Regulatory Assets, Liabilities, And Balancing Accounts

9 Months Ended

Sep. 30, 2014

Regulatory Assets, Liabilities, And Balancing Accounts

NOTE 3: REGULATORY ASSETS, LIABILITIES, AND BALANCING ACCOUNTS

Regulatory Assets

Long-term regulatory assets are composed of the following:

	Balance at
	September 30,		December 31,
(in millions)	2014		2013
Pension benefits	$	1,397	$	1,444
Deferred income taxes		2,269		1,835
Utility retained generation		468		503
Environmental compliance costs		714		628
Price risk management		83		106
Electromechanical meters		87		135
Unamortized loss, net of gain, on reacquired debt		118		135
Other		81		127
Total long-term regulatory assets	$	5,217	$	4,913

Regulatory Liabilities

Long-term regulatory liabilities are composed of the following:

	Balance at
	September 30,		December 31,
(in millions)	2014		2013
Cost of removal obligations	$	4,144	$	3,844
Recoveries in excess of asset retirement obligations		687		748
Public purpose programs		705		587
Other		597		481
Total long-term regulatory liabilities	$	6,133	$	5,660

Regulatory Balancing Accounts

The Utility's recovery of revenue requirements and costs is generally decoupled from the volume of sales.  The Utility tracks (1) differences between the Utility's authorized revenue requirement and actual customer billings, and (2) differences between incurred costs and customer billings.  To the extent these differences are probable of recovery or refund over the next 12 months, the Utility records a current regulatory balancing account receivable or payable.  Regulatory balancing accounts that the Utility expects to collect or refund over a period exceeding 12 months are recorded as other noncurrent assets - regulatory assets or noncurrent liabilities - regulatory liabilities, respectively, in the Condensed Consolidated Balance Sheets.

The Utility sells and delivers electricity and natural gas.  The Utility also administers public purpose programs, primarily related to customer energy efficiency programs.  The balancing accounts associated with these items will fluctuate during the year based on seasonal electric and gas usage and the timing of when costs are incurred and customer revenues are collected.  

The balancing accounts reflect the impacts of the final decision in the Utility's 2014 GRC that was issued by the CPUC on August 14, 2014.   

Current regulatory balancing accounts receivable and payable are composed of the following:

	Receivable
	Balance at
	September 30,		December 31,
(in millions)	2014		2013
Electric distribution	$	173	$	102
Utility generation		162		57
Gas distribution		549		70
Energy procurement		633		410
Public purpose programs		106		56
Other		332		429
Total regulatory balancing accounts receivable	$	1,955	$	1,124

	Payable
	Balance at
	September 30,		December 31,
(in millions)	2014		2013
Energy procurement	$	286	$	298
Public purpose programs		157		171
Other (1)		780		539
Total regulatory balancing accounts payable	$	1,223	$	1,008

 ⁽¹⁾ At September 30, 2014, Other regulatory balancing accounts payable mostly includes energy supplier settlements.  (See Note 9 Resolution of Remaining Chapter 11 Disputed Claims for additional details.)