Constellation EnergyQ2 2006 Earnings Presentation

July 28, 2006

2

Forward-looking Statements DisclaimerCertain statements made in this presentation are forward-looking statements and may contain words such as “believes,”“anticipates,” “expects,” “intends,” “plans,” and other similar words. We also disclose non-historical information that represents management’s expectations, which are based on numerous assumptions. These statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to be materially different from projected results. These risks include, but are not limited to: the timing and extent of changes in commodity prices for energy including coal, natural gas, oil, electricity, nuclear fuel, and emissions allowances; the timing and extent of deregulation of, and competition in, the energy markets, and the rules and regulations adopted on a transitional basis in those markets; the conditions of the capital markets, interest rates, availability of credit, liquidity and general economic conditions, as well as Constellation Energy’s and BGE’s ability to maintain their current credit ratings; the ability to attract and retain customers in our competitive supply activities and to adequately forecast their energy usage; the effectiveness of Constellation Energy’s and BGE’s risk management policies and procedures and the ability and willingness of our counterparties to satisfy their financial and other commitments; the liquidity and competitiveness of wholesale markets for energy commodities; uncertainties associated with estimating natural gas reserves, developing properties and extracting gas; operational factors affecting the operations of our generating facilities (including nuclear facilities) and BGE’s transmission and distribution facilities, including catastrophic weather-related damages, unscheduled outages or repairs, unanticipated changes in fuel costs or availability, unavailability of coal or gas transportation or electric transmission services, workforce issues, terrorism, liabilities associated with catastrophic events, and other events beyond our control; the inability of BGE to recover all its costs associated with providing electric residential customers service; the effect of weather and general economic and business conditions on energy supply, demand, and prices; regulatory or legislative developments that affect deregulation, transmission or distribution rates, demand for energy, or that would increase costs, including costs related to nuclear power plants, safety, or environmental compliance; the actual outcome of uncertainties associated with assumptions and estimates using judgment when applying critical accounting policies and preparing financial statements, including factors that are estimated in applying mark-to-market accounting, such as the ability to obtain market prices and in the absence of verifiable market prices, the appropriateness of models and model impacts (including, but not limited to, extreme contractual load obligations, unit availability, forward commodity prices, interest rates, correlation and volatility factors); changes in accounting principles or practices; losses on the sale or write-down of assets due to impairment events or changes in management intent with regard to either holding or selling certain assets; cost and other effects of legal and administrative proceedings that may not be covered by insurance, including environmental liabilities; and the inability to complete the proposed merger with FPL Group, Inc., to successfully integrate the businesses of Constellation Energy and FPL Group after the merger or to achieve anticipated synergies. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Please see our periodic reports filed with the SEC for more information on these factors. These forward-looking statements represent estimates and assumptions only as of the date of this presentation, and no duty is undertaken to update them to reflect new information, events or circumstances.

3

Use of Non-GAAP Financial MeasuresConstellation Energy presents adjusted earnings per share (adjusted EPS) in addition to its reported earnings per share in accordance with generally accepted accounting principles (reported GAAP EPS). Adjusted EPS is a non-GAAP financial measure that differs from reported GAAP EPS because it excludes the cumulative effects of changes in accounting principles, discontinued operations, special items (which we define as significant items that are not related to our ongoing, underlying business or which distort comparability of results) included in operations, the impact of certain economic, non-qualifying hedges, and synfuel earnings. Constellation Energy has excluded from adjusted earnings two categories of non-qualifying hedges: hedges against the Commodities Group New England fuel adjustment clauses and hedges on gas transportation and storage contracts. The mark-to-market impact of these hedges is significant to reported results, but economically neutral to the company in that offsetting gains on underlying accrual positions will be recognized in the future. We present adjusted EPS because we believe that it is appropriate for investors to consider results excluding these items in addition to our results in accordance with GAAP. We believe such measures provide a picture of our results that is comparable among periods since it excludes the impact of items such as workforce reduction costs or gains and losses on the sale of a business, which may recur occasionally, but tend to be irregular as to timing, thereby distorting comparisons between periods. However, investors should note that these non-GAAP measures involve judgments by management (in particular, judgments as to what is classified as a special item or an economic, non-qualifying hedge to be excluded from adjusted earnings). These non-GAAP measures are also used to evaluate management's performance and for compensation purposes. Constellation Energy also provides its earnings guidance in terms of adjusted EPS. Constellation Energy is unable to reconcile its guidance to GAAP earnings per share because we do not predict the future impact of special items, economic, non-qualifying hedges or synfuel earnings due to the difficulty of doing so. The impact of special items, economic, non-qualifying hedges, or synfuel earnings could be material to our operating results computed in accordance with GAAP. We note that such information is not in accordance with GAAP and should not be viewed as an alternative to GAAP information. A reconciliation of pro-forma information to GAAP information is included either on the slide where the information appears or on one of the slides in the Non-GAAP Measures section provided at the end of the presentation. Please see the Summary of Non-GAAP Measures included to find the appropriate GAAP reconciliation and its related slide(s). These slides are only intended to be reviewed in conjunction with the oral presentation to which they relate.

4

Non-Solicitation This communication is not a solicitation of a proxy from any security holder of FPL Group or Constellation Energy. Constellation Energy has filed with the Securities and Exchange Commission a registration statement on Form S-4 (Registration No. 333-135278) that includes a preliminary joint proxy statement/prospectus of Constellation Energy and FPL Group and other relevant documents regarding the proposed transaction. A definitive joint proxy statement/prospectus will be sent to security holders of FPL Group and Constellation Energy seeking approval of the proposed transaction. WE URGE INVESTORS TO READ THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT FPL GROUP, CONSTELLATION ENERGY AND THE PROPOSED TRANSACTION. Investors and security holders also will be able to obtain these materials (when they are available) and other documents filed with the SEC free of charge at the SEC’s website, www.sec.gov. In addition, a copy of the definitive joint proxy statement/prospectus (when it becomes available) may be obtained free of charge from Constellation Energy, Shareholder Services, 750 E. Pratt Street, Baltimore, MD 21202, or from FPL Group, Shareholder Services, P.O. Box 14000, 700 Universe Blvd., Juno Beach, Florida 33408-0420.

This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.

FPL Group, Constellation Energy, and their respective directors and executive officers of FPL Group and Constellation Energy and other persons may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding FPL Group’s and Constellation Energy's directors and executive officers is available in the preliminary joint proxy statement/prospectus contained in the above-referenced registration statement on Form S-4.

5

Q2 2006 Adjusted EPS Summary

$0.30 - $0.45Q2 Earnings Guidance

(0.09)0.01Synfuel Earnings

$0.59$0.56Adjusted Earnings

(0.02)0.03Special Items

See Appendix

0.02-Loss on Economic Non-Qualifying Hedges

$0.68 $0.52GAAP Earnings

Q2 2005Q2 2006($ per share)

6

Q2 2006 Operating Highlights

• Implemented rate stabilization plan for BGE residential customers

• Business leaders and employees focused on delivering results amid political and regulatory activity

– Growing wholesale power, gas and coal businesses in line with expectations

– Generated strong portfolio management and trading earnings

– Leveraging NewEnergy’s scale and national platform to drive higher returns

§ Realized electric gross margin in Q2 of $3.95 per MWh

– Year-to-date, achieved 70% of full-year productivity objective; on track to reach 2006 productivity target of $40 million

7

Potential Sale of Gas-fired Merchant Plants• Gas-fired merchant fleet

– High Desert (California)– Rio Nogales (Texas)– University Park (Illinois)

• Generation asset valuations have increased substantially

• Gas-fired merchant fleet less strategically connected – Focus on baseload coal and nuclear fleet in the Mid-Atlantic and other

competitive markets

• Expect proceeds will be applied to pay down debt– Should allow us to be at our target leverage ratios– Free cash flow in 2007 would be available for reinvestment in the business

or for stock repurchases

• If completed, transaction could close in 2006 and be modestly dilutive in 2007 and accretive in 2008

– Holland (Illinois)– Wolf Hills (Virginia)– Big Sandy (West Virginia)

8

Rate Stabilization Plan (Senate Bill 1)• Period 1 (July 1, 2006 to May 31, 2007) - 15% increase in total residential electric rate

• Period 2 (June 1, 2007 to December 31, 2007) - Customers either pay full market rate or opt into a rate at an “intermediate level” to be determined by the PSC

• Period 3 (After December 31, 2007) - Full market rates

• Deferred costs, including carrying costs, may be securitized and recovered through a non-bypassable, usage-based charge over 10 years beginning January 1, 2007

• BGE to provide rate mitigation credits of $38.7 million per year for 10 years starting on January 1, 2007

– Suspend collection residential SOS return ($20 million per year)

– Collect and credit back to residential customers nuclear decommissioning revenue ($18.7 million)

• Other provisions of Senate Bill 1

– Matter of replacing PSC remains before the Maryland Court of Appeals

– Instructed PSC to review stranded costs, property tax on generating assets, electric restructuring and Standard Offer Service

9

Proposed Merger Rationale• Merger creates new FORTUNE 100 company and the U.S. market leader in

competitive energy markets

• Well-matched, complementary contributions from two strong companies create a balanced footprint

• Multiple channels of growth, balanced by solid base of stable, growing earnings and cash flow

• Combined company will have the strongest balance sheet in the industry

• Remain confident that pre-tax synergies of at least $200 - $250 million per year by year 3 retained for shareholders is attainable

• Significant increase in dividend for Constellation’s current shareholders

– Generation assets in NEPOOL and ERCOT– Strong wind position– Strong nuclear capability– Focus on cost and operational efficiency

– Highest load serving market share– Leading risk management expertise– Strong nuclear capability– Focus on cost and operational efficiency

FPL GroupConstellation Energy

10

Merger Update• Merger approval process continues forward

– Merger proxy filed with SEC on June 23, 2006; comments received on July 21, 2006– FERC extended date by which they must issue an order to February 2, 2007– Expect Maryland approval process to be critical path to closing the merger

• Implementation of rate stabilization plan clears one obstacle for Maryland PSC to consider merger – Filed new merger application with the Maryland PSC on July 21, 2006 to address

new statutory standards of Senate Bill 1– PSC scheduled prehearing conference for August 9, 2006, to rule on interveners

and set a procedural schedule for merger review– Requested a November 2006 decision, but depending on procedural schedule

published by the PSC, closing could be delayed• Uncertainty surrounding closing of the merger remains

– Integration activity remains on hold until companies have more clarity on timing and economics

– If risks to closing the merger or economics become unacceptable, Constellation Energy and FPL Group could agree to terminate the merger

• Constellation Energy remains committed to the merger with FPL, but not at the expense of shareholder value

11

Earnings Outlook

2.422.82 2.83

3.283.35-3.65

4.40-4.65

5.25-5.75

$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

2002 2003 2004 2005 2006E 2007E 2008E

(1) Adjusted for the effect of special items, certain economic, non-qualifying hedges and synfuel earnings

See Appendix

Compounded annual growth rate from 2006 to 2008 of 22 to 28%

Adjusted EPS (1) EPS Guidance

($ per share)

Financial Overview

E. Follin Smith

13

Q2 2006 Adjusted EPS Summary

$0.30 - $0.45Q2 Guidance

(0.09)0.01Synfuel Earnings

$0.59$0.56Adjusted Earnings

(0.02)0.03Special Items

See Appendix

0.02-Loss on Economic Non-Qualifying Hedges

$0.68 $0.52GAAP Earnings

Q2 2005Q2 2006($ per share)

14

Q2 2006 Segment Earnings Per Share (1)

$0.30 - $0.45

(1) Excludes special items, certain economic, non-qualifying hedges and synfuel earnings

N.M.0.010.010.02Other Non-regulated

See Appendix

Q2 2006 Earnings Guidance

-5%($0.03)$0.59$0.56Adjusted Earnings Per Share

4%(0.02)0.450.43Merchant

-15%($0.02)$0.13 $0.11BGE

%EPSQ2 2005Q2 2006

Change($ per share)

15

$0.08 - $0.13$0.11Adjusted Earnings

GuidanceActual

Q2 2006Adjusted Earnings vs. Guidance($ per share)

BGE

($0.02)

Change

$0.13$0.11Adjusted Earnings

Q2 2005Q2 2006

Adjusted Earnings vs. Prior Year ($ per share)

See Appendix

16

$0.20 - $0.35$0.43Adjusted Earnings

GuidanceActual (1)

Q2 2006Adjusted Earnings vs. Guidance($ per share)

Merchant

-8¢ Inflation, Interest, Other+3¢ New Energy

See Appendix

(1) Excludes special items, certain economic, non-qualifying hedges and synfuel earnings

-3¢ CTC

-18¢ Mid-Atlantic Fleet Pricing

+6¢ Generation Productivity

+17¢ Commodities New Business/Backlog

Variance Primarily Due to:

($0.02)$0.45$0.43Adjusted Earnings (1)

ChangeQ2 2005Q2 2006Adjusted Earnings vs. Prior Year($ per share)

17

Merchant – Income Statement (1)

32%226890NewEnergy

120%145121266Wholesale Competitive Supply

50%123Qualifying Facilities/Other

4%6171177 Plants with PPAs

-30%($67)$221$154 Mid-Atlantic Fleet

-11%(7)6673D & A

-4%($3) $80 $77 Net Income*

-2%(1)4849Income Tax

-2%(2)128126Pre-Tax Income

-12%(5)4146Net Interest Expense

2%3169172EBIT

-25%(104)414 518Total Costs below Gross Margin

(4)

(93)

107

$

Change

-13%

-29%

18%

%

3236Other Expense

316409O & M

583690Gross Margin

Q2 2005Q2 2006$ in millions

(1) Excludes special items, certain economic, non-qualifying hedges and synfuel earnings See Appendix

18

Wholesale Competitive Supply (1)

New Business

12255177Total New Business Realized (2)

(1) Excludes special items, certain economic, non-qualifying hedges and synfuel results(2) Includes power, gas (non-project), and coal gross margin and gas project margin (projected revenue less operating, depreciation, depletion and

interest expenses incurred at the project level)

11434148Portfolio Management & Trading

See Appendix

108%$129$120$249Total Contribution Margin (2)

82129Originated & Realized (2)

$7$65$72Total Already Originated Business (2)

%$Q2 2005Q2 2006

Change($ in millions)

19

Wholesale Competitive Supply: Origination

$268$452Current Year Target – January Plan

$288

216

$72

Q2 2005

$309

113

$196

Q2 2006

(1) Includes power, gas (non-project), and coal gross margin and gas project margin (projected revenue less operating, depreciation, depletion and interest expenses incurred at the project level)

(2) Includes gross margin originated to be realized in the current year and future years

$504$824Total Origination Target (2) – January Plan

73%78%% of Revised Total Origination Target Achieved

51%79%% of Revised Current Year Target Achieved

Total Wholesale Competitive Supply Origination Value to be Realized (1)

$504$908Total Origination Target (2) – Revised

$268$536Current Year Target - Revised

234284Future Years

$370$707Total Originated

$136$423Current Year

To Be Realized In:

1H 20051H 2006($ in millions)

20

Wholesale Competitive Supply Backlog

(1) Includes power, gas (non-project), and coal gross margin and gas project margin (projected revenue less operating, depreciation, depletion and interest expenses incurred at the project level)

(2) Includes portfolio value changes for downstream gas and coal(3) Reflects portfolio pricing on 12/15/05

Backlog (1)

(as of 6/30/06)

300241 194

423

123

71

$0

$100

$200

$300

$400

$500

$600

$700

$800

2006 2007 2008

($ in

mill

ions

)

New Business Since12/31/05 (2)

Value as of 12/31/05 (3)

21

NewEnergy: Q2 2006 Highlights

+21%$3.95Realized Electric Gross Margin per MWh

+32%$90 millionTotal Gross Margin (2)

+24%82Gas Volume Delivered (Bcf)

+25%370Market Volume Served (Bcf)

Gas

75%Adjusted Q2 Retention Rate (1)

65%Q2 Retention Rate

+9%16.9 millionVolume Delivered (Megawatt Hours)

Electric

Changevs. Q2 2005Q2 2006

See Appendix

(1) Excludes customers returning to utility default service(2) Excludes certain economic, non-qualifying hedges

22

NewEnergy: Retail MWh Backlog

Contracted Retail MWh (as of 6/30/06)

64

32

34

3113

0

20

40

60

80

100

2005 2006 2007 2008

(MW

hs in

mill

ions

)

Delivered Backlog

89% of 2006 plan MWhs delivered or contracted

23

Limiting Variability – Portfolio Management

Percent Hedged as of 6/30/06

0.060.06Fuel down $0.10/MMBtu, Power unch.

$(0.05)$(0.04)Power down $1/MWh, Fuel unchanged

(1) Numbers may not sum due to roundingNote: Percent hedged includes Mid-Atlantic Fleet, Plants with PPA’s, Wholesale Competitive Supply (excludes upstream gas and coal) and NewEnergy

77%87%Fuel

$0.01

Sensitivity to Price Changes as of 6/30/06 ($ per share)

$0.01Power down $1/MWh, Fuel down $0.10/MMBtu (1)

86%Power 83%

20082007

MTM portfolio VaR levels remain low at an average $9.9 million for the quarter

24

Productivity

Annual Productivity

(40)

90

60

28

-$50

$0

$50

$100

2004 2005 2006 2007

($ i

n m

illio

ns)

Annual Target

Realized

40

Year-to-date, we have realized $28 million, or 70% of our 2006 productivity target

25

(273)(17)(84)(172)Capital Expenditures & Investments

15895990Depreciation & Amortization

(68)Dividends

22Equity Issuances – Benefit Plans

250 (1)18-232 (1)Asset Dispositions & Contract Restructuring

(153)1995(267)Working Capital & Other

22Pension Adjustment (pre-tax)

$56Net Cash Flow before Debt Issuances/(Payments)

102$31$91($42)Free Cash Flow

(115)(8)(25)(82)Net CapEx

$98$2$21$75Net Income Before Special Items

TotalOther

Non-RegUtilityMerchant($ in millions)

Q2 2006 Consolidated Cash Flow

See Appendix

(1) Includes $218 million Aquila transaction

26

Collateral Positions

Shift from letters of credit to cash collateral has had no impact on our liquidity

($ in millions) B/(W) vs12/31/05 3/31/06 6/30/06 Q1 06

Cash Collateral Held 401$ 216$ 167$ (49)$

Collateral Posted Exchanges 281$ 461$ 539$ (78)$

3rd Parties 86 150 166 (16) Subtotal Posted 367$ 611$ 705$ (94)$

Net Cash Posted Subtotal (34)$ 395$ 538$ (143)$

Letters of Credit 2,486$ 1,947$ 1,802$ 145$

Change in Liquidity 2$

27

Balance Sheet

See Appendix

(1) Includes preferred stock and minority interest(2) Related to cash flow hedges of commodity transactions(3) Excludes AOCI Balance related to cash flow hedges of commodity transactions and 3r d Party Cash Collateral

$0.2$0.23rd Party Cash Collateral

$1.2$1.0AOCI Balance (2)

45.9%46.6%Adjusted Net Debt to Adjusted Total Capital (3)

4.74.7Net Debt

$4.9$5.2Total Debt

50.7%50.4%Net Debt to Total Capital

Actual

0.10.150% Trust Preferred

Capital

4.44.5 Equity (1)

(0.2)(0.4)Less: Cash

$9.2$9.4Total Capital

Debt

6/30/063/31/06($ in billions)

28

BGE Rate Stabilization Financing Plan

Funding Plan

• July – December 2006 deferrals will be funded by the company

• Expect securitization program to be complete by early in 2007

– Securitization will cover first 11 months of deferrals of $604 million

– Recovered and repaid through non-bypassable surcharge to customers

Deferrals

$ Mil Interval Comments$ 324 7/1/06 - 12/31/06 $54 million per month deferrals 280 1/1/07 - 5/31/07 84 6/1/07 - 12/31/07 Assumes opt-in plan with rate increase 1/2 way

to market rates; conservative 50% opt-in

$ 688 Maximum Possible Deferral

29

Credit Metrics

43.7%

$2.1

42.8%

12/31/05

50.6%

$1.9

49.9%

12/31/03

See Appendix

(1) Assumes no sale of gas-fired merchant plants(2) Net debt adjusted to exclude 3r d party collateral. Total capital adjusted to exclude AOCI balance related to cash flow hedges of commodity transactions, 3r d party collateral and AOCI balance related to changes in pension and post-retirement accounting

43% - 47%54.8%Adjusted Net Debtto Capital (2)

Projected (1)

$0.6Excess Liquidity ($ billions)

48% - 52%

12/31/06

54.6%Net Debt to Total Capital

12/31/01

Actual

• Metrics much stronger than when current credit ratings were established

• 19 quarters of dependable performance from highly hedged deregulated business model

• Significantly larger company with more powerful liquidity profile

30

2006 EPS Walk

See Appendix(1) Excludes special items, certain economic, non-qualifying hedges and synfuel results

(0.21)

(0.10) 0.130.12

0.27

0.31

0.10

3.28

$2.75

$3.00

$3.25

$3.50

$3.75

$4.00

$4.25

$4.50

2006

Comp.Transition

Charge

2005

InflationHQ & CGG

ProductivityHQ & CGG

WholesaleComp. Supply

BacklogBGE

(0.07)

(0.12)

3.35-3.65

Other

WholesaleComp.

Supply New Business

NewEnergyFleet Price

(0.16)

Outages

(1)

• For 2006, strong commercial business growth more than offsets headwinds of loss of CTC

• Compared to January 2006 forecast, stronger Commodities and NewEnergy, offset by extended Calvert Cliffs outage and additional costs

($ per share)

31

Long-Term Earnings Outlook

2.422.82 2.83

3.283.35-3.65

4.40-4.65

5.25-5.75

$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

2002 2003 2004 2005 2006E 2007E 2008E

(1) Adjusted for the effect of special items, certain economic, non-qualifying hedges and synfuel earnings

See Appendix

Compounded annual growth rate from 2006 to 2008 of 22 to 28%

Adjusted EPS (1) EPS Guidance

($ per share)

32

Q3 2006 Earnings Per Share Guidance

$1.08$1.10 - $1.25Adjusted Earnings Per Share (1)

$0.08

-

0.24

$0.84

Actual Q3 2005

See Appendix

(0.01) - 0.01Other

(1) Excludes special items, certain economic, non-qualifying hedges and synfuel earnings

($0.01)Synfuels

0.17 - 0.22BGE

$0.90 - $1.05Merchant

Guidance Q3 2006($ per share)

Additional Modeling Information

34

Synfuel Update

($0.01)

($0.28)

($51)

(61)

$10

68%

$0.27

$49

93

26

($70)

2006 Estimate

68%Tax Credit Phase-out Percentage

$0.01Net Synfuel EPS (Post Phase-out)

($0.22)Synfuel EPS Phase-out Impact

$9Production Expenses, Net of Tax

Impact of Phase-out (as of 6/30/06)

$0.23Synfuel EPS (Pre-Phase-out)

Pre-Phase-out:

($40)

(49)

$42

76

21

($55)

YTD 6/30/06

Net Income

Tax Credits

Net Income (Pre-Phase-out)

Tax Credits

Tax Benefit of Pre-tax Loss

Pre-tax Loss on Production

($ in millions, except per share amounts)

35

0.5 1.11.0Production (tons in millions)

68%

$0.01

($0.07)

($13)

(19)

$6

$0.08

$15

29

8

($22)

YTD 2006 Actual

$0.01-Net Synfuel EPS (Post Phase-out)

($0.08)($0.05)Synfuel EPS Impact

68%Expected Tax Credit Phase-out Percentage

$6$4Production Exp., Net of Tax

Impact of Expected Phase-out (as of 6/30/06)

$0.09$0.05Synfuel EPS (Pre-Phase-out)

Pre-Phase-out:

($15)

(21)

$16

32

9

($25)

2006 Estimate

($9)Net Income

(13)Tax Credits

$9Net Income (Pre-Phase-out)

16Tax Credits

4Tax Benefit of Pre-tax Loss

($11)Pre-tax Loss on Production

Q2 2006 Actual($ in millions, except per share amounts)

Pace Synfuel (1)

(1) Numbers may not sum due to rounding

Pace synfuel ceased production in July

36

South Carolina Synfuel (1)

0.6 2.11.5Production (tons in millions)

68%

$ -

($0.15)

($27)

(30)

$3

$0.15

$27

47

13

($33)

YTD 2006 Actual

($0.01)($0.01)Net Synfuel EPS (Post Phase-out)

($0.20)($0.10)Synfuel EPS Impact

68%Expected Tax Credit Phase-out Percentage

$4$2Production Exp., Net of Tax

Impact of Expected Phase-out (as of 6/30/06)

$0.19$0.09Synfuel EPS (Pre-Phase-out)

Pre-Phase-out:

($36)

(40)

$33

61

17

($45)

2006 Estimate

($18)Net Income

(20)Tax Credits

$17Net Income (Pre-Phase-out)

26Tax Credits

6Tax Benefit of Pre-tax Loss

($15)Pre-tax Loss on Production

Q2 2006 Actual($ in millions, except per share amounts)

(1) Numbers may not sum due to rounding

• In July, South Carolina synfuel production reduced from 250,000 tons/month to 80,000 tons/month• Operating costs lowered to result in higher breakeven tax credit phase-out percentage• Now running low production levels near breakeven to enable quick ramp up should oil prices fall

Non-GAAP Reconciliations

38

Summary of Non-GAAP Measures

Slide(s) Where Used Slide Containing Non-GAAP Measure in Presentation Most Comparable GAAP Measure Reconciliation

Adjusted EPS Reported GAAP EPSQ206 Actual 5, 13, 14, 15, 16 39Q205 Actual 5, 13, 14, 15, 16 39EPS Guidance 5, 11, 13, 14, 15, 16, 30, 31 392005 YTD Actual 11, 31 402004 YTD Actual 11, 31 402003 YTD Actual 11, 31 402002 YTD Actual 11, 31 40Q305 Actual 32 41

Q206 Merchant Gross Margin 17, 18, 21 Income from Operations / Net Income 42Q205 Merchant Gross Margin 17, 18 43Q206 Merchant Below Gross Margin 17 42Q205 Merchant Below Gross Margin 17 43

Net Cash Flow before Debt Issuances/(Payments) 25 Operating, Investing and Financing Cash Flow 44Free Cash Flow 25 44

Debt to Total Capital 27, 28 Debt Divided by Total Capitalization 45Projected Debt to Total Capital 28 45

39

Adjusted EPS Q206 and Q205We exclude special items and certain economic, non-qualifying fuel adjustment clause and gas transportation hedges because we believe that it is appropriate for investors to consider results excluding these items, in addition to our results in accordance with GAAP. We have also adjusted earnings to exclude synfuel results due to the potential volatility and phase-out of the tax credits. We believe such a measure provides a picture of our results that is comparable among periods since it excludes the impact of items, which may recur occasionally, but tend to be irregular as to timing and magnitude, thereby distorting comparisons between periods. However, investors should note that this non-GAAP measures involve judgment by management (in particular, judgments as to what is or is not classified as a special item). We also use these measures to evaluate performance and for comp ensation purposes.

RECONCILIATION:Merchant Regulated Regulated OtherEnergy Electric Gas BGE Nonreg. Total

A B C D = (B+C) E F =(A+D+E)

2Q06 ACTUAL RESULTS:

Reported GAAP EPS 0.40$ 0.11$ (0.01)$ 0.10$ 0.02$ 0.52$ GAAP MEASURE

Special Items, Non-qualifying Hedges, and Synfuel Results Included in Operations:

Synthetic fuel facility results (0.01) - - - - (0.01)

Merger-related costs (0.02) (0.01) - (0.01) - (0.03)

Non-qualifying Hedges - - - - - -

Total Special Items, Non-qualifying Hedges, and Synfuel Results (0.03) (0.01) - (0.01) - (0.04)

Adjusted EPS 0.43$ 0.12$ (0.01)$ 0.11$ 0.02$ 0.56$ NON-GAAP MEASURE

2Q05 ACTUAL RESULTS:

Reported GAAP EPS 0.53$ 0.14$ (0.01)$ 0.13$ 0.02$ 0.68$

Income from Discontinued Operations 0.01 - - - 0.01 0.02 GAAP MEASURES

0.52 0.14 (0.01) 0.13 0.01 0.66

Special Items, Non-qualifying Hedges, and Synfuel Results Included in Operations:

Non-qualifying Hedges (0.02) - - - - (0.02)

Synthetic fuel facility results 0.09 - - - - 0.09

Total Special Items, Non-qualifying Hedges, and Synfuel Results 0.07 - - - - 0.07

Adjusted EPS 0.45$ 0.14$ (0.01)$ 0.13$ 0.01$ 0.59$ NON-GAAP MEASURE

EARNINGS GUIDANCE Constellation Energy is unable to reconcile its earnings guidance excluding special items, Non-qualifying hedges, and Synfuel results to GAAP earnings per share because we do not predict the future impact of special items such as the cumulative effect of changes in accounting principles, the disposition of assets, economic, nonqualifying hedges or synfuel results.

EPS Before Discontinued Operations

40

Adjusted EPS YTD 2005, 2004, 2003, 2002We exclude special items and certain economic, non-qualifying fuel adjustment clause and gas transportation hedges because we believe that it is appropriate for investors to consider results excluding these items, in addition to our results in accordance with GAAP. We have also adjusted earnings to exclude synfuel results due to the potential volatility and phase-out of the tax credits. We believe such a measure provides a picture of our results that is comparable among periods since it excludes the impact of items, which may recur occasionally, but tend to be irregular as to timing and magnitude, thereby distorting comparisons between periods. However, investors should note that this non-GAAP measures involve judgment by management (in particular, judgments as to what is or is not classified as a special item). We also use these measures to evaluate performance and for comp ensation purposes.RECONCILIATION:

Total Total

2005 ACTUAL RESULTS: 2003 ACTUAL RESULTS:

Reported GAAP EPS 3.47$ Reported GAAP EPS 1.66$

Income from Discontinued Operations 0.13 GAAP MEASURES Income from Discontinued Operations 0.11 GAAP MEASURES

Cumulative Effects of Changes in Accounting Principles (0.04) Cumulative Effects of Changes in Accounting Principles (1.19)

3.38 2.74

Special Items and Non-qualifying Hedges Included in Operations: Special Items and Non-qualifying Hedges Included in Operations:

Non-qualifying Hedges (0.14) Non-qualifying Hedges (0.17)

Merger related transaction costs (0.09) Net Gain on Sales of Investments and Other Assets 0.10

Workforce Reduction Costs (0.01) Workforce Reduction Costs (0.01)

Total Special Items and Non-qualifying Hedges (0.24) Total Special Items and Non-qualifying Hedges (0.08)

Adjusted EPS 3.62 NON-GAAP MEASURE Adjusted EPS 2.82$ NON-GAAP MEASURE

Synthetic fuel facility earnings 0.34 Synthetic fuel facility earnings - Adjusted EPS excluding Synfuel results 3.28$ NON-GAAP MEASURE Adjusted EPS excluding Synfuel results 2.82$ NON-GAAP MEASURE

2004 ACTUAL RESULTS: 2002 ACTUAL RESULTS:Reported GAAP EPS 3.12$ Reported GAAP EPS 3.20$ (Loss) Income from Discontinued Operations (0.16) GAAP MEASURES Income from Discontinued Operations 0.06 GAAP MEASURESEPS Before Discontinued Operations 3.28 3.14 Special Items Included in Operations: Special Items Included in Operations:

Recognition of Prior Year Synthetic Fuel Tax Credits 0.21 Net Gain on Sales of Investments and Other Assets 1.02 Workforce Reduction Costs (0.03) Impairment Losses and Other Costs (0.11) Impairment Losses and Other Costs (0.01) Workforce Reduction Costs (0.23) Net Loss on Sales of Investments and Other Assets (0.01) Total Special Items 0.68 Total Special Items 0.16 Adjusted EPS 2.46$ NON-GAAP MEASURE

Adjusted EPS 3.12$ NON-GAAP MEASURE Synthetic fuel facility earnings 0.04

Synthetic fuel facility earnings 0.29 Adjusted EPS excluding Synfuel results 2.42$ NON-GAAP MEASUREAdjusted EPS excluding Synfuel results 2.83$ NON-GAAP MEASURE

EPS Before Discontinued Operations and Cumulative Effects of Changes in Accounting Principles

EPS Before Discontinued Operations and Cumulative Effects of Changes in Accounting Principles

EPS Before Discontinued Operations and Cumulative

41

Adjusted EPS 3Q05We exclude special items and certain economic, non-qualifying fuel adjustment clause and gas transportation hedges because we believe that it is appropriate for investors to consider results excluding these items, in addition to our results in accordance with GAAP. We have also adjusted earnings to exclude synfuel results due to the potential volatility and phase-out of the tax credits. We believe such a measure provides a picture of our results that is comparable among periods since it excludes the impact of items, which may recur occasionally, but tend to be irregular as to timing and magnitude, thereby distorting comparisons between periods. However, investors should note that this non-GAAP measures involve judgment by management (in particular, judgments as to what is or is not classified as a special item). We also use these measures to evaluate performance and for compensation purposes.

RECONCILIATION:Merchant Regulated Regulated Other

Energy Electric Gas BGE Nonreg. Total

A B C D = (B+C) E F =(A+D+E)

3Q05 ACTUAL RESULTS:

Reported GAAP EPS 0.78$ 0.28$ (0.04)$ 0.24$ 0.01$ 1.03$

Income from Discontinued Operations - - - - 0.01 0.01 GAAP MEASURES

0.78 0.28 (0.04) 0.24 - 1.02

Special Items, Non-qualifying Hedges, and Synfuel Results Included in Operations:

Non-qualifying Hedges (0.13) - - - - (0.13)

Synthetic fuel facility results 0.08 - - - - 0.08

Workforce Reduction Costs (0.01) - - - - (0.01)

Total Special Items, Non-qualifying Hedges, and Synfuel Results (0.06) - - - - (0.06)

Adjusted EPS 0.84$ 0.28$ (0.04)$ 0.24$ -$ 1.08$ NON-GAAP MEASURE

EPS Before Discontinued Operations

42

Q206 Merchant Gross Margin and Below Gross MarginWe utilize the non-GAAP financial measure of Gross Margin to highlight the relationship between the costs of and prices for energy in our Merchant Energy business categories (i.e., Mid-Atlantic Fleet, Plants with PPAs, Wholesale Competitive Supply, NewEnergy, and QFs/Other). We believe this non-GAAP measure helps investors to better understand the changes in the level of our Merchant Energy operating results for these categories from period to period.

RECONCILIATION:GAAP Adjustments Merchant

GAAP Fuel & Purchased In Arriving Gross MarginMerchant Revenue & Expense Categories Revenues Energy Expenses Difference At Gross Margin Notes (Non-GAAP)

($ millions)Mid-Atlantic Fleet 651.6$ 398.9$ 252.7$ (99)$ a, b, c 154$ Plants with PPAs 194.0 18.6 175.4 2 a 177 Wholesale Competitive Supply 1,249.9 1,088.9 161.0 105 a , d, e 266 **NewEnergy 1,845.9 1,751.8 94.1 (4) d 90 QFs / Other 9.6 - 9.6 (6) e, f 3

Total Merchant 3,951.0$ 3,258.2$ 692.8$ (2)$ 690$

Adjustments Merchant Below Arriving At Merchant Gross Margin

Total Merchant: GAAP Below Gross Margin (Non-GAAP)Revenues less fuel and purchased energy expenses 692.8$ 690$ Operations and maintenance expenses (423.0) 14 g, h, i (409) Merger related transaction costs (5.0) 5 j - Depreciation, depletion, and amortization (72.1) (1) h, i (73) Taxes other than income taxes (31.5) 32 k - Accretion of asset retirement obligations (16.7) 17 k -

Income From Operations 144.5 208 Other income / (expense) 15.9 (51) b, k, l (36)

EBIT N/A 172 Fixed charges (54.1) 8 i, l (46)

Income Before Income Taxes 106.3 126 Income tax expense (34.6) (15) i, j (49)

Net Income 71.7$ 77$

Details of Adjustments Made in Arriving at Merchant Gross Margin:a Adjustment to remove ($98 million) gain from Mid-Atlantic Fleet and $2 million loss from Plants with PPA's of estimated gross margin created through active portfolio

management more appropriately categorized as a competitive supply activity.b Adjustment to remove ($5 million) of decommissioning revenues from non-GAAP gross margin measure and included in Other Income. The offsetting decommissioning

expense was recorded in accretion of asset retirement obligations.c Adjustment to remove $4 million of other indirect costs have been removed from non-GAAP gross margin as they are more appropriately categorized as operating expenses.d Adjustment to remove $4 million loss in Wholesale Competitive Supply and ($4 million) gain in NewEnergy related to economic, non-qualifying hedges of gas transport contracts.e Adjustment to remove synfuel losses from Wholesale Competitive Supply gross margin of $4 million and Other gross margin of $5 millionf Adjustment to reflect ($11 million) of direct costs in Other for purposes of non-GAAP gross margin measure.

Details of Adjustments Made in Arriving at Merchant Below Gross Margin:g Adjustment detailed in "c" and "f" above are offset by adjustments made to O&M costs. h Adjustment to reclassify certain allocated costs totaling $5 million from O&M to Depreciation and Amortizationi Adjustment to remove Synfuel results, which are not included in determining Merchant Below Gross Margin - $2 million in O&M, $4 million in D&A, $1 million in Fixed Charges, and ($14 million) from income tax expensej Adjustment to remove Special Items and related taxes, which are not included in determining Merchant Below Gross Margin.k Adjustment to reflect management's view of these items as Other Income / Expense.l Adjustment to move Interest Income of $7 million recorded in Other Income / Expense to Fixed Charges (to show a fixed charge amount net of interest income).

** Excludes $17 million of operating expenses, depreciation, depletion and amortization, and interest expense associated with our Upstream Gas properties

PROJECTED GROSS MARGIN AND RESULTS BELOW GROSS MARGIN:Constellation Energy is unable to reconcile its projected gross margin or results below gross margin to GAAP because we do not predict the future impact of reconciling items or special items such as the cumulative effect of changes in accounting principles and the disposition of assets.

Quarter Ended June 30, 2006

43

Q205 Merchant Gross Margin and Below Gross MarginWe utilize the non-GAAP financial measure of Gross Margin to highlight the relationship between the costs of and prices for energy in our Merchant Energy business categories (i.e., Mid-Atlantic Fleet, Plants with PPAs, Wholesale Competitive Supply, NewEnergy, and QFs/Other). We believe this non-GAAP measure helps investors to better understand the changes in the level of our Merchant Energy operating results for these categories from period to period.

RECONCILIATION:GAAP Adjustments Merchant

GAAP Fuel & Purchased In Arriving Gross MarginMerchant Revenue & Expense Categories Revenues Energy Expenses Difference At Gross Margin Notes (Non-GAAP)

($ millions)

Mid-Atlantic Fleet 495.4$ 227.8$ 267.6$ (46)$ a, b, c 221$ Plants with PPAs 191.9 18.6 173.3 (2) a 171 Wholesale Competitive Supply 929.1 863.9 65.2 57 a , d, e 121 **

NewEnergy 1,403.0 1,335.4 67.6 - 68 QFs / Other 2.7 - 2.7 (1) e, f 2

Total Merchant 3,022.1$ 2,445.7$ 576.4$ 8$ 583$

Adjustments Merchant Below Arriving At Merchant Gross Margin

Total Merchant: GAAP Below Gross Margin (Non-GAAP)

Revenues less fuel and purchased energy expenses 576.4$ 583$ Operations and maintenance expenses (328.5) 14 g, h, i (316) Depreciation, depletion, and amortization (65.4) - h, i (66)

Taxes other than income taxes (25.5) 26 j - Accretion of asset retirement obligations (15.3) 15 j -

Income From Operations 141.7 201 Other income / (expense) 8.2 (40) b, j, k (32)

EBIT N/A 169 Fixed charges (44.6) 4 k (41)

Income Before Income Taxes 105.3 128 Income tax benefit / (expense) (12.6) (36) i, l (48)

Income from Continuing Operations 92.7 80

Income from discontinued operations 2.7 (3) m - Net Income 95.4$ 80$

Details of Adjustments Made in Arriving at Merchant Gross Margin:

a Adjustment to remove gains of ($45 million) from Mid-Atlantic Fleet and gains of ($2 million) from PPAs of estimated gross margin created through active portfolio management more appropriately categorized as a competitive supply activity.

b Adjustment to remove ($5 million) of decommissioning revenues from non-GAAP gross margin measure and included in Other Income. The offsetting

decommissioning expense was recorded in accretion of asset retirement obligations.c Adjustment to remove $4 million of other indirect costs have been removed from non-GAAP gross margin as they are more appropriately categorized as operating expenses.

d Adjustment to remove $6 million loss related to economic, non-qualifying hedges of fuel adjustment clauses and gas transport contractse Adjustment to remove synfuel losses from Wholesale Competitive Supply gross margin of $4 million and Other gross margin of $9 millionf Adjustment to reflect ($11 million) of direct costs in Other for purposes of non-GAAP gross margin measure.

Details of Adjustments Made in Arriving at Merchant Below Gross Margin:g Adjustment detailed in "c" and "f" above are offset by adjustments made to O&M costs. h Adjustment to reclassify certain allocated costs totaling $6 million from O&M to Depreciation and Amortization

i Adjustment to remove Synfuel results, which are not included in determining Merchant Below Gross Margin - $2 million in O&M, $6 million in D&A, ($34 million) from income tax expensej Adjustment to reflect management's view of these items as Other Income / Expense.

k Adjustment to move Interest Income of $4 million recorded in Other Income / Expense to Fixed Charges (to show a fixed charge amount net of interest income).l Adjustment to remove tax benefit ($2 million) related to losses on economic, non-qualifying hedges of fuel adjustment clauses and gas transport contractsm Adjustment to remove income from discontinued operations which is treated as a special item

** Excludes $1 million of operating expenses, depreciation, depletion and amortization, and interest expense associated with our Upstream Gas properties

PROJECTED GROSS MARGIN AND RESULTS BELOW GROSS MARGIN:Constellation Energy is unable to reconcile its projected gross margin or results below gross margin to GAAP because we do not predict the future impact of

reconciling items or special items such as the cumulative effect of changes in accounting principles and the disposition of assets.

Quarter Ended June 30, 2005

44

Cash FlowsThe following is a reconciliation of the non-GAAP financial measures of Net Cash Flow before Debt Issuances/Payments and Free Cash Flow for the six months ended June 30, 2006. We utilize these non-GAAP measures because we believe they are helpful in understanding our ability to reduce debt by existing cash.

RECONCILIATION:

QTD JUNE ACTUAL RESULTS:Net cash used in operating activities (GAAP measure) 70 Adjustment for derivative contracts presented as financing activities under SFAS 149 25 Adjusted Net Cash Used in Operating Activities 95$ NON-GAAP MEASURE

Net cash used in investing activities (GAAP measure) (215)

Net Cash Used in Financing Activities (Excl. Debt-Related Sources & Uses) *Common stock dividends paid (68) Proceeds from issuance of common stock 22 Net proceeds from acquired contracts 221 Other financing activities, excluding SFAS 149 activities included in operating 1 Adjusted Net Cash Used in Financing Activities 176

Net Cash Flow before Debt Issuances/(Payments) 56 NON-GAAP MEASURE

Less: Proceeds from issuance of common stock (22) Add: Common stock dividends paid 68

Free Cash Flow 102$ NON-GAAP MEASURE

* Total GAAP Cash Used in Financing Activities (incl. debt-related sources & uses) was $52 million QTD June 06.

PROJECTED CASH FLOWS:

Constellation Energy is unable to provide a reconciliation of these measures for Projected 2006 because it does not prepare a forecasted statement of cash flows on a GAAP basis.

2006($ millions)

45

Debt to Total CapitalDebt to Total CapitalDebt to Total Capital is a non-GAAP ratio that excludes unamortized discounts and premiums, reduces debt by our cash balance, and includes minority interests in equity. In addition, we reflect a 50 percent equity credit for our trust preferred securities, similar to the evaluation performed by major credit rating agencies. Management believes this non-GAAP measures provide investors useful information on our leverage because it is consistent with the evaluation performed by rating agencies, takes into account minority equity interests in our consolidated affiliates and cash available to reduce debt, and facilitates comparability between periods.

RECONCILIATION:

Total long-term debt (gross of current portion) 4,590.9$ 4,590.9$ 4,589.5$ 4,589.5$ 4,610.9$ 4,610.9$ 5,134.9$ 5,134.9$ 3,874.4$ 3,874.4$

Fair value decrease in fixed to floating rate swap included in long-term debt 21.7 6.5 0.9 - -

6.20% deferrable interest subordinated debentures due

October 15, 2043 to BGE wholly owned BGE Capital

Trust II relating to trust originated preferred securities 257.7 257.7 257.7 257.7 257.7 257.7 257.7 257.7 250.0 250.0 50% Equity credit to trust preferred securities - (125.0) - (125.0) - (125.0) - (125.0) - (125.0)

Adjustment to include High Desert Lease on Balance Sheet at December 31, 2001 - - - - - - - - - 221.0

Short-term borrowings 155.0 155.0 425.0 425.0 0.7 0.7 9.6 9.6 975.0 975.0 Unamortized discount and premium (6.0) - (7.6) - (8.0) - (10.2) - (5.2) -

Subtotal 4,997.6 4,900.3 5,264.6 5,153.7 4,861.3 4,745.2 5,392.0 5,277.2 5,094.2 5,195.4 LESS: Cash - 228.1 - 424.8 - 813.0 - 721.3 - 72.4

Total Net Debt 4,997.6 4,672.2 50.7% 5,264.6 4,728.9 50.4% 4,861.3 3,932.2 42.8% 5,392.0 4,555.9 49.9% 5,094.2 5,123.0 54.6%

BGE Preference Stock Not Subject To Mandatory Redemption 190.0 190.0 190.0 190.0 190.0 190.0 190.0 190.0 190.0 190.0 Minority Interests - 21.6 - 22.0 - 22.4 - 113.4 - 101.8

Common shareholders' equity 4,208.5 4,208.5 4,324.0 4,324.0 4,915.5 4,915.5 4,140.5 4,140.5 3,843.6 3,843.6

Subtotal 4,398.5 4,420.1 4,514.0 4,536.0 5,105.5 5,127.9 4,330.5 4,443.9 4,033.6 4,135.4 50% Equity credit to trust preferred securities - 125.0 - 125.0 - 125.0 - 125.0 - 125.0

Total Equity 4,398.5 4,545.1 49.3% 4,514.0 4,661.0 49.6% 5,105.5 5,252.9 57.2% 4,330.5 4,568.9 50.1% 4,033.6 4,260.4 45.4%

Total Capitalization 9,396.1$ 9,217.3$ 100.0% 9,778.6$ 9,389.9$ 100.0% 9,966.8$ 9,185.1$ 100.0% 9,722.5$ 9,124.8$ 100.0% 9,127.8$ 9,383.4$ 100.0%

Exclude commodity hedge AOCI Balance from common shareholders' equity 1,157.0 996.6 323.0 (9.6) (30.0) Counterparty cash collateral held reflected as a reduction of cash balance (167) (216) (388) (120) -

Adjusted Net Debt to Total Capital 45.9% 46.6% 43.7% 50.6% 54.8%

PROJECTED LEVERAGE RATIOS:

Constellation Energy is unable to provide a reconciliation of this measure for Projected 2006 because it does not prepare a forecasted balance sheet on a GAAP basis.

($ millions)

December 31, 2005

GAAP Balances Non-GAAP Ratio GAAP Balances Non-GAAP Ratio

December 31, 2001

GAAP Balances Non-GAAP Ratio

December 31, 2003

GAAP Balances Non-GAAP Ratio

June 30, 2006

GAAP Balances Non-GAAP Ratio

March 31, 2006