Regulatory Assets and Liabilities

Regulatory assets and liabilities include the following:



	September 30, 2014		December 31, 2013
(millions)
Dominion
Regulatory assets:
Deferred cost of fuel used in electric generation⁽¹⁾	$	180	$	—
Deferred rate adjustment clause costs⁽²⁾	105		89
Deferred nuclear refueling outage costs⁽³⁾	48		—
Unrecovered gas costs⁽⁴⁾	17		50
Derivatives⁽⁵⁾	5		16
Other	47		62
Regulatory assets-current⁽⁶⁾	402		217
Unrecognized pension and other postretirement benefit costs⁽⁷⁾	675		706
Deferred rate adjustment clause costs⁽²⁾	246		287
Income taxes recoverable through future rates⁽⁸⁾	139		155
Derivatives⁽⁵⁾	59		16
Deferred cost of fuel used in electric generation⁽¹⁾	19		1
Other	99		63
Regulatory assets-non-current	1,237		1,228
Total regulatory assets	$	1,639	$	1,445
Regulatory liabilities:
PIPP⁽⁹⁾	$	76	$	76
Other	52		52
Regulatory liabilities-current⁽¹⁰⁾	128		128
Provision for future cost of removal and AROs⁽¹¹⁾	1,064		1,028
Decommissioning trust⁽¹²⁾	772		693
Deferred cost of fuel used in electric generation⁽¹⁾	28		90
Other	172		190
Regulatory liabilities-non-current	2,036		2,001



Total regulatory liabilities	$	2,164	$	2,129
Virginia Power
Regulatory assets:
Deferred cost of fuel used in electric generation⁽¹⁾	$	180	$	—
Deferred rate adjustment clause costs⁽²⁾	96		62
Deferred nuclear refueling outage costs⁽³⁾	48		—
Derivatives⁽⁵⁾	5		16
Other	44		50
Regulatory assets-current	373		128
Deferred rate adjustment clause costs⁽²⁾	177		227
Deferred cost of fuel used in electric generation⁽¹⁾	19		1
Income taxes recoverable through future rates⁽⁸⁾	107		124
Derivatives⁽⁵⁾	59		16
Other	60		49
Regulatory assets-non-current	422		417
Total regulatory assets	$	795	$	545
Regulatory liabilities:
Other	$	47	$	41
Regulatory liabilities-current⁽¹⁰⁾	47		41
Provision for future cost of removal⁽¹¹⁾	839		807
Decommissioning trust⁽¹²⁾	772		693
Deferred cost of fuel used in electric generation⁽¹⁾	28		90
Other	7		7
Regulatory liabilities-non-current	1,646		1,597
Total regulatory liabilities	$	1,693	$	1,638
Dominion Gas
Regulatory assets:
Deferred rate adjustment clause costs⁽²⁾	$	9	$	27
Unrecovered gas costs⁽⁴⁾	7		40
Bad debt tracker⁽¹³⁾	—		11
Other	1		1
Regulatory assets-current⁽⁶⁾	17		79
Unrecognized pension and other postretirement benefit costs⁽⁷⁾	188		194
Deferred rate adjustment clause costs⁽²⁾	69		59
Income taxes recoverable through future rates⁽⁸⁾	24		24
Other postretirement benefit costs⁽¹⁴⁾	—		7
Other	32		1
Regulatory assets-non-current	313		285
Total regulatory assets	$	330	$	364
Regulatory liabilities:
PIPP⁽⁹⁾	$	76	$	76
Other	2		3
Regulatory liabilities-current⁽¹⁰⁾	78		79
Provision for future cost of removal and AROs⁽¹¹⁾	178		177
Unrecognized pension and other postretirement benefit costs⁽⁷⁾	—		18
Other	18		8


(1)	Primarily reflects deferred fuel expenses for the Virginia jurisdiction of Virginia Power's generation operations.


(2)	Reflects deferrals under the electric transmission FERC formula rate and the deferral of costs associated with certain current and prospective rider projects for Virginia Power. Reflects deferrals of costs associated with certain current and prospective rider projects for Dominion Gas. See Note 12 for more information.


(3)	Legislation enacted in Virginia in April 2014 requires Virginia Power to defer operation and maintenance costs incurred in connection with the refueling of any nuclear-powered generating plant. These deferred costs will be amortized over the refueling cycle, not to exceed 18 months.


(4)	Reflects unrecovered gas costs at regulated gas operations, which are recovered through filings with the applicable regulatory authority.


(5)	For jurisdictions subject to cost-based rate regulation, changes in the fair value of derivative instruments result in the recognition of regulatory assets or regulatory liabilities as they are expected to be recovered from or refunded to customers.


(6)	Current regulatory assets are presented in other current assets in Dominion's and Dominion Gas' Consolidated Balance Sheets.


(7)	Represents unrecognized pension and other postretirement employee benefit costs expected to be recovered through future rates generally over the expected remaining service period of plan participants by certain of Dominion's rate-regulated subsidiaries.


(8)	Amounts to be recovered through future rates to pay income taxes that become payable when rate revenue is provided to recover AFUDC-equity and depreciation of property, plant and equipment for which deferred income taxes were not recognized for ratemaking purposes, including amounts attributable to tax rate changes.


(9)	Under PIPP, eligible customers can make reduced payments based on their ability to pay. The difference between the customer's total bill and the PIPP plan amount is deferred and collected or returned annually under the PIPP rider according to East Ohio tariff provisions.


(10)	Current regulatory liabilities are presented in other current liabilities in the Companies' Consolidated Balance Sheets.


(11)	Rates charged to customers by the Companies' regulated businesses include a provision for the cost of future activities to remove assets that are expected to be incurred at the time of retirement.


(12)	Primarily reflects a regulatory liability representing amounts collected from Virginia jurisdictional customers and placed in external trusts (including income, losses and changes in fair value thereon) for the future decommissioning of Virginia Power's utility nuclear generation stations, in excess of the related AROs.


(13)	Represents East Ohio's deferrals for the UEX Rider which are recovered through rates which are filed annually. Most of East Ohio's bad debt expense is recovered either through the UEX Rider or the PIPP Rider.


(14)	Primarily reflects costs recognized in excess of amounts included in regulated rates charged by Dominion Gas' regulated gas operations before rates were updated to reflect a change in accounting method for other postretirement benefit costs.


(15)	Noncurrent regulatory liabilities are presented in other deferred credits and other liabilities in Dominion Gas' Consolidated Balance Sheets.

At September 30, 2014, approximately $182 million of Dominion's, $147 million of Virginia Power's and $24 million of Dominion Gas' regulatory assets represented past expenditures on which they do not currently earn a return. These expenditures are expected to be recovered within the next two years.

Regulatory liabilities-non-current⁽¹⁵⁾

Total regulatory liabilities