Revenue from Contracts with Customers

3 Months Ended

Mar. 31, 2021

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

4. Revenue from Contracts with Customers

(All Registrants)

See Note 3 in PPL's 2020 Form 10-K for a discussion of the principal activities from which the Registrants and PPL’s segments generate their revenues.

The following tables reconcile "Operating Revenues" included in each Registrant's Statement of Income with revenues generated from contracts with customers for the periods ended March 31.

	2021 Three Months
	PPL		PPL Electric		LKE		LG&E		KU
Operating Revenues (a)	$	1,498	$	605	$	885	$	428	$	469
Revenues derived from:
Alternative revenue programs (b)	24		22		2		—		2
Other (c)	(6)		—		(6)		(3)		(3)
Revenues from Contracts with Customers	$	1,516	$	627	$	881	$	425	$	468
	2020 Three Months
	PPL		PPL Electric		LKE		LG&E		KU
Operating Revenues (a)	$	1,440	$	608	$	825	$	407	$	432
Revenues derived from:
Alternative revenue programs (b)	(3)		—		(3)		(3)		—
Other (c)	(8)		(2)		(6)		(3)		(3)
Revenues from Contracts with Customers	$	1,429	$	606	$	816	$	401	$	429

(a)PPL Electric and LKE represent revenues from external customers reported by the Pennsylvania Regulated and Kentucky Regulated segments. See Note 3 for additional information.

(b)Alternative revenue programs include the transmission formula rate for PPL Electric, the ECR and DSM programs for LG&E and KU, the GLT program for LG&E, and the generation formula rate for KU. For PPL Electric, the three months ended March 31, 2021 includes a $27 million reserve recorded as a result of a challenge to the transmission formula rate return on equity. See Note 7 for further information. This line item shows the over/under collection of these rate mechanisms with over-collections of revenue shown as positive amounts in the table above and under-collections shown as negative amounts.

(c)Represents additional revenues outside the scope of revenues from contracts with customers, such as lease and other miscellaneous revenues.

The following tables show revenues from contracts with customers disaggregated by customer class for the periods ended March 31.

	2021 Three Months
	PPL		PPL Electric		LKE		LG&E		KU
Residential	$	774	$	361	$	413	$	205	$	208
Commercial	313		82		231		121		110
Industrial	152		12		140		46		94
Other (a)	91		12		71		34		37
Wholesale - municipality	6		—		6		—		6
Wholesale - other (b)	20		—		20		19		13
Transmission	160		160		—		—		—
Revenues from Contracts with Customers	$	1,516	$	627	$	881	$	425	$	468
	2020 Three Months
	PPL		PPL Electric		LKE		LG&E		KU
Residential	$	714	$	344	$	370	$	187	$	183
Commercial	312		81		231		124		107
Industrial	144		8		136		45		91
Other (a)	87		14		66		28		38
Wholesale - municipality	5		—		5		—		5
Wholesale - other (b)	8		—		8		17		5
Transmission	159		159		—		—		—
Revenues from Contracts with Customers	$	1,429	$	606	$	816	$	401	$	429

(a)Primarily includes revenues from pole attachments, street lighting, other public authorities and other non-core businesses.

(b)Includes wholesale power and transmission revenues. LG&E and KU amounts include intercompany power sales and transmission revenues, which are eliminated upon consolidation at LKE.

As discussed in Note 2 in PPL's 2020 Form 10-K, PPL segments its business by geographic location. Revenues from external customers for each segment/geographic location are reconciled to revenues from contracts with customers in the footnotes to the tables above.

Contract receivables from customers are primarily included in "Accounts receivable - Customer" and "Unbilled revenues" on the Balance Sheets.

The following table shows the accounts receivable and unbilled revenues balances that were impaired for the periods ended March 31.

	Three Months
	2021		2020
PPL	$	2	$	6
PPL Electric	1		4
LKE	1		2
LG&E	—		1
KU	1		1

The following table shows the balances and certain activity of contract liabilities resulting from contracts with customers.

	PPL		PPL Electric		LKE		LG&E		KU
Contract liabilities at December 31, 2020	$	40	$	23	$	11	$	5	$	6
Contract liabilities at March 31, 2021	33		16		10		5		5
Revenue recognized during the three months ended March 31, 2021 that was included in the contract liability balance at December 31, 2020	21		9		11		5		6
Contract liabilities at December 31, 2019	$	37	$	21	$	9	$	5	$	4
Contract liabilities at March 31, 2020	34		15		14		10		4
Revenue recognized during the three months ended March 31, 2020 that was included in the contract liability balance at December 31, 2019	19		8		9		5		4

Contract liabilities result from recording contractual billings in advance for customer attachments to the Registrants' infrastructure and payments received in excess of revenues earned to date. Advanced billings for customer attachments are recognized as revenue ratably over the billing period. Payments received in excess of revenues earned to date are recognized as revenue as services are delivered in subsequent periods.

At March 31, 2021, PPL had $47 million of performance obligations attributable to Corporate and Other that have not been satisfied. Of this amount, PPL expects to recognize approximately $38 million within the next 12 months.