Utility Rate Regulation (Tables)

9 Months Ended

Sep. 30, 2015

Utility Rate Regulation [Line Items]

Regulatory Assets

The following table provides information about the regulatory assets and liabilities of cost-based rate-regulated utility operations.

		PPL				PPL Electric
		September 30,		December 31,		September 30,		December 31,
		2015		2014		2015		2014
Current Regulatory Assets:
	Environmental cost recovery	$	19	$	5
	Gas supply clause		1		15
	Transmission service charge		7		6	$	7	$	6
	Other		10		11		3		6
Total current regulatory assets (a)		$	37	$	37	$	10	$	12
Noncurrent Regulatory Assets:
	Defined benefit plans (b)	$	734	$	720	$	411	$	372
	Taxes recoverable through future rates		323		316		323		316
	Storm costs		101		124		34		46
	Unamortized loss on debt		70		77		44		49
	Interest rate swaps (c)		146		122
	Accumulated cost of removal of utility plant		130		114		130		114
	AROs		109		79
	Other		14		10
Total noncurrent regulatory assets		$	1,627	$	1,562	$	942	$	897

		LKE				LG&E				KU
		September 30,		December 31,		September 30,		December 31,		September 30,		December 31,
		2015		2014		2015		2014		2015		2014
Current Regulatory Assets:
	Environmental cost recovery	$	19	$	5	$	10	$	4	$	9	$	1
	Gas supply clause		1		15		1		15
	Fuel adjustment clause				4				2				2
	Other		7		1						7		1
Total current regulatory assets		$	27	$	25	$	11	$	21	$	16	$	4
Noncurrent Regulatory Assets:
	Defined benefit plans (b)	$	323	$	348	$	200	$	215	$	123	$	133
	Storm costs		67		78		37		43		30		35
	Unamortized loss on debt		26		28		17		18		9		10
	Interest rate swaps (c)		146		122		102		89		44		33
	AROs		109		79		38		28		71		51
	Plant retirement costs (e)		6								6
	Other		8		10		2		4		6		6
Total noncurrent regulatory assets		$	685	$	665	$	396	$	397	$	289	$	268

Regulatory Liabilities

The following table provides information about the regulatory assets and liabilities of cost-based rate-regulated utility operations.

Current Regulatory Liabilities:
	Generation supply charge	$	41	$	28	$	41	$	28
	Demand side management		12		2
	Gas supply clause		9		6
	Transmission formula rate		61		42		61		42
	Storm damage expense		13		3		13		3
	Other		15		10		5		3
Total current regulatory liabilities		$	151	$	91	$	120	$	76
Noncurrent Regulatory Liabilities:
	Accumulated cost of removal of utility plant	$	695	$	693
	Coal contracts (d)		28		59
	Power purchase agreement - OVEC (d)		86		92
	Net deferred tax assets		23		26
	Act 129 compliance rider		25		18	$	25	$	18
	Defined benefit plans		22		16
	Interest rate swaps		82		84
	Other		1		4
Total noncurrent regulatory liabilities		$	962	$	992	$	25	$	18

Current Regulatory Liabilities:
	Demand side management		$	12	$	2	$	6	$	1	$	6	$	1
	Gas supply clause			9		6		9		6
	Fuel adjustment clause			8								8
	Gas line tracker					3				3
	Other			2		4						2		4
Total current regulatory liabilities			$	31	$	15	$	15	$	10	$	16	$	5
Noncurrent Regulatory Liabilities:
	Accumulated cost of removal
		of utility plant	$	695	$	693	$	304	$	302	$	391	$	391
	Coal contracts (d)			28		59		12		25		16		34
	Power purchase agreement - OVEC (d)			86		92		59		63		27		29
	Net deferred tax assets			23		26		23		24				2
	Defined benefit plans			22		16						22		16
	Interest rate swaps			82		84		41		42		41		42
	Other			1		4				2		1		2
Total noncurrent regulatory liabilities			$	937	$	974	$	439	$	458	$	498	$	516

(a)For PPL, these amounts are included in "Other current assets" on the Balance Sheets.

(b)Included in 2015 is $4 million for PPL and LKE, $3 million for LG&E and $1 million for KU related to the deferred recovery of the difference between the pension cost calculated in accordance with LG&E and KU's pension accounting policy and pension cost using a 15 year amortization period for actuarial gains and losses as provided in the June 30, 2015 rate case settlement. See Note 9 and “Kentucky Activities - Rate Case Proceedings” below for additional information.

(c)Amounts include net settlements related to forward-starting interest rate swaps that were terminated in September 2015 and are included in "Cash Flows from Operating Activities" on the Statements of Cash Flows. See Note 14 for additional information.

(d)These liabilities were recorded as offsets to certain intangible assets that were recorded at fair value upon the acquisition of LKE by PPL.

(e)The June 30, 2015 rate case settlement provided for deferred recovery of costs associated with Green River's coal-fired generating unit retirements. These costs include inventory write-downs and separation benefits and will be amortized over threeyears.