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Investments (Tables)
Nov. 18, 2019
Equity and Debt Securities and Cash Equivalents and Cost Method Investments in Decommissioning Trust Funds decommissioning costs for its nuclear plants. Dominion Energy’s decommissioning trust funds are summarized below:
 
  
Amortized
Cost
 
  
Total
Unrealized
Gains
 
  
Total
    Unrealized    
Losses
 
  
Fair Value
 
(millions)
 
   
   
   
 
December 31, 2018
 
 
 
  
 
 
  
 
 
  
 
 
Equity securities:
(1)
    
     
     
     
 
U.S.
 
$
1,741
 
  
$
1,640
 
  
$
(51
)
 
$
3,330
 
Fixed income securities:
(2)
    
     
     
     
 
Corporate debt instruments
 
 
435
 
  
 
5
 
  
 
(9
)
 
 
431
 
Government securities
 
 
1,092
 
  
 
17
 
  
 
(12
)
 
 
1,097
 
Common/collective trust funds
 
 
76
 
  
 
—
 
  
 
—
 
  
 
76
 
Cash equivalents and other
(3)
  
 
4
 
    
—
     
—
   
 
4
 
                                 
Total
 
$
3,348
 
  
$
1,662
 
  
$
(72
)
(4)
  
$
4,938
 
                                 
December 31, 2017
 
 
 
  
 
 
  
 
 
  
 
 
Equity securities:
(2)
    
     
     
     
 
U.S.
  $
1,569
    $
1,857
    $
—
    $
3,426
 
Fixed income securities:
(2)
    
     
     
     
 
Corporate debt instruments
   
430
     
15
     
(1
 )    
444
 
Government securities
   
1,039
     
27
     
(5
 )    
1,061
 
Common/collective trust funds
   
60
     
—
     
—
     
60
 
Cost method investments
   
68
     
—
     
—
     
68
 
Cash equivalents and other
(3)
    
34
     
—
     
—
     
34
 
                                 
Total
  $
         
3,200
    $
         
1,899
    $
 
(6
 )
(4)
   $
         
5,093
 
                                 
(1)
Effective January 2018, unrealized gains and losses on equity securities, including those previously classified as cost method investments, are included in other income and the nuclear decommissioning trust regulatory liability as discussed in Note 2.
(2)
Unrealized gains and losses on equity securities (for 2017) and fixed income securities are included in AOCI and the nuclear decommissioning trust regulatory liability as discussed in Note 2.
(3)
Includes pending sales of securities of $5 million at December 31, 2017.
(4)
The fair value of securities in an unrealized loss position was $833 million and $565 million at December 31, 2018 and 2017, respectively.
Unrealized Gain Loss on Equity The portion of unrealized gains and losses that relates to equity securities held within Dominion Energy’s nuclear decommissioning trusts is summarized below:
 
       
 
 
                     
 
                    
 
 
  
    Twelve Months Ended    
December 31, 2018
 
(millions)
 
 
Net losses recognized during the period
 
$
(245
)
Less: Net gains recognized during the period
on securities sold during the period
 
 
(58
)
         
Unrealized losses recognized during the period
on securities still held at December 31, 2018
(1)
  
$
(303
)
         
(1)
Included in other income and the nuclear decommissioning trust regulatory liability as discussed in Note 2.
Investments Classified by Contractual Maturity Date
The fair value of Dominion Energy’s debt securities with readily determinable fair values held in nuclear decommissioning trust funds at December 31, 2018 by contractual maturity is as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(millions)
 
 
Due in one year or less
 
$
167
 
Due after one year through five years
 
 
389
 
Due after five years through ten years
 
 
376
 
Due after ten years
 
 
672
 
         
Total
 
$
1,604
 
         
Marketable Securities
Presented below is selected information regarding Dominion Energy’s equity and debt securities with readily determinable fair values held in nuclear decommissioning trust funds.
Year Ended December 31,
 
2018
 
  
2017
   
2016
 
(millions)
 
 
  
   
 
Proceeds from sales
 
$
             
1,804
 
   $
             
1,831
    $
             
1,422
 
Realized gains
(1)
  
 
140
 
    
166
     
128
 
Realized losses
(1)
  
 
91
 
    
71
     
55
 
(1)
Includes realized gains and losses recorded to the nuclear decommissioning trust regulatory liability as discussed in Note 2.
Other-Than-Temporary Impairment Losses
Dominion Energy recorded other-than-temporary impairment losses on investments held in nuclear decommissioning trust funds as follows:
Year Ended December 31,
 
2018
 
  
2017
   
2016
 
(millions)
 
   
   
 
Total other-than-temporary impairment losses
(1)
  
$
             
30
 
   $
             
44
    $
             
51
 
Losses recorded to the nuclear decommissioning trust regulatory liability
 
 
—
 
    
(16
 )    
(16
 )
Losses recognized in other comprehensive income (before taxes)
 
 
(30
)
   
(5
 )    
(12
 )
                         
Net impairment losses recognized in earnings
 
$
—
 
   $
23
    $
23
 
                         
(1)
Amounts include other-than-temporary impairment losses for debt securities of $
5
 million and $
13
 million at December 31, 2017 and 2016, respectively.
Investments Accounts Under Equity Method of Accounting
Investments that Dominion Energy and Dominion Energy Gas account for under the equity method of accounting are as follows:
                             
Company
  
    Ownership%    
    
Investment Balance
    
Description
As of December 31,
  
 
    
        2018        
    
        2017        
    
 
(millions)
  
 
    
 
    
 
    
 
Dominion Energy
 
 
 
  
 
 
  
 
 
  
Atlantic Coast Pipeline
   
48
 %  
$
820
 
   $
382
   
Gas transmission system
Blue Racer
   
50
 %  
 
—
 
    
691
   
Midstream gas and related services
Iroquois
   
50
 %  
 
302
 
    
311
   
Gas transmission system
Fowler Ridge
   
50
 %  
 
82
 
    
81
   
Wind-powered merchant generation facility
Other
(
1
)
    
various
   
 
74
 
    
79
   
                             
Total
   
   
$
1,278
 
   $
1,544
   
                             
Dominion Energy Gas
 
 
 
  
 
 
  
 
 
  
Iroquois
   
50
 %  
 
302
 
    
311
   
Gas transmission system
White River Hub
   
50
 %  
 
37
 
    
38
   
Gas transmission system
                             
Total
   
   
$
339
 
   $
349
   
                             
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1)
Liability of less than $1 million and $17 million associated with NedPower recorded to other deferred credits and other liabilities, on the Consolidated Balance Sheets as of December 31, 2018 and 2017, respectively. See additional discussion of NedPower below.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Financial Information Provided Equity Method Investment
Summarized financial information provided to Dominion Energy Gas by Iroquois for 100% of Iroquois at December 31, 2018 and 2017 and for the years ended December 31, 2018, 2017 and 2016 is presented below.
                 
 
  At December 31, 2018  
 
  
  At December 31, 2017  
  
(millions)
 
   
 
Current assets
 
$
112
 
   $
122
 
Noncurrent assets
 
 
588
 
    
599
 
Current liabilities
 
 
165
 
    
21
 
Noncurrent liabilities
 
 
193
 
    
334
 
 
 
 
 
 
 
 
 
                         
 
Year Ended
 December 31, 
2018
 
  
Year Ended
 December 31, 
2017
   
Year Ended
 December 31, 
2016
 
(millions)
 
   
   
 
Revenues
 
$
194
 
   $
194
    $
195
 
Operating
i
ncome
 
 
108
 
    
110
     
103
 
Net
i
ncome
 
 
94
 
    
93
     
86
 
 
 
 
 
 
 
 
 
Summarized financial information provided to Dominion Energy Gas by White River Hub for 100% of White River Hub at December 31, 2018 and 2017, for the years ended December 31, 2018, 2017, and for the period from September 2016, the inception date of common control for Dominion Energy Questar Pipeline as described in Note 3, through December 31, 2016 is presented below.
                 
 
  At December 31, 2018  
 
  
  At December 31, 2017  
  
(millions)
 
   
 
Current assets
 
$
3
 
   $
3
 
Noncurrent assets
 
 
41
 
    
42
 
Current liabilities
 
 
2
 
    
1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                         
 
Year Ended
 December 31, 
2018
 
  
Year Ended
 December 31, 
2017
   
Period Ended
 December 31, 
2016
 
(millions)
 
   
   
 
Revenues
 
$
12
 
   $
10
    $
3
 
Operating
i
ncome
 
 
8
 
    
7
     
2
 
Net
i
ncome
 
 
8
 
    
7
     
2
 
 
 
 
 
 
 
 
 
Virginia Electric and Power Company  
Equity and Debt Securities and Cash Equivalents and Cost Method Investments in Decommissioning Trust Funds decommissioning costs for its nuclear plants. Virginia Power’s decommissioning trust funds are summarized below:
 
Amortized
Cost
 
  
Total
Unrealized
Gains
 
  
Total
Unrealized
Losses
 
  
Fair Value
 
(millions)
 
   
   
   
 
December 31, 2018
 
 
 
  
 
 
  
 
 
  
 
 
Equity securities:
(1)
    
     
     
     
 
U.S.
 
$
858
 
  
$
751
 
  
$
(24
)
 
$
1,585
 
Fixed income securities:
(2)
    
     
     
     
 
Corporate debt instruments
 
 
224
 
  
 
2
 
  
 
(5
)
 
 
221
 
Government securities
 
 
504
 
  
 
7
 
  
 
(5
)
 
 
506
 
Common/collective trust funds
 
 
51
 
  
 
—
 
  
 
—
 
  
 
51
 
Cash equivalents and other
(3)
  
 
6
 
  
 
—
 
  
 
—
 
  
 
6
 
                                 
Total
 
$
1,643
 
  
$
760
 
  
$
(34
)
(4)
  
$
2,369
 
                                 
December 31, 2017
 
 
 
  
 
 
  
 
 
  
 
 
Equity securities:
(2)
    
     
     
     
 
U.S.
  $
734
    $
831
    $
—
    $
1,565
 
Fixed income securities:
(2)
    
     
     
     
 
Corporate debt instruments
   
216
     
8
     
—
     
224
 
Government securities
   
482
     
13
     
(2
 )    
493
 
Common/collective trust funds
   
27
     
—
     
—
     
27
 
Cost method investments
   
68
     
—
     
—
     
68
 
Cash equivalents and other
(3)
    
22
     
—
     
—
     
22
 
                                 
Total
  $
         
1,549
    $
         
852
    $
         
(2
 )
(4)
   $
         
2,399
 
                                 
 
(1)
Effective January 2018, unrealized gains and losses on equity securities, including those previously classified as cost method investments, are included in other income and the nuclear decommissioning trust regulatory liability as discussed in Note 2.
(2)
Unrealized gains and losses on equity securities (for 2017) and fixed income securities are included in AOCI and the nuclear decommissioning trust regulatory liability as discussed in Note 2.
(3)
Includes pending sales of securities of $6 million at both December 31, 2018 and 2017.
(4)
The fair value of securities in an unrealized loss position was $404 million and $234 million at December 31, 2018 and 2017, respectively.
Unrealized Gain Loss on Equity
The portion of unrealized gains and losses that relates to equity securities held within Virginia Power’s nuclear decommissioning trusts is summarized below:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Twelve Months Ended
 
 
 
 
 
 
 
 
 
 
 
 
 
 

December 31, 2018
 
(millions)
 
 
Net losses recognized during the period
 
$
(105
)
Less: Net gains recognized during the period
on securities sold during the period
 
 
(32
)
         
Unrealized losses recognized during the period
on securities still held at December 31, 2018
(1)
  
$
(137
)
         
(1)
Included in other income and the nuclear decommissioning trust regulatory liability as discussed in Note 2.
Investments Classified by Contractual Maturity Date
The fair value of Virginia Power’s debt securities with readily determinable fair values held in nuclear decommissioning trust funds at December 31, 2018, by contractual maturity is as follows:
 
                             
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                      
 
  
Amount
 
(millions)
 
 
Due in one year or less
 
$
54
 
Due after one year through five years
 
 
156
 
Due after five years through ten years
 
 
210
 
Due after ten years
 
 
358
 
         
Total
 
$
778
 
         
Marketable Securities
Presented below is selected information regarding Virginia Power’s equity and debt securities with readily determinable fair values held in nuclear decommissioning trust funds.
Year Ended December 31,
 
2018
 
  
2017
   
2016
 
(millions)
 
   
   
 
Proceeds from sales
 
$
             
887
 
   $
             
849
    $
             
733
 
Realized gains
(1)
  
 
60
 
    
75
     
63
 
Realized losses
(1)
  
 
27
 
    
30
     
27
 
(1)
Includes realized gains and losses recorded to the nuclear decommissioning trust regulatory liability as discussed in Note 2.
Other-Than-Temporary Impairment Losses
Virginia Power recorded other-than-temporary impairment losses on investments held in nuclear decommissioning trust funds as follows:
Year Ended December 31,
 
2018
 
  
2017
   
2016
 
(millions)
 
   
   
 
Total other-than-temporary impairment losses
(1)
  
$
15
 
   $
20
    $
26
 
Losses recorded to the nuclear decommissioning trust regulatory liability
 
 
—
 
    
(16
 )    
(16
 )
Losses recognized in other comprehensive income (before taxes)
 
 
(15
)
   
(2
 )    
(7
 )
                         
Net impairment losses recognized in earnings
 
$
         
—
 
   $
         
2
    $
         
3
 
                         
(1)
Amounts include other-than-temporary impairment losses for debt securities of $
2
 million and $
8
 million at December 31, 2017 and 2016
 
, respectively.