Commitments and Contingencies

6 Months Ended

Jun. 30, 2015

Commitments and Contingencies Disclosure [Abstract]

Environmental Matters: We periodically review our exposure for environmental remediation costs as evidence becomes available indicating that our liability has changed. Given current information, including the following, we believe that future costs in excess of the amounts accrued and/or disclosed on all presently known and quantifiable environmental contingencies will not be material to our financial position or results of operations.

We have a program of comprehensive environmental remediation planning for former manufactured gas plant sites and coal combustion product disposal sites. We perform ongoing assessments of manufactured gas plant sites and related disposal sites, as well as coal combustion product disposal/landfill sites used by our utilities.

We are working with various state jurisdictions in our investigation and remediation planning. In addition, certain of our natural gas utilities are coordinating the investigation and cleanup of the sites subject to the jurisdiction of the United States Environmental Protection Agency (EPA) under what is called a "multisite" program. This program involves prioritizing the work to be done at the sites, preparation and approval of documents common to all of the sites, and use of a consistent approach in selecting remedies. At this time, we cannot estimate future remediation costs associated with these sites beyond those described below.

Manufactured Gas Plant Sites: We have identified several sites at which our utilities or a predecessor company owned or operated a manufactured gas plant. These sites are at various stages of investigation, monitoring, and remediation. We have also identified other sites that may have been impacted by historical manufactured gas plant activities. Our natural gas utilities are responsible for the environmental remediation of these sites, some of which are in the EPA Superfund Program.

The future costs for detailed site investigation and future remediation is dependent upon several variables including, among other things, the extent of remediation, changes in technology and changes in regulation. Historically, our regulators have allowed us to recover incurred costs, net of insurance recoveries, associated with the remediation of manufactured gas plant sites. Accordingly, we have established regulatory assets for costs associated with these sites.

We have established the following reserves and regulatory assets related to manufactured gas plant sites:



	June 30, 2015		December 31, 2014
	(Millions of Dollars)

Regulatory Assets	$	670.7	$	45.9
Reserves for Future Remediation	$	608.6	$	32.6

The increase in the regulatory assets and reserves is primarily related to balances associated with the Integrys regulated companies.

Illinois Investigations: In March 2015, the ICC opened a docket, naming PGL as respondent, to investigate the veracity of certain allegations included in anonymous letters that the ICC staff received. The allegations mainly focus on the management of the Accelerated Natural Gas Main Replacement Program (AMRP). The initiating order stated that the investigation would also include any further allegations of a similar nature as they pertain to AMRP. The Illinois Attorney General’s office is also conducting an investigation into the same matters. The investigations are ongoing. We plan to engage a nationally recognized firm to help conduct an independent, bottom up review of the cost, scope, and schedule for the program.