,301 .6,888.439 6,791.fd 6,335.806 5,960,010 ..,m.............. - large Commercial and Indu. trial -

Excludire. De%ry Scrvicc i..........,,m, 20,010,708'-

-18,772,305 21,769A70 18,345,190 21.234,221-Delivery Service................................... 40,238,751 45.230,133 - 40.827.285 40dlB,136 31 551,899 j 5 2 . Total;..... m _102,630,923 110,696,730 109.529,392 102,941,315 97,375,887 ....m.. m,......... ..... m m... - Customero Residen t ial.,............................m. m 482,680 482,538 482,011 482,023 482.394 .m...~ Small Commercial,..m.............. . 31,981 31,881 31,582 31,108 30,820 Large Commercial and industrial.........,. _ 5,373 5,307' 5.160 5,001 4,873 -

To t al.......................... m................

520,034 519.726 518.753 518.132 518.087 Average use per Residemial Customer - DTil... 74.7 82.6 83.3 79.1 -80.2 Average Rate per DTil (excluding ... - delivery service) m...m.. $5.62 $5.70 $ 5.15 55.93 $6.29 m. Nak Day Sendout - DTH.......,..... .m. 653,900 663.200 669,500 636.000 624,700 - Peak Day Capability - DTH... 853,000 761.000 793,000 731,000 748.000 20 l l 4 l

SEMCTED FINANCIAL DATA Meiwr Gu mdIharic Compas nd%budwin Summacy of Operations 1989 1988 1987 1986 1990 am An,mno in muuna,. I uq,, iw he Anmunu> Revenucs Electric.,.. $ 1,684,154 $1,519,294 $1.434362 $ 1.393,735 $1.388.251 G a s........... 373,419 411,801 381,536 415,456 445,769 Diversified activities. 101,690 73,041 47,570 27,555 20.086 - 1btal revenues........_ Expemes Other Than Interest and Income Taxes ~ 2,159,263-~ ~2.004,136 1.863,668 1,836,746 1,854,106 "~~~~ ~ ~ - ~ ~ ~ ~ - F.lectric fuel and purchased energy.m.. 523,086 370.131 311,510 296,543 327,317 Provision for imnible dkallowance of replacement energy co,a.... 35,000 Gas purchased for resale... 200,762 223,402 198,431 233,702 271,383 Op: rations... 576,271 478,194 433,828 388.973 369.277 Maintenance.. 163,457 149,014 132,746 124,837 120.052 Depreciation.. 170,586 156,546 147,076 134,838 128,002 Taxes other than income taxes... 156,722_ _ 150.204 _ 143,127 _ _135.731 131,554 'thtal expenses other than interest and income taxes.. _l,825,884_ 13273p l _1, %6.71_8_l,}l 4,624 _l,}47,585 income from Operations.m _J3A379 _W(s58L _496,950_j22d 2CJ06J21_ Other income Allowance for equity funds med during comtruction... 27,086 18,564 16.056 16.870 16,871 Fquity in earning of Safe flarhor Waier Power Lorporation....., 4,900 5,176 5,570 6,331 5,765 Net other income and deductions., __4,689_ _ 7.188 1,928 _ _ _945 j 619)_ Total other income... .m. _ 36.675 J0 928 _._ 2.h554__,. 24,146 22.017 .m.. t income liefbre interest and Income Taxes. 370.054 507,513 520304 546.268 528.538 Interest Expense Interest charges.., 200,922 164,369 136.071 129,871 126,324 Allowance ihr hormwed funds med during construction.. j26,266). jl4.776)_, _12.075) ( _.14.069) (13,582) ( Net imerest expenw... 174 656_ 149,593 12A996 115J102 112 242_ 3 income llefore income Taxes, 195,398 357,920 396,508 430.466 415,796 i ncome Ta xen...................... income Before Cumulative Effect of Change m 19,952 81,629 93.096 130,368 141,177~ Accounting Method.. 175,446 276,291 303,412 300,098 274.619 j ..... -.............. ~ Cumulative Effect of Change in the Method of Accounti_ng for Unhilled Revenues, Net of Taxes..,. 37,754 Net income............. 213,200 276.291 303,412 300,098 274,619 Preferred and Preference Stock Dividends.... 40,261 32,381 29,375 26,406 26,876 Earninp Appheable m Common Stock., 5 172,939 $ 243,910 $ 274.037 $ 273.692 $ 247,743 Earning IVr Share of Common Smck Before Cumulative Effect of Change in Accounting Method.. $1.64 $3.05 $3.47 $3.47 $3.15 Cumulative F.flect of Change in the Method of Accounting ihr Unhilled Revenues............ .46 'Ibral Earninp Per Share of Common Stock......... ~ $ 210 $4Os $447 $447-~MW Dividends Declared Per Share of Common Stock. $2.10 $2.075 $ 1.975 $ 1.875 $1.775 Ratio of Earning to Fixed Charges...........- 1.96 3.12 3.83 4.22 4.19 Ratio of Earnings to fixed Charges and Preferred and Preference Stock Dividends Combined., 1.61 2.50 3.01 3.29 3.20 Financial Statistics at Year End lbtal Anets..,,, $6,710,375~~~~~ $5,985,679~ ~ ~ - ~ "$5,126.362 $4.780.167 $4.582,670~~~ - Capitalization ~~ ~ ~ ~ ~ - Eongterm debt.. $2,193,844 $2,076.620 $ 1,769,066 $ 1,707,407 $1,596,275 Pref erred stock....... 59,185 $9,185 59,185 59,185 59,185 Redeemable preference stock.. 365,000 322,800 229.600 186,400 50.000 Preference stock not subicet to mandatory redemption. I10,000 110.000 110.000 110,000 110,000 Common shareholders' equiry. 2,073,158 2.001,188 1.885.245 1,755,368 1.629,795 Total capitalization... $4,801,187 $4,569,793 $4,053.096 $3,818,360 53,445,255 llook Value Per Share of Common Stock. $24.87 $24.91 $23.77 $22.24 $20.72 Number of Common Shareholders. 68,689 70.395 73,786 75,682 76,972 21

MANAGEMENT'S DISCUSSION AND ANAIXSIS OF .l FINANCIAL CONDITION AND RESULTS OF OPERATIONS Baltimorr Go andHarric Cmany andSJiidurin I The fmancial condition and results of operations of Baltimme Statements (Notes), Selested Financial Data and Utility Gas and Electric Company (BGNE) and Subsidiaries Operating Statistia sections of this Annual Report. Factors (collectively, the Company) are set forth in the Consolidated signi6cantly affecting resuln of operations, liquidity, and Fmancial Statements, Notes to Consolidated Fmancial capital resourcn are discussed below. -) RuUITS OF OrmAnONS Earnings The Company's consolidated earnings per share for 1990 were of high voltage tramminion capability. Finally, the 1990 $2.10. which represents a decline of 5.95 from the 1989 level of decrease re'lects a provision of $35 million, or 28c per common $3.05. The carnings per share are summarized as follows: share, for '.he possible disallowance of certain replacement er% costs anociated with outages at Calvert ClilTs (see 1220- 1989 1288 Notes 1 and 11). Utility business F.arnings from utihty operations are affected by the regulation Current 7 ear operations. $1.46 $2.81 $3.23 of BG&E's rates by the Public Service Comminion of hiaryland Cumulauve effect of change m (Maryland Commission) and by the effect on sales of economic the method of accounting for and weather conditions. Expected increases in utility operating unbilled revenues (see Note 1)...... .46 expemes in 1991 will be offset partially by additional electric Total utility business.,. 1.92 2,81 3.23 revenues resulting from the electric base rate increases autho.. red Diversified business activities....... .18 .24 .24-by the Maryland Commission in December 1990 as discussed Total........,........, 52.10 $3 os $3 47 under litility Revenuo and Sales below. In addition, there are currently soeral fuel rate cases pending before the Maryland Utility earnings decreased during 1990 and los9 primarily Commission, as discussed in Notes 1 and 11, which could u a result of higher operations and maintenance expenses, g y puticularly at the Calvert ClitTs Nuclear lower Plant, higher Divers Ded business activities, which primarily represent the Gnancing costs, and the efTects on sales ofless favorable weather operations of Constellation iloldings, Inc. and its subsidiaries, as compared to the respective prior years. In addition, the dised W decrease m 1990 reflects mereaxd costs resulting from the purchase of additional generating capacity and from lower sales Utility Revenuo and Sales The increases in electric revenu:s for 1990 and 1989 are primarily The changes in electric sales volumes were u followu attributable to higher fuel rate revenues resulting from increased ,999 39g9 fuel costs. The increases for both years are summarized below. Residential. (.4)% 2.8% .1910,. j989 Small commercial....... 4.8 7.3 N"$1 Large commercial and industrial.. (2.0) 3.1 Changes in sales volumes...... 5 (3.6) $31.2 'Ibtal (.7) 3.4 - Increued bue rates... 32.9 .4 increaser' fuel rates.. _lE6 M1 Sales to residemial and small commercial customers reflect growth in t e number of customers in both years and increued Total $acreues in revenues.. 5164.9 $84.7 h per capita usage in 1989. In 1990, customer growth wu more than offset by the elTects of warmer winter weather. The decrease in sales to large commercial and inJustrial customers in 1990 reflects lower steel production by Ikthlehem Steel, which completed a planned maintenance outage during 1990. Il

~. 4l Mrirwr Gas adEletric CompnydSuhlurin The increased base rates for 1990 reDect the Maryland The changes in gas sales volumes were as follown Commissior6 December 1989 rate order and a surcharge ,999 3939 authorized during 1990 to recover certain purchued Residential....... (9.5)% (.8)% capacity charges. Small commercial.. (7.8) 1.4 Electric revenues are expected to increase in 1991 as a result of several electric base rate increases authorized by the Maryland Lirge commercial and industrial.. (5.9) 2.2 Comminion in its December 1990 rate order. In that onict, the Total. p.3) 1.1 ~ m., Maryland Commission authorized an immediate electric Lt.e The decreases in sales to residential and small commercial rate increase of $77 million annually. In addition, the Maryland customers in 1990 reDect the effects ofwarmer winter weather Comminion authorized a $124 million boe rate increase to as compared to 1989. The decrene in sale to large commercial provide rate recognition for BGNE's investment and operating and industrial customers during 1990 reaccts lower steel expenses at Brandon Shores Unit 2 upon that Unit's commercial pmduction by liethlehem S:cel and decrened utilization of operation in May 1991. The $124 million increase in bue rates delivery service by certain large customers. During 1989, is to be accompanied by a reduction in the fuel rate to reflect the sales to large commercial and industrial customers increased currendy estimated $52 million of expected annual fuel cost due to greater utilization ofdelivery service. savings resuhing from the commeicial operation of that Ur.it-The citanges in gas cost adjustments in each year reAcct The Maryland Commission a,lso authorized BGNE to apply for primarily changes in the price of gas from BGNE's pipeline a surcharge to bue rates beginning in October 1991 to provide suppliers, in addition, the decrease in 1990 redecca a settlement for recovery of approximately $50 million of purchased capacity of certain take.or. pay inues with IIGNE's principal gas pipeline costs which will begin to be incurred at that time. liased on suppliers. BG&E's Gnancial performance, the Maryland Commission has egreed to authorize the base rate increase for Brandon Shores and the surcharge ifit determines that BG&E would otherwise - be unable to achieve its authorized return. Gas revenues changed compared to the respective prior years as a result of the following factors: j990 1989 Un %Ilmns) Changes in sales volumes... $(20.6) $ 4.1 Decreased base rates.. (2.8) (.6) Changes in gas cost adjustments.. (15.0) 26.8 Total changes in revenues..., 508A $303 Disenified Businns Actisities Earnings from Constellation Holdings. Inc., and its subsidiaries the troubled banking and Gnancial services industries, offset (collectively, the Constellation Companies) declined in 1990 somewhat by the performance in other parts of the selectively from 1989 and 1988 due to softneu in the real estate market diversi6ed portfolio. and lower earnings from Gnancial investments. Earnings from the Constellation Companies' power The Constellation Companici real estate development generation projects increased in 1990 over 1989, reDecting a p business hu been affected by depressed real estate and economic continuing utilization ofenergy tax credits from construction of markets, resuhing in reduced demand for the purchase or lease energy projects and some operating income. Earnings from a 'of available land, of6ce, and retail space. The inability to number of the imwer generation projects are expected to remain l complete anticipated sales of real estate pmjects has resuhed in low initially but then increase. As a result,it is anticipated that l-increased carrying cosa and depreciation, negatively impacting the total earnings of the energy projects will begin to increase in j earnings. Earnings from real estate activities are expected to 1993. Energy tax credits remain available through 1991 for j remain depreued as long as the real estare market remains soft. construction of geothermal and solar energy projects. l The performance of the Constellation Companies' porifolio l of Gnancial investments h25 been adversely affected in 1990 by t 23 I i r

Maimr Gu ed work Gmpny ed wtww, ~~ lipenses Electric fuel and purchased energy expeme wu a followt operatiom and nuimenance expemes are still expected to mcreaw m 1991 as llrandon Shorn Unit 2 begins wmmercial _1920. J98 L _1988m "P"ation and as on,cr ihsu,l power and dn.tnbuium (in m),om3 Actual costs.. $630.9 $608.2 5322.0 expend c ain increase. In addition. ihe 1990 inucase aho Net deferral of cmn under electric rennu the expemes anociated with entain of the Conuellation fuel rate clause (see Note 1). (107.8) 1238.lM10_.5) Companies' real estate partnerships which were previoudy 'Ibtal expeme...... $523.1 5370.1 5311.5 'cPorted under the equiry method (we Note n Depreciation expeme increa ed in hth yean as a result of The increue in actual dectric fuel and purchawd energy highn inch of depreciable plant in service. Depreciation coo m 1989 was due primarily to a less favorable generation openw Ibr 1990 aho rdlects a 52.9 million annualincreaw in mix.%e furthet increue in actual costs in 1990 was due to the nucles dnomminioning accruah as authorised by the purchase of additional generating capacity to meet BCNE's Muyland Comminion in its Dnember 1989 rate order. In requirements under the Pennsyhania.New Jersey-Maryland 1991, deprecision expense will increa e as a inuit of lirandon interconnection Agreement and to lower sales of high vohage Shores Unit 2 being placed in servise and a 51.2 milhon annual transminion capability. The less favorable gennation mix-inuraw in dnomminioning auruah a authorized by the capacity pcechues, and lower sain of transmbsion capability Muyland Comrninion in its Dnemba 1990 rate order. were antibutable to extended maintenance and tepair outages Tan otha than income tain increawd in 1990 and 1989 - at the Calvert Cliffs Nuclear Power Plani. Calveri Clith Unit 2 due m higher capiul stock. propeny, public ser, ice company went out of service on March 18,1989 ar d remainni out of franchiw, and payroll tain. service throughout the remaindu of > 69 and all of 1990. The ahowance for funds used during construction (Al C) - Calvert Clifh Unit I went out of service on May 6,1989, increued in 1990 und 1989 due to the continuni conuruction continued out of service for the remainder of that year. and wa$ of Brandon Shores Unit 2 and other maior electric projecu. The in operation for 80 d tys in 1990. Unit I has returned to service increue in AFC for 1990 aho reflecu the Maryland and Unit 2 is expected to return to service by the end of the Ont Commissioni Daember 1989 rate order which increawd the quarter of 1991, in ihn nudear generation represents the town: Al C rate to 8.80% and reimtaed in the AFC base certain -(mt power generated by BG&E, outages at the Calven Cliffs opndimrn rdued m Bundon Shorn Unit 2. Al C is expected plant have a sulmantial effect on fuel cosn (see Note 11), m decreue in 1991 due to the mmpletion and commercial As discussed in Note 11, during 1990 BGNE rnorded a opnaion of Bundon Shorn Unit 2 and the deacaw in the prnvision e>f $35 million for the pouible disallowance of eenain AFC rre m 8.699a in accordance with the Maryland - replacement energy cmts anociated with ouuges at the Calv"' Comminion's December 1990 rate order. ChlTs plant, The increaws in interest chaiges for both yean primarily. - Purchued gas expense was as follows: reflat increasnl leveh of debt outstanding. The increued debt 1990 1989 1988 Inch are attributable to greater wnsouction expenditurn and On MJhom) irwreased deferred electric fuel costs. Actual ums..._... $181.1 $233.9 $220.6 income tax expeme decreued in both 1990 and 1989 a 2

Ner recovery (deferral) of cmts result oflowcr pre.cax carnings.

under purchased gas adjmtment Preferred and preference uock dividends increawd in clause (see Note 1). _191310A)J22.2) 1990 and 1989 as a resuh of greater amoums of preference Total expeme..... - $200.8 $22M $ 198.4 stock ountanding. The decrece in actual purchued gas cosu tbr 1990 reflects inHation affecn the Company through inueued operating lower output due to warmer winter womher, while the increme expensa and Qn reifacenum cons lor uuhty plant aucu. in 1989 reflects higher prices imm pipeline suppliers. pmugh the effects of inflation can be nu,n. gated through umely rae el cf, the regulatory procus impows a time lag during which { men-a7ed cmts may not be recove Operations and maintenance expenses increased in both yean due primarily to higher payroll and other cmu at the Calvert Clifh Nudear Power Plant. The higher cous at Calvert Cliff regulaory lag u annbuuW in part to rate relief being based on s are a result of signi6 cant expenditures to upgrade the plant P4" cmn rather than projected cous, it hu been the Mayland equipment and procedures to the high standards required at Cornminioni practice to permii rnovery of the cost of replacing newer nudear facilities. Anuming the roumption of normal plant anen, togethu wah the opponunity m can a f.s remm operations at Calvert Cliffs. the Company anticipates that the thaeon beginningat the time of replacement. level ofexpenditures at the Plant will nabilhe in 1991. flowever. L1 1 j

Mornwor 6 aoud Unten G.ny9 adudrann 1 JQUID11Y AND CAITI Al IU NOURCI % The Company's upital requirements reflect the capital-intn.Ge 1938 through 1990, along with ntimated amounts for 1991 nature of the utility businns. Actual tapitat xquirements for throne,h 1993, are shown below 19L IN9_199L199.1_199Ll9A3 on uhm) Utility liusinrss Comtruction npenditurn (e cluding AlC) Liectric.,. 5212 5307 5362 5 379 5374 5 390 Gas.._ 34 27 39 47 52 42 Common.... 44 80 81 74 99 43 Total wmouction expenditurn.. 290 414 482 500 525 475 AFC_ 28 33 53 33 16 25 Deferred nuclear expenditures.. 10 28 23 27 13 Nudcar fuel (uranium pursh.un and procnsing charpn)... j'.l _ J 3 _ 60 _ 89 _ J 3 n 3]O 47 17 21 3 37 55 Retirement oflong term debt and redemption of prefereme suitk.. 'ibial utility bminess. 386 527 644 648 678 878 Diversified liminns lwtivities Retirement of kmg-term debt.... 131 89 8 364 97 84 L]uiry commitments.................. J 03_84 l22_ _ _)8 63. 78 'thtal diversi6cd bmincu anivitin. 234_ 173 _ 130 _ 402 ___160 162 Total....... 5620 57tx1 5774 51.0%0 $H38 51.040 BGN!"s comtruction program is subject to continuous review Utility opital requirements not met through the internal and modification and actual expenditurn may vary from the . generation of cash are met through the inuame of debt and neimatn above. The increase in estimated mnstruction expen. equity securities. Duris g the three year period ended fim n mvpud n p2.a ec.i.mu i utdtmi.ta o the Dn.idrr."d, 70, PM M iowm of k et-rm Jebt, g expamion and upgrading ofliGNia transminion and distri. preferred and preference stock, and wmmon stock were bution facilitin and modifkations to nisting generating faciliiin. 5632 milhon,5215 million, and 5132 million, engwavely. The mmt significant projects in the mmiruction pro During the same three year period. BGNE's retirements of the wal fired Brandon Shores Unit 2 and two mmbinef. ram arecyde units long-tenn d*bt and redemptions of preferred and preference at the Perryman site. Excluding Al C. mmtruction expenduurn on auxL we.. El14 rnillion and $20 rnillion. ropectively. The e Brandon Shores Unit 2 totaled $202 million ovet the 1988-1990 timing of futu#e issuanco and redemptiona and the mix of debt perkxt, and such expenditurn are expected in amount to $25 and npiity securitie will depend upon market mnditiom and million in 1991. Expenditurn for Perryman are expnied to total lu;ND needs. a appmximately $110 million, acludirg AFC, over the 1991 1993 Estimates of the Comtellation Companin' capital period. Other electric construction expenditurn are primarily requirements are subject to mntinuom review and modifkation. attributable to improvemenn to BG AD existing generating plants Thne estimarn may vary significandy due to the type and and to its tramminion and distributien facilitin. The niimain number of projects selected for development and the impact of above do not tellect any expenditures Ia complianet with the market mnditions on ihme projects. The Comtellation Clean Air kt of 1990, and the Comp,ny does not expect to incur Companin' capital requiecments have been met in the past significant openditurn for compliann through 1995, through the internal generation of ush and through borrowings During 1990,1989, and 1988, the internal generation of Imm imtitutional lenders. As of Dec,mber 31,1990, cash frorn utility operatiom provided 14% 8% and 74% Comtellation iloidinp. Inc. had utilized fully its outstanding rnpectively, of the funds required for mmtruction, nuclear fuel, credit facilitin. Approximately $364 million of the Constell ion and deferred nucicer npenditurn. The significant reduction from Companicilong term debt, along with the 564 million of the 1988 inclis due primarily to increased deferred electric fuel shon.ierm borrowinp outstandmg at Dnember 31,1990, will cmn. greater comtruction expenditurn, and lower net income. nuture during 1991. The Comtellation Companies intend to During the ihree. year period 1991 through 1993, approximately refinance this indebtednns as it rnatures and to continue to satisfy 60% of the funds required for construaion, nuclear fuel, and ongoing capital requirements through new and nisiing credit deferred nuclear npenditures are npected to be provided through facilities and internally generated cash flow. utility operations. 4 h

.,5 1 REPOllT or MANAGEMENT Mn we (% ed11n reir Ceyes ed Mnd.em Manapment is responsible for the information and Coopers N 1ybrand. mdipend<nt auditors, are enrdF to J reprnentations watained in the Company's financial audit the financial statementi and npress ihcar opiriion thereon, statements. The finandal uatemeins are prepared in nuordarac Their audii is made in aucidance with pnerally anipied with pnerally maepted accountio i prindpin Ened upon auditing standards which indude a review ofinternal umnoh. cunently available facts and cirns,astancn and hianapment's The Auth Committee of the lioard of Dnecion, which best estimates and judgmenu of known condnions. wnsists of foui ouinde Direcion rnens periodially with The Company maintains an suounting system and ictated Menapment, internal auditors, and Coopcri N 1 vbrand to eynem ofinternal amtroh which are designed to pmvide trview the activitin of cath in dsharging their rnpondbihtin. reesonable usurance that the financial rewrds are accurate and The intonal audit uaff and Coopers N 1ybrand have fire aans thet the Company's anets are pmtected. The Onnpany's uafl of to r'ie Audit Committee. Internal auditors, which reports direcdy to the Chairman of the lioard, conducu periodic reviews to maintain the encoivenni of internal wntrol procedures. REPORT OF INDEPENDENT AUDITons lir the SaoeMdm of B.drimrne Gas andHurrit Cempany We have audital the aaompanying wnsohdated b./ xe sheen in our opinion. the finandal naiements refened to above end natements of capitaliiation of Italtimore Gu and 1:Intric prnent faidy, in s!I material reputs, the wnwhdated finandal Compariy and Subsidi.uien at Dnember 31,1990 and 1989, position of liakimore Gu and 1:lectric Company and end ine related wmolidated statemenu ofinwme, cuh flows, subsidkrie, ai December 31,1"VO and 1989, and the common shareholden' equiry, and ta es for each of the three wnsolideo mulu of their operations and their cch Dows for yeau in the period endni December 31,1990. These financial each citi e eb re years in the petiod ended December 31,1990 statements are the rnponsibility of the Company's Manapment. in wnformky cith pnerally aucpted acwunting prindptn. Our top (msibility is to npros an opinion on ihne fmancial As diwoued in Note 11 to the wnsohdated finandal statements based on our audits. hatemenn. the Public Service Comminion of Maryland is We conducted our audin in anordance with pnerally currently rniewing the nplacement energy cosa enuhing from accepied auditing nandards. Those standards require that we the recent outagn at the Company's nudear power plant, and plan and perform the audit to obtain renonable auurance about the Company hu provided a rnerve of $35 million for the whether the financial natements are free of material ponible disallowance of replaecment energy cmu. The mintatement. An audit indudn namining. on a int huis, ultimate outcome of the fuel rate prmeedinp howevn, cannot evidence supporting the ame.unn and disdosurn in the finandal be dnermined but may roult in a dnallowan(c in cucu of the statemenu. An audit aho indudes avessing the acwunting rnerve provided, prindples med and significant niimates made by Management. As discunni in Note i,mhc wntoli6ued fic.andal as well a evahtating the metall finandal statement prnentation. natements, the Compar '.hangd its metW of auounting for We believe that our audits provide a renonable buis for our unbilled retenun in ! F a. opinion. l/M. 4

• 4 Coopers N Iyhrand llahimore, Maryland January 17,1991 s-26 i

l

CONSOlIDATI D STATEMENTS 01: INCOME flahmm Go edIb,s4 Cwqm ad.%kdranco be laded December 31, 1990 - 1989.- -....-.~1.%.H-On hamit Iwry l>n he Amounol Reventws 13c ctrk.. 51,684,154 51,519.294 51,434,562 Gas. 373,419 411.801 381,536 47,570 Darrufied actintics... 101.690 73.04) 'lbtal trunac: 2,1 W,263 2.004,136 1.86 L66R

1. spen $rs Other Than interest and income Taites 1.lec rk fuel and purthat-a entryg.

523,086 370.131 311,510 Provision for ptmihlc disAowarte of replaccrnent energy unts (we Note 11). 35.000 Gas purchawd tot resale. 200.762 223.462 196,431 0;wrations.. S76.271 478,194 433,828 Maintenana. 163,457 149,014 132.746 Depict iation.. 170.% 6 156.% 6 147.076 Tnes other than income ines.. 156,'?!2 _150.204 _ _ 143.127 'f oul esperacs other than interest and inuime ines.. 1,825.8H 4 1 3 27,551 , l.%6,71 H 3.13.379 4763k5 496,950 income from Operations. Other Irnome Allowan<c for equity funds uwd during curotruuion.. 27,086 18364 16.056 1 qmry in earnings of Safe liarbor Water Power Caporation 4.900 5.176 5370 , y2R 1, 7.188 Net other inuune and dedmtioni. 4,689 'lbtal other income... 36.675 _30.92 H __, _,23.534 . _ 170,034 J 07313 520j04 Inuime liefore Interest and Income Toes.... intervs Lancue a Interest charges.. 200,922 164,369 136.071 (14'r'6) (12,075) Allowance for borrowed funds uwd during construuion.. (26,266) N4 i inscrest espeme 174.656 149393 l 2),9q6 Income liefore Inu>me Taxes.. 195,39H 357.920 396,50h 81,629 93.096 income Tates. - - - -19,952 Income liefore Cumulative IHect of Change in Auonnting Method. I'5,446 276,291 303,412 Cumulative Effect of Change in the Method of Auounting for Unbilled Re$cnues Net of Tasca (See Note 1).. _ _37,754__ Net income.. 213,200 276.291 303,412 Preferred and Preference 5tmk Dividends.... 40,261 32.3H1 29375 - -. - - -. ~ Larnings Applicable to Common 5tml., 5 172.939 5 243,910 5 274,037 d Average Shares of Common 5tml Outstanding... 82.366 79.997 79,052 lirnings Per Share of Conunon Simk liefore cumulative eficci of change in accounting method.. 51.64 53.05 53.47 Cumulative effest of change in the method of acuiunting for unhilled revenues... .46 _ ___~ _ _ ,,7 Total carriings per share of common stock.. 52.10 5.105 53 47 .sce nouoe wn,eMaudfinanaalaauwnes 27

CON 50llDATED BAl.ANG Sill:ETS lulw.wr cia oro J lb. tru, r mp.w,, awl %d nov At thuinix r 31, 1990 )OH9 on I hou,cda A%I is CurungAneti Cash and udi s'qunalents, 5 44!!79 18.900 Auounts rn. enable (net of alhntanse for untolicttiblo). 26N 392 284.020 Au med unbilled icvenun.. 49.N 13 l'u:1 stoa. $ t." 5 4;a99 Materiah and wpphes. I19.835 111,643 Insome tasn refundable. 44.720 73.144 Prepaid tonn other tfun income inn. 43.453 38.618 Other prepayme;nts. 30,759 34.247 Ch her.. 9.237 % 625 Total current auets.. 684.623 611,69/, hvnttnents and Other Anets I inancial invnt ruents.-, 322,532 326,341 Real otate proie(ts.. 412,963 2M.640 Alternative energy systems... 171,922 112.911 5 aft liaibor Water Power Corporation.. 34,241 40A21 Senior living facihtin. 26,944 27.(H W Nuticar decornminioning trust fund-21,335 12.313 Other.. 54,517 3N.120 'lotal invntments and other anets.. 1.044,474 N32.685 Utility Plant Plant in servke TJnt:ic. 4,230,SH I q,034.4 9 4 Gas. 496.603 471,*140 Common.. ,410,538 308.492 'Ibtal plant in service.. 5,138,022 4.814,676 Auumulated deprniation.. (1,694,166) (1,561,329) Net plant in service., 3,443,856 3.253.347 Plant held for future use., 17,614 10,583 Construction work in progros. 861,734 704,931 Nudcar fuel (net of arneirtuation). 189,895 175,559 Net utility plani.. 4,511,099 4.144 A 20 Deferred Charges Deferred fuel costs (net of provision for pouible dnallowante)... 3H9,775 345,104 Deferred nudear npenditurn (net of amortiration)... 43,1 H2 16.367 Other.. _ _ 3.5,222 35,407 'Ibtal deferred t hargn.. , 468,179 39(i,8 18_ 4 Total Aucts... $6,710,375 55.485.679 Su owtes to omwlsdaredtiwuialnagementw Certam priur-par amounn hair hun rotatrd oc amform woih the curwnryear k pnentarwn 28 ig

CONSOUDKM:D BAl.ANCE SilEF!rS Momer G,o,,&11nvo, Cem,r.any n JMuumn o At December 31. 1990 1989 un 'l tsmunM [.1AB11,11115 AND cal'lM1.17AllON Current liabilities Short term borrowing;. $ 227,700 5 123,807 Current portions of king term debt and ptrference stuk.. 452.912 72.9M Anounts papble..... 202,928 256.418 Customer deposits.... 13,176 12.361 Accrued taxn.. 23,982 22.501 Acc rued imernt............... 46.249 41.920 Dn;dend3 decl.ned...... 54.334 50.983 Accr ued vacation cmts...................... 27,0$0 25.482 Other.. _ _14.262 . _)2.4 59 'Ibtal current liabihtin.. _l 062,593 , _63Ry6 3 Deferred Credits and Oiber Liabilitin Deferred income tun........................ 647,912 570,723 Delerred investment tax ctedits.. 180.591 184,991 - l H,092 21,276 Other........ 'Ibtal deferred credits and other liabilitin.... 846395 _J76,920 Capitalitation 1 ong. term debt...... 2,193,844 2.076.620 Preferred stock.......... 59,185 59.185 Redeemable preferenc.c sim k................................ 365,000 322.800 - Preference stock not subject to mandatory redemption...,, I10,000 110,000 Common shareholders' equity............, 2S71136 2#0ld88 'Ibial capitalization... ,4Achts? JdMJ93 Commitments. Guaranten, and Contingencin See Note 11

• lotal I.iabilities and Capitalization........

$6.710.375 $5.9H5.679 1 Sn noen to wnwMair.!fn.onciahtairmentt 29

ON501.lDATED STATEMI NTS OF CAMI Fi ows h,d:rewr Gd: and I k tm Comfaw) e nd,%budraoare Year 1.nded Ibendier 31, 1990 1989 198N tin 4,u mi.id Cash flows Item Opriating Artisitics Net intoine. 5 213.200 5 276.291 5 303,412 Adjustments to recutuilt to net udt pimided by operating at tivities Cumulatise efini of ihange in the methm! of auonnting for unbdled rnenues.. (37,754) Deprettation and amortitation.. 179,793 17(1,706 199,533 Dcfotted income takes.. $6,99$ 136,3MN 42,299 It vestment tat (rrdit adlustments. (4,450) (1A78) (7.196) Ikferred fuel tosts..... (79,671) (24H,472) (32."39) Providon lor pouible diullowaruc of repl.ucinent cricrgy tosis.. 35.000 Allowance for equity fundi uwd during (onurucoon.. (27,086.1 (1H.564) (16.056) 1:quiry in carnings of afliliates and joint venturn (riet). 14,029 (6.449) (7,034) Changes in turn nt awets and current habihtin Auounts recciuble.. I5,6956 ('s i.030) (30.161) Accrued unbilled revenun.. 9.580 Mattrial, supphes, and fuel itmb.. (41.228) ((07s) 3.819 income tasci ref undable., 2H,424 (73.144) Auounts payable. (53,H44) 124.011 26A62 Aurued taxes. 36 (1,N24) (14,8H9) Oiher current aweti and turrent habilitici.. (12,H.171 17,969 5,291 Other.. (10,376) 1,095 (1,769) Net ush pnivided by operating attivitin.. _ 285,509 _ _320 A 24 470,98l_ Cmh I' lows l' rom l'inanting Activitics Prm reds from iwuante of Short-terrn borrowings (net).- 103,H93 44,382 24,299 Inrigactm debt.. 1,987A 26 1.296,310 452.282 Preference sto< k. 64,342 98,860 49.721 Common stock.. 86,8H I 32A45 12.228 Reacquidtion oflong-term dcht.. (1,495 A6 3) (1,0 2n,020) 07aAll) Rrdernption of preierrnte simk. (6,H00) (6.800) (6,800) Cornmon $tmk dividends p,dd.... (171,623) (163.534) (153.976) Prrferred and prrference Stm k dividends paid. (3HA90) 0 1,151) (27,568) Ot her., (34) (94)._ ( ,,1,268) Net odi pmvided by (owd in) l'nancing at tivities. 430,132 250,38') (2iA93) Cash Ilows imm Irnnting Achities Utihty (onstrut tion expenditures... (535,316) (447,339) (318,01K) Allowante fot equity funds used during construction.. 27,086 18,561 16,0%6 Nudear fuel expenditures., (20,519) (17A 31) (46,511) Dcierred nuclear expenditurn... ~ (27,755) (9,605) Nuclear dnomnusuoning truu fund.. (8,108) (6.968) (4,761) Financial investments,. (9.907) ( 1,04 H) (14,396) Real ntate projuts.. (49,745) (40,282) (80,742) Ahi rna ve energy systenn, (62A94) (65,702) (2,940) 5enior I,ving f acihrin. (2A92) (4.390) (451) Ot het.... .J5 A l 2) (l l,60M) (5,612) Net ash med in invening activitin.. (694,662) (58tH09) ( _.457,375) Net increase (Decreec) in Cash and Cash I'quivalents.. 20,979 (14,996) (7,887) Cash and Cash Iquivah.nts at lleginning of Year. 18,900 33.H96 41,783 Cash and Cash 1;quivalen's at l'nd of Year.. 5 39.879 5c 18 M00 5 TLH96 Other Cah I' low informatlan Cash paid during the year for: Intetr+t (net of amounts up;talised)., $ 166,723 $ 150,178 $ 124,278 Income taws. 5 (56,937) 5 14.390 $ 76,810 !ee notes to answiutatedpnan.ulaaw,nentt Cerr.nn pwr yre amouras lwr been rr uud to a'oh,rm u al, si.e o,rrentytan1 pnentann 30 .......................i.........-, n

CONSOLIDATED STATEMENTS OF COMMON SilAIEllOLDElts' Equi ty hhumow Gu ed Hurnc C.*m,sey ed Mudann lla[sLnded Decembed),1,jm]282tancLj2[N Net Unrealised [ Premium on lou on } Commnn Stock _, Preferred Retained Marketable Total Shares Amount Stock _l}rninp_ Securities Amount un h undo Balarne at December 31.1987. 78,912 $817.513 $157 $ 944.526 $ (6.828) 51,755.368 Net income.... 303,412 303.g l2 ~ Dividends declared Preferred and preference stock. (29.375) (29.375) Common stock ($1.975 per share). (156.142) (156.142$ Common stock inued under Dividend Reinvestment and Stock Purchase Plan.. 386 12.228 12.228 ( Costs anociated with iuuance of redeemable preference stock... (279) (279) a Change in net unrealized lou on marketable securities. 33 33 Balance at December 31,1988.. 79.298 829.462 157 1.062,421 (6.795) 1,885.245 Net inc ome......... 276.291 276.291 Dividends declared Preferred and preference stock.... ( 32,381) (32.381) Common stock ($2.075 per share).. (166.067) (166.067) Common stock inued under Dividend Reinvestment and Stock Purchase Plan... 860 26.465 26.465 l'mployer Stocl Ownership Plan.... 190 5,980 5.980 Costs anociated with inuance of redeemable preference stock.. (1,140) (1,140) i Chanp in nct unre.lued iew. un mar.eedic sceu.*i'io. 6.795 6,9 5 t r Balance at December 31,1989.. 80.348 860,767 157 1,140.264 2,001,168 Net income... 213,200 213.200 Disidends declared Preferred and preference saxk (40.261) (40.261) Common stixk ($2.10 per sha e;.. (173.204) (173.204) Common stock inued under Public offering. 2.000 57,062 57,062 Dividend Reinvestmcni and Stock Purchase Plan. 936 27.474 27,474 Lmployee Savinp Plan.. 75 2.345 2.345 Costs anocied with innance of renemable preference stock. (69) (658) Chang in net unrealind lou on marketable securities. ____J13.988)_(ljd)88) llalance at December 31,1990.. 83.359 5946.990 5157 $ 1.139.999 5(13.988) 52.073,158 .% rwen to co.no!id.tredfiwuulit. menzt 4 33

CONSOl.lDATl!D STATEMENTS 01: CAPITAllZATION h,Jumer Gw,ond Ik en, Cem),,oy and %dww, At Dnernt.ct 31, __l990 1989 tin U,,,uw,,10 long. Term Debt hrst refund ng mortgage bonds 3W4 Senn, due Dccember 1,1990.. 5 29,6N2 44% Series, duc July 15,1992. 24,751 25.000 4% Serin, due Manh 1.1993... 24,070 24.095 4%% Serin, due luly 15,1994.., 29,921 29,989 9WN Series, due October 15,1995.. 200,000 5%% Series, due April li,1996.. 26,585 26,680 8%% Serin, duc June 15,1997. 99,500 100,000 6h% Serin, due August 1,1997. 24,958 24.967 5h% installment Series, due Auguu 15,1998. 55,155 56.770 7% Series, due Decend,er 15,1998.. 28,646 28,684 84% Serien due Septend cr 15,1999, 22.077 22.184 8.40% Senes, due October 15.1999,. I00,000 100,000 8%% Serin, due September 15,2000, i1,338 11,414 74% Series, due April I5,2001, 59,919 59,999 7%% Series, due Sep, ember 1,2001. 59,985 60.000 74% Serien due January 1,2002.. 49,999 49,999 7%% Series, due July 1,2002.......... 49,985 50.000 $b% Inuallment Se' ries, due July 15,2002.. 12,500 12,500 7h% Series, due September 15,2002. 49,990 50,000 8%% Series, due I chruary 1,2004....... 74,983 74.986 6.80% Serin, due September 15,2004.. 20,000 20,000 8%% Series. due September 15,2006.. 74,960 74,995 8%% Series, due September 15,2007.. 75,000 75,000 9%% Series, duc July 1,2008.. 43,894 48,918 6.90% Installment.4 cries, due September 15,2009.. 55.000 55,000 94% Series, due March 1,2016.. _ 98,000 _ 1H,000 'Ibtal Ant refunding rnortpge bonds.. 1,371,216 1.208,862 Otbr inr4 eens da loan under unsecured credit facibry... 25.000 loans under, evolving creibt agreements.. 175,000 50,000 Medium. term notes...... 47,000 4%% Sinking fund debentures, due August 1,1990. 15,545 9%% Nous, due May 1.1993. 100,000 100.000 l'loating rate notes, duc July 1,1995...... _...... 100,000 100,000 1loating rate notes, duc October 15.1995 Series 11.. 100,000 100,000 Pollution contml loan, duc July 1,2011. 36,000 36,000 Port facilities loan, due June 1, 2013............,. 48,000 48,000 Adjustable rate pollution control laan, duc July 1,2014.. 20,000 20,000 Economic development loan, due Dnember 1,2018.. 35,000 32,100 'Ihtal other long. tern, debt. , 686,000 _501,645 tong-term debt of Constellation Companies Mortgage and construction loans and other collatnalized notes 8.875%, due June 30,1991. 21,250 21,250 10.50%, due Aup,ust 24,1992 and October 1,1992. 53,300 Variable rates due through 1995.., 98,278 70,434 10.31%, due August 1,1997.. 19,128 19,354 Ind. atrial park facilities bonds.. 1,450 2,150 ..a.. loans under credit agreements... 265,996 210,971 Umecured noin 8.875%, due August to,1991, 15,000 15,000 8.30%, due April 12,1993.. ,_ 100,000 100p00 Total long-term debt of Constellation Companics.. _ 574,402 _ 439,159 Unamortized discount and premium. (7,662) (6,881) Current portion oflong. term debt.. _ {430,112) _ 66,165) ( Total long-term debt.. ,2,193.844 _2,076.620 See noin to unwMardfinavuhsaremenn. 32

CONSOLIDATED STATEMENTS OF CAPnAUZKMON Mimer G.o and Wrvu Gmpny ed $sd.ddwus At Dnember 31, ___! 99R_ _l.989 _ unm wna Preferred Strd Cumulative. 5100 par value, 1.000.000 sharn authorired Serin H,4h% 222.921 sharn outstanding, callable si 5110 per share... 5 22.292 5 22,292 Serin C,4% 68.928 shares outstanding, callable at 5105 per share. 6,893 6.893 Series D,5.40% 300.000 sharn outstanding, callable at 5101 per share. 30.000 30,000 Total preferred stock.. 59,181 59,1 N 5_ Preference Stock Cumulative, 5100 par value. 6.000,000 sharn authorired Rcdeemable preference stock 12 % 1981 Serics A. 68.000 and 136.000 $harn, respectively, outstanding 6.800 13.600 12 % 1981 Series B, 160.000 sharn outstanding. 16.000 16.000 7.$0% 1986 Series. 500.000 sharn outstanding, callable at 5107.50 per share prior to October 1,1991 and at leuer amounts thereafter.... 50,000 50.000 6.75% 1987 Series,500.000 sharn outstanding, callable at $106.75 per share prior to April 1,1992 and at lesser arnounti thereafter... 50,000 50,000 6.95% 1987 Series. 500,000 share outstanding. 50,000 50.000 7.64% 1988 Series. 500,000 sharn outstanding, callable at $107.64 per share prior to July 1,1993 and at lesser amounts thereafter.. 50,000 50,000 7.80% 1989 Series. 500.000 shares outstanding.. 50,000 50,000 8.25 % 1989 Series, 500,000 sharn outstanding............. 50,000 50.000 8.625% 1990 Series,650.000 shares outstanding in 1990.. 65,000 Current pardon of redeemable preference stock..... (22,800) _ J6,800) Total redeemahle preference stock... 365,000 322,H00 Preference *tock vor wbjert to rn2ndstory redemprinn 7.88 % 1971 Series,500.000 shares outstanding, callable at 5101 per share..... %,000 50.000 7.75% 1972 Series,400.000 sharn outstanding, callable at $101 per share... 40,000 40.000 L 7.78% 1973 Series. 200.000 shares outstanding, callable at 5101 per share...... 20,000 20,000 Total preference stock noi subject to rnandatory redemption........ 110.000 110,000 Common Shareholders' ihuity Common stock - without par value - 100,000.000 sharn authorized; 83,359,464 and 80,348,185 sharn issued and outstanding at December 31,1990 and 1989, respectively. (At December 31,1990,402.362 shares were rnerved for the I;mployee Savings Plan and 3,251.990 shares were toerved for the Dividend Reinvntrrant and Stock 1 urchase Plan.), 946,990 860,767 Premium on preferred stock.... 157 157 Retained earnings... 1,139,999 1,140.264 l N-t unrealized lou on marketable securities.. (13.988) Total common shareholders' equity.. _2 073,158, 2.001.188 Total Capitaliration... 54.801.187 54.569,793 l Sa noin to remMaudpnanaalnarements. t l l l 33

CONSOI.lDNTED STNIT.MENTS OF taxes - Adnwer Ge edM k Cmpny adSMwm br Ended December 31, 1990 _ 1989 1988 (tkikt Anscuma in huumh) Income Tames Current. Regulartax....................................................................................... 5 (65,130) 5 (78.617) $ 57,993 Altet native minimum t ax.............................................................. __. 31,792 .. 25.336 Total current taxes....-....-................. o.... ..o., ..................o j3h3JN ,,J,5),28 I) 5791 2 Deferred Accele ra ted deprecia tio n..................................................................... 70.639 64.540 43.378 Deferred fuel costs................m............ 27,088 64.48i 11,777 ..........................u... Provision for possible diallvwance of replacement energy costs...................... (l1.900) Alternative minimum tax._ (31.792) (25,336) Tax rate differential attributable to tax net operating 1osi............................ 5,744 15.325 Energ tu credit carryforward offset....................e.... (8.410) .......... ~.............. Unbilied revenues.......= 12.952 (9.420) (l1.957) Deferred nuclear expenditures................o...........m.,............... 9,117 3,259 Customer information system development costs................................. 6,885 7.790 3.105 Contributions in aid of construction..............u.......................... (2,704) (2.785) (3,510) ...n............. leveraged leases............o...... o...................... (943) 4,877 6,066 Other........................................................................................................ 513 (6.343) (6.560) Total deferred tues.................... 77,189 136.388 42.299 =.................................................. Investment tax credit adjustrnents Cu r rent tax cr edita de ferred................-.................-................................ 2,887 6.428 3,564 Amortita tion of deferred tax credits............................................................. (7,337) - (7,906) (10,760) Investment tax credit adjustments...............................................u............... (4.450) (1,478)_ (7,196) - Total income taxes........-. - - -.. _.......................................... -,................ 39,401 81.629 93,096 locome taxes included in cetrelathe chet of dange in acwuntin6 'LCth('d + '" I39.449) Income Taxes per Consolidated Statements of income......m............ $ 19.952 5 81.629 $ 93.096 ..................e Reconciliation oflocome Taaes Computed at Statutory Federal Rate to Total Income Taaes income before income taxes (including cumulative effect of accounting change)... 5252,601 5357.920 $396,508 S ta tu t o ry fe d e tal income t u ta te............................. e...................................... 344t 34 % 34 % income taxes computed at statutory federal rate.................... 85,884 121,693 134,813 Increases (decreases) in income taxes due to Depreciation differences not normalired........................................................., 4,301 4,610 4,990 Allowance for funds used during comtruction................................................... (18,140) (11,336) (9,565) Amortization of deferred investment tax credits............................s................... (7,337) (7.906) (10,760) Investment tax credits flowed through tc. income...-....................................... -(15,283) (10,219) (8.556) Dividen di i eceived ded uct 10n...................................................................... (4,352) (5Ii1) (5,084) Equiry in earnings of Safe Harbor Water Ibwer Corporatan.................-.......... (1,666) (1,760) (1,894). Loss on disposition of asse ts......................................................................... ( t,892) (2,230) (4,329) Deferred tax raie differentlal.: (3,062) (2.673) (3.385) Other.......................................................................,.......................,,,.. 948 (3,439) (3.134) Total ineo me taxes.......................................................... $ 39.401 5 81.629 $ 93.096 Effective fede tal income tax raie..........................................-......-........,.... I 5.6% 22.8 % 23.5 5 Taxes Other Than income Tases Capitalstock.............-................................................................-......... 5 48,198 5 46,515 5 44.328 Property........... 37,174 36A44 34A75 Public service company franchise............................-............................. 42,812 38.293 36.040 social secu ri ty...............,................................................................... _.. 30.344 27.843 25.980-- other.......................................................................... _6a0 . 2 094 7s9 Total taxes other than income taxes................ 165,298 156.189 148,732 t Amounts included above charged to acwunts other than taxes....,.................. (8.576) _(5.985)_ (5,605) d Taxes other than income taxes per Consolidated Statements oflacome.-......., $1%722 $150.204 $ 143.127 See non se comolubredfinavialstatemenu. 34

NOTES To CONSOLIDATEl> FINANCIAL, SMMNI NTS Mwn.ew G,o nd him Coupg, ned 3sandem 1' Noit 1. Su so naNi A(( on t tu Pot u it s / meure of the inunnen i m l.md Pun h,aed i new t mii Baltimere Gu and Llectric Company (BG AE) and Subsidiann Subject to the apprm al of the hiaryland Comminion, tu cost (collectively, the Company) is primarily an electric and ps of fuel med in generating tketricity and the wit of gu sold may utility serving a territory which encompaun Balurnore City and be rewvered through tero-tiased electric fuel rate and purchased all or part of nine Central Maryland wantin The Company is pai achu<tment damn (see Note 11). To the extent actual fuel aho enpged in dnersified budnn, acovitin as further dncribed witi differ from revenun under the dausn, BGAE defers the in Note 3. fuel wits and auurnulain them on the balance sheet to be s recovered fron or refunded to customers in future periodo Pringin of Conmh& tion An implemented by the htaryland Comminion, the electric The coraolid:ted financial statements include the acwunts of fuel rate formula is based upon the laint twenty four month BGNE and all subsidiatin in which BG A L owns directly or genersoon mit and the latnt three rnanth average fuel wit for indirecdy a maiority of the voting giock. Intercompany balanco each generating unit. IJTective June 1,1990, the Maryland and transactions have been ehminated in wnsolidation. Cornmmion moddied the clntric fuel rate formula and ordered Corporate joint venturn. partnerships, and affihated companin BG Al to include a enirumum level of nuclear generation in it in which a 50% or !ca voting internt is held are acwunted for twenty.four month generation mit The fuel rate does not under the equiry or wit methods. Under this policy, the chanp unleu the calculated rate a more than 5% abme or acwunts of Constellation Holdinp. Inc and its sub.idiatin below the rate then in effect In addition, the Maryland (collectively, the Conitellation Companin) and BNG, Inc, are Cornminion ha authottred a surcharge to the clntric fuel rate consolidated in the financial statements, and Safe Harbor W.ter to enable BGNL to rewver a portion ofits undeaccovned Ibwer Corporation is reported under the equity method. deferred electric fuel cmtt BGNL he rewvered $62.9 milhon from this surcharge through Dnember 31,1990 and expects to ikgulation of INhey opuuions remver an additional 515,3 mdhon between January 1,1991 PGNEi milit) optraicns are subjec; tu iegulation by.he Public and the wheduled ternannt,on of the surcharge n g Service Comminion of Maryland (Maryland Commiuionh The October 1991, accounting for utility operations is in accordance with the The purchased pi adjmiment a baed on retent annual Uniform System of Accounti prescribed by the lederal Energy volumn of pi and the related wrrent pricn charged by Regulatory Commiidon end adopted by the Maryland BG AL's pi supplins. As authorized by the Maryland Comminion. The accounting pohcies and practico used in the Comminion, any deferred underrecoverin or metrecoverin of determination of servia rain are aho generally med for financial purchued gu mus for the twelve months ended November 30 reporting purpmn in accordance with genera y accepted each > ear are charged or creditrd to cuuomern over the ensuing 4 accounting principin for regulated induurin. calendar year (see Note 11h The underrecovered costs deferred under the fuel clamn were Utihty Rnennn u follows: EfTective January 1,1990, BGNE changed its revenue At Decembei 31, recognition policy to provide for the ucrual of rnenue for Jypt _l R service rendered but unbilled u of the end of each month. Prior unw unu to 1990, revenun were recognized at the time cmtomers' meteri Electric wne read on a monthly cycle bain The new puhey wu adopted Com defnred, 542H,632 5322,820 in order to provide a better matching of revenues and expemn Providon for ponible and to conform with the predominant practice within the utility diullowanse of icplaa.nent industry. This change in pobey roulted in an inuease in 1990 encrpy com (see Note 11, _ 35,000) ( net income of $31,675,000, or 38t per common share, This Net clectric 393,632 322,820 increase comhted of an iactene of $37,754,000, or 46< per du, JR57) _ 22,284 common share, attributable to the cumulative effect of the Total. 5389,775 5345.104 change at January 1,1990, partially ofhet by a decieue of 56.079.000, or 84 per common share,in the December 31,1990 At Duember 31,1990 and 1989, the amount of electnc accrual. If the current policy had been in efTect in prior yeus, deferred fuel msts induded in rate bec by the Maryland net income wouki have been increned by 56,046,000, or FC per Cornminion for ratemaking purpmn was 572,795,000 and common share, in 1989 and by 54,445.000, or 6e per common 560.295,000, rnrectiv ely, share, in 19FA 35 l )

4 Mnwe Gu nodWem Cmm oued%dwm Interne Taus for finandal reporting purpmn, the Company enords tertain Upon adoption of Statement No. 96, the balance of revenues and npemn in years ddfert ni from the yurs in which atcumulated deferred income taan would increce_Although they are recognized for income tax purpmes. Deferred income changn in utility-relatal auumulated defenni inwrrw tain taxn are generally pmvided on timing difTeremn cucpt show arising from the initial application of $tatement No. 96 pertaining to suelerated depreciation on pre lO property generally would be deferred and enovered from or refunded to additions. The cumulative net amount of timing ddTerenco for cuuomets in future years. thangn aswciated with nonregulated whkh deferred inmme taxo have nm been provided activitin would How through to income. As a anult of its effnt ipproximated 5215 milhon and $227 milhon as of on nonregulaird activitin,5:atement No. 96 is prnently Dnember 31,1990 and 1989,inpecovely, npnied to tnuit in an increase in net income of approximately The invorment tas tredit (lTC) anoaated with itGNii 515 milhon for the year in whic.h it si adopted. regulaird utility operations is deferred and amortired to inwmc ratably over the hvn of the subint propnry. M C and other tax 1memor) Wluation credits anociated With nonregulated diverhibed bminni I ucl timks and materiah and supplin are generally stated at activkin other than levnaged lean are lhiwed through to aserage unt. income. As of Dnember 31,1990, the Company had energy tex credit carryforwards of $8,410,000 which capire in the Irnutmente year 2005, Marketable snurities are stated at the lown of aggregate (mt or BG&l" utility revenue h subject to the Maryland pubhc market value, and other snuritici are stated at (mt. There service cornpany franchie tax in lieu of a state income tax. The - appropriate,(mt reflecti amortiution of premium and dixount - - franchin tax is mcluded in taan other than income tan in the twmputed on a straight line boit Gaim and lunes on the sale of Comolidaied Statementi of Inwme. invntment securitin are remgnised up<m realiution on a - The 1989 and 1990 current tax refunduomist of a regular specific identilkation bals. tax refund reduced by an ehernative minimum tax (AMT). T5,tse :tgu'ar t,.x reiunds reprnem principally the las heaclit of Utdity I'lant and Depreciati<m s net operating loan (NOla) incurred in 1989 and 1990 which Utihty plant in service h stated at original uai, whhb !ncludn ere being carried back to rnover taxn previoudy paid in t"86 material, labor, comtruaion overhead msre, and, where end 1987 at federal tax rain of 46 percent and 40 perant, applicable, an allowame for funds owd dunng construction.- rnpectively. The AMT liabilitio can be carried forward as tax Comtruction work in progros, plant held for future me, and credits to future years in which the regular tax liability eucedi nuctor fuct are stared ai cmt. the AMT lisbility; e of Dnember 31,1990, this carryforward Additiom to utility plant and replxements of units of totaled 557,414,000. In that the NOla and AMTi are property are capnalired to utility plant anounit The original - sitributable to timing differenas deferted taxn were nat of plant retired h removed from utility plant, and such mit, p,ovided thneer plus removal cmt, leu salvage value, is charged to the $tatement of Financial Aaounting Standards No 96, anumulatni pmvision for depreciation. Maintenana and which is still being reviewed by the Financial Auounting repairs of property and repNements ofiterm of property Standards lloard, proently muu be adopted by 1992. As determined to be ins than a unit of property are charged to prnently inued, this Statement would require a change in the maintenance expeme, enounting for deferred income taxn from the deferrn! method Depreciation h generally mmputed using mmposite to the liability methmt. Under the liability method, the straight line raici, applied to the average invntment in dann ' Company would be rnjuired to accrue deferted income taxn on of depreciable property. The compmite deprniation rain by substantially all temporary differencn between the book and tax des of deprniable property are 2.80% for the Calvert Cliffi baso of anm and liabilitin, to adjmt deferred income in Nudcar Ibwer Plant,2.75% for the Brandon Shorn Ibwer balances upon enactment of chango in tax rain or laws, and to Plant,3.26% for other electric plant 3.12% for gn plant, and -disamtinue net of. tax reporting of the allowana for funds uwd 4,02% for common plant other than vehidesMehides are during comtruction. depreciated bawd on their ntimated useful livn. 36

s a tuhoount ca, oroutIkim t mpv ehkuiaw Nucleat duomminiorung wits are aurned by and reuncred Maryland Comnuuion nuhed in the atur tas Al C tate through a sinking fund methodolop in in Dnembu 1990 rate being inoened to 8.80% compounded annually, and the ordet, the Maryland Conuninion pai.ed IRWl: addaional 5%344.000 of wnurustum npendnurn on tirandon entnue to prmide for an inoene in in nudear Shorn Umt 2 bemg reimtated in the Al C base. Idnine deuimmisdoning aurual in order to ascuntulate a rnerve of Deumber 17, l'No, a nie order of the Mar 3land Comminion $275 million in 1989 dollan by the end of Cahert Chfin'senisc reduced the aber-in Al C rate to N49% wmpounded annual 4 hfe. The total dewmmiuianing rnene of D2.026D00 and $41,135.000 at Dnember 31,1990 and Im, inpectisch, n Nu,lrar i url included in aaumulated depiniation in the Consohdated Nudcar fuel opendaurn are upaahird and amortired e a Italance $heen. wmponent of aaual fuel sosn baud on the energy pniduent inG&l is required by regulanons of the NuJear Rrgalamr3 over the hft of the fuel. Ien for the future diyma' of spent fuel Commisdon (NRC) to prmide financial aourance that are paid quanerly to the Department of I nemy and are aurued dnomminioning funds in an amount at leau equal to an NRG bard on the kilowatt houn of cleariuty generated. Nudear fuel openso are suh nt to reuntry through the clearic fuel rate. prncribed minimum hvel will be auumulated ov-r the remaining wn he life of the Cahert Chffs plant. \\camhng!y, ItGN1; hn ntablished s tat quahfied dnommutonint. net to t h fond Nmirar t ape ndnurn w hkh a ponion of decommimoning wsu auturd hne tren Defened nodear openditurn reprnent the net unamortized omtributed, balance of unain opoationi and maintenante wsu whkh, m auordanu with orden of the Maryland Cunimmion, have been Alion anu for f und, Wed Duting Comtrmtior deferred. instuded m rate bee, and are being amortired over the The allowana for funds used during wrutruction (AIC n an remaimng hfe of the Calven Chifs Nudcar Power llant. Thne 4anuntinc pro < edure whereby the rmt of funn. ed n, bne e pendiwn mn.45 cf wm iecurred f om !Y79 thragh 195;? utihty et.ruttion projects is capitalised n pan i f unl ty plant for irupeaing and repairing seismic pipe supporn, npenditmn on the balanu sheet and is medard n a nonush item or, the incurred duong 1989 and 1990 auociated wnh nonrecurnog inwme sturment. The mit of bormwed and equity fuxh n phno of(ertain nudear operations projeas, and openditurn segregated between net imerni durpn and other inwme, incuned during 1990 for invntigating leaks in the preuoriin rnpntivdy. ItG&l'. rewven the upitahin! Al C and a return heatcr61co n. thereon after the rdated utihty plant is placed in servi.e and induded in depreciable auen and rate bue. Al C does not Ieng Inm Debt repinent tauble inwme, and the deprniation of opit dued The dnwant or premium and opeme ofiuuance awodated Al C is not a tax <lnluaibh npense, with long term debt is deferrnt and amortiini mer the hves of During the period January thmugh March lu, an after=tn the inpeuise debt inues Gains and loon on the reasquintion AlC rate of 8 55% wmpounded annually, was apphed to all of debt are amortiicd mer the remaining originallivn of the major electric proicen.1(Tutive April 1988. an acwu,ong iuuancn. dunge authorired by the Maryland Comminion rnulted in 537,603,000 of lirandon Shorn wmmon facilities p,vioudv Cash flom wnndered pan of Unit 2 for regulatory pursues, a wdl n 1or the purime of reponing cnh flows highly liquid 5R344,000 of wnstruaion npenditurn on Unit 2, t.ei,,g imntmenn purthned with a nuturity of three months or lea removed fmm the bee to whkh the 8.55% Al C rate wn are wnddered to be cnh equivalenn. applied.1.fTutive Dnemba 15,1989, a rate order of the l U

Munnm Gm aJlkmu Cepey ed Mndwm Nort 2. St attxt ININtArioN Year Ended December 31, 1990 _ 1989 1988 un muune Electric Revenues. 51.664,154 51,519,294 51,434.562 Income from operatione. 264,814 388.071 418.647 income from operations net ofincome taxes.. 233,863 307,300 326.882 Depreciation.. 146,188 135,735 127,784 Cumulative effect of change in the method of accounting for unbilled revenues.. 30,173 Construction expend;tures On:luding AFC). 482,529 406,410 276.278 Identi6able assets at December 31., 4,796,542 4.279,399 3,746.826 Gas Revenues.. 5 373,419 5 411,801 5 381,536 Income from operations.... 35,919 55,230 54,505 income from operations net ofincome taxes.. 30,654 42,343 40,251 Depreciation.... 17,243 16.169 15,164 Cumulative effect of change in the method of accounting for unbilled revenues.. 7,581 Construction expenditures (including AFC)....... 5).,787 40,929 41,740 laentifiable assets at December 31.. 447,292 433.248 394,013 Diveuihtd Auivit;es Revenues... $ 101,690 5 73,041 5 47,570 Income from operations.. 32,646 33,284 23,798 income from operations net ofincome taxes.... 48,910 45,313 36,721 Depreciation.. 7.155 4.642 4,108 ldentinable assets at December 31.. 1,041,365 836.530 622.860 Total Revenues.. 52,159,263 52,004.136 51,863,608 income from operations.. 333,379 476,585 496,950 Income from operations net ofincome taxes.... 313,427 394.956 403,854 Depreciation.. 170,586 156,546 147.076 Cumulative e!Tect of change in the method of accounting for unbilled revenues. 37,754 Construction expenditures (including AFC). 535,316 447,339 318.018 Identi6able snets at December 31.. 6,285,199 5,549,177 4.763,699 Other a sets at December 31.. 425,176 436,502 362.663 Total at ets at December 31. 6,710.375 5.985.679 5.126.362 38

Muvr G,o ed nurn. wpy ed kl,udww Noli 3. StWUtWJ N OutM ION lhversified budnen activitin wnsist of the operations of method. This invutment reprocnts two-thirds of Safe liarbor's Corutellation lloldinp, Inc. and its subddianes and itNG, Inc. total sapital atml. imluding one-half of the soting simL, and a P Constellation Holding, Inc., a wholly owned subddiary, two-thuds hiernt in the subddiaryi retained carnmp. heads all of the sim5 of three other subsidurin, Comtellation The following is wndensed financial mformation for Inyntnwnts, Inc., Comiellation 1.ney v Inc., and Comtellation Comtelhtion Holdinp Inc. und its subddiarin and Safe Harbor Real l'. state Group, Inc. Thne wmpanin are engaged in diverdfied Water Power Corporation Similar information is not prnented bunnen activnin inJuding financial intntment; the-development, for inNL, Inc. as its finantial podiion (shareholderi eqtaty of ownership. and operation of ahernative encrp systenu; real ntate $6.2 million) and enuhs of operat;om (tontribution of it per development; and ow nership of senior living facilitin. wmmon share to the Companyi catninp) are immaterial to the llNG, Inc. is a wholly owned Suhddiary whkh invnes in natural wmolidated finantial statements. The wndemed finantial ps rnervn and obtains gas from nontradnional murtn. informatmn tot the Comtellation Companin does not reflett the The invntment in Safe liarbor Water Power Corporation, a ehmination ofinterwmpany balarues and tramactions wliith are produter of hydroelettric imwer, is reported under the equity chminated in the Compania wnwhdated finanual statementi. ~1990 _ _ 1989 . _19HH tin t houuna. I up Pn h Arnounn) Comiellation iloidinp, Inc. cnd Subsidiarin inwme Statemems Rev en un........... $ 106,175 $ 77,787 $ 51.433 lapemn other than internt and inwme taxn.. _ 73,537 _ 44,966 _ _ _ _2 7J61, ince ne from operatiom.. 32.63H 32,H21 24,172 Other income.,. 952 340 196 In'erest opeme............ 37,345 28,709 18,917 inwme tax expeme (benefit).. jl7,H59) (14,678) (13,108) Net inwme.. 5 14,104 $ 19.140 $ lH,%9 Contribution to the Companyi carning per share of wmmon stock.. 5 .17 5 .24 5 .24 lialame Sheets Current aucts. $ 71,H37 $ 68.H58 $ 38,942 Noncurrent auets. 964,095 760.688 57s,991 Total anets.. 51,0 M,932 $N29.546 5614.933 Current liabilitin.. 5 439,6H7 5 26.7.46 5 25,599 Noncurrent liabihtin,. 343,602 551,482 363,931 Shareholderi cquity. _ 252,643 , 2 51,32H _ _225,403 Totai liabihties and shatcholdesi equity. 51.035,932 $ N29.546 5614.933 Safe liarbot Watee Power Corporation income Statements Rn enues.......... $ 2H,793 $ 28,713 $ 29,454 lapemes other than internt and inwme taxn.. _ 13,163 _ 12.337 _ _ 12 138, 1 Income from operatiom..

5,630 16.376 17,316 Other incorre.

721 700 211 Interest rspeme. 4,702 4,700 4.727 inwme taxes.. 4.299 4,612, 4,881 Nei in ome.. 5 7, B0 $ ' 764 5 7319 l\\GN!"s equity in carninp., 5 4.900 5 5,176 5 5.570 Dividends paid to llGNE by Safe liarbor. I1.084 $ 5.142 5 3.960 llalance Sheets Cutrent auets. 10,H03 $ 15,464 $ 9.600 Noncurient i'. nets., _122.044 ,124.932 _ l.27,947 Total anets.. 5 132,847 $140.w6 $ 137,547 Current li,ibilitin.. 5 3,798 5 3,801 5 .i,788 Noncurrent liabihties.. 77,686 75.963 73.247 Shareboklers' equiry. _ $ 1,363 60,632 _ 60,512 Total habilitics and shareholJeri equity. 5 132.847 $ 140.396 $ 137.s47 IlGN Ei invest ment.. 5 34.241 5 40A21 5 40.441 39

e liainmeer G.n ad 1Jurru-Censpous ed %%n%*m NOrl. 4. l'INANCIAl INV1 WMINi$ ANI) RI At. I'si Ai1 I>itoli cis Financial invntments consisted of the following imotments held in August 1989, a suhiidiary of Comtellation iloidinp. Inc. by the Comtellation Companin: acquired 100% of the anets and liabihties of a real ntate At Deteruber 31, partnership in which it had previoudy held a 50% couity _1990_ 198L internt. The aut ts acquired totaled $66.934.000, includmg do'liununda 562.354.000 of real estate property. and the liabilities anumed Marketable murities totaled $50.306,000. including $43.060.000 of long-term debt. At cost. > 82,051 5 79,355 The acquisition was enorded ming the purchase methm! of Net unreabied loss.. jl3,988) accounting. At lower of aggregate wst in July 1990, a subudiary of Conurilation lloldinp, Inc. or market value..... 68,063 79.355 obtained wntrol of socral real ntate partnerslops whic h had Other scouritin.,. o 17,659 22,216 prnamdy been accounted fm unda the n;uiry method. Iinanciallimited partnerdiips. 123,711-121.556 A'""dihi'ly, die Gnancial uatnnents reflert anett totaling Insurante companio... 72,603 62.70( Il5M'3L000, including $154,182.000 of real neate property, .~ Irveraged leasn... 40,496 40,510 and liabilities totaling 576.277.000, it,tludmg 574,734400 of 'lbtal........... 1322M2 5326.341 ""M"*

• "E"

' U " ""'

1. 4" I invest.nent.

Real otate projects comisted of the following invntments held by the Comtellation Companin: At Decernber 31. 1990 ,,1989 On linemdd Rental and operating properties (net of accumulated depreciation).... $219,778 $125,391 Propertin under developmero (net of accumulated depreciation).. 190,677 76.295 Other real atate ventures.. _ 2328. , 73.854 Total.... 5412.983 527ts40 .lo 1

lukower G,o ar dIkam t emy o.y and himd,aw, Noli s Joisitt Owsiti Lit < t rr ti iiiii1 l'i as i liGN!; owns an undividalinternt in the Krystone and The following data et perwnt liG A I i dure of the puntly on ned Conenuurh minc.nmuth clettric generating plann huted m pmputin at Ibnnhcr 31.1"90. wntern Ptnmylcania, as well as in the tranuniwion hne w hah 1 raninnuion tramporu the plana' output to the joint ownen'scnia Krvuom Conemacph 1 mr territorin Finanung and aaountmg for thew proputin art ihr a o,M Am.,mm m wounM same as h,r whou owned unhty plant. ItGAlis shaic of the r ( M n( edup intriot, 20.9'On 10,56 % ., 00'%, dirnt rhpt nwn and a%CB and liabiIttin of the joint proprit) th li ihty plant m senitc. 5, s,9 %., 5 41,2s6 $ l A86 t = included in the uurnponding wotiorn of the Conmhdated Auumu.uted drpenianon. 2 U87 14.9'9 til Statemona of. Inu,mc and Conmhdated Balanto Shectt Consitutoon work m. propru, 3,051 1,0'2 Noli 6. Siloni liioa lioniurriscs / Infoimation u,nterning umunntial paper noin and hnn of uunpcmating balantn w hi<h h.nt no wahdiawal intn. tiom. ordn h wt forth below. In support of the linn of ordit, the l\\orrowinp t"uln the lino are at the banks' prime rain, baw Company pays uimnutment fcn and, in mme taws, maintams meernt rain, or ai varmm money enarlet r un. 1990 l !89 __ __ 1988 (n..n.n Amounn m n,onunao ilG&l?s Commercial Paptr Noici botmwinp ountandmg at linember 31. $ 163,700 $ 117,300 $ 72,050 Wrighted avuage ininnt rate of noin ountandmg at I)nember 31. 7,91 % 8 69 % 9.6.W Unuwd hon of ordit supportmg commercial paper noin at lbomber 31. 5225,000 5200.000 $150,200 Maimum borrowinp during the year. $344,200 $21 D s0 5 83,000 Average daily borrowinp during the year (at $21 H,642 $ 8',02 $ 5 23,514 Trighted avnage internt ratr for the year (bk 8.29 % 9.26 % N 07% Constellation Compaint s' liries of Ctrdit l\\orrowinp ountanding at linember 31. 5 M,000 5 6,507 $ 7,37s Wrighted a,trage interni rate of borrowinp ountandmg at ()ctemhet 31, H.89% 10.6s % 10.64 % Untned linn of unht at linember 31. $ 10,000 % 7A93 $ 1,625 M,uimum lxurowirip during the par, $ 64,000 $ ?,130 $ 12,3%9 Average daily borrowmp during the year (a).. $ 38,932 5 5,588 $ 7,90s Weighint au rage internt rait for the year (b).. 8,93 % 11.12 % 9.14% (4) The sum of do!!ar dan of ouniandmg borrowinp dhi&d by thi number of dos m the period. (b)'Ibut interni aurned during the period divided 19 au raye dady bonowina 0

o Mrmee Go ad&n cmr aJskJwm l NOlL 7. LON61'i RM Di Br-Titst Refunding Mortgap Ikmds Substantially all of the principd propenics and franthhes owned inGNI; rnaintains revolving credit agreements providing for by liGNE, as well as the capital stock of Connulation iloidiup. borrowinp of up to a total of $200 million. One of thne Inc., Safe 11 arbor Water Ibwer Corporation, and itNG. Inc., are agreements. which provides for borrowing of up to $50 million, subject to a tien under the morigage under whkh 1)G&l;'s first expirn in Dnember 1991, and the others, whkh provide for llefunding Monpge lionds are luurd. twrowinp of up to a total of $150 milhon expire in 1993. On August 1 of each year,itGkE la required to pay to the Under the terms of the agreements.1\\ GAL may, at its option, mortpge trustee an annual sinking fund payment equal to 1% of obtain loam at variom interni ratn A ommitment fee is paid the largest amount of Mortpge Inonds outstanding under the on the daily averap of the unionowed portion of the mortpge during the preceding twelve monda. Such (tmda are to commitment. At December 31,1990. InGNii had bonowed be used, ai pmvided in the mortpp, for the purchase and $175 milhon under the revolving credit agreements and had retirement by the inmee of Monpge liondi of any ser;n other available $25 million of unmed capacity under one of the than the Installment Series of 1998. 2002, and 2009, the agreements expiring in 1993 94% Series of 1995, the 8.40% Serin of 1999, and the The medium-icrm noin mature at variom datn from 6.80% Serin of 2004. Purthain may be made by the inntre January 1992 through January 1993. The weighted average in the open market and/or through rnp(man to invitations for interni rate for noin outstanding at Dnembei 31.1990 h 8% cesed proposah if purchasn are pouible at or below the Interni rain on the $100 million of f loating itate Notes due applicable redemption prke. or direnly thmugh the redemption 1995 are determined quanerly based on the 91. day Treasury llill provhions to which the Moripp ikmds are subject if purchasa aunton rate (exprosed on a band equivalent basis) pha 1.1% st a more favorable prke are rmt poulble. liGAE may purchase The internt rate is subject to a minimum and maximum of 8% outstanding Monpp ikmda from time to time and may submit and 12% topcaively. per annum, its scaled proposal for the sale of such Moripp lionds to the internt rates on the $100 million of Hoating itate Notn due trusice for the sinking fund. 1995 Serin 11 are determined quarterly based on the 91. day The principal amounu ofinstallment Serin Monpp lionds Treasury 11111 auction rate (uprnsed on a bond njuivalent basi 0 payable each year are as follows: plus 1,125% The intnut rate is subjnt to a minimum and maximum of 7.9% and 11.9% rnpectively, per annum, yn,. D"M"' U1fopue Bogue gg iongTerm Debt of Conutilation Companies C<mstellation } loidinp. Inr. (CHI) maintains committed credit 1991............,................ 5 2,15 5 apeemenu that expire at various datn through August 1991 199 2...........m., 3.000 and permit loans at various internt rain. Commitment fen are 1993.............................. 3,000 $ 420 paid on the daily averap of the unborrowed portion of the 1994................................. 3.000 -430 commitments. CHI sho maintains' uncommitted nedit 1995............,................ 3.000 605 apeemenu which are supponed by liquidity faciliiin for 1996 and 1997,............... 4.000 605 Imnowing under a loan sale propam at variom intnest rain. 19 9 8............ ;............... 33,000 690 At December 31,1990. Cl11 had borrowed $266 million under 1999..............................., 690 thne credit aperments, and there is no unused capacity 2000 and 2001.................. 865 thereunder. .2002............................. 6,725 The mortpp and comtruction loans and other collateralized 2005 thmugh 2006............. $ 3,250 noin require monthly principal and imernt payments 2009...................,........-.... 42.000 through maturity, The industrial Park Facilitin lionds require principal Other I ong/lenn Debt payments of $700.000 in 1991 and $750,000 in 1992. Internt The loan under the ur secured credit facility matured on is payable semi annually at a weighted averap rate of 10.25% January 15,1991.This loan has been clanified as long term The $100 million of 8.30% unsecured nata are subject to a became, subsequent to December 31,1990, it was refmanced on mandatory sinkmg fund under which 30% of the principal a long term basis through the $25 million of unused capacity amount will be redeemed at par in each of the years 1991 and under the revolving credit speements dhcuned below. 1992, with the remaining 40% being redeemed at par in 1993. 42 l 1, l

O 9 Mnm.ar & sud Wrow Cmp.wpd.%bdwin i n Wrighted Aurage internt Rain f9r Yariable Ibte Debt Ansgaic Maturitin The weighted average interni rato fm variable rate debt during The combined aggregate maturitin and sinking fund i 1990 end 19H were as followu requirements for all of the Company's long term bormwings j , 1990 ,19 % for each of the next five years are as followo i ItGN!: tcans undet unwrured credit facility...... 8.81 % Yur Reguirementi. Imns under tevolving credit aptccmento.. 8.44 9.56. -da N """ " 4 Floating raic noin.......~.............. 9.04 9.67 1991.. 5430,112 ...-...o i. Floating rate notes Serin 11........... 8.99 9,51 1992.... 168.425 lbliution econtml loan.................. 5.84 6.35 1 "9 3.......... 390.876 lbrt facilities loan.... .m............ 5.91 6.32 1994....... ....-... m. 46,446 Adjustable rate pollution controlloan.... 6.15 5.91 1995.-.....................-........... - 428.075 [4onomic deYelopment loan.o 6.05 6.45 nuo.no.n u Constellation Companin Mortgage and construction loans and other collateralized notn............. 9.89 11.13 1 toans under creda agreements..... 8.56 9.48 .- j NOTl; 8. Rint MAi1r Piti.it stiNet Sma The 68,000 shares of the 12 %,1981 Serin A outstanding at The combined aggregate rulemption trquirements for all December 31.1990 ce subject to mandatory redernption at par serin of redeemable preference smck for each of the next five on July 1,1991. Pursuant to the redemption requirements. years are as followo 'j 68.000 shares were redeemed at par in each of r$ e years 1987 - Year i Re through 1990. The 12%,1981 Serin 11 is subject to mandatory ~~ Ti,guirements mo ,,o tedemption in its entitery at par on July 1.1991* 1991"" ' ' ' $22'800 ' The 6.95%. !987 Series and the 7.80%,1989 Serin are subject to rnandatory redernption in their entirety at par on " ' ' ' " ' ' " " " " ~ ' " " " " " " ' " " " ' " " " ' " " * " October 1,1995 und July 1.1997, ropectively. t i The following serin are subject to an annual mandatory redemption of the nuruber of shares shown below ai par beginning in the year shown below. At inG&D option. an With regard to payment of dividends or aswts available in the adaitional number of sharn. not to exceed the saine number as event ofliquidatioa, preferred stock ranks prior to preference are mandatory, may be redeemed at giar in any year.- Stock: all inues of preference stoc k, whether subject m > commencing in'the same year in which the mandatory man laiory redemption or not, rank equallyt and all preferred redemption begins. The 8.25%,1989 Scrin and the 8.625%. and preference stock tanks prior to common trock. 1990 Serin hsted below are not redeemable racept through ~, operation of a sinking fimd. 11e. inning .S_er.i_es. - _ Shares ' car 7.50%, I 986 Series.............,....o I5,000 1992 6,75 %,1987 Se ries................... 15,000 1993 7.64 %,1988 Series...................... 100.000 1994-8.2 5% 1989 Serio.................... 100.000 _1995 8.62 5% 1990 Serin................. 130.000 1996 ,-,~.r--._-a-,ewp. a~., w, e no v.e ...%,-w%w..rw.-.w.,+=....-w,,.-,----r.n.,--cm..,..--.m,-,4e.,,,--,.% -m%,.-,e,., E,

e kinwe % andIlank Capm niMukerm Noil 9. PLNsioN Anis 011ti n Posi nt'llut ut N^i lit NiaiIs The Company sponsori sneral nonwninbutory defmed benefit average remaininpervke perimi of attise employees. pernion plant the larpnt of whkh (the Pension Plan) mvers The Companis pohty is to fund annually the cmt of the BGNi: employen and tertain employen of the Conuellation Ptosion "lan as determinni under the appepte mu method. Companin. The other plans whkh are not materialin amount. Plan awes at Dnembc r 31,1990 consiued primarily of provide supplemental benefin to cenain Lev employees Itenella marknable suuritin gmup annuity entra:ts.and " I " * ** "" C"" ' undet the plans are generally baed on age. years of servke, and '"! N'"fo liie w ng ta n an fonh die condo.ned h,nancial status wrapensation in cis. Prior scryke cou aunciated with retroacnvc plan . die pin and the compson of total net penison wu: amendmenu is amortiini on a straight.hne bois over the At Dnembc 31. I990 19H9 0 n..lle Amouna in 't imuunk Aaumulated benefit obhption Ves t ed.................... 5377.8I8 $355.232 Nonvnted.. _i1,283 11J5H 'Ibtal.,...... 53H9.101 5366390 Plan aura ut fair value. 5474.688 5475.333 Projected benefit obliption.. (472.90p __ 46.540) (4 Exceu of plan amis over projected benefit obhption. 1,784 28.793 Unrewgnued prior servke mst. 10.597 11,404 Unremgniied net gain............... (18,860) (47,649) Unamortised net auct from adoption of I A$lt Statement No. N7. (2A92) . _ 2.71 H) ( Actrued pension cost.... $ mM7I) $ f10.170) ....mm. Auumptions Discount rate.............. 9.25 % 9.25% Average increaw in future compensation levels.. 4.5% 4.5% 14 ccted long. term rate of return on amis. 9.5% 9.5% Year l'nded Dnember 31, ._ P/9L. - 19H9 _._ .1988 On ibouwmW - Compments of net pension wst Servkr cost benefits carned during the period., 5 11,257 $ 10.H93 5 9.813 Internt cmt on projected benefit obligatmn. 40.455 38.042 35.50H Actual return on plan auets...... (18.881) (64.593) (41,068) Net amonization and deferral.,. (23,066) ,,_24.507__j,74 4_ Total net pension cou....... 9,765 8.849 5,997 Amount capitalii.ed ai conuruction cost.. __jl,377) Ji 237)__ JH02) a Amount charged to expeme. 4. 5 H.3RR $ 7.fil ? $ %.195 in addition to providing pension benefits cenain health care must be adopted by 1993. roluirn a change in the method of and life insurance benefits are provided for retired BG&E anoontmg for postretirement benefiu other than pemions frmn employen and cenain retired employen of the Constellation the prnent pay.avyou-go method to an accrual methml. Companin. The cost of these benefits is generally rewgniied as 110 wever, the Company expecn that the adoption of this . the benefas are paid and totaled 511.464,000 for 1990. The Statement will nor have a significant impact on net income cmt of providing these benefits for yean prior to 1990 is not bnause any increawd costs for which service rates are not separable (mm the cost of providinpimilar benefia for active provided would be deferred under the provisions of Statement employees.- No. 71 for regulated enterpriws. Statement ofIinancial Acmunting Standards No.106. which 44

s NIlfl*Ntnt rn.8f d%$ $ $rs f*W ( E Qdr > AMd Akkad4n y No1i 10.1 IN.I.5 The Company, n lence, sontrain hir urtun faohtin.u.d Cenam of the (:omtdiain n Cinnpamn. e insor. Lau equipment under lene agrecmena w ah urious npiration datn t otucd into olwratmg k,nn lot olha and retail spaa. and it newal optiom. Comistent with the icgulatory truiment. Thne lenn opin mer pouwb vanpng f rom I in 25 nan. Icar payments for operating and capaallenn for unhty w nh opnom to renew. The net lu.ok s. dot of poipcrty undct operniom are thanged to opeme m il~ Comohdaird operaung lenc-w e 518".419.0n0 and Sko.Oso.000 ai Statemenn of In ome. Irne opcme w.n as folhiws for ihr linemhci 31. PJoo md 1984 rnpu t.nh. The imurt three ycan ended Desember 31: nanimum reniah to ht uam d undn operanng k.nn in 1990 . logo logs elleo at !)ntmhei 31, lo"0 art a follows. On 1 h..ounda (jperating Icasn.. $ 13.240 $ 1 %,031 $ 14.014 g.g, g Lapnal lenn.. 330 36% H39 1991' 5 H 101 Total lene npcme. S I L5?O ^$18406 5105\\ 1992.. h 728 CapitalIc.nn included in the finantial statemenu hut not 1093,. N.222 dmhned separatcly scprocnt men and obbganons of 199 L ',152 $1,097,000 at Dn ember 31.1990 and 51,211.000 at to R

t090 Darmhrr 31,1989.

Thoca' o. 3kJ31 The futuir minimum Icec paymenn at Ducmtwe 31,1990 . lot.d minunum it atah. 5'6 074 for long-term nonunnlable tenn are as lhllon (}{ctatirig ('apital Tya.r_ _ linn _ lcan llre l houundd 1991. 5 4.9 t h 5 324 199' 4,5 % 267 1993.. 4.271 94 1994.., 1,91i kh 1995.. 1,00 H 86 Thercafter.. 3.394 %6 Iotal tuinirnutu Icbe pn nu nn. 5 20.95R I.423 Internt portion. (472) Prnent ulue of net tumuuum lene paymenn. 5 9si ( Nor i 11. O >uuli vi s i s, GuasAN iiis, ANi> 0)N ilN(.,1 N(:llh Commitmenn SGN! hn made sulatanual tonunismenn in (onantion w nh Edf (la %"oundo ia comtruction pmgram for 1991 and solnequent ytan. In addith('n, llCN)$ ha fntried into two longictin (ontrattg for th'* 199I. 2 h,896 purthne of ciccuic rennating capa. ity and energy. The ointracts 1992-68,'04 npire in 2001 and 2013. htal paymenn under ihne contrain 19 E 69.282 IW" 71.% h wt're $17 778,000, $12,922,000, avid $8.840,000 during 1990. 1989, and 1988. respntively. At Dnemher 31,1990, the 19 E '2.444 Thercaf ter.. 831,177 ntimated future paymenn for uparny and cocrgy that itGN1; is obligated to buy under ihne tontracts are a followv htal pavmenn. 51,142 411 l l As

4 Miwe Ga asdIkom GmorpodMisem Ccrtain of the Constcllatmn Cmnpanin have somnutted to cuntive maintename and opcoating cnntrol pnwedures tontribute addinonal capitd and ui :nale additional h>ans to epropriate for peneniing the outage. l.ficoive January 1,1987, certain aflihatn, joint venturn, and partncnhips in whnh they the Maryland Comminion authorired the niablishment of a have an internt. As of Dnember 31,1990, the total amount of Gennating Unit Performan(c Program (GUPI') to measure, capital umtribu ions commiurd to by the ComteHation annuaHy mihty mmphame with maintaining the punluuive Companin is $146 milhon. upacity of ennaing plama m teamnable levds by ntablishing i Gunanu n a system +ide generating perliomance target and indhidual BGNE has agreed to tuarantee two thirds of certain E" ""*"" targns for cadi base loahennanng unk in futuir url rate cannp anual gennanng p mnunce ahn indebtedness incune by Lfc liarbot Water Power Corporation I

• ""**
• I"' I '""" ""f"a gndyI* ' "'"P"d
• d 'f"'""

.(iec Note 3), The amount of sut.h indebininen totah 550 wpc target an H nwi, simo at B N anomphed million, of whkh 533.3 million reprnents BGN!?: share of the guarantee. Also, the Comtellation Companin have agrent to wah Ae nsjuurnwna oWandJaw. Fadute m nect de syunn-w targn wiu rnuh in reuew of each uno s aduced guarantee certain borrowing of various alternative energy and real ntate pminio As of Dnember 31,1990, the total '" " ^ E'""'""E E" f"""'"' ' "'""? I" P"I"""'"" 'E" ' annumng uimphame w w law and Ar bam fm pouMy outstanding loam guaranteed by the Connellation Companin ""P*I"E'E'"'"Y"" N E~ ' '" I"'I "I'*d"P "YT l qunnon de prudente of Mu"'"s anions m inaniom wnh were 596 million. The Company aunws that the thL of s matnial lou on the loan guaranteed is minimal. ropai to any given generating plant outage, whk h uiuld inuh Nmkar inmnouc in the diuliowsme of replacement energy unts by the Maryland An accident or an extended outage at either unit of the Calvert Conuniuion. Clifh Nudcar Ibwer Plant could have a suhaantial advene Since the two units at BG&l?s Cahnt Chfis Nudear Pown efTect on BGNE. The primary contingendo roulting from an Plant prmluce the lowest cost power gennated by llGNE, inddent at the Cahnt Clilli plant wouki invohe the physical replaument enngy unn amiciated with outarn at thne unin damage to the plant, the inovnabihiy of replacement power, can be signifkant, BGNE unnot ntimate tbc amoum of and liGNirs liabihty to third panin for property damage and replac ement energy unts that muhl be (hallenged or diullowed bality iniury. Although BGNE maintaim the various imurame in future fud raie pnneedinp but such amounts muld be policia cunently available to pmvide covnage foi portiom of manthd. these umtingencin, llGNE don not comider the available in Ooober 1988, ilGNii filed in fmt annual fuel raic imurance to be adequate to mye: the unts that muld resuk appliation for a change in in clntrk fuct rate under the GUPP from a major accident or an utendal ounge at either of the program. The rnuhant case before the Maryland Comnduion Cahnt Chih unin, coven BG&l?s opnating performance in ulendar year 1987, in addinon, in the evem of an incident at any nudcar power and BGNI? 'iling demomtrated that it met the system wide phnt in the muntry, BGNE muld be aucued for a portion of and individual nudear plant perionnance targen Int 1987, in any third pany daims, physical damage to the plant, and the Nove nber 1989, tntimony was fded on behalf of Maryland ont ofirplaument power amwiated with the incident Undo l'eoplei Coumel alleging that seven outages at the Cahert Clilh the pmvhions of the Price Andermn Act, BGNE couhl be plant in 1987 were due to management imprudeme and that aucued up to 5132 million per incident, payable at a rate of $20 the replaument enngy msts awmiatal with ihme outagn million per year, for third party dairm. Under the nudcar should be diullowed by the Comrniuion Total repimement imurance pooh in whkh BG&l; panidpain BGNL muld be energy mits amiciated with the 19M7 outaga were aucued up to a total of $24 million in any one imlky year foi apprmiresicly 533 nullion, physical damage, the mit of replacement power, oi radiation in May 1989, BGNE fded in fud rate case in whkh 1988 i injury daims by worken anniated with an incident at anothn performance will be naminnt. BGNE met ihr syncm. wide and company's plant. nudcar plant performance targen in 1988. People's Coumel allegn that liGN E imprudendy managed sevnal outages at lluourability of IJesuk i.uct U."" s i By statute, actual elecinc fuel aan are recoverable so long as the Cahen Clifhand BGNhuimm dm de ud r@mm Muyland Cormmumn fmds that BGNE demonorain that, enngy coin anociated with thne 1988 outagn wne approximately $2 million, among other thmp, n has mamtained the producnvc capacity of During 1989 and 1990, both un':n at Calvert Clifh had us generanng plann at a reaionable levd. The Maryland Comnumon and Marylandi highnt appdlaie murt have niended outafes beginning in the Spring of 19H9 when a leak we dismvne around the Unit 2 promriier heater deevn interpreted thh as permitting a subjective evaluation of each during a refuding outage.- BGNE shut down Unit I as a unplanned outage at BGNI.s gennaung plann to detamme whether or not BGNE had implememed all teamnable and mit lunaudomry naamn on May E 1989 m impm for similu cals and none were found. llowever, Unit I we out of wryke a i

s ikdwnour G,u andIkruu Compny and.%k ulww for the remainder of 1989 and 285 days of 1990 to undergo The Comenmion noted in the ordct that its review and findmp rnaimenance and modifiution work to enhance the reliabiiny on ihne inun pertain to the reawnab!cnce of 1\\GNI?s int 9 ear of various ufety systems, to repair eqtJpment, and to perform operations and rnaintenante expemn for purpmn of witing b.ne required perimlic surveillance ents. Unit 2, which is npected to ratn and not to the ropomibihty for replacement power (ous return to servite by the end of the first quarter of 1991, awniated wnh the outaro at Cainri Ch!k TL hiaryland remained out of servke throughout 1989 and 1990 to repair the Comminion stated that its dnision in the base raic case w dl have prnsuriier, perform maintenance and nmihfication work, and no mjuduau tlundmg) ethst in the fuel rate prmeedmg mmplete the refueling. The replacement energy mit aumiated esamining the 1989 1990 outagn. The work characterimi n with the 19891990 outages for both units at Calvert Chfh is avmdable had a sigmlicant impact on the duration of the Unit I ntimated to be approximately $415 milhon as of outage. Dnpite the hiaryland Comminion's statement regarding December 31,1990, no mjudnau efint, llGNI. rnogni,n that the views nprnsed in a Dnember 1990 order inued by the hiaryland by the hiaryland Comminion make the full rewvery of all of the Comminion in a 1\\G&l'. base rate prmeeding, the hiaryland replatement energy mti aw(iated with the Unit I outage Comminion found that certain operations and snaintenance doubtful. Therefore liG Ali has rnorded a pmvidon of expemes insurred at Calvert Chfh during the int year should 535 milhon agaimt the diullowance of smh witi whi$h redmed not be rewsered from ratepayers. The hiaryland Comminion 1990 carninp by 2M per mmmon 6 hare. Ilowever. DGNI. found that this work, which wu performed during the onnot determine whether replacement energy cmti may be 19891990 Unit i outage and fell within the int year, wu daallowed in the prnent fuel rate prmredmp in euns of the avoidable and ouwd by liGAl; actions whkh were deficient. provision. but iush amounti could he material. Non 12. Qmia liar ihNclat D Ai A (Uwoll e tu The following daia are unaudital but in the opinion of hianage-uln perimh gem rally msurring during the summer and w meer ment, indude all adjmtmenti nnewary for a fair prnentation. months. Aaordmgly, mmparisom among quatters of a year may l\\G&l"5 utility bmineu is seawnal in nature with the peak nm be inJicative of overall trends and changn in operatiom. _ _.___S"M" b.ndc{, _ g,, nani hh u lune w g,yrnt.o 30 onnnt,n u onnnt,n u On lhmnaA I t,rp l'rt Wre Arnounm 1990 Revenues.. 5545,436 5480,665 5616,338 $516,824 $ 2.159,263 Income from operatiom.. 77,279 74,773 174,007 7,320 333.379 inwme before cumulative efTect of change in aaounting method.. 36,775 38,859 100,320 (508) 175,446 Cumulauve efTect of change in the roethod of accouming for unbilled revenun..., 37,754 37,754 Net inwme.. 74,529 38,859 100,320 (508) 213,200 liarning appikable to mmmon semk... 65,156 29,112 H9,749 (l1,078) 172,939 thrning per share of common simk liefore cumulative effect of(hange in acwunting method. 0.34 0.35 1,0H (.13) 1.64 Cumulative cfTect of change in the mnhod of anounting for unbilied revenues. 0.47 0.46 'Ibtal earninp per share of common stock. 0.81 0.35 1.08 (.13) 2,10 1989 Revenues.., $ 523,852 $ 434,763 $ 560.010 $485.511 $2,004,136 Income from operatiom.. 115,763 81,43H 196,7/8 82,646 476.%85 Net hcome-70.527 43,952 1l'/,751 44,061 276.291 lkrninp applicable to mmmon stock. 62.956 36,284 109,409 35,261 243.910 l'.arning per share of common stock.. 0 79 0 45 1U 0 44 \\ 0% Quarterly anwuntsfor IN lusty l>ren rest.sted to nl lect a cluingr avr a.nuntingredig vln.l usu ostdr on iA t< der iM rfssurJanssor,1. IW ber Iin!n, kenues sectum ofNote () kultsfw rivfcurth quarrer ofiN rr$ect tivprmhionfor a ymsdde Jm!lmcawe ofnylurment enery w,ts bre Nose 1I). l i De we eft e quarterG ranung,per dwr emeunts nury owt equ.d tiv totalfw t vyac du to ciringes on de airnige numbes ofdwo ountandmg thrvugivur dvyar. 47

o COltl'OllATI: AND UTILITY OITIClItS w,w,, aa,,a n. !,,: a,,,,,,,,,,a sa a,., nc, G:okul V. Mt.Gowru Outonnan <frir liv.tod and Cl.orf^lhrcsstin Officer CiltimrN Il. I'olNtilXH.R Via Ch4/rrnan v[d'r livard Ltruno A. Cnookn 1%ident - l'tility operations Tslot,1rs Y \\\\hrur \\ia breident, Au cunting and Economics Mlaths t ). Ct\\\\ vi n Vice hnident. Conn treie n Ilt unn ui D. Cos. )n. \\ ice hoident, lin tric Interc onnection and oj.crations Glonal C. Cnn n. \\-ice hnident, Nuclear Enny Gn ount LL LNu1 ann Vice br<ident, />isted.ution jos M,11u s Vue hnident. Manayment Snrit n G. Down t Satwrnu, Ju. Via hoident, GeneralServitn Cn\\nt 1 s W. Snlvi kr Via hvident, Cerporate nnant c, kasurrr. and Scartary Josl.l'tt A. TtLuurN Vice hnident, Corporate Aff.' airs ). Tno ars Wn u n N1 u \\ia noident, Fund Energ } \\L) f kl Y 1., DrYo Anistant Srcortary Tuours E. l(USZIN.JR. Anistant 7iraturer CurNi,1 s IN OMsvo ios I;ffbctice April 1 J990: Ilerbert 11 Cms, Jr., became Vice l'residt nt of l'.lectric Intermnnet tion and Operation.. succeeding John W, Gore, Jr., who retired with ruore than 41 years of urvi(c. G. Dowell Schwarti.,Jr., was elected Vice l' resident of General Services succeeding Ilerbert D Cou, Jr. 48

l '. hoAlto or Dint clons i ) IhtlHtwtr i.h nntiilur*u Ce71ani ar.tl hlmili.t*w' l l I p-l g o i_ g g g 4 I 1 4: g i ,,,,,,,D M. m._ M,.,,,_,,, e..,m...,, m,

e. _,

M. o _ ...s s ,e, I l Gt out t V McGowAN Chaironan <{the hvarilarulChieflhrcutive Offiirr

• Cetutts'sirN li. PosNntxsn n Vite Chairman efthe Board
• ll. I'vitt0NG \\\\rt owrN Chairman ofthe BoardamlChiefthecutin 0][icer. Afrrcantile Bank: barn Corporation (bank holding tempany), Baltimpor * ). Own N Col.l= Chairrnan e{the lhecutier Cc.mmitter, l

l' int Alanland Bancorp (bank hviding company), Baltimvor ^ 1;tswrun A. Cnoonl nnident - (!!ility Operatium

• l 1.ssun lt. Dt%stanooN Former Chairman ufthe Berdand hnident. Alonumental corj. oration (iruurame). Haltimore sis ^t l u li Al n u l N l't l TIT, 5.h.N.D. nnident, College ofNotre Dame <{Alarriand h d..<ation). Baltimore l

fs. i 7"Mfij k $.g. y Y, [i t Mk. 6t c8.11 Mm. llst s.t ast4N Ma. Mil t r a Ma.luirittit Mt. Hi% u Ma let'au sed Ma. witin . j utoMn. W. GI.cuu. Chairman r{rhe hoard (Ret.). Pilll Corpora:ivn (trhide, erforation. andprilitin managanent scruitn), haltientur

• WitLAhn ll Acki RM AN Prnident and Chiefihrrutier Gjficer llor Whiting-lierner Contracting Company (corutruction andcrontruction managernent). Baltimort
• PAUL G. MILD R Chairman t{the finartl, Supercomputer Sprenn. Inc. (dnign, mannheturing, andsala of supercomputen), l.aurel. Aid. A Giance G. ItAucun n' former Churman <{the Boardand ChiefIkerutive Officer, 7' r Baltimore lap Imurance Company (imurance) Baltinum.
• b Gl ouGs.1. ItvssuL,)R., l%Q. Partner, Piper a Alarbury (lanofirm). Baltimour
• l\\t usrun C. Tuot.scssu n O! airman i

ofthe Ihrcutive Cinnminre l1Anur N. Wsus 0 airman <{the Board (Retired), AfrCmmick & Cempany. Inc. (fiwd a l procruing, spit n, nr.). Baltinant I ( WM(I fij N (11 lill ll(>ARI) Audit Committec Mr. Radcliffe Chairman: Mr. llaklwiru hit. Cole; Mr. Ituwell Committer on Management Mr. Geckle. Chairmarr. Mr. Cole: Mr. Disharoon: Mr. Truewhier liecutive Committee Mr. Trueschler, Chairman; Mr. Crooke: Mr. Disharoon: Siuct I celey l Mr. McGowan: Mr. Poindexter: Mr. ItadcliHe i Committee on Nuclear Power Mr. Welk. Chairmarr, Siuer Feeley: Mr. Ilackermam Mr. Miller: Mr. Poindexter l l 49 a

o L,.ONSTEl I ATION S,UllSil)l AltlES Mwwr Go and nau com; wynd Midem Oll K 1 Rs G1 onar V. hicGonN Ciraironan oftlor floard. Constellation IMding. Inc. Uwcl h1. Aunt n u 14rsident and CiriefI.'rerutirr Gjiar. Corutrilation Ileiding, Inc. Tnunst.(%tsl' urn l' resident Constellation 1:nrixv. Inr. W. E. (Pr n ) 51Muuss, Ju. I'rrsident. Constellation Real15 tate Group >, Inc. ) AMl s W. )n I con hesidens. Cen>teflation IlealtI. Sereim. Inc. hN SIlYi N D. NI81) k l'rrsident. Countriistion Investunents. Inc. n Yl Tl R h1. N1Rk l'orsident. tie KMS Group., Inc. Rolti Rr E. WINDil AM l'arjident. Cir!otl' Starrt Station, Inc. Cons t u lat inn ilot niscs Cossit uAnos Riai 1 si Ali Gnutm Constellation iloidings provides direction to all ofits This is the parent wmpany of sevetal bminewes - operating subddiarin and furnishes them whh legal, including Church Street Station in Orlando, Ilotida - 6nancial, tax, aaounting, and primnnel servicn. ihat seek new hmineu opportunitin in several hmad in addition, decisions on aP new investment or uitgorin. The Nh15 Group performs real niate acquisition opportunitin are controlled f om development, mmtruction, and operaibnal activitin, Constellation lloldings, and Comisllation lleahh Servites, through joint ventmu, owm senior.living and retirement C,ossTU l. Anon l.AUua ,I,h,n, the senior member of our Enngv and commurutsch as well as nuning fac,h,u.n for the elderly. i a Envimnmental Group. Under the auspkn of CoWH H AHoN INumH NIS Connellation Energy, it.c company panicipain m a The largeu single coinpany at thh tinte, Connellation . number of ahernative energy and wgennation pminn I"V"""C"" *"V" d' 'h* Pfi"5d'T P'"Vid" "I C""r"8 producing electricity for sale to other utilitin. The '""""r f""" i" I"V"""r"" I" Vd'i""5 ""'i'ir5-Energy company is actively involved with developing, inmunent pannnships, and Gnancial4rtvice arranging financing, buikling, and operating a numba ("'"Pd " '"- of wholnale power pmjeca throughout the muntry. Cil ANGt A IN ORGANI/AlloN Robert E. Windham joined Churen Street Station on December 19,1985, as Controller and was subsequently elecied Prnident of Church Street Statior., Inc. on February 23,199(i. 50

. CONSTEl.i.ATION SUllSIDIARIES mm G.n ad na,,, cenq.a.,.md %I.,,s.vw, IkukD of Dint c1oin t S

s. s f

s

• m

( g,'; f* ;, - y. st o ic co n s 1.it rum,, sim. nu ous sit annoa,s sim. cio n Gt onan V. h1rfanN Chair. eta ofthe Boarr, Con <trilition Holdings. Inc.; Churman i ofthe Board a>,, %iefEruurier DJ]iur, Baltimor Ga> and Flutric Company

• l\\ nuts. h1. Akint n n nrsident and CloirfErantinr Of]icer, Constrilation iIvidings, Inc. *

11. Yt'nsnNa \\\\rs.uwsN Chairman ofthe floardan l ChiefErrcutisr Officer, Mercantile Bankbares Corporation

• 1.1 sun. II, DisstrnooN Former Chairman oftbr Board andhrsident, MonumentalCorporation + ]s.noktn W. Gncku Chairman ofthe Board (RetJ. Pilli Corporation g-m]

p- + .a + lj Y.,. k N $f tt 4 ? Y si. um... si m, sio,,o, st < i._,m,, si,. i,_ m,, WsuAnn i1 Acun nst Au Presidem and ChiefEruurier Olliur. The Whiting lierner Contracting Company

• ElWAnn W. KAY Former Co-Chairman and ChirfOperating Officer, Ernst & Dung
• l'Aun. G. hinuut Chairman efthe Board. Supercomputer Systems, Inc.
• ClintsilAN i1. l'olNunxtn n Vice Chairman ofthe Board. Baltimore

. Gu and Elutric Company + \\\\s nsrnn C. Tuviscsit.i n Chairman ofthe Executier Commi::n, Baltimore Gas and Elatric Company Costsinm.s oi nii. Iloriu) Audit Committce hir. Kay, Chairman: hit. llaklwin: hit. hiiller Committee on hianagement hit. Geckle, Chairmair, htr. Dishamon; hir. Trueschler si

SilAitElioinnit IN1'ORM ATION klunwar Go sund Iintru Compasn ad %bddun;c ComtoN hiot A DwipiNin AND PRM i llW.Is Disidend 1989, tyyc Pris e Dividend Prh e Dulared liigh low Declared Ibgh I.ow lint Quaiter... 5.tal 634% S*9% s ao $124 528 "i bnond Quarter.. 121 }oIs 2 *U s 52% 32h 29 'Ihird Quartet.... 95 29 4 24% .s25 u% ti4 Iourth Quarter., 12$ 19 % 4th .tli 34 3 3Oh .o Tor 41... s 2.io

2.0 s Dmot No Poua AsNUu Mituw The tomrnon stock is entitled m dnidends when and as The annual inecting of shanholden will be held at 10:00 a.m.

dnlared by the lioard of Directors. Thee are no lirnitatiom in on April i9. m9t. in the llant %) ley llathnom of Mattiott's any indenture or other agreemenu on payment of dividendu Ilunt Wile) Inn,245 Shawan Road (18 at Shawan Roadh 3 howner, holden of prefertnt stock (6nt) and holders of llum %lley, Muyland. preference stock (next) are entitlni to receive, when und as declared. fmm the surpha or net prona, cumulatise yearly I out io+ dividends at the lhed preferential rate spni6ed for cath serin Upon written request, the Company will furnish, without and no more, payable quanerly,,nd to enche when due the charge, a wpy ofin f orm io-K annual report,imluding applicable preference stock sedemption paymenu. before any Gnancial statements, afin it h Gled with the Suuritin and dividend on the mmmon stock shall be paid or set apart. I uhange Conuninion in Manh i99t Requnts should be Dividends have been paid on the mmmon stock wminuoudy addreuni to Charin W. Shivery, Vice Penident, Sn retary, sina 19:o. I uture dividet.ds depend upon future earnings the and 'Ircaiurer, P.O. Itos q75, llahinmre, Maryland 2:2o3 475 financial wndition on.he Company. and other facion. Quarterly dividends were declared on the wr mon stock doiing At Tn ion 1990 and 1989 in the urnounn sei lonh above. Coopen oc 1.ybrand ComtoN SlOLK DIVIDIND DAHS lN EU HVt. OH H h Rnord dato are normally o,. the mth of March, June, Gas and 1 lectric liuilding September, and December. Quartuly dividends are Charin Center cusmmarily mailed to each sharehokler on or about the l\\2himore, Maryland uzoa ni of April July, Oeinber, and January. Maib l!D. lim q7s DivintND RilNmlMINi AND $10( A PURulAsl PIF llahinwrr, Maryland n203-4 5 The Company's Dividend Reinvntment and Smck Purchase Plan provido an opportunity for holders of the Companyi Situt no'"iiK Isyntai s Aso Awtviwo common stock to acquire additional sharn of such snxL in a Sharchc ' siring auinance with lost or stolen snxk convenient and economical manner, l'anicipana in the I'lan certilkar unidend chuts, n ac changn addren t-hangn, may reinvnt cash dividends on all or a ponion of their sharn ansk iramten, or other maiten shodd call the Shareholder of wmmon stock and/or make optional cash payments. Senicn Reprnentativn on out mlbf,melephone numben. I he following mlbfree telephone numben are available S toa TiahtNG during our busineu houn,8:oo a.m. to 4:45 p.m. The Companyi common stock. which is traded under the it.dtimore Menopohtan Area 783 593o ticker symbol !\\GE, is listed on the New York. Midwnt, and Within Maryland i.Noo-492-286: Pacinc stock exchangn. and has unlisted trading privileget Ounide of Manland on the Itoston, Cincinnati, and Philadelphia exchangn. ~ i.8co an up As of December 3t,1990, there were 68.689 Common Wrinen communication should be addrnsed to: Shareholders of record. liahinmre Gas and Electric Company Shareholder Savicn TMNu t.a At.i NT mo Rt cisTRAR p O Ilm i6 2 4 Maryland National liank.11ahimore liahimore Maryland zi203-i6 2 4 51 h

O

• ,ON Oun COVEit

^ ^-' EtWS 44 53 37 n 4 43 m c-35 38- @ p 9Q (gi'> L 4 47 i 39 ' l 49 $o 7 AL \\ (3 2 - 34 0 ~ 22 O 21 4 g-j 42 26 2o P 33 '9 8 25 9 h t4 a ::t s [ q ~ N 31 s 3 si 27 24 A 1 23 v t , ',~T V 16 29 g p r ,g x v x . Oriole Gas Range circa spp

18. GE Electric Fan cirra 192a

p. Diehl Ribn Fan circa spy

2. Philco Rvu circa 'pfos

19. Fuse Pullet ci ca ip2a 3. lWantU Gas circa 1913 6

3. King Kool Electric Fan circa 1936 2o 82 Aluminum Cable

37. Engineering Blueprint circa 1900

4. Edison Light and Reel circa ippo 3. Weiskittel Fire King 8

Bulb (replica) . tina 1879 e Sunbeam Toaster circa 194.5 Gas ficater cerca 1897 5, American Beauty

22. Victor Instantaneous

39. CGEL&PCo.

Electric Iron dw 1945 Water fleater circa 1399 Work 1.antern circa 1950

6. Noma Decoratiw zi Fire Budet circa ipso

40. Emeralits Desk lamp cirra 1930 Lighting Outfit cirov 1929 2. Westinghouse Watameter cir.a i393 4i. liigh Ve tage Sign circa ipso

7. Sonheam Mixmaster circa 1937 as. Bryan Gu Range and

42. KAE Drafting Pounce circa 1955

8. Engineering Blueprint circa iguo Ponable Oven circa 1895

45. SJety Plaque circa 1957

$. Good. Lite Decorative

26. American Beauty

44. Nipper Savings Bank cirra 1932 Lighting Outf t cims #93o Flectric Iron circa 1945

45. Westclos Alarm Clock rirca 1933 no. Dieta Construction Meter arca ipJo 4. Gas Lamp i cca ipoo 6

Lantern circa 1956 .. matric Generating Plant

47. RCA Radia circa 1935 is, Oilote Gas Space Heater amt 1914.

Power Factor Gauge circa 192o 8 I"E *"" is. Wooden Las Pipe

29. Wet Test Meter circa 1935

j ' g 4'

g, and %In circa 182f

30. Electric Generating Pl. tnt 4 9' U".'

'"*""E i3. Arch Water Gauge circa 19'l Amperes Gcuge arca 1920 Kilovolts Gauge circa1920 t4. Gas Meter circa spir 3i. RCA Television circa 1947

50. Electnc Fuse circa 1920

n. Gu Meter 1990

32. Line trew liard Hat circa ipoo

16. Wooden Cross Arm and Glass &

33. Numa Bubble-lites circa 1946 lbrcelain insulators circa ipoo,

52. Eureka Vacuum Cleaner circa 1925

'y GE Refrigerator arca ipp i7. Electric Generating 5 3. BG & E.,s i75m Plant Battery Switch circa 192o Anniversary 1.ogo 1991

..,3 s.. <g+

3. y e,e.. ++.

.e. .u

.,, j g. y e.,

g. s- '..G g. .,[ '[ ,'Y .v .,d .g N .-... ' '....' Y k. ,5. [ -l... ^ , [ I

-.,~

- *'.-(."e..8 -. -. u. .m '. i - 4 t .c.....,.,, 3 ' w . m, 4., - r. .. a .r .} .j q 6.V b.... '- . [,7 y., Y Y, '. '.. ' J,. l ',.' { 4 4 s . t.y, c.y. .,.,i-... fx. :- _y' e s . ~, ,3, -1 g ... p'...i.

W

-,cy- .,, S -

1. 9* * '

,'i.q.-. ~* <l. .'h ^ " ~ * .y' v: 'R.

u u

,x.. - .' ; y.. .,y,e . 3 3,, ,, %x_y _.. -q ..f b J. e. .x..- +. o,. , t...... s 5. l ~ ....:..... c., -.y- x.. .D,

i...,

". 5 * - ./.... .,k . 4 - .;g 1 g,,

• -k

'b,' 44 w, 4 $,y p{l . : ~ .e. e . s,4 's

'i z*

;:y g.

i

,4-p' = * }. -,.', ^ {- t .4u " - % J,. ' 4 J. -ek dd', h; .. ~ '. f. i : 4.y ' ' ., i ', -.. ac .,.+ ; ! s t. .( .f,' ."7 M;BrS.. X. i, 'y ....,. d)$ g f ', g. e' ..s ~. . 4. %,. 7. m .,.'.4.- ^ l ' ,4 ~. " " " " " " " " - t e,. 6l. r 'l [*. k l} f v.-, n ^ y .[ q e n.

1... *. -

.g ~ 1 l. ~.., '. ; 'f.. t. y ' hy

v:

t-Y; ~ f;_.j l b ' s -, l, ' ',.. J ".(,', ' '. ',] s i, -.,-- [ h 'h ~ ' - %d } 4e o ... - - s. ,MAynththypyN 'T. - i.. 5 4;M A

.s

- s 74 % . w :;.% g +;; Kr.a y i s f,-[ }.j.'l y) '/* sj_ ^ f.f.jJji fi . L,... . f;,l. - ' + - l., ^ y- / '

• 4

t..,

? c nr;. n q j ^ f; pgj. ...a... p.., d h,f.-. i 's ; ?,. s ; ;. r. s... r a

• y

."(2- ~

J' N.. ty

g. g.,*,,

+ 4 b, Sa 1,' O \\ 4tNI.i 3 M. ...p. .s ,).c MIIM ' ' \\ '.[ Y. - S. . u.,, 7 ' ~. ' ' 54 p -m . :. v m{' y[p [\\. v.;;. w - . c s-4

p. '.J L

..' ' c.. ;. 3 {' e c .;,. 6 ', "k:. v. b . o.74 ..e- -.,h h '.';' j _ei l[ {, 4,\\.SI[ 7,,. >. g. g. ( '. ?' .... ' J 4. a.... _ 3. " P7, . q 3.<yy e.. '. L, ' Q_ [ 3.f yr*$.f ';: N ,,q.. s 9, L C , _ _ _ y ' f - l. J _ '. Q '.q-g . -g*h. ) c ~. 4' s -n

1. .. "... S

.,8 4. e '.' S ,t J a, wf. g., - ..y ,[ ' ' y_ Q, 5 ',I l'. . _..N ; ',.-.- 4 3.. }.l '.,..,,. x >:,s' '

g...

nw n a.mb I i 2 M D, ' '. ;,., g -. '. j J. N:~ }. ;'.wlq T/. U.' '.p. ' j,' '. - O ' '. 7 Ma.. 9,.- t .a .;(. m' e $.1 . r. ; w: s-r ~ -. < y 3.; VvN%:y. ,wn y y '\\ fli 1 'l;;.. h. M. y M.. ... M U (, w WO ,. g' .. t.- =. a w ( .; - ;a. a. /., au- ...-l..- ..9

e., T :s3,3.i.

.r ~- ,.' s' e ,-5 s. y* ~..,..g ~.. n... 7..y f :.g. M;. c, ?.$,w ; b.p '.ly(J. y. .t.. n .,..,.r 3 .,;... I '. l. r ~ w - :. 6.. {m ? c,.. - ?.v ; '; [?. k Qt Q.?.Q -..._.... i .1.' ^ WW ' _.. h,.N[.. ..;s. :c-- ., N g 3.,. 4 qg y ;.;s..M. o.u e o j..S W ;q t y. t...: .,y .,e d

~....

p@u.jf U gp.N. 3._ 4W Q7....c, -..* ' ~,... q y+ .y. - 5

g.,.

c ; t 7 p.1 h .-g,, t xo

w. 2 <.

z .a .x 1 -... 4 a t~ ~. n..: :. . e. % i ' y. t A.WY g.. 3-3. ij ! .c.s W . +,. e .. w. p ' '; ;;h;..- 5 .;g y-a.'~ s ..t. g ge u.,. 9 4.: , ;,. - v 7,;... - : nn A

Y q..

w. ,y .) l-Uf hk k e...y.d.l g. Y,.;,[' } c.}}