Asset Retirement Obilgations

12 Months Ended

Dec. 31, 2022

Asset Retirement Obligation [Abstract]

ASSET RETIREMENT OBLIGATIONS

AROs consist of the following (in millions):


	As of December 31,
	2022		2021
Trojan decommissioning activities	$	170	$	139
Utility plant	86		95
Non-utility property	33		35
Total asset retirement obligations	289		269
Less: current portion *	32		31
Noncurrent asset retirement obligations	$	257	$	238

* Current portion of AROs are classified within Accrued expenses and other current liabilities in the consolidated balance sheets.

Trojan decommissioning activities represents the present value of future decommissioning costs for PGE’s 67.5% ownership interest in Trojan, which ceased operation in 1993. The remaining decommissioning activities primarily consist of the long-term operation and decommissioning of the ISFSI, an interim dry storage facility that is licensed by the Nuclear Regulatory Commission. The ISFSI will store the spent nuclear fuel at the former plant site until an off-site storage facility is available. Decommissioning of the ISFSI and final site restoration activities will begin once shipment of all the spent fuel to a USDOE facility is complete, which is not expected prior to 2059. In 2022, the Company recorded an increase in the ARO of $36 million due to an increase in expected annual ISFSI operation costs. The Company also recorded accretion of $6 million and a reduction of $11 million due to settled liabilities.

Under a settlement agreement reached with the USDOE, the Company receives annual reimbursement from the USDOE for certain costs related to monitoring the ISFSI. Pursuant to this process, the USDOE reimbursed the co-owners $6 million in 2022 for costs incurred in 2021 and $5 million in 2021 for costs incurred in 2020 resulting from USDOE delays in accepting spent nuclear fuel.

Utility plant represents AROs that have been recognized for the Company’s thermal and wind generation sites, and distribution and transmission assets, the disposal of which is legally required. During 2022, utility AROs decreased

by $9 million, with the change comprised of new liabilities incurred of $1 million, accretion of $3 million, and a reduction of $13 million due to settled liabilities.

Non-utility property primarily represents AROs that have been recognized for portions of unregulated properties that are currently or previously leased to third parties. Revisions to estimates for non-utility AROs relate to assets that are no longer in service and the offset is charged directly to Depreciation and amortization on the consolidated statements of income in the period in which the revisions are probable and reasonably estimable. Non-utility AROs are not subject to regulatory deferral.

The following is a summary of the changes in the Company’s AROs (in millions):


	Years Ended December 31,
	2022		2021		2020
Balance as of beginning of year	$	269	$	291	$	279
Liabilities incurred	1		—		3
Liabilities settled	(27)		(18)		(18)
Accretion expense	10		10		10
Revisions in estimated cash flows	36		(14)		17
Balance as of end of year	$	289	$	269	$	291

Pursuant to regulation, the amortization of utility plant AROs is included in depreciation expense and in customer prices. Any differences in the timing of recognition of costs for financial reporting and ratemaking purposes are deferred as a regulatory asset or regulatory liability. Recovery of Trojan decommissioning costs is included in PGE’s retail prices with an equal amount recorded in Depreciation and amortization expense.

PGE maintains a separate Nuclear decommissioning trust in the consolidated balance sheet for funds collected from customers through prices to cover the cost of Trojan decommissioning activities.

The Oak Grove hydro facility and transmission and distribution plant located on public right-of-ways and on certain easements meet the requirements of a legal obligation and will require removal when the plant is no longer in service. An ARO liability is not currently measurable as management believes that these assets will be used in utility operations for the foreseeable future. Removal costs are charged to accumulated asset retirement removal costs, which is included in Regulatory liabilities on PGE’s consolidated balance sheets.