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Income Taxes (Tables)
 9 Months Ended
Sep. 30, 2019
Income Taxes [Line Items]  
Schedule of Effective Income Tax Rate Reconciliation
Reconciliations of income taxes for the periods ended September 30 are as follows.
(PPL)
 
Three Months
 
Nine Months
 
2019
 
2018
 
2019
 
2018
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%
$
125

 
$
115

 
$
359

 
$
373

Increase (decrease) due to:
 

 
 

 
 

 
 

State income taxes, net of federal income tax benefit
13

 
9

 
34

 
34

Valuation allowance adjustments (a)
7

 
5

 
21

 
17

Impact of lower U.K. income tax rates
(6
)
 
(7
)
 
(20
)
 
(20
)
Impact of the U.K. Finance Act on deferred tax balances
(5
)
 
(4
)
 
(8
)
 
(7
)
Depreciation and other items not normalized
(2
)
 
(1
)
 
(5
)
 
(4
)
Amortization of excess deferred federal and state income taxes
(9
)
 
(11
)
 
(30
)
 
(30
)
Deferred tax impact of state tax reform (b)
—

 
—

 
—

 
9

Interest benefit on U.K. financing entities
(3
)
 
(4
)
 
(9
)
 
(13
)
Kentucky recycling credit, net of federal income tax expense (a)
—

 
—

 
(20
)
 
—

Other
(2
)
 
1

 
6

 
3

Total increase (decrease)
(7
)
 
(12
)
 
(31
)
 
(11
)
Total income taxes
$
118

 
$
103

 
$
328

 
$
362



(a)
During the second quarter of 2019, LKE recorded a deferred income tax benefit associated with two projects placed into service that prepare a generation waste material for reuse and, as a result, qualify for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky, with the benefit recognized during the period in which the assets are placed into service. A valuation allowance of $3 million has been recognized related to this credit due to insufficient Kentucky taxable income projected at LKE. During the third quarter of 2019, LKE filed the Kentucky recycling credit application with the Kentucky Department of Revenue and expects a ruling in the fourth quarter of 2019.
(b)
During the second quarter of 2018, LKE recorded deferred income tax expense, primarily associated with LKE's non-regulated entities, due to the Kentucky corporate income tax rate reduction from 6% to 5%, as enacted by HB 487, effective January 1, 2018.
PPL Electric Utilities Corp [Member]  
Income Taxes [Line Items]  
Schedule of Effective Income Tax Rate Reconciliation
(PPL Electric)
 
 
 
 
 
 
 
 
Three Months
 
Nine Months
 
2019
 
2018
 
2019
 
2018
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%
$
33

 
$
30

 
$
94

 
$
93

Increase (decrease) due to:
 

 
 

 
 

 
 

State income taxes, net of federal income tax benefit
13

 
12

 
36

 
35

Depreciation and other items not normalized
(2
)
 
(1
)
 
(5
)
 
(4
)
Amortization of excess deferred income taxes
(4
)
 
(5
)
 
(12
)
 
(13
)
Other
—

 
(1
)
 
1

 
—

Total increase (decrease)
7

 
5

 
20

 
18

Total income taxes
$
40

 
$
35

 
$
114

 
$
111


Reconciliations of income taxes for the periods ended September 30 are as follows.
LG And E And KU Energy LLC [Member]  
Income Taxes [Line Items]  
Schedule of Effective Income Tax Rate Reconciliation
Reconciliations of income taxes for the periods ended September 30 are as follows.
(LKE)
 
 
 
 
 
 
 
 
Three Months
 
Nine Months
 
2019
 
2018
 
2019
 
2018
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%
$
42

 
$
34

 
$
98

 
$
97

Increase (decrease) due to:
 

 
 

 
 

 
 

State income taxes, net of federal income tax benefit
8

 
6

 
18

 
17

Amortization of investment tax credit
(1
)
 
(1
)
 
(2
)
 
(3
)
Deferred tax impact of U.S tax reform
—

 
(2
)
 
—

 
(2
)
Deferred tax impact of state tax reform (a)
—

 
—

 
—

 
9

Valuation allowance adjustments (b)
—

 
—

 
3

 
—

Amortization of excess deferred federal and state income taxes
(5
)
 
(3
)
 
(17
)
 
(14
)
Kentucky recycling credit, net of federal income tax expense (b)
—

 
—

 
(20
)
 
—

Other
(1
)
 
(2
)
 
(2
)
 
(2
)
Total increase (decrease)
1

 
(2
)
 
(20
)
 
5

Total income taxes
$
43

 
$
32

 
$
78

 
$
102



(a)
During the second quarter of 2018, LKE recorded deferred income tax expense, primarily associated with LKE's non-regulated entities, due to the Kentucky corporate income tax rate reduction from 6% to 5%, as enacted by HB 487, effective January 1, 2018.
(b)
During the second quarter of 2019, LKE recorded a deferred income tax benefit associated with two projects placed into service that prepare a generation waste material for reuse and, as a result, qualify for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky, with the benefit recognized during the period in which the assets are placed into service. A portion of this amount has been reserved due to insufficient Kentucky taxable income projected at LKE. During the third quarter of 2019, LKE filed the Kentucky recycling credit application with the Kentucky Department of Revenue and expects a ruling in the fourth quarter of 2019.
Louisville Gas And Electric Co [Member]  
Income Taxes [Line Items]  
Schedule of Effective Income Tax Rate Reconciliation
Reconciliations of income taxes for the periods ended September 30 are as follows.
(LG&E)
 
 
 
 
 
 
 
 
Three Months
 
Nine Months
 
2019
 
2018
 
2019
 
2018
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%
$
21

 
$
18

 
$
50

 
$
50

Increase (decrease) due to:
 

 
 

 
 

 
 

State income taxes, net of federal income tax benefit
4

 
3

 
9

 
9

Valuation allowance adjustments (a)
—

 
—

 
15

 
—

Amortization of excess deferred federal and state income taxes
(2
)
 
(1
)
 
(7
)
 
(6
)
Kentucky recycling credit, net of federal income tax expense (a)
—

 
—

 
(15
)
 
—

Other
(1
)
 
(2
)
 
(1
)
 
(2
)
Total increase (decrease)
1

 
—

 
1

 
1

Total income taxes
$
22

 
$
18

 
$
51

 
$
51



(a)
During the second quarter of 2019, LG&E recorded a deferred income tax benefit associated with two projects placed into service that prepare a generation waste material for reuse and, as a result, qualify for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky, with the benefit recognized during the period in which the assets are placed into service. This amount has been reserved due to insufficient Kentucky taxable income projected at LG&E.
Kentucky Utilities Co [Member]  
Income Taxes [Line Items]  
Schedule of Effective Income Tax Rate Reconciliation
(KU)
 
 
 
 
 
 
 
 
Three Months
 
Nine Months
 
2019
 
2018
 
2019
 
2018
Federal income tax on Income Before Income Taxes at statutory tax rate - 21%
$
25

 
$
21

 
$
63

 
$
60

Increase (decrease) due to:
 

 
 

 
 

 
 

State income taxes, net of federal income tax benefit
5

 
3

 
12

 
10

Valuation allowance adjustments (a)
—

 
—

 
5

 
—

Amortization of excess deferred federal and state income taxes
(3
)
 
(2
)
 
(10
)
 
(8
)
Kentucky recycling credit, net of federal income tax expense (a)
—

 
—

 
(5
)
 
—

Other
(1
)
 
(1
)
 
(3
)
 
(3
)
Total increase (decrease)
1

 
—

 
(1
)
 
(1
)
Total income taxes
$
26

 
$
21

 
$
62

 
$
59



(a)
During the second quarter of 2019, KU recorded a deferred income tax benefit associated with a project placed into service that prepares a generation waste material for reuse and, as a result, qualifies for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky, with the benefit recognized during the period in which the assets are placed into service. This amount has been reserved due to insufficient Kentucky taxable income projected at KU.
Reconciliations of income taxes for the periods ended September 30 are as follows.