Fair Value Measurements

6 Months Ended

Jun. 30, 2011

Fair Value Measurements

NOTE 8: FAIR VALUE MEASUREMENTS

PG&E Corporation and the Utility measure their cash equivalents, trust assets, and price risk management instruments at fair value. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value:

Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 - Other inputs that are directly or indirectly observable in the marketplace.

Level 3 - Unobservable inputs which are supported by little or no market activities.

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Assets and liabilities measured at fair value on a recurring basis for PG&E Corporation and the Utility are summarized below (money market investments and assets held in rabbi trusts are held by PG&E Corporation and not the Utility). The 2010 presentation has been changed to reflect gross assets and liabilities by level to conform to the current period presentation. Additionally, the Company corrected $125 million that was netted and classified inappropriately between Level 3 price risk management instrument assets and liabilities and other immaterial price risk management instrument changes.

	Fair Value Measurements
	At June 30, 2011										At December 31, 2010
(in millions)	Level 1		Level 2		Level 3		Netting (3)		Total		Level 1		Level 2		Level 3		Netting (3)		Total
Assets:
Money market investments		$ 228		$ -		$ -		$ -		$ 228		$ 138		$ -		$ -		$ -		$ 138
Nuclear decommissioning trusts
U.S. equity securities (1)		863		11		-		-		874		1,029		7		-		-		1,036
Non-U.S. equity securities		365		-		-		-		365		349		-		-		-		349
U.S. government and agency securities		681		145		-		-		826		584		40		-		-		624
Municipal securities		-		103		-		-		103		-		119		-		-		119
Other fixed-income securities		-		101		-		-		101		-		66		-		-		66
Total nuclear decommissioning trusts (2)		1,909		360		-		-		2,269		1,962		232		-		-		2,194
Price risk management instruments (Note 7)
Electric		1		-		184		58		243		6		2		119		63		190
Gas		-		-		10		1		11		-		-		6		5		11
Total price risk management instruments		1		-		194		59		254		6		2		125		68		201
Rabbi trusts
Fixed-income securities		-		25		-		-		25		-		24		-		-		24
Life insurance contracts		-		66		-		-		66		-		65		-		-		65
Total rabbi trusts		-		91		-		-		91		-		89		-		-		89
Long-term disability trust
U.S. equity securities (1)		4		16		-		-		20		11		24		-		-		35
Non-U.S. equity securities		-		12		-		-		12		-		-		-		-		-
Corporate debt securities (1)		-		137		-		-		137		-		150		-		-		150
Total long-term disability trust		4		165		-		-		169		11		174		-		-		185
Total assets		$ 2,142		$ 616		$ 194		$ 59		$ 3,011		$ 2,117		$ 497		$ 125		$ 68		$2,807
Liabilities:
Price risk management instruments (Note 7)
Electric		$ 200		$ 66		$ 468		$ (282)		$ 452		$ 235		$ 73		$ 475		$ (315)		$ 468
Gas		37		1		6		(37)		7		41		1		49		(41)		50
Total liabilities		$237		$ 67		$ 474		$ (319)		$ 459		$ 276		$ 74		$ 524		$ (356)		$ 518

⁽¹⁾  Level 2 balances include commingled funds, which are composed primarily of securities traded publicly on exchanges. Price quotes for the assets held by the funds are readily observable and available.

⁽²⁾  Excludes $200 million and $185 million at June 30, 2011 and December 31, 2010, respectively, primarily related to deferred taxes on appreciation of investment value.

(3) Includes the effect of netting and collateral.

Money Market Investments

PG&E Corporation invests in money market funds that seek to maintain a stable net asset value. These funds invest in high-quality, short-term, diversified money market instruments, such as treasury bills, federal agency securities, certificates of deposit, and commercial paper with a maximum weighted average maturity of 60 days or less. PG&E Corporation's investments in these money market funds are generally valued using unadjusted quotes in an active market for identical assets and are thus classified as Level 1. Money market funds are recorded as cash and cash equivalents in PG&E Corporation's Condensed Consolidated Balance Sheets.

Trust Assets

The assets held by the nuclear decommissioning trusts, the rabbi trusts related to the non-qualified deferred compensation plans, and the long-term disability trust are composed primarily of equity securities and debt securities. In general, investments held in the trusts are exposed to various risks, such as interest rate, credit, and market volatility risks.

Equity investments primarily include investments in common stock and commingled funds composed of equity securities across multiple industry sectors in the U.S. and other regions of the world. Equity securities are generally valued based on unadjusted prices in active markets for identical transactions and are classified as Level 1.

Debt securities are composed primarily of fixed-income securities that include U.S. government and agency securities, municipal securities, and corporate debt securities. U.S. government and agency securities consist primarily of treasury securities that are classified as Level 1 as the fair value is determined by observable market prices in active markets. A market based valuation approach is generally used to estimate the fair value of debt securities classified as Level 2. Under a market approach, fair values are determined based on evaluated pricing data, such as broker quotes, for similar securities adjusted for observable differences. Significant inputs used in the valuation model generally include benchmark yield curves and issuer spreads. The external credit rating, coupon rate, and maturity of each security are considered in the valuation, as applicable.

Price Risk Management Instruments

Price risk management instruments include physical and financial derivative contracts, such as forwards, swaps, options, and CRRs that are either exchange-traded or over-the-counter traded. (See Note 7 above.)

Forwards and swaps that are valued using observable market prices for the underlying commodity or an identical instrument and are classified as Level 1 or Level 2. Forwards and swaps that are valued using unobservable data are considered Level 3. These contracts are valued using either estimated basis adjustments from liquid trading points or techniques including extrapolation from observable prices when a contract term extends beyond a period when market data is available.

All energy-related options are classified as Level 3 and are valued using a standard option pricing model with various assumptions, including forward prices for the underlying commodity, time value at a risk free rate, and volatility. For periods in which market data is not available, the Utility extrapolates these assumptions using internal models.

The Utility holds CRRs to hedge financial risk of CAISO-imposed congestion charges in the day-ahead markets. CRRs are valued based on auction prices discounted at the risk free rate. Limited market data is available between auction dates; therefore, CRRs are classified as Level 3.

Transfers between Levels

PG&E Corporation and the Utility recognize any transfers between levels in the fair value hierarchy as of the end of the reporting period. There were no significant transfers between levels for the three and six months ended June 30, 2011.

Level 3 Reconciliation

The following tables present reconciliations for assets and liabilities measured and recorded at fair value on a recurring basis for PG&E Corporation and the Utility (money market investments and dividend participation rights are held by PG&E Corporation and not the Utility), using significant unobservable inputs (Level 3), for the three months ended June 30, 2011 and 2010, respectively:

		00000000000000000000000000
(in millions)	Price Risk Management               Instruments
Asset (liability) balance as of March 31, 2011		$ (312)
Realized and unrealized gains (losses):
Included in earnings		23
Included in regulatory assets and liabilities or balancing accounts		(82)
Purchases		57
Issuances		-
Sales		-
Settlements		34
Transfers into Level 3		-
Transfers out of Level 3		-
Asset (liability) balance as of June 30, 2011		$ (280)

		000000000000		000000000000		000000000000		000000000000
(in millions)	Dividend Participation Rights		Price Risk Management Instruments		Other Liabilities		Total
Asset (liability) balance as of March 31, 2010		$ (7)		$ (424)		$ (1)		$ (432)
Realized and unrealized gains (losses):
Included in earnings		-		7		-		7
Included in regulatory assets and liabilities or balancing accounts		-		(169)		(1)		(170)
Purchases, issuances, sales and settlements		7		116		-		123
Transfers into Level 3		-		-		-		-
Transfers out of Level 3		-		-		-		-
Asset (liability) balance as of June 30, 2010		$ -		$ (470)		$ (2)		$ (472)

The following tables present the reconciliation for Level 3 assets and liabilities for the six months ended June 30, 2011 and 2010, respectively:

		00000000000000000000000000
(in millions)	Price Risk Management               Instruments
Asset (liability) balance as of December 31, 2010		$ (399)
Realized and unrealized gains (losses):
Included in earnings		15
Included in regulatory assets and liabilities or balancing accounts		(118)
Purchases		99
Issuances		-
Sales		-
Settlements		123
Transfers into Level 3		-
Transfers out of Level 3		-
Asset (liability) balance as of June 30, 2011		$ (280)

		000000000000		000000000000		000000000000		000000000000		000000000000
(in millions)	Money Market		Dividend Participation Rights		Price Risk Management Instruments		Other Liabilities		Total
Asset (liability) balance as of December 31, 2009		$ 4		$ (12)		$ (250)		$ (3)		$ (261)
Realized and unrealized gains (losses):
Included in earnings		-		-		(36)		-		(36)
Included in regulatory assets and liabilities or balancing accounts		-		-		(392)		1		(391)
Purchases, issuances, sales and settlements		(4)		12		208		-		216
Transfers into Level 3		-		-		-		-		-
Transfers out of Level 3		-		-		-		-		-
Asset (liability) balance as of June 30, 2010		$ -		$ -		$ (470)		$ (2)		$ (472)

Financial Instruments

PG&E Corporation and the Utility use the following methods and assumptions in estimating fair value for financial instruments:

_• The fair values of cash, restricted cash and deposits, net accounts receivable, short-term borrowings, accounts payable, customer deposits, and the Utility's variable rate pollution control bond loan agreements approximate their carrying values at June 30, 2011 and December 31, 2010, as they are short term in nature or have interest rates that reset daily.

_• The fair values of the Utility's fixed rate senior notes and fixed rate pollution control bond loan agreements, PG&E Corporation's fixed rate senior notes, and the energy recovery bonds issued by PERF were based on quoted market prices at June 30, 2011 and December 31, 2010.

The carrying amount and fair value of PG&E Corporation's and the Utility's debt instruments were as follows (the table below excludes financial instruments with carrying values that approximate their fair values):

		0000000000		0000000000		0000000000		0000000000
	At June 30, 2011				At December 31, 2010
(in millions)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Debt (Note 4)
PG&E Corporation		$349		$386		$349		$383
Utility		10,245		11,096		10,444		11,314
Energy recovery bonds (Note 4)		636		665		827		862

Nuclear Decommissioning Trust Investments

The Utility classifies its investments held in the nuclear decommissioning trust as "available-for-sale." As the day-to-day investing activities of the trusts are managed by external investment managers, the Utility is unable to assert that it has the intent and ability to hold investments to maturity. Therefore, all unrealized losses are considered other-than-temporary impairments. Gains or losses on the nuclear decommissioning trust investments are refundable or recoverable, respectively, from customers. Therefore, trust earnings are deferred and included in the regulatory liability for recoveries in excess of ARO. There is no impact on the Utility's earnings or accumulated other comprehensive income. (See Note 3 above for further discussion.)

The following table provides a summary of available-for-sale investments held in the Utility's nuclear decommissioning trusts:

		00000000000		00000000000		00000000000		00000000000
(in millions)	Amortized Cost		Total Unrealized Gains		Total Unrealized Losses		Total Fair Value (1)
As of June 30, 2011
Equity securities
U.S.		$ 322		$ 554		$ (2)		$ 874
Non-U.S.		184		182		(1)		365
Debt securities
U.S. government and agency securities		766		61		(1)		826
Municipal securities		102		2		(1)		103
Other fixed-income securities		100		1		-		101
Total		$ 1,474		$800		$ (5)		$ 2,269
As of December 31, 2010
Equity securities
U.S.		$ 509		$ 529		$ (2)		$ 1,036
Non-U.S.		180		170		(1)		349
Debt securities
U.S. government and agency securities		571		55		(2)		624
Municipal securities		119		1		(1)		119
Other fixed-income securities		65		1		-		66
Total		$ 1,444		$ 756		$ (6)		$ 2,194

⁽¹⁾  Excludes $200 million and $185 million at June 30, 2011 and December 31, 2010, respectively, primarily related to deferred taxes on appreciation of investment value.

The debt securities mature on the following schedule:

		00000000000000000000
(in millions)	As of June 30, 2011
Less than 1 year		$ 63
1–5 years		348
5–10 years		278
More than 10 years		341
Total maturities of debt securities		$ 1,030

The following table provides a summary of activity for the debt and equity securities:

		000000000000		000000000000		000000000000		000000000000
	Three Months Ended June 30,				Six Months Ended June 30,
	2011		2010		2011		2010
(in millions)
Proceeds from sales and maturities of nuclear decommissioning trust investments		$ 281		$ 348		$ 1,007		$ 685
Gross realized gains on sales of securities held as available-for-sale		9		7		29		22
Gross realized losses on sales of securities held as available-for-sale		(3)		(1)		(6)		(6)

Pacific Gas and Electric Company [Member]

Fair Value Measurements

NOTE 8: FAIR VALUE MEASUREMENTS

PG&E Corporation and the Utility measure their cash equivalents, trust assets, and price risk management instruments at fair value. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value:

Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 - Other inputs that are directly or indirectly observable in the marketplace.

Level 3 - Unobservable inputs which are supported by little or no market activities.

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Assets and liabilities measured at fair value on a recurring basis for PG&E Corporation and the Utility are summarized below (money market investments and assets held in rabbi trusts are held by PG&E Corporation and not the Utility). The 2010 presentation has been changed to reflect gross assets and liabilities by level to conform to the current period presentation. Additionally, the Company corrected $125 million that was netted and classified inappropriately between Level 3 price risk management instrument assets and liabilities and other immaterial price risk management instrument changes.

	Fair Value Measurements
	At June 30, 2011										At December 31, 2010
(in millions)	Level 1		Level 2		Level 3		Netting (3)		Total		Level 1		Level 2		Level 3		Netting (3)		Total
Assets:
Money market investments		$ 228		$ -		$ -		$ -		$ 228		$ 138		$ -		$ -		$ -		$ 138
Nuclear decommissioning trusts
U.S. equity securities (1)		863		11		-		-		874		1,029		7		-		-		1,036
Non-U.S. equity securities		365		-		-		-		365		349		-		-		-		349
U.S. government and agency securities		681		145		-		-		826		584		40		-		-		624
Municipal securities		-		103		-		-		103		-		119		-		-		119
Other fixed-income securities		-		101		-		-		101		-		66		-		-		66
Total nuclear decommissioning trusts (2)		1,909		360		-		-		2,269		1,962		232		-		-		2,194
Price risk management instruments (Note 7)
Electric		1		-		184		58		243		6		2		119		63		190
Gas		-		-		10		1		11		-		-		6		5		11
Total price risk management instruments		1		-		194		59		254		6		2		125		68		201
Rabbi trusts
Fixed-income securities		-		25		-		-		25		-		24		-		-		24
Life insurance contracts		-		66		-		-		66		-		65		-		-		65
Total rabbi trusts		-		91		-		-		91		-		89		-		-		89
Long-term disability trust
U.S. equity securities (1)		4		16		-		-		20		11		24		-		-		35
Non-U.S. equity securities		-		12		-		-		12		-		-		-		-		-
Corporate debt securities (1)		-		137		-		-		137		-		150		-		-		150
Total long-term disability trust		4		165		-		-		169		11		174		-		-		185
Total assets		$ 2,142		$ 616		$ 194		$ 59		$ 3,011		$ 2,117		$ 497		$ 125		$ 68		$2,807
Liabilities:
Price risk management instruments (Note 7)
Electric		$ 200		$ 66		$ 468		$ (282)		$ 452		$ 235		$ 73		$ 475		$ (315)		$ 468
Gas		37		1		6		(37)		7		41		1		49		(41)		50
Total liabilities		$237		$ 67		$ 474		$ (319)		$ 459		$ 276		$ 74		$ 524		$ (356)		$ 518

⁽¹⁾  Level 2 balances include commingled funds, which are composed primarily of securities traded publicly on exchanges. Price quotes for the assets held by the funds are readily observable and available.

⁽²⁾  Excludes $200 million and $185 million at June 30, 2011 and December 31, 2010, respectively, primarily related to deferred taxes on appreciation of investment value.

(3) Includes the effect of netting and collateral.

Money Market Investments

PG&E Corporation invests in money market funds that seek to maintain a stable net asset value. These funds invest in high-quality, short-term, diversified money market instruments, such as treasury bills, federal agency securities, certificates of deposit, and commercial paper with a maximum weighted average maturity of 60 days or less. PG&E Corporation's investments in these money market funds are generally valued using unadjusted quotes in an active market for identical assets and are thus classified as Level 1. Money market funds are recorded as cash and cash equivalents in PG&E Corporation's Condensed Consolidated Balance Sheets.

Trust Assets

The assets held by the nuclear decommissioning trusts, the rabbi trusts related to the non-qualified deferred compensation plans, and the long-term disability trust are composed primarily of equity securities and debt securities. In general, investments held in the trusts are exposed to various risks, such as interest rate, credit, and market volatility risks.

Equity investments primarily include investments in common stock and commingled funds composed of equity securities across multiple industry sectors in the U.S. and other regions of the world. Equity securities are generally valued based on unadjusted prices in active markets for identical transactions and are classified as Level 1.

Debt securities are composed primarily of fixed-income securities that include U.S. government and agency securities, municipal securities, and corporate debt securities. U.S. government and agency securities consist primarily of treasury securities that are classified as Level 1 as the fair value is determined by observable market prices in active markets. A market based valuation approach is generally used to estimate the fair value of debt securities classified as Level 2. Under a market approach, fair values are determined based on evaluated pricing data, such as broker quotes, for similar securities adjusted for observable differences. Significant inputs used in the valuation model generally include benchmark yield curves and issuer spreads. The external credit rating, coupon rate, and maturity of each security are considered in the valuation, as applicable.

Price Risk Management Instruments

Price risk management instruments include physical and financial derivative contracts, such as forwards, swaps, options, and CRRs that are either exchange-traded or over-the-counter traded. (See Note 7 above.)

Forwards and swaps that are valued using observable market prices for the underlying commodity or an identical instrument and are classified as Level 1 or Level 2. Forwards and swaps that are valued using unobservable data are considered Level 3. These contracts are valued using either estimated basis adjustments from liquid trading points or techniques including extrapolation from observable prices when a contract term extends beyond a period when market data is available.

All energy-related options are classified as Level 3 and are valued using a standard option pricing model with various assumptions, including forward prices for the underlying commodity, time value at a risk free rate, and volatility. For periods in which market data is not available, the Utility extrapolates these assumptions using internal models.

The Utility holds CRRs to hedge financial risk of CAISO-imposed congestion charges in the day-ahead markets. CRRs are valued based on auction prices discounted at the risk free rate. Limited market data is available between auction dates; therefore, CRRs are classified as Level 3.

Transfers between Levels

PG&E Corporation and the Utility recognize any transfers between levels in the fair value hierarchy as of the end of the reporting period. There were no significant transfers between levels for the three and six months ended June 30, 2011.

Level 3 Reconciliation

The following tables present reconciliations for assets and liabilities measured and recorded at fair value on a recurring basis for PG&E Corporation and the Utility (money market investments and dividend participation rights are held by PG&E Corporation and not the Utility), using significant unobservable inputs (Level 3), for the three months ended June 30, 2011 and 2010, respectively:

		00000000000000000000000000
(in millions)	Price Risk Management               Instruments
Asset (liability) balance as of March 31, 2011		$ (312)
Realized and unrealized gains (losses):
Included in earnings		23
Included in regulatory assets and liabilities or balancing accounts		(82)
Purchases		57
Issuances		-
Sales		-
Settlements		34
Transfers into Level 3		-
Transfers out of Level 3		-
Asset (liability) balance as of June 30, 2011		$ (280)

		000000000000		000000000000		000000000000		000000000000
(in millions)	Dividend Participation Rights		Price Risk Management Instruments		Other Liabilities		Total
Asset (liability) balance as of March 31, 2010		$ (7)		$ (424)		$ (1)		$ (432)
Realized and unrealized gains (losses):
Included in earnings		-		7		-		7
Included in regulatory assets and liabilities or balancing accounts		-		(169)		(1)		(170)
Purchases, issuances, sales and settlements		7		116		-		123
Transfers into Level 3		-		-		-		-
Transfers out of Level 3		-		-		-		-
Asset (liability) balance as of June 30, 2010		$ -		$ (470)		$ (2)		$ (472)

The following tables present the reconciliation for Level 3 assets and liabilities for the six months ended June 30, 2011 and 2010, respectively:

		00000000000000000000000000
(in millions)	Price Risk Management               Instruments
Asset (liability) balance as of December 31, 2010		$ (399)
Realized and unrealized gains (losses):
Included in earnings		15
Included in regulatory assets and liabilities or balancing accounts		(118)
Purchases		99
Issuances		-
Sales		-
Settlements		123
Transfers into Level 3		-
Transfers out of Level 3		-
Asset (liability) balance as of June 30, 2011		$ (280)

		000000000000		000000000000		000000000000		000000000000		000000000000
(in millions)	Money Market		Dividend Participation Rights		Price Risk Management Instruments		Other Liabilities		Total
Asset (liability) balance as of December 31, 2009		$ 4		$ (12)		$ (250)		$ (3)		$ (261)
Realized and unrealized gains (losses):
Included in earnings		-		-		(36)		-		(36)
Included in regulatory assets and liabilities or balancing accounts		-		-		(392)		1		(391)
Purchases, issuances, sales and settlements		(4)		12		208		-		216
Transfers into Level 3		-		-		-		-		-
Transfers out of Level 3		-		-		-		-		-
Asset (liability) balance as of June 30, 2010		$ -		$ -		$ (470)		$ (2)		$ (472)

Financial Instruments

PG&E Corporation and the Utility use the following methods and assumptions in estimating fair value for financial instruments:

_• The fair values of cash, restricted cash and deposits, net accounts receivable, short-term borrowings, accounts payable, customer deposits, and the Utility's variable rate pollution control bond loan agreements approximate their carrying values at June 30, 2011 and December 31, 2010, as they are short term in nature or have interest rates that reset daily.

_• The fair values of the Utility's fixed rate senior notes and fixed rate pollution control bond loan agreements, PG&E Corporation's fixed rate senior notes, and the energy recovery bonds issued by PERF were based on quoted market prices at June 30, 2011 and December 31, 2010.

The carrying amount and fair value of PG&E Corporation's and the Utility's debt instruments were as follows (the table below excludes financial instruments with carrying values that approximate their fair values):

		0000000000		0000000000		0000000000		0000000000
	At June 30, 2011				At December 31, 2010
(in millions)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Debt (Note 4)
PG&E Corporation		$349		$386		$349		$383
Utility		10,245		11,096		10,444		11,314
Energy recovery bonds (Note 4)		636		665		827		862

Nuclear Decommissioning Trust Investments

The Utility classifies its investments held in the nuclear decommissioning trust as "available-for-sale." As the day-to-day investing activities of the trusts are managed by external investment managers, the Utility is unable to assert that it has the intent and ability to hold investments to maturity. Therefore, all unrealized losses are considered other-than-temporary impairments. Gains or losses on the nuclear decommissioning trust investments are refundable or recoverable, respectively, from customers. Therefore, trust earnings are deferred and included in the regulatory liability for recoveries in excess of ARO. There is no impact on the Utility's earnings or accumulated other comprehensive income. (See Note 3 above for further discussion.)

The following table provides a summary of available-for-sale investments held in the Utility's nuclear decommissioning trusts:

		00000000000		00000000000		00000000000		00000000000
(in millions)	Amortized Cost		Total Unrealized Gains		Total Unrealized Losses		Total Fair Value (1)
As of June 30, 2011
Equity securities
U.S.		$ 322		$ 554		$ (2)		$ 874
Non-U.S.		184		182		(1)		365
Debt securities
U.S. government and agency securities		766		61		(1)		826
Municipal securities		102		2		(1)		103
Other fixed-income securities		100		1		-		101
Total		$ 1,474		$800		$ (5)		$ 2,269
As of December 31, 2010
Equity securities
U.S.		$ 509		$ 529		$ (2)		$ 1,036
Non-U.S.		180		170		(1)		349
Debt securities
U.S. government and agency securities		571		55		(2)		624
Municipal securities		119		1		(1)		119
Other fixed-income securities		65		1		-		66
Total		$ 1,444		$ 756		$ (6)		$ 2,194

⁽¹⁾  Excludes $200 million and $185 million at June 30, 2011 and December 31, 2010, respectively, primarily related to deferred taxes on appreciation of investment value.

The debt securities mature on the following schedule:

		00000000000000000000
(in millions)	As of June 30, 2011
Less than 1 year		$ 63
1–5 years		348
5–10 years		278
More than 10 years		341
Total maturities of debt securities		$ 1,030

The following table provides a summary of activity for the debt and equity securities:

		000000000000		000000000000		000000000000		000000000000
	Three Months Ended June 30,				Six Months Ended June 30,
	2011		2010		2011		2010
(in millions)
Proceeds from sales and maturities of nuclear decommissioning trust investments		$ 281		$ 348		$ 1,007		$ 685
Gross realized gains on sales of securities held as available-for-sale		9		7		29		22
Gross realized losses on sales of securities held as available-for-sale		(3)		(1)		(6)		(6)