Fitch: Affirmation Likely for Constellation Energy on Proposed Maryland Settlement

CHICAGO--(Business Wire)--
Fitch Ratings expects to affirm the Issuer Default Rating (IDR)
and other ratings of Constellation Energy Group, Inc. (CEG; 'BBB+')
and Baltimore Gas and Electric Company (BGE; 'BBB+') upon approval by
the Maryland General Assembly of the proposed settlement between the
two companies and the State of Maryland and the Maryland Public
Service Commission. Fitch had placed the companies on Rating Watch
Negative on Feb. 1, 2008 after the political and regulatory
environment became more contentious, which elevated the risk profile
and operating environment for the companies. Upon approval, Fitch
expects to remove the ratings from Negative Watch, and the Outlook for
both companies will likely be Stable.

In Fitch's view the proposed settlement resolves most of the
outstanding legal and regulatory issues, and signals the potential for
a more constructive regulatory and political environment going
forward. The settlement will have a net cash impact on BGE of
approximately $143 million, consisting of a $187 million refund offset
by recovery of various costs totaling $44 million. While this places
mild downward pressure on credit metrics, Fitch expects that they will
remain within parameters for the current rating category.

Fitch currently rates the companies as follows:

Constellation Energy Group, Inc.

--IDR 'BBB+';

--Short-term IDR 'F2';

--Senior unsecured notes 'BBB+';

--Commercial paper 'F2'.

Baltimore Gas and Electric Company

--IDR 'BBB+';

--Short-term IDR 'F2';

--First-mortgage bonds 'A';

--Unsecured notes and pollution control revenue bonds 'A-';

--Preferred stock 'BBB+';

--Commercial paper 'F2'.

BGE Capital Trust II

--Preferred stock 'BBB+'.

Fitch's rating definitions and the terms of use of such ratings
are available on the agency's public site, www.fitchratings.com.
Published ratings, criteria and methodologies are available from this
site, at all times. Fitch's code of conduct, confidentiality,
conflicts of interest, affiliate firewall, compliance and other
relevant policies and procedures are also available from the 'Code of
Conduct' section of this site.

Fitch Ratings
Justin Bowersock, CFA, 312-368-3151, Chicago
Glen Grabelsky, 212-908-0577, New York
or
Media Relations:
Brian Bertsch, 212-908-0549, New York

Copyright Business Wire 2008