Investments
Dominion
Equity and Debt Securities
Rabbi Trust Securities
Marketable equity and debt securities and cash equivalents held in Dominion’s rabbi trusts and classified as trading totaled $98 million and $100 million at March 31, 2016 and December 31, 2015, respectively.
Decommissioning Trust Securities
Dominion holds marketable equity and debt securities (classified as available-for-sale), cash equivalents and cost method investments in nuclear decommissioning trust funds to fund future decommissioning costs for its nuclear plants. Dominion’s decommissioning trust funds are summarized below:
|
| | | | | | | | | | | | | |
| Amortized Cost | Total Unrealized Gains(1) | Total Unrealized Losses(1) | | Fair Value |
(millions) | | | | | |
At March 31, 2016 | | | | | |
Marketable equity securities: | | | | | |
U.S. large cap | $ | 1,317 |
| $ | 1,218 |
| $ | — |
| | $ | 2,535 |
|
REIT | 60 |
| 7 |
| — |
| | 67 |
|
Marketable debt securities: | | | | | |
Corporate bonds | 448 |
| 19 |
| (3 | ) | | 464 |
|
U.S. Treasury securities and agency debentures | 650 |
| 20 |
| — |
| | 670 |
|
State and municipal | 308 |
| 25 |
| — |
| | 333 |
|
Other | 96 |
| — |
| — |
| | 96 |
|
Cost method investments | 70 |
| — |
| — |
| | 70 |
|
Cash equivalents and other(2) | 4 |
| — |
| — |
| | 4 |
|
Total | $ | 2,953 |
| $ | 1,289 |
| $ | (3 | ) | (3) | $ | 4,239 |
|
At December 31, 2015 | | | | | |
Marketable equity securities: | | | | | |
U.S. large cap | $ | 1,295 |
| $ | 1,213 |
| $ | — |
| | $ | 2,508 |
|
REIT | 59 |
| 4 |
| — |
| | 63 |
|
Marketable debt securities: | | | | | |
Corporate bonds | 433 |
| 11 |
| (7 | ) | | 437 |
|
U.S. Treasury securities and agency debentures | 654 |
| 8 |
| (4 | ) | | 658 |
|
State and municipal | 312 |
| 22 |
| — |
| | 334 |
|
Other | 99 |
| — |
| — |
| | 99 |
|
Cost method investments | 70 |
| — |
| — |
| | 70 |
|
Cash equivalents and other(2) | 14 |
| — |
| — |
| | 14 |
|
Total | $ | 2,936 |
| $ | 1,258 |
| $ | (11 | ) | (3) | $ | 4,183 |
|
| |
(1) | Included in AOCI and the nuclear decommissioning trust regulatory liability. |
| |
(2) | Includes pending sales of securities of $2 million and $12 million at March 31, 2016 and December 31, 2015, respectively. |
| |
(3) | The fair value of securities in an unrealized loss position was $151 million and $592 million at March 31, 2016 and December 31, 2015, respectively. |
The fair value of Dominion’s marketable debt securities held in nuclear decommissioning trust funds at March 31, 2016 by contractual maturity is as follows:
|
| | | |
| Amount |
(millions) | |
Due in one year or less | $ | 211 |
|
Due after one year through five years | 423 |
|
Due after five years through ten years | 380 |
|
Due after ten years | 549 |
|
Total | $ | 1,563 |
|
Presented below is selected information regarding Dominion’s marketable equity and debt securities held in nuclear decommissioning trust funds.
|
| | | | | | |
| Three Months Ended March 31, |
| 2016 | 2015 |
(millions) | | |
Proceeds from sales | $ | 368 |
| $ | 337 |
|
Realized gains(1) | 25 |
| 56 |
|
Realized losses(1) | 19 |
| 17 |
|
| |
(1) | Includes realized gains and losses recorded to the nuclear decommissioning trust regulatory liability. |
Other-than-temporary impairment losses on investments held in nuclear decommissioning trust funds for Dominion were not material for the three months ended March 31, 2016 and 2015.
Virginia Power
Virginia Power holds marketable equity and debt securities (classified as available-for-sale), cash equivalents and cost method investments in nuclear decommissioning trust funds to fund future decommissioning costs for its nuclear plants. Virginia Power’s decommissioning trust funds are summarized below: |
| | | | | | | | | | | | | |
| Amortized
Cost | Total Unrealized
Gains(1) | Total Unrealized
Losses(1) | | Fair Value |
(millions) | | | | | |
At March 31, 2016 | | | | | |
Marketable equity securities: | | | | | |
U.S. large cap | $ | 583 |
| $ | 529 |
| $ | — |
| | $ | 1,112 |
|
REIT | 60 |
| 7 |
| — |
| | 67 |
|
Marketable debt securities: | | | | | |
Corporate bonds | 242 |
| 9 |
| (1 | ) | | 250 |
|
U.S. Treasury securities and agency debentures | 257 |
| 6 |
| — |
| | 263 |
|
State and municipal | 159 |
| 13 |
| — |
| | 172 |
|
Other | 46 |
| — |
| — |
| | 46 |
|
Cost method investments | 70 |
| — |
| — |
| | 70 |
|
Total | $ | 1,417 |
| $ | 564 |
| $ | (1 | ) | (3) | $ | 1,980 |
|
At December 31, 2015 | | | | | |
Marketable equity securities: | | | | | |
U.S. large cap | $ | 574 |
| $ | 525 |
| $ | — |
| | $ | 1,099 |
|
REIT | 59 |
| 4 |
| — |
| | 63 |
|
Marketable debt securities: | | | | | |
Corporate bonds | 237 |
| 5 |
| (4 | ) | | 238 |
|
U.S. Treasury securities and agency debentures | 260 |
| 1 |
| (2 | ) | | 259 |
|
State and municipal | 162 |
| 13 |
| (1 | ) | | 174 |
|
Other | 34 |
| — |
| — |
| | 34 |
|
Cost method investments | 70 |
| — |
| — |
| | 70 |
|
Cash equivalents and other(2) | 8 |
| — |
| — |
| | 8 |
|
Total | $ | 1,404 |
| $ | 548 |
| $ | (7 | ) | (3) | $ | 1,945 |
|
| |
(1) | Included in AOCI and the nuclear decommissioning trust regulatory liability. |
| |
(2) | Includes pending sales of securities of $8 million at December 31, 2015. There were no pending sales of securities at March 31, 2016. |
| |
(3) | The fair value of securities in an unrealized loss position was $91 million and $281 million at March 31, 2016 and December 31, 2015, respectively. |
The fair value of Virginia Power’s marketable debt securities held in nuclear decommissioning trust funds at March 31, 2016 by contractual maturity is as follows:
|
| | | |
| Amount |
(millions) | |
Due in one year or less | $ | 74 |
|
Due after one year through five years | 191 |
|
Due after five years through ten years | 196 |
|
Due after ten years | 270 |
|
Total | $ | 731 |
|
Presented below is selected information regarding Virginia Power’s marketable equity and debt securities held in nuclear decommissioning trust funds.
|
| | | | | | |
| Three Months Ended March 31, |
| 2016 | 2015 |
(millions) | | |
Proceeds from sales | $ | 193 |
| $ | 133 |
|
Realized gains(1) | 12 |
| 18 |
|
Realized losses(1) | 10 |
| 11 |
|
| |
(1) | Includes realized gains and losses recorded to the nuclear decommissioning trust regulatory liability. |
Other-than-temporary impairment losses on investments held in nuclear decommissioning trust funds for Virginia Power were not material for the three months ended March 31, 2016 and 2015.
Equity Method Investments
Dominion Gas
Iroquois
Dominion Gas' equity earnings totaled $6 million and $8 million for the three months ended March 31, 2016 and 2015, respectively. Dominion Gas received distributions from this investment of $6 million and $12 million for the three months ended March 31, 2016 and 2015, respectively. At both March 31, 2016 and December 31, 2015, the carrying amount of Dominion Gas' investment of $102 million exceeded its share of underlying equity in net assets by $8 million. The difference reflects equity method goodwill and is not being amortized. In May 2016, Dominion Gas sold 0.65% of the non-controlling partnership interest in Iroquois to TransCanada for approximately $7 million, which resulted in a $5 million ($3 million after-tax) gain.