Fair Value Measurements and Credit Concentration (Tables)

9 Months Ended

Sep. 30, 2011

Notes To Financial Statements [Abstract]

Fair Value of Assets and Liabilities Measured on Recurring Basis

The assets and liabilities measured at fair value were:

				September 30, 2011								December 31, 2010
				Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
PPL
Assets
	Cash and cash equivalents			$	1,511	$	1,511					$	925	$	925
	Short-term investments - municipal debt
		securities											163		163
	Restricted cash and cash equivalents (a)				117		117						66		66
	Price risk management assets:
		Energy commodities			2,042		1	$	1,990	$	51		2,503			$	2,452	$	51
		Interest rate swaps			5				5				15				15
		Foreign currency exchange contracts			21				21				11				11
		Cross-currency swaps			51				37		14		44				44
	Total price risk management assets				2,119		1		2,053		65		2,573				2,522		51
	NDT funds:
		Cash and cash equivalents			13		13						10		10
		Equity securities
			U.S. large-cap		260		180		80				303		207		96
			U.S. mid/small-cap		104		77		27				119		89		30
		Debt securities
			U.S. Treasury		82		82						75		75
			U.S. government sponsored agency		11				11				7				7
			Municipality		82				82				69				69
			Investment-grade corporate		37				37				33				33
			Other		3				3				1				1
		Receivables (payables), net			2				2				1		(1)		2
	Total NDT funds				594		352		242				618		380		238
	Auction rate securities (b)				24						24		25						25
Total assets				$	4,365	$	1,981	$	2,295	$	89	$	4,370	$	1,534	$	2,760	$	76

Liabilities
	Price risk management liabilities:
		Energy commodities		$	1,191	$	1	$	1,165	$	25	$	1,552			$	1,498	$	54
		Interest rate swaps			120				120				53				53
		Cross-currency swaps			2				2				9				9
	Total price risk management liabilities			$	1,313	$	1	$	1,287	$	25	$	1,614			$	1,560	$	54

PPL Energy Supply
Assets
	Cash and cash equivalents			$	375	$	375					$	661	$	661
	Restricted cash and cash equivalents (a)				53		53						26		26
	Price risk management assets:
		Energy commodities			2,041		1	$	1,989	$	51		2,503			$	2,452	$	51
		Foreign currency exchange contracts											11				11
		Cross-currency swaps											44				44
	Total price risk management assets				2,041		1		1,989		51		2,558				2,507		51
	NDT funds:
		Cash and cash equivalents			13		13						10		10
		Equity securities
			U.S. large-cap		260		180		80				303		207		96
			U.S. mid/small-cap		104		77		27				119		89		30
		Debt securities
			U.S. Treasury		82		82						75		75
			U.S. government sponsored agency		11				11				7				7
			Municipality		82				82				69				69
			Investment-grade corporate		37				37				33				33
			Other		3				3				1				1
		Receivables (payables), net			2				2				1		(1)		2
	Total NDT funds				594		352		242				618		380		238
	Auction rate securities (b)				19						19		20						20
Total assets				$	3,082	$	781	$	2,231	$	70	$	3,883	$	1,067	$	2,745	$	71

Liabilities
	Price risk management liabilities:
		Energy commodities		$	1,190	$	1	$	1,164	$	25	$	1,541			$	1,487	$	54
		Cross-currency swaps											9				9
	Total price risk management liabilities			$	1,190	$	1	$	1,164	$	25	$	1,550			$	1,496	$	54

PPL Electric
Assets
	Cash and cash equivalents			$	261	$	261					$	204	$	204
	Restricted cash and cash equivalents (c)				13		13						14		14
Total assets				$	274	$	274					$	218	$	218

(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.

(c) Current portion is included in "Other current assets" on the Balance Sheets. Such amounts were insignificant at September 30, 2011 and December 31, 2010. The long-term portion is included in "Other noncurrent assets" on the Balance Sheets.

(d) Included in "Other current assets" on the Balance Sheets.

(e) Included in "Other current liabilities" on the Balance Sheets.

(f) Current portion is included in "Other current liabilities" on the Balance Sheets. The long-term portion is included in "Price risk management liabilities" 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, 2011 is as follows:

					Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
					Three Months								Nine Months
					Energy		Auction		Cross-				Energy		Auction		Cross-
					Commodities,		Rate		Currency				Commodities,		Rate		Currency
					net		Securities		Swaps		Total		net		Securities		Swaps		Total
PPL
Balance at beginning of
	period				$	26	$	25			$	51	$	(3)	$	25			$	22
		Total realized/unrealized
			gains (losses)
				Included in earnings		6						6		2						2
				Included in OCI (a)		2		(1)				1		6		(1)				5
		Purchases												2						2
		Sales												(4)						(4)
		Settlements				(2)						(2)		23						23
		Transfers into Level 3				(1)			$	14		13		(1)			$	14		13
		Transfers out of Level 3				(5)						(5)		1						1
Balance at end of period					$	26	$	24	$	14	$	64	$	26	$	24	$	14	$	64

PPL Energy Supply
Balance at beginning of
	period				$	26	$	20			$	46	$	(3)	$	20			$	17
		Total realized/unrealized
			gains (losses)
				Included in earnings		6						6		2						2
				Included in OCI (a)		2		(1)				1		6		(1)				5
		Purchases												2						2
		Sales												(4)						(4)
		Settlements				(2)						(2)		23						23
		Transfers into Level 3				(1)						(1)		(1)						(1)
		Transfers out of Level 3				(5)						(5)		1						1
Balance at end of period					$	26	$	19			$	45	$	26	$	19			$	45

(a) "Energy Commodities" are included in "Qualifying derivatives" and "Auction Rate Securities" are included in "Available-for-sale securities" on the Statements of Comprehensive Income.

A reconciliation of net assets and liabilities classified as Level 3 for the periods ended September 30, 2010 is as follows:

			Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
			Three Months						Nine Months
			Energy		Auction				Energy		Auction
			Commodities,		Rate				Commodities,		Rate
			net		Securities		Total		net		Securities		Total
PPL
Balance at beginning of period			$	48	$	25	$	73	$	107	$	25	$	132
	Total realized/unrealized gains (losses)
		Included in earnings		(58)				(58)		(126)				(126)
		Included in OCI (a)		4				4		12				12
	Net purchases, sales, issuances and
		settlements (b)		(13)				(13)		(12)				(12)
	Transfers into Level 3			(13)				(13)		(15)				(15)
	Transfers out of Level 3			46				46		48				48
Balance at end of period			$	14	$	25	$	39	$	14	$	25	$	39

PPL Energy Supply
Balance at beginning of period			$	48	$	20	$	68	$	107	$	20	$	127
	Total realized/unrealized gains (losses)
		Included in earnings		(58)				(58)		(126)				(126)
		Included in OCI (a)		4				4		12				12
	Net purchases, sales, issuances and
		settlements (b)		(13)				(13)		(12)				(12)
	Transfers into Level 3			(13)				(13)		(15)				(15)
	Transfers out of Level 3			46				46		48				48
Balance at end of period			$	14	$	20	$	34	$	14	$	20	$	34

(a) Included in "Qualifying derivatives" on the Statements of Comprehensive Income.

(b) Accounting guidance effective January 1, 2011 requires purchase, sale, issuance and settlement transactions within Level 3 to be presented on a gross basis. The transactions in 2010 are reported on a combined basis.

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

		Unregulated Retail				Wholesale Energy				Net Energy
		Electric and Gas				Marketing				Trading Margins				Energy Purchases
		2011		2010		2011		2010		2011		2010		2011		2010
PPL and PPL Energy Supply
Total gains (losses) included in earnings		$	6	$	10	$	(1)	$	3	$	1	$	1			$	(72)
Change in unrealized gains (losses) relating to
	positions still held at the reporting date		3		8				4		1			$	1		(3)

		Nine Months
		Energy Commodities, net

		Unregulated Retail				Wholesale Energy				Net Energy
		Electric and Gas				Marketing				Trading Margins				Energy Purchases
		2011		2010		2011		2010		2011		2010		2011		2010
PPL and PPL Energy Supply
Total gains (losses) included in earnings		$	11	$	22	$	(5)	$	16	$	(2)	$	(1)	$	(2)	$	(163)
Change in unrealized gains (losses) relating to
	positions still held at the reporting date		6		18		(6)		8		1				20		(5)

Fair Value of Assets and Liabilities Measured on Nonrecurring Basis

The following nonrecurring fair value measurements occurred during the reporting periods, resulting in asset impairments:

		Carrying		Fair Value Measurements Using
		Amount (a)		Level 2		Level 3		Loss (b)
Sulfur dioxide emission allowances (c):
	September 30, 2011	$	1					$	1
	March 31, 2011		1						1
	September 30, 2010		6			$	2		4
	June 30, 2010		11				3		8
	March 31, 2010		13				10		3
RECs (c):
	September 30, 2011		1						1
	June 30, 2011		2	$	1				1
	March 31, 2011		3						3
Certain non-core generation facilities:
	September 30, 2010		473		381				96

(a) Represents carrying value before fair value measurement.

(b) Losses on sulfur dioxide emission allowances and RECs were recorded in the Supply segment and included in "Other operation and maintenance" on the Statements of Income. Losses on certain non-core generation facilities were recorded in the Supply segment and included in "Income (Loss) from Discontinued Operations (net of income taxes)" on the Statements of Income.

(c) Current and long-term sulfur dioxide emission allowances and RECs are included in "Other intangibles" in their respective areas on the Balance Sheets.

Fair value of Financial Instruments Not Recorded at Fair Value - Other

The carrying amounts of contract adjustment payments related to the 2010 Purchase Contract component of the 2010 Equity Units, the 2011 Purchase Contract component of the 2011 Equity Units, and long-term debt on the Balance Sheets and their estimated fair value are set forth below.

		September 30, 2011				December 31, 2010
		Carrying				Carrying
		Amount		Fair Value		Amount		Fair Value
PPL
	Contract adjustment payments (a)	$	220	$	220	$	146	$	148
	Long-term debt		18,177		19,369		12,663		12,868
PPL Energy Supply
	Long-term debt		3,025		3,416		5,589		5,919
PPL Electric
	Long-term debt		1,718		2,044		1,472		1,578

(a) Included in "Other current liabilities" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

- Definition

Tabular disclosure of the total amount of gains or losses for the period which are included in earnings or resulted in a change to net assets which gains or losses have arisen from the use of significant unobservable inputs (Level 3) to measure the fair value of assets and liabilities. Such gains or losses are attributable to the change in unrealized gains or losses relating to those assets and liabilities so valued which are still held at the reporting date and which change are also considered for disclosure; it may be expected that a description of where those unrealized gains or losses are reported in the statement of income or the statement of financial position would also be disclosed.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

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