NOTE 9. REGULATORY ASSETS AND LIABILITIES

Regulatory assets and liabilities include the following:

	2017		2016
(millions)
Regulatory assets:
Purchased-gas adjustment⁽¹⁾	$	10.7	$	3.4
EEP⁽²⁾		3.3		1.1
Pipeline integrity costs⁽³⁾		2.0		1.9
Contract withholding⁽⁴⁾		0.4		2.6
Other		0.2		0.6
Regulatory assets-current		16.6		9.6
Cost of reacquired debt⁽⁵⁾		2.7		3.2
Pipeline integrity costs⁽³⁾		0.6		2.3
Regulatory assets-noncurrent⁽⁶⁾		3.3		5.5
Total regulatory assets	$	19.9	$	15.1
Regulatory liabilities:
CET⁽⁷⁾	$	4.4	$	2.9
Cost of plant removal and AROs⁽⁸⁾		4.2		3.5
Other		1.3		0.1
Regulatory liabilities-current⁽⁹⁾		9.9		6.5
Income taxes refundable through future rates⁽¹⁰⁾		244.9		—
Cost of plant removal and AROs⁽⁸⁾		194.0		189.1
Other		2.1		—
Regulatory liabilities-noncurrent		441.0		189.1
Total regulatory liabilities	$	450.9	$	195.6

(1)	Purchased-gas costs that are different from those provided for in present rates are accumulated and recovered or credited through future rate changes.

(2)

The EEP relates to funds expended for promoting the conservation of natural gas through advertising, rebates for efficient homes and appliances and home energy audits. Costs are recovered from customers through periodic rate adjustments. Costs incurred in excess of recoveries result in an asset; recoveries in excess of costs incurred result in a liability.

(3)	The costs of complying with pipeline-integrity regulations are recovered in rates subject to a Utah Commission order. Questar Gas is allowed to recover $7.0 million per year. Costs incurred in excess of this amount will be recovered in future rate changes.

(4)	The balance at December 31, 2016 represents a disputed amount withheld from a supplier of storage services. The dispute was settled in March 2017 and the amount was reversed, which resulted in no material impact to Questar Gas’ results of operations, financial position or cash flows.

(5)	Gains and losses on the reacquisition of debt by rate-regulated companies are deferred and amortized as interest expense over the would-be remaining life of the reacquired debt. The reacquired debt costs had a weighted-average life of approximately 5.1 years as of December 31, 2017.

(6)	Noncurrent regulatory assets are presented in other deferred charges and other assets in the Balance Sheets.

(7)	Represents the difference between actual and allowed revenues. Any deficiency in amounts collected are recovered through periodic rate adjustments.

(8)	Cost of plant removal and AROs represent amounts recovered from customers for costs of future activities to remove assets that are expected to be incurred at the time of retirement.

(9)	Current regulatory liabilities are presented in other current liabilities in the Balance Sheets.

(10)	Amounts recorded to pass the effect of reduced income tax rates from the 2017 Tax Reform Act to customers in future periods, which will reverse at the weighted average tax rate that was used to build the reserves over the remaining book life of the property

At December 31, 2017 none of Questar Gas’ regulatory assets were earning a return.