PECO Energy Company

November 17, 2004

Renewal of Contracts

Requests For Proposal (RFP)

Storage and Transportation Contracts

The following PECO Energy Company transportation and storage contracts have pending notice periods.

Pipeline/ContractContract Notice Period

Termination Date

Equitrans

STS(transportation)March 31, 2006Twelve Months

SS-3 (storage)March 31, 2006Twelve Months

Transco

WSS (storage)March 31, 2006Twelve Months

S-2 (storage)April 16, 2006Twelve Months

Texas Eastern

FTS-2March 31, 2006Twelve Months

PECO requests proposals from licensed natural gas suppliers to provide all or a part of these storage and transportation services.

Some of the factors to be taken into consideration by PECO in deciding whether or not to accept a proposal will be:

1) Whether transportation/storage capacity used in connection with the proposed agreement would be assignable to PECO and the conditions of such assignment;

2) Whether the proposed agreement provides for annual renewals;

3) Whether the supplier is a natural gas supplier licensed to sell natural gas at retail in the Commonwealth of Pennsylvania;

4) Whether the supplier has a proven record of reliability; and

5) Whether the proposed agreement is otherwise consistent with PECO’s public utility obligations under the Pennsylvania Public Utility Code, including but not limited to Sections 2204, 2205, and 2207 of that legislation.

6) Creditworthiness of bidders will be subject to a review that applies a reasonable commercial standard.

At a minimum, a proposal submitted as an alternative to the above mentioned transportation or storage service, must be deliverable on a primary firm basis to the PECO city gate interconnections with either Transcontinental Gas Pipe Line Corporation or Texas Eastern Transmission Corporation, or other delivery points located on those pipelines, as specified by PECO and at a total annual price that will keep the PGC rates revenue neutral. The proposal must also show that primary receipt points under the proposed capacity are at points as may be reasonably expected to be locations where gas supplies would generally be available. Furthermore, the capacity must have firm capacity rights sufficient in volume and duration to serve the market to be served by the supplier.

PECO reserves the right to reject any proposal for any reasonable purpose, including a determination by the Pennsylvania Public Utility Commission that the proposal and associated gas supply contract do not meet the statutory requirements of the Gas Competition Act and any other provision of law.

Proposals to the above requests are due on or before the close of business December 17, 2004. (5:00PM Eastern Time). These proposals should be addressed to:

Vice President

Gas

2301 Market Street S9-3

Philadelphia, PA 19101