Defined Benefits

3 Months Ended

Mar. 31, 2016

9. Defined Benefits

(PPL, LKE and LG&E)

Certain net periodic defined benefit costs are applied to accounts that are further distributed among capital, expense and regulatory assets, 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 and its subsidiaries, LKE and its subsidiaries and LG&E for the three month periods ended March 31:

		Pension Benefits								Other Postretirement Benefits
		U.S.				U.K.
		2016		2015		2016 (b)		2015		2016		2015
PPL
Service cost		$	17	$	30	$	18	$	20	$	2	$	4
Interest cost			43		57		62		79		6		7
Expected return on plan assets			(56)		(75)		(133)		(131)		(5)		(7)
Amortization of:
	Prior service cost		1		2
	Actuarial (gain) loss		15		24		37		39
Net periodic defined benefit costs (credits) (a)		$	20	$	38	$	(16)	$	7	$	3	$	4


LKE
Service cost		$	6	$	7	$	1	$	1
Interest cost			17		17		2		2
Expected return on plan assets			(21)		(22)		(2)		(1)
Amortization of:
	Prior service cost		1		2		1		1
	Actuarial (gain) loss		5		8
Net periodic defined benefit costs (credits)		$	8	$	12	$	2	$	3

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

(a) For the three months ended March 31, 2015, the total net periodic defined benefit cost includes $11 million reflected in discontinued operations related to costs allocated from PPL's plans to PPL Energy Supply prior to the spinoff.

(b) See Note 2 for a discussion of changes to the discount rate used for the U.K. Pension Plans.

(PPL Electric, LG&E and KU)

In addition to the specific plans it sponsors, LG&E is allocated costs of defined benefit plans sponsored by LKE based on its 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 March 31, PPL Services allocated the following net periodic defined benefit costs to PPL Electric, and LKE allocated the following net periodic defined benefit costs to LG&E and KU.

	Three Months
	2016		2015

PPL Electric	$	6	$	8


LG&E	2	3
KU	3	5