Defined Benefits

6 Months Ended

Jun. 30, 2014

9. Defined Benefits

(PPL, PPL Energy Supply and PPL Electric)

Effective July 1, 2014, PPL's primary defined benefit pension plan and postretirement medical plan were closed to newly hired IBEW Local 1600 employees. As such, the majority of PPL's defined benefit pension plans are now closed to newly hired employees.

(All Registrants except PPL Electric and KU)

Certain net periodic defined benefit costs are applied to accounts that are further distributed between capital and expense, including certain costs allocated to applicable subsidiaries for plans sponsored by PPL Services and LKE. Following are the net periodic defined benefit costs (credits) of the plans sponsored by PPL, PPL Energy Supply, LKE and LG&E for the periods ended June 30:

			Pension Benefits
			Three Months								Six Months
			U.S.				U.K.				U.S.				U.K.
			2014		2013		2014		2013		2014		2013		2014		2013
PPL
Service cost			$	25	$	32	$	18	$	16	$	51	$	63	$	36	$	34
Interest cost				58		53		90		78		117		107		178		159
Expected return on plan assets				(75)		(73)		(132)		(113)		(149)		(147)		(262)		(231)
Amortization of:
		Prior service cost		5		5						10		11
		Actuarial (gain) loss		8		20		33		37		15		40		66		75
Net periodic defined benefit
	costs (credits) prior to
	termination benefits			21		37		9		18		44		74		18		37
Termination benefits (a)				20								20
Net periodic defined benefit
	costs (credits)		$	41	$	37	$	9	$	18	$	64	$	74	$	18	$	37

		Pension Benefits
		Three Months				Six Months
		2014		2013		2014		2013
PPL Energy Supply
Service cost		$	2	$	2	$	3	$	4
Interest cost			2		2		4		4
Expected return on plan assets			(3)		(2)		(5)		(5)
Amortization of:
	Actuarial (gain) loss		1				1		1
Net periodic defined benefit costs (credits)		$	2	$	2	$	3	$	4


LKE
Service cost		$	5	$	6	$	11	$	13
Interest cost			16		15		33		31
Expected return on plan assets			(21)		(20)		(41)		(41)
Amortization of:
	Prior service cost		1		1		2		2
	Actuarial (gain) loss		3		9		6		17
Net periodic defined benefit costs (credits)		$	4	$	11	$	11	$	22

LG&E
Service cost		$	1			$	1	$	1
Interest cost			3	$	4		7		7
Expected return on plan assets			(5)		(5)		(10)		(10)
Amortization of:
	Prior service cost						1		1
	Actuarial (gain) loss		2		4		3		7
Net periodic defined benefit costs (credits)		$	1	$	3	$	2	$	6

(a) See Note 10 for details of a one-time voluntary retirement window offered to certain bargaining unit employees.

		Other Postretirement Benefits
		Three Months				Six Months
		2014		2013		2014		2013
PPL
Service cost		$	3	$	3	$	6	$	7
Interest cost			8		7		16		14
Expected return on plan assets			(7)		(6)		(13)		(12)
Amortization of:
	Actuarial (gain) loss				2				3
Net periodic defined benefit costs (credits)		$	4	$	6	$	9	$	12


LKE
Service cost		$	1	$	1	$	2	$	2
Interest cost			3		2		5		4
Expected return on plan assets			(2)		(1)		(3)		(2)
Amortization of:
	Prior service cost						1		1
Net periodic defined benefit costs (credits)		$	2	$	2	$	5	$	5

(All Registrants except PPL)

In addition to the specific plans they sponsor, PPL Energy Supply subsidiaries are also allocated costs of defined benefit plans sponsored by PPL Services, and LG&E is allocated costs of defined benefit plans sponsored by LKE based on their participation in those plans, which management believes are reasonable. PPL Electric and KU do not directly sponsor any defined benefit plans. PPL Electric is allocated costs of defined benefit plans sponsored by PPL Services and KU is allocated costs of defined benefit plans sponsored by LKE based on their participation in those plans, which management believes are reasonable. For the periods ended June 30, PPL Services allocated the following net periodic defined benefit costs to PPL Energy Supply subsidiaries and PPL Electric, and LKE allocated the following net periodic defined benefit costs to LG&E and KU.

	Three Months				Six Months
	2014		2013		2014		2013

PPL Energy Supply (a)	$	23	$	12	$	30	$	23
PPL Electric (a)		10		9		15		18

LG&E				2			3			4			6
KU				1			5			4			9

(a) The three and six months ended June 30, 2014 include $16 million and $4 million of termination benefits for PPL Energy Supply and PPL Electric related to a one-time voluntary retirement window offered to certain bargaining unit employees. See Note 10 for additional information.