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Fair Value Measurements and Credit Concentration (Tables)
 9 Months Ended
Sep. 30, 2015
Fair Value Disclosures [Abstract]  
Fair Value of Assets and Liabilities Measured on Recurring Basis
The assets and liabilities measured at fair value were:
 
September 30, 2015
 
December 31, 2014
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
648

 
$
648

 
$
—

 
$
—

 
$
352

 
$
352

 
$
—

 
$
—

Restricted cash and cash equivalents (a)
83

 
83

 
—

 
—

 
193

 
193

 
—

 
—

Price risk management assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Energy commodities
802

 
—

 
739

 
63

 
1,318

 
6

 
1,171

 
141

Total price risk management assets
802

 
—

 
739

 
63

 
1,318

 
6

 
1,171

 
141

NDT funds:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
13

 
13

 
—

 
—

 
19

 
19

 
—

 
—

Equity securities
 
 
 
 
 
 
 
 
 
 
 

 
 

 
 
U.S. large-cap
581

 
433

 
148

 
—

 
611

 
454

 
157

 
—

U.S. mid/small-cap
84

 
35

 
49

 
—

 
89

 
37

 
52

 
—

Debt securities
 
 
 
 
 
 
 
 
 
 
 

 
 

 
 

U.S. Treasury
94

 
94

 
—

 
—

 
99

 
99

 
—

 
—

U.S. government sponsored agency
7

 
—

 
7

 
—

 
9

 
—

 
9

 
—

Municipality
81

 
—

 
81

 
—

 
76

 
—

 
76

 
—

Investment-grade corporate
49

 
—

 
49

 
—

 
42

 
—

 
42

 
—

Other
4

 
—

 
4

 
—

 
3

 
—

 
3

 
—

Receivables (payables), net
—

 
(3
)
 
3

 
—

 
2

 
—

 
2

 
—

Total NDT funds
913

 
572

 
341

 
—

 
950

 
609

 
341

 
—

Auction rate securities (b)
6

 
—

 
—

 
6

 
8

 
—

 
—

 
8

Total assets
$
2,452

 
$
1,303

 
$
1,080

 
$
69

 
$
2,821

 
$
1,160


$
1,512


$
149

Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Price risk management liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Energy commodities
$
684

 
$
—

 
$
626

 
$
58

 
$
1,217

 
$
5

 
$
1,182

 
$
30

Total price risk management liabilities
$
684

 
$
—

 
$
626

 
$
58

 
$
1,217

 
$
5


$
1,182


$
30

 

(a)
Current portion is included in "Restricted cash and cash equivalents" and long-term portion is included in "Other noncurrent assets" on the Balance Sheets.     
(b)
Included in "Other investments" on the Balance Sheets. 
Reconciliation of Net Assets and Liabilities Classified as Level 3
A reconciliation of net assets and liabilities classified as Level 3 for the periods ended September 30, 2015 is as follows:
 
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
 
Three Months
 
Nine Months
 
Energy Commodities, net
 
Auction Rate Securities
 
Total
 
Energy Commodities, net
 
Auction Rate Securities
 
Total
Balance at beginning of period
$
10

 
$
7

 
$
17

 
$
111

 
$
8

 
$
119

Total realized/unrealized gains (losses)
 
 
 
 
 
 
 
 
 
 
 
Included in earnings
(7
)
 
—

 
(7
)
 
(148
)
 
—

 
(148
)
Purchases (a)
—

 
—

 
—

 
(39
)
 
—

 
(39
)
Sales
—

 
(1
)
 
(1
)
 
65

 
(2
)
 
63

Settlements
(9
)
 
—

 
(9
)
 
(6
)
 
—

 
(6
)
Transfers into Level 3
—

 
—

 
—

 
10

 
—

 
10

Transfers out of Level 3
11

 
—

 
11

 
12

 
—

 
12

Balance at end of period
$
5


$
6


$
11


$
5


$
6


$
11

           
(a)
Positions acquired through the acquisition of RJS Power.

A reconciliation of net assets and liabilities classified as Level 3 for the periods ended September 30, 2014 is as follows:
 
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
 
Three Months
 
Nine Months
 
Energy Commodities, net
 
Auction Rate Securities
 
Total
 
Energy Commodities, net
 
Auction Rate Securities
 
Total
Balance at beginning of period
$
74

 
$
13

 
$
87

 
$
24

 
$
16

 
$
40

Total realized/unrealized gains (losses)
 
 
 
 
 
 
 
 
 
 
 
Included in earnings
(84
)
 
—

 
(84
)
 
(147
)
 
—

 
(147
)
Purchases
—

 
—

 
—

 
(6
)
 
—

 
(6
)
Sales
67

 
(3
)
 
64

 
67

 
(6
)
 
61

Settlements
(37
)
 
—

 
(37
)
 
82

 
—

 
82

Balance at end of period
$
20


$
10


$
30


$
20


$
10


$
30
Significant Unobservable Inputs Used in Fair Value Measurement of Assets and Liabilities Classified as Level 3
The significant unobservable inputs used in and quantitative information about the fair value measurement of assets and liabilities classified as Level 3 are as follows:
 
September 30, 2015
Talen Energy
Fair Value, net
Asset
(Liability)
 
Valuation
Technique
 
 Significant Unobservable
Input(s)
 
Range
(Weighted
Average) (a)
Energy commodities
 
 
 
 
 
 
 
Natural gas contracts (b)
$
31

 
Discounted cash flow
 
Proprietary model used to calculate forward prices
 
10% - 100% (37%)
Power sales contracts (c)
(2
)
 
Discounted cash flow
 
Proprietary model used to calculate forward prices
 
10% - 100% (70%)
FTR purchase contracts (d)
(1
)
 
Discounted cash flow
 
Historical settled prices used to model forward prices
 
100% (100%)
Heat rate call options (e)
(21
)
 
Discounted cash flow
 
Proprietary model used to calculate forward prices
 
100% (100%)
CRR purchase contracts (g)
(2
)
 
Discounted cash flow
 
Proprietary model used to calculate forward prices
 
100% (100%)
Auction rate securities (f)
6

 
Discounted cash flow
 
Modeled from SIFMA Index
 
52% - 57% (54%)
 
December 31, 2014
Talen Energy
Fair Value, net
Asset
(Liability)
 
Valuation
Technique
 
 Significant Unobservable
Input(s)
 
Range
(Weighted
Average) (a)
Energy commodities
 
 
 
 
 
 
 
Natural gas contracts (b)
$
59

 
Discounted cash flow
 
Proprietary model used to calculate forward prices
 
11% - 100% (52%)
Power sales contracts (c)
(1
)
 
Discounted cash flow
 
Proprietary model used to calculate forward prices
 
10% - 100% (59%)
FTR purchase contracts (d)
3

 
Discounted cash flow
 
Historical settled prices used to model forward prices
 
100% (100%)
Heat rate call options (e)
50

 
Discounted cash flow
 
Proprietary model used to calculate forward prices
 
23% - 51% (45%)
Auction rate securities (f)
8

 
Discounted cash flow
 
Modeled from SIFMA Index
 
51% - 69% (63%)

(a)
The range and weighted average represent the percentage of fair value derived from the unobservable inputs.    
(b)
As the forward price of natural gas increases/(decreases), the fair value of purchase contracts increases/(decreases).  As the forward price of natural gas increases/(decreases), the fair value of sales contracts (decreases)/increases.    
(c)
As forward market prices increase/(decrease), the fair value of contracts (decreases)/increases.  As volumetric assumptions for contracts in a gain position increase/(decrease), the fair value of contracts increases/(decreases).  As volumetric assumptions for contracts in a loss position increase/(decrease), the fair value of the contracts (decreases)/increases.    
(d)
As the forward implied spread increases/(decreases), the fair value of the contracts increases/(decreases).  
(e)
The proprietary model used to calculate fair value incorporates market heat rates, correlations and volatilities.  As the market implied heat rate increases/(decreases), the fair value of purchased calls increases/(decreases).   As the market implied heat rate increases/(decreases), the fair value of sold calls (decreases)/increases.    
(f)
The model used to calculate fair value incorporates an assumption that the auctions will continue to fail.  As the modeled forward rates of the SIFMA Index increase/(decrease), the fair value of the securities increases/(decreases).    
(g)
As the forward implied spread increases/(decreases), the fair value of the contracts increases/(decreases).
The significant unobservable inputs used in and the quantitative information about the nonrecurring fair value measurement of assets and liabilities classified as Level 3 are as follows:
 
 
Fair Value, net
Asset
(Liability)
 
Valuation
Technique
 
Significant
Unobservable
Input(s)
 
Range
(Weighted
Average)(a)
 
 
 
 
 
 
 
 
 
 
 
 
Kerr Dam Project (March 31, 2014)
$
29

 
Discounted cash flow
 
Proprietary model used to calculate plant value
 
38% (38%)
 
Sapphire portfolio and C.P. Crane plant (September 30, 2015)
266

 
Discounted cash flow
 
Proprietary model used to calculate plant value
 
100% (100%)

(a)
The range and weighted average represent the percentage of fair value derived from the unobservable inputs.
Fair Value of Assets and Liabilities Classified as Level 3 Measured on Recurring Basis Included in Earnings
Net gains and losses on assets and liabilities classified as Level 3 and included in earnings for the periods ended September 30 are reported in the Statements of Income as follows:
 
 
Three Months
 
 
Energy Commodities, net
 
 
Wholesale Energy
 
Retail Energy
 
Energy Purchases
 
 
2015
 
2014
 
2015
 
2014
 
2015
 
2014
Total gains (losses) included in earnings
 
$
2

 
$
(102
)
 
$
(1
)
 
$
16

 
$
(8
)
 
$
2

Change in unrealized gains (losses) relating
to positions still held at the reporting date
 
8

 
6

 
12

 
13

 
(1
)
 
1

 
 
Nine Months
 
 
Energy Commodities, net
 
 
Wholesale Energy
 
Retail Energy
 
Energy Purchases
 
 
2015
 
2014
 
2015
 
2014
 
2015
 
2014
Total gains (losses) included in earnings
 
$
(108
)
 
$
(133
)
 
$
(33
)
 
$
(35
)
 
$
(7
)
 
$
21

Change in unrealized gains (losses) relating
to positions still held at the reporting date
 
(31
)
 
5

 
9

 
(12
)
 
(5
)
 
(3
)
Fair Value of Assets and Liabilities Measured on Nonrecurring Basis
The following nonrecurring fair value measurements occurred during the periods ended September 30, 2015 and 2014 resulting in asset impairments:             
 
Carrying
Amount (a)
 
Fair Value Measurements Using
Level 3 (b)
 
Pre-tax Loss (c)
Kerr Dam Project (March 31, 2014)
$
47

 
$
29

 
$
18

Sapphire portfolio and C.P. Crane plant (September 30, 2015)
388

 
266

 
122


(a)
Represents carrying value before fair value measurement.    
(b)
For the Sapphire portfolio, also reflects estimated cost to sell.
(c)
The impairments on the Kerr Dam Project and Sapphire portfolio are included in "Income (Loss) from Discontinued Operations (net of income taxes)" on the Statement of Income. The impairment on the C.P. Crane plant is included in "Impairments" on the Statement of Income.
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
The carrying amounts of long-term debt on the Balance Sheets and its estimated fair values are set forth below.  The fair value was estimated using an income approach by discounting future cash flows at estimated current cost of funding rates, which incorporates the credit risk of Talen Energy Supply.  Long-term debt is classified as Level 2.           

 
September 30, 2015
 
December 31, 2014
 
Carrying Amount
 
Fair Value
 
Carrying Amount
 
Fair Value
Long-term debt
$
4,030

 
$
3,717

 
$
2,218

 
$
2,204