10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2019

OR

( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

DPL INC. (an Ohio corporation)	THE DAYTON POWER AND LIGHT COMPANY (an Ohio corporation)
Commission file number 1-9052	Commission file number 1-2385
1065 Woodman Drive Dayton, Ohio 45432	1065 Woodman Drive Dayton, Ohio 45432
937-259-7215	937-259-7215
I.R.S. Employer Identification No. 31-1163136	I.R.S. Employer Identification No. 31-0258470

Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
N/A	N/A	N/A

Indicate by check mark whether each registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

DPL Inc.	Yes o	No x
The Dayton Power and Light Company	Yes o	No x

Each of DPL Inc. and The Dayton Power and Light Company is a voluntary filer that has filed all applicable reports under Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months.

Indicate by check mark whether each registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

DPL Inc.	Yes x	No o
The Dayton Power and Light Company	Yes x	No o

1

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

	Large accelerated filer	Accelerated filer	Non- accelerated filer (Do not check if a smaller reporting company)	Smaller reporting company	Emerging growth company
DPL Inc.	o	o	x	o	o
The Dayton Power and Light Company	o	o	x	o	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

DPL Inc.	o
The Dayton Power and Light Company	o

Indicate by check mark whether each registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

DPL Inc.	Yes o	No x
The Dayton Power and Light Company	Yes o	No x

All of the outstanding common stock of DPL Inc. is indirectly owned by The AES Corporation. All of the outstanding common stock of The Dayton Power and Light Company is owned by DPL Inc.

As of November 5, 2019, each registrant had the following shares of common stock outstanding:

Registrant	Description	Shares Outstanding
DPL Inc.	Common Stock, no par value	1
The Dayton Power and Light Company	Common Stock, $0.01 par value	41,172,173

This combined Form 10-Q is separately filed by DPL Inc. and The Dayton Power and Light Company. Information contained herein relating to any individual registrant is filed by such registrant on its own behalf. Each registrant makes no representation as to information relating to a registrant other than itself.

2

DPL Inc. and The Dayton Power and Light Company

Quarter Ended September 30, 2019

	Table of Contents	Page No.
Glossary of Terms		4
Forward-Looking Statements		5
Part I Financial Information
Item 1	Financial Statements – DPL Inc. and The Dayton Power and Light Company (Unaudited)
	DPL Inc.
	Condensed Consolidated Statements of Operations	8
	Condensed Consolidated Statements of Comprehensive Income	9
	Condensed Consolidated Balance Sheets	10
	Condensed Consolidated Statements of Cash Flows	11
	Condensed Consolidated Statements of Shareholder's Deficit	12
	Notes to Condensed Consolidated Financial Statements	13
	Note 1 – Overview and Summary of Significant Accounting Policies	13
	Note 2 – Supplemental Financial Information	16
	Note 3 – Regulatory Matters	17
	Note 4 – Fair Value	18
	Note 5 – Derivative Instruments and Hedging Activities	20
	Note 6 – Long-term Debt	22
	Note 7 – Income Taxes	24
	Note 8 – Benefit Plans	25
	Note 9 – Shareholder's Deficit	25
	Note 10 – Contractual Obligations, Commercial Commitments and Contingencies	25
	Note 11 – Business Segments	27
	Note 12 – Revenue	29
	Note 13 – Dispositions	30
	Note 14 – Discontinued Operations	31
	The Dayton Power and Light Company
	Condensed Statements of Operations	34
	Condensed Statements of Comprehensive Income	35
	Condensed Balance Sheets	36
	Condensed Statements of Cash Flows	37
	Condensed Statements of Shareholder's Equity	38
	Notes to Condensed Financial Statements	39
	Note 1 – Overview and Summary of Significant Accounting Policies	39
	Note 2 – Supplemental Financial Information	42
	Note 3 – Regulatory Matters	42
	Note 4 – Fair Value	43
	Note 5 – Derivative Instruments and Hedging Activities	45
	Note 6 – Long-term Debt	47
	Note 7 – Income Taxes	48
	Note 8 – Benefit Plans	48
	Note 9 – Shareholder's Equity	49
	Note 10 – Contractual Obligations, Commercial Commitments and Contingencies	49
	Note 11 – Revenue	50
	Note 12 – Dispositions	50
Item 2	Management's Discussion and Analysis of Financial Condition and Results of Operations	51
Item 3	Quantitative and Qualitative Disclosures about Market Risk	69
Item 4	Controls and Procedures	69
Part II Other Information
Item 1	Legal Proceedings	70
Item 1A	Risk Factors	70
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	70
Item 3	Defaults Upon Senior Securities	70
Item 4	Mine Safety Disclosures	70
Item 5	Other Information	71
Item 6	Exhibits	71
	Signatures	72

3

GLOSSARY OF TERMS 

The following terms are used in this Form 10-Q:

Term	Definition
2017 ESP	DP&L's ESP - approved October 20, 2017, effective November 1, 2017
AES	The AES Corporation - a global power company and the ultimate parent company of DPL
AES Ohio Generation	AES Ohio Generation, LLC - a wholly-owned subsidiary of DPL that owns an interest in a coal-fired EGU from which it makes wholesale sales and previously operated other EGUs
AOCI	Accumulated Other Comprehensive Income
ARO	Asset Retirement Obligation
ASU	Accounting Standards Update
CAA	U.S. Clean Air Act - the congressional act that directs the USEPA’s regulation of stationary and mobile sources of air pollution to protect air quality and stratospheric ozone
CCR	Coal Combustion Residuals
Conesville	AES Ohio Generation's interest in Unit 4 at the Conesville EGU
CSAPR	Cross-State Air Pollution Rule - the USEPA's rule to address interstate air pollution transport to decrease emissions to downwind states
D.C. Circuit Court	United States Court of Appeals for the District of Columbia Circuit
DIR	Distribution Investment Rider - established in the ESP and authorized in the DRO to recover certain distribution capital investments placed in service beginning October 1, 2015
DMP	Distribution Modernization Plan - on December 21, 2018, DP&L filed a comprehensive grid modernization plan pursuant to the PUCO Order in the ESP
DMR	Distribution Modernization Rider - established in the ESP as a non-bypassable rider to collect $105.0 million in revenue per year for the first three years of the ESP term
DPL	DPL Inc.
DP&L	The Dayton Power and Light Company - the principal subsidiary of DPL and a public utility that delivers electricity to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio
DRO	Distribution Rate Order - the order issued by the PUCO on September 26, 2018 establishing new base distribution rates for DP&L, which became effective October 1, 2018
EBITDA	Earnings before interest, taxes, depreciation and amortization. EBITDA also excludes the Fixed-asset impairment
EGU	Electric Generating Unit
ERAC	Environmental Review Appeals Commission - a commission appointed by the Governor of Ohio to resolve appeals related various Ohio agencies including Ohio EPA, Ohio Department of Agriculture and others
ERISA	The Employee Retirement Income Security Act of 1974
ESP	The Electric Security Plan - a plan that a utility must file with the PUCO to establish SSO rates pursuant to Ohio law
FASB	Financial Accounting Standards Board
FASC	FASB Accounting Standards Codification
Form 10-K	DPL’s and DP&L’s combined Annual Report on Form 10-K for the fiscal year ended December 31, 2018, which was filed on February 26, 2019
First and Refunding Mortgage	DP&L’s First and Refunding Mortgage, dated October 1, 1935, as amended, with the Bank of New York Mellon as Trustee
GAAP	Generally Accepted Accounting Principles in the United States of America
Generation Separation	The transfer on October 1, 2017 to AES Ohio Generation of the DP&L-owned generating facilities and related liabilities pursuant to an asset contribution agreement with a subsidiary that was then merged into AES Ohio Generation
kV	Kilovolt, 1,000 volts
kWh	Kilowatt-hours - a measure of electrical energy equivalent to a power consumption of 1,000 watts for 1 hour
LIBOR	London Inter-Bank Offering Rate
Master Trust	DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans
MATS	Mercury and Air Toxics Standards - the USEPA’s rules for existing and new power plants under Section 112 of the CAA
Merger	The merger of DPL and Dolphin Sub, Inc., a wholly-owned subsidiary of AES. On November 28, 2011, DPL became a wholly-owned subsidiary of AES.
Miami Valley Lighting	Miami Valley Lighting, LLC is a wholly-owned subsidiary of DPL established in 1985 to provide street and outdoor lighting services to customers in the Dayton region. Miami Valley Lighting serves businesses, communities and neighborhoods in West Central Ohio with over 70,000 lighting solutions for more than 190 businesses and 180 local governments.
MVIC	Miami Valley Insurance Company is a wholly-owned insurance subsidiary of DPL that provides insurance services to DPL and its subsidiaries and, in some cases, insurance services to partner companies related to the jointly-owned facility operated by AES Ohio Generation
MW	Megawatt, a unit of power equal to one million watts

4

GLOSSARY OF TERMS (cont.)
Term	Definition
NAAQS	National Ambient Air Quality Standards - the USEPA’s health and environmental based standards for six specified pollutants, as found in the ambient air
NERC	North American Electric Reliability Corporation - a not-for-profit international regulatory authority whose mission is to assure the effective and efficient reduction of risks to the reliability and security of the electric grid
Ohio EPA	Ohio Environmental Protection Agency
OVEC	Ohio Valley Electric Corporation - an electric generating company in which DP&L holds a 4.9% equity interest
Peaker assets	The generation and related assets for the 586.0 MW Tait combustion turbine and diesel generation facility, the 236.0 MW Montpelier combustion turbine generation facility, the 101.5 MW Yankee combustion turbine generation and solar facility, the 25.0 MW Hutchings combustion turbine generation facility, the 12.0 MW Monument diesel generation facility, and the 12.0 MW Sidney diesel generation facility that were sold on March 27, 2018
PJM	PJM Interconnection, LLC, an RTO
PRP	Potentially Responsible Party
PUCO	Public Utilities Commission of Ohio
RTO	Regional Transmission Organization - an entity that is independent from all generation and power marketing interests and has exclusive responsibility for grid operations, short-term reliability, and transmission service within a region
SEC	U.S. Securities and Exchange Commission
SERP	Supplemental Executive Retirement Plan
Service Company	AES US Services, LLC - the shared services affiliate providing accounting, finance, and other support services to AES’ U.S. SBU businesses
SSO	Standard Service Offer represents the regulated rates, authorized by the PUCO, charged to DP&L retail customers that take retail generation service from DP&L within DP&L’s service territory
TCJA	The Tax Cuts and Jobs Act of 2017, signed on December 22, 2017
TCRR	The Transmission Cost Recovery Rider is a rider designed to recover transmission-related costs imposed on or charged to DP&L by FERC or PJM
U.S.	United States of America
USEPA	U.S. Environmental Protection Agency
USF	The Universal Service Fund is a statewide program which provides qualified low-income customers in Ohio with income-based bills and energy efficiency education programs
U.S. SBU	U.S. and Utilities Strategic Business Unit, AES’ reporting unit covering the businesses in the United States, including DPL
Utility segment	DPL's Utility segment is made up of DP&L’s electric transmission and distribution businesses, which distribute electricity to residential, commercial, industrial and governmental customers

FORWARD-LOOKING STATEMENTS

Certain statements contained in this report are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Matters discussed in this report that relate to events or developments that are expected to occur in the future, including management’s expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters constitute forward-looking statements. Forward-looking statements are based on management’s beliefs, assumptions and expectations of future economic performance, considering the information currently available to management. These statements are not statements of historical fact and are typically identified by terms and phrases such as “anticipate,” “believe,” “intend,” “estimate,” “expect,” “continue,” “should,” “could,” “may,” “plan,” “project,” “predict,” “will” and similar expressions. Such forward-looking statements are subject to risks and uncertainties and investors are cautioned that outcomes and results may vary materially from those projected due to various factors beyond our control, including but not limited to:

• growth in our service territory and changes in demand and demographic patterns;

• weather-related damage to our electrical system;

• performance of our suppliers;

• transmission and distribution system reliability and capacity;

• regulatory actions and outcomes, including, but not limited to, the review and approval of our rates and charges by the PUCO;

• federal and state legislation and regulations;

• changes in our credit ratings or the credit ratings of AES;

• fluctuations in the value of pension plan assets, fluctuations in pension plan expenses and our ability to fund defined benefit pension plans;

• changes in financial or regulatory accounting policies;

• environmental matters, including costs of compliance with, and liabilities related to, current and future environmental laws and requirements;

5

• interest rates and the use of interest rate hedges, inflation rates and other costs of capital;

• the availability of capital;

• the ability of subsidiaries to pay dividends or distributions to DPL;

• level of creditworthiness of counterparties to contracts and transactions;

• labor strikes or other workforce factors, including the ability to attract and retain key personnel;

• facility or equipment maintenance, repairs and capital expenditures;

• significant delays or unanticipated cost increases associated with construction projects;

• the availability and cost of funds to finance working capital and capital needs, particularly during periods when the time lag between incurring costs and recovery is long and the costs are material;

• local economic conditions;

• costs and effects of legal and administrative proceedings, audits, settlements, investigations and claims and the ultimate disposition of litigation;

• industry restructuring, deregulation and competition;

• issues related to our participation in PJM, including the cost associated with membership, allocation of costs, costs associated with transmission expansion, the recovery of costs incurred and the risk of default of other PJM participants;

• changes in tax laws and the effects of our tax strategies;

• product development, technology changes and changes in prices of products and technologies;

• cyberattacks and information security breaches;

• the use of derivative contracts;

• catastrophic events such as fires, explosions, terrorist acts, acts of war, pandemic events, or natural disasters such as floods, earthquakes, tornadoes, severe winds, ice or snowstorms, droughts or other similar occurrences; and

• the risks and other factors discussed in this report and other DPL and DP&L filings with the SEC.

Forward-looking statements speak only as of the date of the document in which they are made. We disclaim any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in our expectations or any change in events, conditions or circumstances on which the forward-looking statement is based. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements.

All such factors are difficult to predict, contain uncertainties that may materially affect actual results, and many are beyond our control. See Item 1A - Risk Factors to Part I in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section in such report and in our Quarterly Reports on Form 10-Q for the quarters ended March 31, and June 30, 2019 and this Quarterly Report on Form 10-Q for a more detailed discussion of the foregoing and certain other factors that could cause actual results to differ materially from those reflected in such forward-looking statements and that should be considered in evaluating our outlook.

Our SEC filings are available to the public from the SEC’s website at www.sec.gov.

COMPANY WEBSITES

DP&L’s public internet site is www.dpandl.com. The information on this website is not incorporated by reference into this report.

Part I – Financial Information

This report includes the combined filing of DPL and DP&L. Throughout this report, the terms “we,” “us,” “our” and “ours” are used to refer to both DPL and DP&L, respectively and altogether, unless the context indicates otherwise. Discussions or areas of this report that apply only to DPL or DP&L will be clearly noted in the applicable section.

Item 1 – Financial Statements

6

FINANCIAL STATEMENTS

DPL INC.

7

DPL INC.
Condensed Consolidated Statements of Operations
(Unaudited)
	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Revenues	$	199.0		$	207.7		$	592.2		$	591.5
Operating costs and expenses
Net fuel cost	5.2			4.6			13.0			12.7
Net purchased power cost	66.5			83.6			195.0			238.9
Operation and maintenance	44.2			37.3			142.3			118.3
Depreciation and amortization	17.7			19.7			54.1			58.8
Taxes other than income taxes	20.9			19.0			58.5			54.5
Other, net (Note 2)	—			1.6			0.9			14.6
Total operating costs and expenses	154.5			165.8			463.8			497.8
Operating income	44.5			41.9			128.4			93.7
Other income / (expense), net:
Interest expense	(18.3		)	(22.6		)	(63.7		)	(74.4		)
Loss on early extinguishment of debt	—			—			(44.9		)	(6.4		)
Other income	0.3			0.5			3.2			0.8
Total other expense, net	(18.0		)	(22.1		)	(105.4		)	(80.0		)
Income from continuing operations before income tax	26.5			19.8			23.0			13.7
Income tax expense / (benefit) from continuing operations	(9.4		)	3.1			(12.6		)	1.5
Net income from continuing operations	35.9			16.7			35.6			12.2
Discontinued operations (Note 14):
Income / (loss) from discontinued operations before income tax	(0.4		)	5.0			32.8			36.7
Gain / (loss) from disposal of discontinued operations	—			0.3			0.1			(1.6		)
Income tax expense from discontinued operations	0.1			1.0			7.1			5.9
Net income / (loss) from discontinued operations	(0.5		)	4.3			25.8			29.2
Net income	$	35.4		$	21.0		$	61.4		$	41.4

See Notes to Condensed Consolidated Financial Statements.

8

DPL INC.
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Net income	$	35.4		$	21.0		$	61.4		$	41.4
Derivative activity:
Change in derivative fair value, net of income tax (expense) / benefit of $(0.1), $0.0, $0.1 and $(0.2) for each respective period	(0.2		)	0.1			(1.0		)	0.4
Reclassification to earnings, net of income tax (benefit) / expense of $(0.1), $0.1, $0.0 and $0.3 for each respective period	(0.4		)	(0.2		)	(0.9		)	(0.6		)
Reclassification of earnings related to discontinued operations, net of income tax benefit of $(0.4), $0.0, $(0.4) and $(1.5) for each respective period	(0.4		)	—			(0.4		)	2.8
Total change in fair value of derivatives	(1.0		)	(0.1		)	(2.3		)	2.6
Pension and postretirement activity:
Reclassification to earnings, net of income tax benefit of $(0.1), $(0.1), $(0.1) and $(0.1) for each respective period	—			0.1			0.1			0.4
Total change in unfunded pension and postretirement obligations	—			0.1			0.1			0.4
Other comprehensive income / (loss)	(1.0		)	—			(2.2		)	3.0
Net comprehensive income	$	34.4		$	21.0		$	59.2		$	44.4

See Notes to Condensed Consolidated Financial Statements.

9

DPL INC.
Condensed Consolidated Balance Sheets
(Unaudited)
$ in millions	September 30, 2019			December 31, 2018
ASSETS
Current assets:
Cash and cash equivalents	$	36.8		$	90.5
Restricted cash	17.6			21.2
Accounts receivable, net (Note 2)	69.8			90.5
Inventories (Note 2)	13.0			10.7
Taxes applicable to subsequent years	18.2			72.6
Regulatory assets, current	40.2			41.1
Prepayments and other current assets	9.3			12.9
Current assets of discontinued operations and held-for-sale businesses	8.3			8.7
Total current assets	213.2			348.2
Property, plant & equipment:
Property, plant & equipment	1,664.2			1,615.6
Less: Accumulated depreciation and amortization	(350.3		)	(310.8		)
	1,313.9			1,304.8
Construction work in process	94.5			32.2
Total net property, plant & equipment	1,408.4			1,337.0
Other non-current assets:
Regulatory assets, non-current	154.7			152.6
Intangible assets, net of amortization	19.3			18.4
Other non-current assets	20.5			21.6
Non-current assets of discontinued operations and held-for-sale businesses	0.2			5.3
Total other non-current assets	194.7			197.9
Total assets	$	1,816.3		$	1,883.1
LIABILITIES AND SHAREHOLDER'S DEFICIT
Current liabilities:
Short-term and current portion of long-term debt (Note 6)	$	237.6		$	103.6
Accounts payable	52.9			58.1
Accrued taxes	78.5			76.7
Accrued interest	27.2			14.3
Customer deposits	20.3			21.3
Regulatory liabilities, current	36.5			34.9
Accrued and other current liabilities	21.4			22.0
Current liabilities of discontinued operations and held-for-sale businesses	9.9			12.2
Total current liabilities	484.3			343.1
Non-current liabilities:
Long-term debt (Note 6)	1,223.3			1,372.3
Deferred income taxes	119.0			116.1
Taxes payable	3.7			76.1
Regulatory liabilities, non-current	252.3			278.3
Accrued pension and other post-retirement benefits	73.9			82.3
Asset retirement obligations	9.5			9.4
Other non-current liabilities	7.5			8.0
Non-current liabilities of discontinued operations and held-for-sale businesses	52.4			69.2
Total non-current liabilities	1,741.6			2,011.7
Commitments and contingencies (Note 10)
Common shareholder's deficit
Common stock:
1,500 shares authorized; 1 share issued and outstanding at September 30, 2019 and December 31, 2018	—			—
Other paid-in capital	2,373.4			2,370.5
Accumulated other comprehensive income	—			2.2
Accumulated deficit	(2,783.0		)	(2,844.4		)
Total common shareholder's deficit	(409.6		)	(471.7		)
Total liabilities and shareholder's deficit	$	1,816.3		$	1,883.1

See Notes to Condensed Consolidated Financial Statements.

10

DPL INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
	Nine months ended September 30,
$ in millions	2019			2018
Cash flows from operating activities:
Net income	$	61.4		$	41.4
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization	34.2			62.4
Amortization of deferred financing costs	4.3			4.4
Loss on early extinguishment of debt	44.9			6.4
Deferred income taxes	(8.7		)	(17.8		)
Fixed-asset impairment	—			2.8
Loss / (gain) on disposal and sale of business, net	(0.1		)	13.2
Loss / (gain) on asset disposal, net	0.9			(0.6		)
Changes in certain assets and liabilities:
Accounts receivable, net	18.0			34.4
Inventories	(3.2		)	14.7
Taxes applicable to subsequent years	56.2			57.7
Deferred regulatory costs, net	2.9			(4.1		)
Accounts payable	(5.1		)	(17.4		)
Accrued taxes	(71.0		)	(47.1		)
Accrued interest	12.9			13.4
Accrued pension and other post-retirement benefits	(9.3		)	(4.0		)
Other	(2.0		)	(6.9		)
Net cash provided by operating activities	136.3			152.9
Cash flows from investing activities:
Capital expenditures	(122.4		)	(75.8		)
Proceeds from disposal and sale of business	—			234.9
Payments on disposal and sale of business	—			(14.5		)
Proceeds from sale of property	—			10.6
Insurance proceeds	—			2.8
Purchase of renewable energy credits	(3.6		)	—
Other investing activities, net	0.1			(0.5		)
Net cash provided by / (used in) investing activities	(125.9		)	157.5
Cash flows from financing activities:
Payments of deferred financing costs	(9.2		)	—
Issuance of long-term debt, net of discount	821.7			—
Retirement of long-term debt, including early payment premium	(978.0		)	(239.4		)
Borrowings from revolving credit facilities	133.0			30.0
Repayment of borrowings from revolving credit facilities	(35.0		)	(40.0		)
Other financing activities, net	(0.2		)	—
Net cash used in financing activities	(67.7		)	(249.4		)
Decrease in cash and restricted cash of discontinued operations and held-for-sale businesses	—			1.5
Cash, cash equivalents, and restricted cash:
Net change	(57.3		)	62.5
Balance at beginning of period	111.7			24.9
Cash, cash equivalents, and restricted cash at end of period	$	54.4		$	87.4
Supplemental cash flow information:
Interest paid, net of amounts capitalized	$	47.1		$	55.2
Income taxes paid / (refunded), net	$	1.3		$	(2.0	)
Non-cash financing and investing activities:
Accruals for capital expenditures	$	2.3		$	7.6
Non-cash proceeds from sale of business	$	—		$	4.1
Non-cash capital contribution (Note 9)	$	2.7		$	30.2

See Notes to Condensed Consolidated Financial Statements.

11

DPL INC.

Condensed Consolidated Statements of Shareholder's Deficit

(Unaudited)

	Common Stock (a)
$ in millions	Outstanding Shares	Amount		Other Paid-in Capital			Accumulated Other Comprehensive Income			Accumulated Deficit			Total
Balance, January 1, 2018	1	$	—	$	2,330.4		$	0.8		$	(2,915.5	)	$	(584.3	)
Net comprehensive income							3.3			16.9			20.2
Capital contributions (b)				44.6									44.6
Other (c)							(1.0		)	1.0			—
Balance, March 31, 2018	1	—		2,375.0			3.1			(2,897.6		)	(519.5		)
Net comprehensive income							(0.3		)	3.5			3.2
Capital contributions (b)				(17.9		)							(17.9		)
Other				0.1									0.1
Balance, June 30, 2018	1	—		2,357.2			2.8			(2,894.1		)	(534.1		)
Net comprehensive income							—			21.0			21.0
Capital contributions (b)				3.5									3.5
Other				0.1									0.1
Balance, September 30, 2018	1	$	—	$	2,360.8		$	2.8		$	(2,873.1	)	$	(509.5	)

(a) 1,500 shares authorized.

(b) Represents the conversion of a tax sharing payable to AES to contributed capital, as DP&L's 2017 ESP restricts tax sharing payments to AES during the term of the ESP. See Note 9 – Shareholder's Deficit.

(c) ASU 2016-01 “Recognition and Measurement of Financial Assets and Financial Liabilities” was effective as of January 1, 2018. This ASU requires the change in the fair value of equity instruments to be recorded in income rather than in Other Comprehensive Income. Equity Instruments were defined to include all mutual funds, regardless of the underlying investments. Therefore, as of January 1, 2018, AOCI of $1.6 million ($1.0 million net of tax) was reversed to Accumulated deficit.

	Common Stock (a)
$ in millions	Outstanding Shares	Amount		Other Paid-in Capital			Accumulated Other Comprehensive Income / (Loss)			Accumulated Deficit			Total
Balance, January 1, 2019	1	$	—	$	2,370.5		$	2.2		$	(2,844.4	)	$	(471.7	)
Net comprehensive income							(0.4		)	42.1			41.7
Capital contributions (b)				1.5									1.5
Other				0.1									0.1
Balance, March 31, 2019	1	—		2,372.1			1.8			(2,802.3		)	(428.4		)
Net comprehensive loss							(0.8		)	(16.1		)	(16.9		)
Capital contributions (b)				(1.5		)							(1.5		)
Balance, June 30, 2019	1	—		2,370.6			1.0			(2,818.4		)	(446.8		)
Net comprehensive income							(1.0		)	35.4			34.4
Capital contributions (b)				2.7									2.7
Other				0.1									0.1
Balance, September 30, 2019	1	$	—	$	2,373.4		$	—		$	(2,783.0	)	$	(409.6	)

(a) 1,500 shares authorized.

(b) Represents the conversion of a tax sharing payable to AES to contributed capital, as DP&L's 2017 ESP restricts tax sharing payments to AES during the term of the ESP. See Note 9 – Shareholder's Deficit.

See Notes to Condensed Consolidated Financial Statements.

12

DPL Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note 1 – Overview and Summary of Significant Accounting Policies

Description of Business

DPL is a regional energy company organized in 1985 under the laws of Ohio. DPL has one reportable segment: the Utility segment. See Note 11 – Business Segments for more information relating to this reportable segment. The terms “we,” “us,” “our” and “ours” are used to refer to DPL and its subsidiaries.

DPL is an indirectly wholly-owned subsidiary of AES.

DP&L, a wholly-owned subsidiary of DPL, is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 524,000 customers located in West Central Ohio. Additionally, DP&L provides retail SSO electric service to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. Following the issuance of the DRO in September 2018 and the resulting changes to the decoupling rider effective January 1, 2019, DP&L's distribution sales are primarily impacted by customer growth within our service territory. DP&L sells its proportional share of energy and capacity from its investment in OVEC into the wholesale market.

DPL’s other primary subsidiaries include MVIC and AES Ohio Generation. MVIC is our captive insurance company that provides insurance services to DPL and our other subsidiaries. AES Ohio Generation's only operating asset is an undivided interest in Conesville. AES Ohio Generation sells all of its energy and capacity into the wholesale market. DPL's subsidiaries are all wholly-owned.

DPL also has a wholly-owned business trust, DPL Capital Trust II, formed for the purpose of issuing trust capital securities to investors.

DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs.

DPL and its subsidiaries employed 653 people as of September 30, 2019, of which 642 were employed by DP&L. Approximately 57% of all DPL employees are under a collective bargaining agreement, which expires October 31, 2020.

Financial Statement Presentation

DPL’s Condensed Consolidated Financial Statements include the accounts of DPL and its wholly-owned subsidiaries except for DPL Capital Trust II, which is not consolidated, consistent with the provisions of GAAP. As of September 30, 2019, AES Ohio Generation has an undivided ownership interest in one coal-fired generating facility, which is included in the financial statements at a carrying value of zero as it has been fully impaired. Operating revenues and expenses of this facility are included on a pro rata basis in the corresponding lines in the Condensed Consolidated Statements of Operations.

Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation.

All material intercompany accounts and transactions are eliminated in consolidation. We have evaluated subsequent events through the date this report is issued.

These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim

13

report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2018.

In the opinion of our management, the Condensed Consolidated Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2019; our results of operations for the three and nine months ended September 30, 2019 and 2018, our cash flows for the nine months ended September 30, 2019 and 2018 and the changes in our equity for the three and nine months ended September 30, 2019 and 2018. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, interim results for the three and nine months ended September 30, 2019 may not be indicative of our results that will be realized for the full year ending December 31, 2019.

The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: recognition of revenue including unbilled revenues, the carrying value of property, plant and equipment; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits.

Cash, Cash Equivalents, and Restricted Cash

The following table provides a summary of cash, cash equivalents, and restricted cash amounts reported on the Condensed Consolidated Balance Sheet that reconcile to the total of such amounts as shown on the Condensed Consolidated Statements of Cash Flows:

$ in millions	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	36.8	$	90.5
Restricted cash	17.6		21.2
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	54.4	$	111.7

Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities

DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2019 and 2018 were $13.0 million and $13.8 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2019 and 2018 were $37.3 million and $39.2 million, respectively.

New accounting pronouncements adopted in 2019 – The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.

14

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed consolidated financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Consolidated Financial Statements.

15

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed consolidated financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed consolidated financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $70.2 million in gross trade accounts receivable.

Note 2 – Supplemental Financial Information

Accounts receivable and Inventories are as follows at September 30, 2019 and December 31, 2018:

	September 30,			December 31,
$ in millions	2019			2018
Accounts receivable, net:
Customer receivables	$	51.1		$	55.8
Unbilled revenue	15.2			16.8
Amounts due from affiliates	0.2			—
Due from PJM transmission enhancement settlement	2.4			16.5
Other	1.3			2.3
Provision for uncollectible accounts	(0.4		)	(0.9		)
Total accounts receivable, net	$	69.8		$	90.5
Inventories, at average cost:
Fuel and limestone	$	3.0		$	1.9
Materials and supplies	10.0			8.3
Other	—			0.5
Total inventories, at average cost	$	13.0		$	10.7

16

Accumulated Other Comprehensive Income / (Loss)

The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2019 and 2018 are as follows:

Details about Accumulated Other Comprehensive Income / (Loss) components	Affected line item in the Condensed Consolidated Statements of Operations	Three months ended						Nine months ended
		September 30,						September 30,
$ in millions		2019			2018			2019			2018
Gains and losses on cash flow hedges (Note 5):
	Interest expense	$	(0.3	)	$	(0.3	)	$	(0.9	)	$	(0.9	)
	Income tax benefit / (expense)	(0.1		)	0.1			—			0.3
	Net of income taxes	(0.4		)	(0.2		)	(0.9		)	(0.6		)
	Loss from discontinued operations	—			—			—			4.3
	Income tax benefit from discontinued operations	(0.4		)	—			(0.4		)	(1.5		)
	Net of income taxes	(0.4		)	—			(0.4		)	2.8
Amortization of defined benefit pension items (Note 8):
	Other expense	0.1			0.2			0.2			0.5
	Income tax benefit	(0.1		)	(0.1		)	(0.1		)	(0.1		)
	Net of income taxes	—			0.1			0.1			0.4
Total reclassifications for the period, net of income taxes		$	(0.8	)	$	(0.1	)	$	(1.2	)	$	2.6

The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2019 are as follows:

$ in millions	Gains / (losses) on cash flow hedges			Change in unfunded pension and postretirement benefit obligation			Total
Balance at January 1, 2019	$	17.0		$	(14.8	)	$	2.2
Other comprehensive loss before reclassifications	(1.0		)	—			(1.0		)
Amounts reclassified from AOCI to earnings	(1.3		)	0.1			(1.2		)
Net current period other comprehensive income / (loss)	(2.3		)	0.1			(2.2		)
Balance at September 30, 2019	$	14.7		$	(14.7	)	$	—

Operating expenses - other

Operating expenses - other generally includes gains or losses on asset sales or dispositions, insurance recoveries, gains or losses on the sale of businesses and other expense or income from miscellaneous transactions. The components of Operating expenses - other are summarized as follows:

	Three months ended				Nine months ended
	September 30,				September 30,
$ in millions	2019		2018		2019		2018
Loss on disposal and sale of businesses	$	—	$	—	$	—	$	11.7
Fixed-asset impairment	—		1.6		—		2.8
Other	—		—		0.9		0.1
Net other expense / (income)	$	—	$	1.6	$	0.9	$	14.6

Note 3 – Regulatory Matters

DMR

On October 20, 2017, the PUCO approved DP&L’s 2017 ESP.  On January 7, 2019, the Ohio Consumers' Counsel appealed to the Supreme Court of Ohio the 2017 ESP with respect to the bypassability of the Reconciliation Rider and the exclusion of the DMR from the SEET. That proceeding has been stayed pending an appeal in a related case involving another utility.

Pursuant to the 2017 ESP, on January 22, 2019, DP&L filed a request with the PUCO for a two-year extension of its DMR through October 2022, in the proposed amount of $199.0 million for each of the two additional years. The extension request was set at a level expected to reduce debt obligations at both DP&L and DPL and to position

17

DP&L to make capital expenditures to maintain and modernize its electric grid. DP&L’s DMP investments are contingent upon the PUCO approving the two-year extension of its DMR.

A rehearing process in DP&L's 2017 ESP case, including the DMR, remains pending. On August 1, 2019, DP&L filed a supplemental brief with the PUCO focused on the applicability of a recent court decision involving another Ohio utility’s DMR which is similar to, but not identical to, DP&L’s DMR.

Ohio House Bill 6

On July 23, 2019, the Governor of Ohio signed Ohio House Bill 6, which, among other things, does the following:

• beginning January 1, 2020, replaces DP&L’s non-bypassable Reconciliation Rider, permitting DP&L to defer, recover or credit the net proceeds from selling energy and capacity received as part of DP&L’s interest in OVEC and its OVEC-related costs through 2023, with a non-bypassable recovery mechanism for recovery of prudently incurred OVEC costs through 2030;

• eliminates the annual energy efficiency targets for Ohio utilities after 2020; and

• allows Ohio utilities to construct customer-sited renewable generation for mercantile customers or groups of mercantile customers, the costs of which may only be recovered from those customers.

Regulatory impact of tax reform

On January 10, 2018, the PUCO initiated a proceeding to consider the impacts of the TCJA to determine the appropriate course of action to pass benefits resulting from the legislation on to ratepayers. The PUCO also directed Ohio utilities to record deferred liabilities for the estimated reduction in federal income tax resulting from the TCJA beginning January 1, 2018. Beginning October 1, 2018, the new distribution rates approved in the DRO include the impacts of the decrease in current federal income taxes as a result of the TCJA. Under the terms of the stipulation approved in the DRO, DP&L agreed to file an application at the PUCO to refund eligible excess accumulated deferred income taxes and any related regulatory liability over a ten-year period. DP&L made such a filing on March 1, 2019. DP&L negotiated a unanimous stipulation with the parties in the proceeding, agreeing to return a total of $65.1 million, $83.2 million when including taxes associated with the refunds. This stipulation was approved by the PUCO on September 26, 2019. See Note 7 – Income Taxes for additional information. In connection with this stipulation, we reduced our long-term regulatory liability related to deferred income taxes by $23.4 million.

Note 4 – Fair Value

The fair value of current financial assets and liabilities, debt service reserves and other deposits approximate their reported carrying amounts. The estimated fair values of our assets and liabilities have been determined using available market information. By virtue of these amounts being estimates and based on hypothetical transactions to sell assets or transfer liabilities, the use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. For further information on our valuation techniques and policies, see Note 5—Fair Value in Item 8.—Financial Statements and Supplementary Data of our Form 10-K.

The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2019 and December 31, 2018. Further information about the fair value of our derivative instruments can be found in Note 5 – Derivative Instruments and Hedging Activities.

	September 30, 2019				December 31, 2018
$ in millions	Cost		Fair Value		Cost		Fair Value
Assets
Money market funds	$	0.2	$	0.2	$	0.4	$	0.4
Equity securities	2.3		3.9		2.4		3.5
Debt securities	4.1		4.1		4.1		4.0
Hedge funds	0.1		0.1		0.1		0.1
Tangible assets	0.1		0.1		0.1		0.1
Total Assets	$	6.8	$	8.4	$	7.1	$	8.1
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities
Long-term debt	$	1,362.9	$	1,451.3	$	1,475.9	$	1,519.6

18

These financial instruments are not subject to master netting agreements or collateral requirements and as such are presented in the Condensed Consolidated Balance Sheet at their gross fair value, except for Long-term debt, which is presented at amortized carrying value.

We did not have any transfers of the fair values of our financial instruments between Level 1, Level 2 or Level 3 of the fair value hierarchy during the nine months ended September 30, 2019 or 2018.

Master Trust Assets

DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans and these assets are not used for general operating purposes. On January 1, 2018, AOCI of $1.6 million ($1.0 million net of tax) was reversed to Accumulated Deficit and all future changes to fair value on the Master Trust Assets will be included in income in the period that the changes occur. Changes to fair value were not material for the nine months ended September 30, 2019 or 2018. These assets are primarily comprised of open-ended mutual funds, which are valued using the net asset value per unit. These investments are recorded at fair value within Other deferred assets on the Condensed Consolidated Balance Sheets and classified as available for sale.

Long-term debt

The fair value of debt is based on current public market prices for disclosure purposes only. Unrealized gains or losses are not recognized in the financial statements as long-term debt is presented at carrying value, net of unamortized premium or discount and unamortized deferred financing costs in the financial statements. The long-term debt amounts include the current portion payable in the next twelve months and have maturities that range from 2020 to 2061.

The fair value of assets and liabilities at September 30, 2019 and December 31, 2018 and the respective category within the fair value hierarchy for DPL is as follows:

$ in millions	Fair value at September 30, 2019 (a)								Fair value at December 31, 2018 (a)
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Master Trust assets
Money market funds	$	0.2	$	—	$	—	$	0.2	$	0.4	$	—	$	—	$	0.4
Equity securities	—		3.9		—		3.9		—		3.5		—		3.5
Debt securities	—		4.1		—		4.1		—		4.0		—		4.0
Hedge funds	—		0.1		—		0.1		—		0.1		—		0.1
Tangible assets	—		0.1		—		0.1		—		0.1		—		0.1
Total Master Trust assets	0.2		8.2		—		8.4		0.4		7.7		—		8.1
Derivative assets
Interest rate hedges	—		0.2		—		0.2		—		1.5		—		1.5
Total Derivative assets	—		0.2		—		0.2		—		1.5		—		1.5
Total Assets	$	0.2	$	8.4	$	—	$	8.6	$	0.4	$	9.2	$	—	$	9.6
Liabilities
Long-term debt	$	—	$	1,433.7	$	17.6	$	1,451.3	$	—	$	1,501.9	$	17.7	$	1,519.6
Total Liabilities	$	—	$	1,433.7	$	17.6	$	1,451.3	$	—	$	1,501.9	$	17.7	$	1,519.6

(a) Includes credit valuation adjustment

Our financial instruments are valued using the market approach in the following categories:

• Level 1 inputs are used for money market accounts that are considered cash equivalents. The fair value is determined by reference to quoted market prices and other relevant information generated by market transactions.

• Level 2 inputs are used to value derivatives such as interest rate hedge contracts which are valued using a benchmark interest rate. Other Level 2 assets include open-ended mutual funds in the Master Trust, which are valued using the end of day NAV per unit.

• Level 3 inputs such as certain debt balances are considered a Level 3 input because the notes are not publicly traded. Our long-term debt is fair valued for disclosure purposes only.

19

All of the inputs to the fair value of our derivative instruments are from quoted market prices.

Our long-term debt is fair valued for disclosure purposes only and most of the fair values are determined using quoted market prices in inactive markets. These fair value inputs are considered Level 2 in the fair value hierarchy. As the Wright-Patterson Air Force Base note is not publicly traded, fair value is assumed to equal carrying value. These fair value inputs are considered Level 3 in the fair value hierarchy as there are no observable inputs. Additional Level 3 disclosures are not presented since our long-term debt is not recorded at fair value.

Note 5 – Derivative Instruments and Hedging Activities

In the normal course of business, DPL enters into interest rate hedges to manage the interest rate risk of our variable rate debt. All of our derivative instruments are used for risk management purposes and are designated as cash flow hedges if they qualify under FASC 815 for accounting purposes. In prior periods, we have used commodity derivatives principally to manage the risk of changes in market prices for commodities.

Cash Flow Hedges

As part of our risk management processes, we identify the relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. The fair values of cash flow hedges determined by current public market prices will continue to fluctuate with changes in market prices up to contract expiration. With the adoption of ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities effective January 1, 2019, we will no longer be required to calculate effectiveness and thus the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item in the period in which it settles.

As of September 30, 2019, we have two interest rate swaps to hedge the variable interest on our $140.0 million variable interest rate tax-exempt First Mortgage Bonds. The interest rate swaps have a combined notional amount of $140.0 million and settle monthly based on a one-month LIBOR. On March 29, 2018, we settled $60.0 million of these interest rate swaps due to the partial repayment of the underlying debt and a gain of $0.8 million was recorded as a reduction to interest expense. Since the swap was partially settled, the remaining swaps were de-designated and then re-designated with a new hypothetical derivative. The AOCI associated with the remaining swaps will be amortized out of AOCI into interest expense over the remaining life of the underlying debt.

We had previously entered into interest rate derivative contracts to manage interest rate exposure related to anticipated borrowings of fixed-rate debt. These interest rate derivative contracts were settled in 2013 and we continue to amortize amounts out of AOCI into interest expense.

20

The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2019 and 2018:

	Three months ended						Three months ended
	September 30, 2019						September 30, 2018
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	0.4		$	15.3		$	—		$	17.4
Net gains / (losses) associated with current period hedging transactions	—			(0.2		)	—			0.1
Net gains reclassified to earnings
Interest expense	—			(0.4		)	—			(0.2		)
(Income) / loss from discontinued operations	(0.4		)	—			—			—
Ending accumulated derivative gains in AOCI	$	—		$	14.7		$	—		$	17.3
	Nine months ended						Nine months ended
	September 30, 2019						September 30, 2018
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains / (losses) in AOCI	$	0.4		$	16.6		$	(2.8	)	$	17.5
Net gains / (losses) associated with current period hedging transactions	—			(1.0		)	—			0.4
Net (gains) / losses reclassified to earnings
Interest expense	—			(0.9		)	—			(0.6		)
(Income) / loss from discontinued operations	(0.4		)	—			2.8			—
Ending accumulated derivative gains in AOCI	$	—		$	14.7		$	—		$	17.3
Portion expected to be reclassified to earnings in the next twelve months				$	(1.2	)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)				11

Net gains or losses associated with the ineffective portion of the hedging transactions were immaterial in the prior year period presented.

Financial Statement Effect

DPL has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. The fair value derivative position of DPL's interest rate swaps are as follows:

Fair Values of Derivative Instruments
at September 30, 2019
				Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Consolidated Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swap	Designated	$	0.2	$	—	$	—	$	0.2
Total assets		$	0.2	$	—	$	—	$	0.2

(a)    Includes credit valuation adjustment.

21

Fair Values of Derivative Instruments
at December 31, 2018
				Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Consolidated Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swaps	Designated	$	0.9	$	—	$	—	$	0.9
Long-term derivative positions (presented in Other non-current assets)
Interest rate swaps	Designated	0.6		—		—		0.6
Total assets		$	1.5	$	—	$	—	$	1.5

(a)    Includes credit valuation adjustment.

Any prior year ineffectiveness on the interest rate hedges and the monthly settlement of the interest rate hedges is recorded in interest expense within the Condensed Consolidated Statements of Operations.

Note 6 – Long-term Debt

The following table summarizes DPL's long-term debt.

	Interest		September 30,			December 31,
$ in millions	Rate	Maturity	2019			2018
Term loan - rates from 4.50% - 4.53% (a) and 4.01% - 4.60% (b)		2022	$	—		$	436.1
First Mortgage Bonds	3.95%	2049	425.0			—
Tax-exempt First Mortgage Bonds - rates from 2.97% - 3.07% (a) and 1.52% - 1.92% (b)		2020	140.0			140.0
U.S. Government note	4.20%	2061	17.6			17.7
Unamortized deferred financing costs			(5.7		)	(6.3		)
Unamortized debt discounts and premiums, net			(2.7		)	(1.4		)
Total long-term debt at DP&L			574.2			586.1
Senior unsecured bonds	6.75%	2019	—			99.0
Senior unsecured bonds	7.25%	2021	380.0			780.0
Senior unsecured notes	4.35%	2029	400.0			—
Note to DPL Capital Trust II (c)	8.125%	2031	15.6			15.6
Unamortized deferred financing costs			(5.8		)	(4.3		)
Unamortized debt discounts and premiums, net			(1.1		)	(0.5		)
Total long-term debt			1,362.9			1,475.9
Less: current portion			(139.6		)	(103.6		)
Long-term debt, net of current portion			$	1,223.3		$	1,372.3

(a) Range of interest rates for the nine months ended September 30, 2019.

(b) Range of interest rates for the year ended December 31, 2018.

(c) Note payable to related party.

Deferred financing costs are amortized over the remaining life of the debt using the effective interest method. Premiums or discounts on long-term debt are amortized over the remaining life of the debt using the effective interest method.

Line of credit

At September 30, 2019 and December 31, 2018, DPL had outstanding borrowings on its line of credit of $38.0 million and $0.0 million, respectively. At September 30, 2019 and December 31, 2018, DP&L had outstanding borrowings on its line of credit of $60.0 million and $0.0 million, respectively.

Significant transactions

On June 19, 2019, DP&L amended and restated its unsecured revolving credit facility. The revolving credit facility has a $175.0 million borrowing limit, with a $75.0 million letter of credit sublimit, a feature that provides DP&L the

22

ability to increase the size of the facility by an additional $100.0 million, a maturity date of June 2024, and a provision that provides DP&L the option to request up to two one-year extensions of the maturity date.

On June 6, 2019, DP&L closed on a $425.0 million issuance of First Mortgage Bonds due 2049. These new bonds carry an interest rate of 3.95%. The proceeds of this issuance were used to repay in full the outstanding principal of $435.0 million of DP&L's variable rate Term Loan B credit agreement.

On June 19, 2019, DPL amended and restated its secured revolving credit facility. The revolving credit facility has a $125.0 million borrowing limit, with a $75.0 million letter of credit sublimit, a feature that provides DPL the ability to increase the size of the facility by an additional $50.0 million, and a maturity date of June 2023.

On April 17, 2019, DPL closed a $400.0 million issuance of senior unsecured notes. These notes carry an interest rate of 4.35% and mature on April 15, 2029. Proceeds from the issuance and cash on hand were used to settle a partial redemption for $400.0 million of DPL's 7.25% senior unsecured notes maturing October 15, 2021, as discussed below. After the redemption, the DPL 7.25% senior notes due in 2021 have an outstanding balance of $380.0 million.

On April 8, 2019, DPL issued a Notice of Partial Redemption to the Trustee (Wells Fargo Bank N.A.) on the DPL 7.25% Senior Notes due 2021. DPL redeemed $400.0 million of the $780.0 million outstanding principal amount of these notes on May 7, 2019. These bonds were redeemed at par plus accrued interest and a make-whole premium of $41.4 million.

On March 4, 2019, DPL issued a Notice of Full Redemption to the Trustee (U.S. Bank) on the DPL 6.75% Senior Notes due 2019. DPL redeemed the remaining $99.0 million outstanding principal amount of these notes on April 4, 2019. These bonds were redeemed at par plus accrued interest and a make-whole premium of $1.5 million with cash on hand.

On March 30, 2018, DPL issued a Notice of Partial Redemption to the Trustee (U.S. Bank) on the DPL 6.75% Senior Notes due 2019. DPL redeemed $101.0 million of the $200.0 million outstanding principal amount of these notes at par plus accrued interest and a make-whole premium of $5.1 million on April 30, 2018 with cash on hand.

On March 30, 2018, DP&L commenced a redemption of $60.0 million of outstanding tax exempt First Mortgage Bonds due 2020 at par value (plus accrued and unpaid interest). These bonds were redeemed at par plus accrued interest on April 30, 2018 with cash on hand.

On March 27, 2018, DPL made a $70.0 million prepayment to eliminate the outstanding balance of its bank term loan in full. As of March 31, 2018, the term loan was fully paid off.

Long-term debt covenants and restrictions

DPL’s revolving credit agreement has two financial covenants. The first financial covenant, a Total Debt to EBITDA ratio, is calculated at the end of each fiscal quarter by dividing total debt at the end of the current quarter by consolidated EBITDA for the four prior fiscal quarters. The ratio in the agreement is not to exceed 7.00 to 1.00. As of September 30, 2019, this financial covenant was met with a ratio of 5.68 to 1.00.

The second financial covenant is an EBITDA to Interest Expense ratio that is calculated, at the end of each fiscal quarter, by dividing EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period. The ratio, per the agreement, is to be not less than 2.25 to 1.00. As of September 30, 2019, this financial covenant was met with a ratio of 2.99 to 1.00.

DPL’s secured revolving credit agreement also restricts dividend payments from DPL to AES, such that DPL cannot make dividend payments unless at the time of, and/or as a result of the distribution, (i) DPL’s leverage ratio does not exceed 0.67 to 1.00 and DPL’s interest coverage ratio is not less than 2.50 to 1.00 or, if such ratios are not within the parameters, (ii) DPL’s senior long-term debt rating from two of the three major credit rating agencies is at least investment grade. DPL is also restricted from making dividend and tax sharing payments from DPL to AES per its 2017 ESP. This order restricts dividend payments from DPL to AES during the term of the 2017 ESP and restricts tax sharing payments from DPL to AES during the term of the DMR.

DP&L’s Bond Purchase and Covenants Agreement (financing document entered into in connection with the sale of $200.0 million of variable rate tax-exempt First Mortgage Bonds, dated as of August 1, 2015) has two financial

23

covenants. The first measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. DP&L’s Total Debt to Total Capitalization ratio shall not be greater than 0.65 to 1.00. Except that, after Generation Separation and the twelve-month period following (October 1, 2017 to September 30, 2018) the ratio shall be a) increased to 0.75 to 1.00 or b) suspended if DP&L’s long-term indebtedness is less than or equal to $750.0 million. Additionally, this covenant shall be suspended any time after separation during which DP&L maintains a rating of BBB- (or in the case of Moody’s Investors Service, Inc. Baa3) or higher with a stable outlook from at least one of Fitch Investors Service Inc., Standard & Poor’s Ratings Services or Moody’s Investors Service, Inc. The Total Debt to Capitalization covenant is calculated as the sum of DP&L’s current and long-term portion of debt, divided by the total of DP&L’s net worth and total debt. As of September 30, 2019, DP&L's ratings meet those requirements and this covenant is suspended for the quarter ended September 30, 2019.

The second financial covenant measures EBITDA to Interest Expense. The Total Consolidated EBITDA to Consolidated Interest Charges ratio is calculated, at the end of each fiscal quarter, by dividing consolidated EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period. The ratio, per the agreement, is to be not less than 2.50 to 1.00. This financial covenant was met with a ratio of 9.36 to 1.00 as of September 30, 2019.

DP&L's unsecured revolving credit facility has one financial covenant. The covenant measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. DP&L’s Total Debt to Total Capitalization ratio shall not be greater than 0.67 to 1.00. This financial covenant was met with a ratio of 0.58 to 1.00 as of September 30, 2019.

As of September 30, 2019, DPL and DP&L were in compliance with all debt covenants, including the financial covenants described above.

DP&L does not have any meaningful restrictions in its debt financing documents prohibiting dividends to its parent, DPL.

Substantially all property, plant & equipment of DP&L is subject to the lien of the mortgage securing DP&L’s First and Refunding Mortgage.

Note 7 – Income Taxes

The following table details the effective tax rates for the three and nine months ended September 30, 2019 and 2018.

	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
DPL	(35.6)%	16.3%	(9.8)%	15.2%

Income tax expense for the nine months ended September 30, 2019 and 2018 was calculated using the estimated annual effective income tax rates for 2019 and 2018 of (10.1)% and 16.8%, respectively. Management estimates the annual effective tax rate based on its forecast of annual pre-tax income. To the extent that actual pre-tax results for the year differ from the forecasts applied to the most recent interim period, the estimated rates could be materially different from the actual effective tax rates. DPL’s effective combined state and federal income tax rate for all operations was (35.6)% and (9.8)% for the three and nine months ended September 30, 2019, respectively. These rates are lower than the combined federal and state statutory rate of 21.6% primarily due to the flowthrough of the net tax benefit related to the reversal of excess deferred taxes of DP&L and the impact of the September 26, 2019 PUCO order which finalized the amount of excess deferred tax balances allocable to DP&L’s utility customers.

For the nine months ended September 30, 2019, DPL’s current period effective tax rate for all operations was not materially different than the estimated annual effective rate.

Per the terms of DP&L's 2017 ESP, DPL will not make any tax-sharing payments to AES and AES will forgo collection of the payments during the term of the DMR. As such, during the nine months ended September 30, 2019

24

and 2018, DPL converted $2.7 million and $30.2 million, respectively, of accrued tax sharing liabilities with AES to additional equity investment in DPL.

Note 8 – Benefit Plans

DP&L sponsors a defined benefit pension plan for the majority of its employees.

We generally fund pension plan benefits as accrued in accordance with the minimum funding requirements of ERISA and, in addition, make voluntary contributions from time to time. There were $7.5 million in employer contributions during each of the nine months ended September 30, 2019 and 2018.

The amounts presented in the following tables for pension include the collective bargaining plan formula, the traditional management plan formula, the cash balance plan formula and the SERP, in the aggregate. The pension costs below have not been adjusted for amounts billed to the Service Company for former DP&L employees who are now employed by the Service Company that are still participants in the DP&L plan.

The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2019 and 2018 was:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Service cost	$	0.9		$	1.5		$	2.7		$	4.5
Interest cost	3.7			3.4			11.2			10.3
Expected return on plan assets	(5.0		)	(5.3		)	(15.0		)	(15.9		)
Amortization of unrecognized:
Prior service cost	0.3			0.3			0.9			0.8
Actuarial loss	1.1			1.6			3.2			4.8
Net periodic benefit cost	$	1.0		$	1.5		$	3.0		$	4.5

In addition, DP&L provides postretirement health care and life insurance benefits to certain retired employees, their spouses and eligible dependents. We have funded a portion of the union-eligible benefits using a Voluntary Employee Beneficiary Association Trust. These postretirement health care benefits and the related unfunded obligation of $9.0 million at September 30, 2019 and $9.2 million at December 31, 2018 were not material to the financial statements in the periods covered by this report.

Note 9 – Shareholder's Deficit

Capital Contributions from AES

DP&L's approved six-year 2017 ESP restricts DPL from making dividend payments to its parent company, AES, during the term of the ESP, as well as from making tax-sharing payments to AES during the term of the DMR. The 2017 ESP also requires that existing tax payments owed by DPL to AES, and similar tax payments that accrue during the term of the DMR, be converted into equity investments in DPL.

For the nine months ended September 30, 2019 and 2018, AES made capital contributions of $2.7 million and $30.2 million, respectively, by converting the amount owed to it by DPL related to tax-sharing payments for current tax liabilities.

Note 10 – Contractual Obligations, Commercial Commitments and Contingencies

Guarantees

In the normal course of business, DPL enters into various agreements with its wholly-owned subsidiary, AES Ohio Generation, providing financial or performance assurance to third parties. These agreements are entered into primarily to support or enhance the creditworthiness otherwise attributed to this subsidiary on a stand-alone basis, thereby facilitating the extension of sufficient credit to accomplish this subsidiary's intended commercial purposes.

At September 30, 2019, DPL had $21.0 million of guarantees on behalf of AES Ohio Generation to third parties for future financial or performance assurance under such agreements. The guarantee arrangements entered into by DPL with these third parties cover select present and future obligations of AES Ohio Generation to such beneficiaries and are terminable by DPL upon written notice to the beneficiaries within a certain time. At

25

September 30, 2019 and December 31, 2018, we had no outstanding balance of obligations covered by these guarantees.

To date, DPL has not incurred any losses related to the guarantees of AES Ohio Generation’s obligations and we believe it is unlikely that DPL would be required to perform or incur any losses in the future associated with any of the above guarantees.

Equity Ownership Interest

DP&L has a 4.9% equity ownership interest in OVEC, which is recorded using the cost method of accounting under GAAP. DP&L, along with several non-affiliated energy companies party to an OVEC arrangement, receive and pay for OVEC capacity and energy and are responsible for OVEC debt obligations and other fixed costs in proportion to their power participation ratios under the arrangement which, for DP&L, is the same as its equity ownership interest. At September 30, 2019, DP&L could be responsible for the repayment of 4.9%, or $67.2 million, of $1,371.3 million OVEC debt obligations if they came due, comprised of both fixed and variable rate securities with maturities from 2022 to 2040. OVEC could also seek additional contributions from DP&L to avoid a default in the event that other OVEC members defaulted on their respective OVEC obligations. One of the other OVEC members, with a 4.85% interest in OVEC, filed for bankruptcy protection and the bankruptcy court approved that member's rejection of the OVEC arrangement and its related obligations on July 31, 2018. We do not expect these events to have a material impact on our financial condition, results of operations or cash flows.

Contingencies

In the normal course of business, we are subject to various lawsuits, actions, proceedings, claims and other matters asserted under various laws and regulations. We believe the amounts provided in our Condensed Consolidated Financial Statements, as prescribed by GAAP, are adequate considering the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Consolidated Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of September 30, 2019, cannot be reasonably determined.

Environmental Matters

DPL’s and DP&L’s facilities and operations are subject to a wide range of federal, state and local environmental regulations and laws. The environmental issues that may affect us include:

• The federal CAA and state laws and regulations (including State Implementation Plans) which require compliance, obtaining permits and reporting as to air emissions;

• Litigation with federal and certain state governments and certain special interest groups;

• Rules and future rules issued by the USEPA, the Ohio EPA or other authorities associated with the federal Clean Water Act, which prohibits the discharge of pollutants into waters of the United States except pursuant to appropriate permits; and

• Solid and hazardous waste laws and regulations, which govern the management and disposal of certain waste. The majority of solid waste created from the combustion of coal and fossil fuels consists of fly ash and other coal combustion by-products.

In addition to imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at our facilities to comply, or to determine compliance, with such regulations. We record liabilities for loss contingencies related to environmental matters when a loss is probable of occurring and can be reasonably estimated in accordance with the provisions of GAAP. Accordingly, we have immaterial accruals for loss contingencies for environmental matters. We also have several environmental matters for which we have not accrued loss contingencies because the risk of loss is not probable, or a loss cannot be reasonably estimated. We evaluate the potential liability related to environmental matters quarterly and may revise our estimates. Such revisions in the estimates of the potential liabilities could have a material adverse effect on our results of operations, financial condition and cash flows.

26

We have several pending environmental matters associated with our current and previously owned coal-fired generation units. Some of these matters could have a material adverse effect on our results of operations, financial condition and cash flows.

Note 11 – Business Segments

DPL has presented the results of operations of Miami Fort Station, Zimmer Station, the Peaker Assets, Stuart Station, and Killen Station as discontinued operations as a group of components for all periods presented. For more information, see Note 14 – Discontinued Operations of Notes to DPL's Condensed Consolidated Financial Statements. As such, AES Ohio Generation only has operating activity coming from its undivided ownership interest in Conesville, which does not meet the thresholds to be a separate reportable operating segment. Therefore, DPL manages its business through one reportable operating segment, the Utility segment. The primary segment performance measure is income / (loss) from continuing operations before income tax as management has concluded that this measure best reflects the underlying business performance of DPL and is the most relevant measure considered in DPL’s internal evaluation of the financial performance of its segment. The Utility segment is discussed further below.

Utility Segment

The Utility segment is comprised of DP&L’s electric transmission and distribution businesses, which distribute electricity to residential, commercial, industrial and governmental customers. DP&L distributes electricity to more than 524,000 retail customers located in a 6,000-square mile area of West Central Ohio. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses recording regulatory assets when incurred costs are expected to be recovered in future customer rates and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. The Utility segment includes revenues and costs associated with our investment in OVEC and the historical results of DP&L’s Beckjord Facility, which was closed in 2014 and transferred to a third party in the first quarter of 2018, and Hutchings Coal generating facility, which was closed in 2013. These assets did not transfer to AES Ohio Generation as part of DP&L's Generation Separation on October 1, 2017. Thus, they are grouped within the Utility segment for segment reporting purposes. In addition, regulatory deferrals and collections, which include fuel deferrals in historical periods, are included in the Utility segment.

Included within the “Other” column are other businesses that do not meet the GAAP requirements for disclosure as reportable segments as well as certain corporate costs, which include interest expense and loss on early extinguishment of debt on DPL's long-term debt as well as adjustments related to purchase accounting from the Merger. DPL's undivided interest in Conesville is included within the "Other" column as it does not meet the requirement for disclosure as a reportable operating segment, since the results of operations of the other EGUs are presented as discontinued operations. The accounting policies of the reportable segment are the same as those described in Note 1 – Overview and Summary of Significant Accounting Policies of our 10-K. Intersegment sales, costs of sales and expenses are eliminated in consolidation. Certain shared and corporate costs are allocated between "Other" and the Utility reporting segment.

27

The following tables present financial information for DPL’s Utility reportable business segment:

$ in millions	Utility		Other			Adjustments and Eliminations			DPL Consolidated
Three months ended September 30, 2019
Revenues from external customers	$	190.9	$	8.1		$	—		$	199.0
Intersegment revenues	0.2		0.8			(1.0		)	—
Total revenues	$	191.1	$	8.9		$	(1.0	)	$	199.0
Depreciation and amortization	$	17.4	$	0.3		$	—		$	17.7
Interest expense	$	6.1	$	12.2		$	—		$	18.3
Income / (loss) from continuing operations before income tax	$	37.7	$	(11.2	)	$	—		$	26.5
Cash capital expenditures	$	58.9	$	0.1		$	—		$	59.0
$ in millions	Utility		Other (a)			Adjustments and Eliminations			DPL Consolidated
Three Months Ended September 30, 2018
Revenues from external customers	$	198.5	$	9.2		$	—		$	207.7
Intersegment revenues	0.2		0.7			(0.9		)	—
Total revenues	$	198.7	$	9.9		$	(0.9	)	$	207.7
Depreciation and amortization	$	19.1	$	0.6		$	—		$	19.7
Interest expense	$	5.8	$	16.8		$	—		$	22.6
Income / (loss) from continuing operations before income tax	$	37.5	$	(17.7	)	$	—		$	19.8
Cash capital expenditures	$	20.5	$	4.6		$	—		$	25.1
$ in millions	Utility		Other			Adjustments and Eliminations			DPL Consolidated
Nine months ended September 30, 2019
Revenues from external customers	$	569.4	$	22.8		$	—		$	592.2
Intersegment revenues	0.8		2.4			(3.2		)	—
Total revenues	$	570.2	$	25.2		$	(3.2	)	$	592.2
Depreciation and amortization	$	52.9	$	1.2		$	—		$	54.1
Interest expense	$	19.9	$	43.8		$	—		$	63.7
Loss on early extinguishment of debt	$	—	$	44.9		$	—		$	44.9
Income / (loss) from continuing operations before income tax	$	108.8	$	(85.8	)	$	—		$	23.0
Cash capital expenditures	$	121.1	$	1.3		$	—		$	122.4
$ in millions	Utility		Other (a)			Adjustments and Eliminations			DPL Consolidated
Nine months ended September 30, 2018
Revenues from external customers	$	562.9	$	28.6		$	—		$	591.5
Intersegment revenues	0.6		2.1			(2.7		)	—
Total revenues	$	563.5	$	30.7		$	(2.7	)	$	591.5
Depreciation and amortization	$	56.5	$	2.3		$	—		$	58.8
Interest expense	$	20.5	$	53.9		$	—		$	74.4
Income / (loss) from continuing operations before income tax	$	73.9	$	(60.2	)	$	—		$	13.7
Cash capital expenditures	$	65.0	$	10.8		$	—		$	75.8

(a) "Other" includes Cash capital expenditures related to assets of discontinued operations and held-for-sale businesses for the three and nine months ended September 30, 2018.

28

Total Assets	September 30, 2019		December 31, 2018
Utility	$	1,779.4	$	1,819.6
All Other (a)	36.9		63.5
DPL Consolidated	$	1,816.3	$	1,883.1

(a) "All Other" includes Total assets related to the assets of discontinued operations and held-for-sale businesses and Eliminations for all periods presented.

Note 12 – Revenue

Revenue is primarily earned from retail and wholesale electricity sales and electricity transmission and distribution delivery services. Revenue is recognized upon transfer of control to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. Revenue is recorded net of any taxes assessed on and collected from customers, which are remitted to the governmental authorities. For further discussion of our Retail, Wholesale, RTO ancillary, and Capacity revenues, see Note 14 — Revenue in Item 8.—Financial Statements and Supplementary Data of our Form 10-K.

DPL's revenue from contracts with customers was $195.0 million and $195.1 million for the three months ended September 30, 2019 and 2018, respectively, and $576.5 million and $560.1 million for the nine months ended September 30, 2019 and 2018, respectively.

29

The following table presents our revenue from contracts with customers and other revenue by segment for the three and nine months ended September 30, 2019 and 2018:

$ in millions	Utility		Other			Adjustments and Eliminations			Total
	Three Months Ended September 30, 2019
Retail revenue
Retail revenue from contracts with customers	$	170.5	$	—		$	—		$	170.5
Other retail revenue (a)	3.8		—			—			3.8
Wholesale revenue
Wholesale revenue from contracts with customers	4.4		5.0			(0.2		)	9.2
RTO ancillary revenue	11.0		0.1			—			11.1
Capacity revenue	1.1		1.1			—			2.2
Miscellaneous revenue from contracts with customers (b)	—		2.0			—			2.0
Miscellaneous revenue	0.3		0.7			(0.8		)	0.2
Total revenues	$	191.1	$	8.9		$	(1.0	)	$	199.0
	Three Months Ended September 30, 2018
Retail revenue
Retail revenue from contracts with customers	$	168.4	$	—		$	(0.4	)	$	168.0
Other retail revenue (a)	12.6		—			—			12.6
Wholesale revenue
Wholesale revenue from contracts with customers	4.9		5.6			—			10.5
RTO ancillary revenue	10.8		(0.1		)	—			10.7
Capacity revenue	2.0		1.7			—			3.7
Miscellaneous revenue from contracts with customers (b)	—		2.2			—			2.2
Miscellaneous revenue	—		0.5			(0.5		)	—
Total revenues	$	198.7	$	9.9		$	(0.9	)	$	207.7
	Nine months ended September 30, 2019
Retail revenue
Retail revenue from contracts with customers	$	503.8	$	—		$	—		$	503.8
Other retail revenue (a)	14.9		—			—			14.9
Wholesale revenue
Wholesale revenue from contracts with customers	12.8		11.4			(0.8		)	23.4
RTO ancillary revenue	32.8		0.2			—			33.0
Capacity revenue	5.0		4.2			—			9.2
Miscellaneous revenue from contracts with customers (b)	—		7.1			—			7.1
Miscellaneous revenue	0.9		2.3			(2.4		)	0.8
Total revenues	$	570.2	$	25.2		$	(3.2	)	$	592.2
	Nine months ended September 30, 2018
Retail revenue
Retail revenue from contracts with customers	$	469.3	$	—		$	(0.8	)	$	468.5
Other retail revenue (a)	31.4		—			—			31.4
Wholesale revenue
Wholesale revenue from contracts with customers	24.6		16.7			—			41.3
RTO ancillary revenue	32.4		0.1			—			32.5
Capacity revenue	5.8		4.7			—			10.5
Miscellaneous revenue from contracts with customers (b)	—		7.3			—			7.3
Miscellaneous revenue	—		1.9			(1.9		)	—
Total revenues	$	563.5	$	30.7		$	(2.7	)	$	591.5

(a) Other retail revenue primarily includes alternative revenue programs not accounted for under FASC 606.

(b) Miscellaneous revenue from contracts with customers primarily includes revenues for various services provided by Miami Valley Lighting.

The balances of receivables from contracts with customers were $66.3 million and $72.6 million as of September 30, 2019 and December 31, 2018, respectively. Payment terms for all receivables from contracts with customers are typically within 30 days.

Note 13 – Dispositions

Beckjord Facility – On February 26, 2018, DP&L and its co-owners of the retired Beckjord Facility agreed to transfer their interests in the retired Facility to a third party, including their obligations to remediate the Facility and its site,

30

and the transfer occurred on that same date. As a result, DPL recognized a loss on the transfer of $11.7 million and made cash expenditures of $14.5 million, inclusive of cash expenditures for the transfer charges. The Beckjord Facility was retired in 2014, and, as such, the income / (loss) from continuing operations before income tax related to the Beckjord Facility was immaterial for the three and nine months ended September 30, 2018, excluding the loss on transfer noted above. Prior to the transfer, the Beckjord Facility was included in the Utility segment.

Note 14 – Discontinued Operations

On December 8, 2017, DPL and AES Ohio Generation completed the sale of their entire undivided interest in the Miami Fort Station and the Zimmer Station. On March 27, 2018, DPL and AES Ohio Generation completed the sale of the Peaker assets to Kimura Power, LLC, and this transaction resulted in a loss on sale of $1.9 million for the nine months ended September 30, 2018. Further, on May 31, 2018, DPL and AES Ohio Generation retired the Stuart Station coal-fired and diesel-fired generating units and the Killen Station coal-fired generating unit and combustion turbine as planned.

Consequently, we determined that the disposal of this group of components, as a whole, represents a strategic shift to exit generation, and, as such, qualifies to be presented as discontinued operations. Therefore, the results of operations, assets and liabilities of this group of components were reported as such in the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets for all periods presented.

The following table summarizes the major categories of assets and liabilities at the dates indicated:

$ in millions	September 30, 2019			December 31, 2018
Accounts receivable, net	$	6.8		$	4.0
Taxes applicable to subsequent years	0.6			2.3
Prepayments and other current assets	0.9			2.4
Intangible assets, net of amortization	0.2			5.3
Total assets of the disposal group classified as assets of discontinued operations and held-for-sale businesses in the balance sheets	$	8.5		$	14.0
Accounts payable	$	4.3		$	3.9
Accrued taxes	2.4			3.1
Accrued and other current liabilities	3.2			5.2
Deferred income taxes (a)	(33.2		)	(39.8		)
Taxes payable	—			2.3
Accrued pension and other post-retirement benefits	—			9.7
Asset retirement obligations	70.4			90.4
Other non-current liabilities	15.2			6.6
Total liabilities of the disposal group classified as liabilities of discontinued operations and held-for-sale businesses in the balance sheets	$	62.3		$	81.4

(a) Deferred income taxes represent the tax asset position of the discontinued group of components, which were netted with liabilities on DPL prior to classification as discontinued operations.

The following table summarizes the revenues, operating costs, other expenses and income tax of discontinued operations for the periods indicated:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Revenues	$	10.1		$	15.6		$	41.0		$	141.8
Operating costs and other expenses	(10.5		)	(10.6		)	(8.2		)	(105.1		)
Income from discontinued operations	(0.4		)	5.0			32.8			36.7
Gain / (loss) from disposal of discontinued operations	—			0.3			0.1			(1.6		)
Income tax expense from discontinued operations	0.1			1.0			7.1			5.9
Net income from discontinued operations	$	(0.5	)	$	4.3		$	25.8		$	29.2

Cash flows related to discontinued operations are included in our Condensed Consolidated Statements of Cash Flows. Cash flows from operating activities for discontinued operations were $(0.5) million and $(7.2) million for the three months ended September 30, 2019 and 2018, respectively, and $12.4 million and $37.2 million for the nine months ended September 30, 2019 and 2018, respectively. Cash flows from investing activities for discontinued operations were $233.8 million for the nine months ended September 30, 2018. There were no cash flows from

31

investing activities for the three and nine months ended September 30, 2019 or for the three months ended September 30, 2018.

AROs of Discontinued Operations

DPL's retired Stuart and Killen generating facilities continue to carry ARO liabilities consisting primarily of river intake and discharge structures, coal unloading facilities, landfills and ash disposal facilities. In the first quarter of 2019, DPL reduced the ARO liability related to the Stuart and Killen ash ponds and landfills by a combined $22.5 million based on updated internal analyses that reduced estimated closure costs associated with these ash ponds and landfills. The remaining ARO liability related to Stuart and Killen is included in the Asset retirement obligations balance in the total liabilities of the disposal group classified as liabilities of discontinued operations and held-for-sale businesses in the balance sheets as of September 30, 2019 above. As these plants are no longer in service, the reduction to the ARO liability was also recorded as a credit to depreciation and amortization expense in the same amount. The credit to depreciation and amortization expense is included in operating costs and other expenses of discontinued operations for the nine months ended September 30, 2019 in the table above.

32

FINANCIAL STATEMENTS

The Dayton Power and Light Company

33

THE DAYTON POWER AND LIGHT COMPANY
Condensed Statements of Operations
(Unaudited)
	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Revenues	$	191.1		$	198.7		$	570.2		$	563.5
Operating costs and expenses
Net fuel cost	0.6			0.1			2.0			1.7
Net purchased power cost	65.9			83.0			193.3			235.7
Operation and maintenance	42.2			33.8			135.2			105.9
Depreciation and amortization	17.4			19.1			52.9			56.5
Taxes other than income taxes	20.8			19.0			58.2			54.3
Loss / (gain) on asset disposal	(0.1		)	—			—			0.1
Loss on disposal of business (Note 12)	—			—			—			12.4
Total operating costs and expenses	146.8			155.0			441.6			466.6
Operating income	44.3			43.7			128.6			96.9
Other income / (expense), net:
Interest expense	(6.1		)	(5.8		)	(19.9		)	(20.5		)
Loss on early extinguishment of debt	—			—			—			(0.6		)
Other income / (expense)	(0.5		)	(0.4		)	0.1			(1.9		)
Total other expense, net	(6.6		)	(6.2		)	(19.8		)	(23.0		)
Income before income tax	37.7			37.5			108.8			73.9
Income tax expense / (benefit)	(7.2		)	6.3			5.1			12.0
Net income	$	44.9		$	31.2		$	103.7		$	61.9

See Notes to Condensed Financial Statements.

34

THE DAYTON POWER AND LIGHT COMPANY
Condensed Statements of Comprehensive Income
(Unaudited)
	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Net income	$	44.9		$	31.2		$	103.7		$	61.9
Derivative activity:
Change in derivative fair value, net of income tax (expense) / benefit of $0.0, $(0.1), $0.2 and $(0.1) for each respective period	(0.1		)	—			(0.9		)	0.5
Reclassification to earnings, net of income tax expense of $0.0, $0.1, $0.0 and $0.6 for each respective period	—			(0.2		)	(0.1		)	(0.5		)
Total change in fair value of derivatives	(0.1		)	(0.2		)	(1.0		)	—
Pension and postretirement activity:
Reclassification to earnings, net of income tax (benefit) / expense of $0.9, $(0.2), $(0.5) and $(0.7) for each respective period	1.7			0.8			2.1			2.5
Total change in unfunded pension and postretirement obligations	1.7			0.8			2.1			2.5
Other comprehensive income	1.6			0.6			1.1			2.5
Net comprehensive income	$	46.5		$	31.8		$	104.8		$	64.4

See Notes to Condensed Financial Statements.

35

THE DAYTON POWER AND LIGHT COMPANY
Condensed Balance Sheets
(Unaudited)
$ in millions	September 30, 2019			December 31, 2018
ASSETS
Current assets:
Cash and cash equivalents	$	14.4		$	45.0
Restricted cash	17.6			21.2
Accounts receivable, net (Note 2)	71.7			90.4
Inventories (Note 2)	9.8			7.7
Taxes applicable to subsequent years	18.1			72.4
Regulatory assets, current	40.2			41.1
Taxes receivable	17.4			19.6
Prepayments and other current assets	8.6			13.3
Total current assets	197.8			310.7
Property, plant & equipment:
Property, plant & equipment	2,306.5			2,274.4
Less: Accumulated depreciation and amortization	(1,010.4		)	(988.0		)
	1,296.1			1,286.4
Construction work in process	93.0			31.7
Total net property, plant & equipment	1,389.1			1,318.1
Other non-current assets:
Regulatory assets, non-current	154.7			152.6
Intangible assets, net of amortization	18.1			17.2
Other non-current assets	19.7			21.0
Total other non-current assets	192.5			190.8
Total assets	$	1,779.4		$	1,819.6
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities:
Short-term and current portion of long-term debt (Note 6)	$	199.6		$	4.6
Accounts payable	51.1			55.8
Accrued taxes	78.5			75.7
Accrued interest	6.5			0.4
Customer deposits	20.3			21.3
Regulatory liabilities, current	36.5			34.9
Accrued and other current liabilities	16.8			17.5
Total current liabilities	409.3			210.2
Non-current liabilities:
Long-term debt (Note 6)	434.6			581.5
Deferred income taxes	132.5			131.7
Taxes payable	4.9			77.1
Regulatory liabilities, non-current	252.3			278.3
Accrued pension and other post-retirement benefits	73.9			83.2
Asset retirement obligations	4.7			4.7
Other non-current liabilities	7.4			7.6
Total non-current liabilities	910.3			1,164.1
Commitments and contingencies (Note 10)
Common shareholder's equity:
Common stock, at par value of $0.01 per share	0.4			0.4
50,000,000 shares authorized, 41,172,173 shares issued and outstanding
Other paid-in capital	621.9			711.8
Accumulated other comprehensive loss	(34.2		)	(35.3		)
Accumulated deficit	(128.3		)	(231.6		)
Total common shareholder's equity	459.8			445.3
Total liabilities and shareholder's equity	$	1,779.4		$	1,819.6

See Notes to Condensed Financial Statements.

36

THE DAYTON POWER AND LIGHT COMPANY
Condensed Statements of Cash Flows
(Unaudited)
	Nine months ended September 30,
$ in millions	2019			2018
Cash flows from operating activities:
Net income	$	103.7		$	61.9
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization	52.9			56.5
Loss on early extinguishment of debt	—			0.6
Deferred income taxes	(17.2		)	(7.5		)
Loss on disposal of business	—			12.4
Changes in certain assets and liabilities:
Accounts receivable, net	18.9			(3.3		)
Inventories	(2.1		)	(0.2		)
Taxes applicable to subsequent years	54.3			54.0
Deferred regulatory costs, net	2.9			(4.1		)
Accounts payable	(4.8		)	(1.1		)
Accrued taxes payable / receivable	(65.6		)	(58.7		)
Accrued interest	6.0			(0.3		)
Accrued pension and other post-retirement benefits	(9.3		)	(3.1		)
Other	(0.8		)	6.1
Net cash provided by operating activities	138.9			113.2
Cash flows from investing activities:
Capital expenditures	(121.1		)	(65.0		)
Insurance proceeds	—			0.1
Payments on disposal of business	—			(14.5		)
Proceeds from sale of property	—			10.6
Other investing activities, net	(3.5		)	(0.2		)
Net cash used in investing activities	(124.6		)	(69.0		)
Cash flows from financing activities:
Payments of deferred financing costs	(4.6		)	—
Returns of capital paid to parent	(90.0		)	(43.8		)
Capital contributions from parent	—			80.0
Borrowings from revolving credit facilities	60.0			30.0
Repayment of borrowings from revolving credit facilities	—			(40.0		)
Issuance of long-term debt, net of discount	422.3			—
Retirement of long-term debt, including early payment premium	(436.1		)	(63.3		)
Other financing activities, net	(0.1		)	—
Net cash used in financing activities	(48.5		)	(37.1		)
Cash, cash equivalents, and restricted cash:
Net change	(34.2		)	7.1
Balance at beginning of period	66.2			5.6
Cash, cash equivalents, and restricted cash at end of period	$	32.0		$	12.7
Supplemental cash flow information:
Interest paid, net of amounts capitalized	$	10.8		$	17.0
Income taxes paid, net	$	19.0		$	8.3
Non-cash financing and investing activities:
Accruals for capital expenditures	$	2.0		$	7.2

See Notes to Condensed Financial Statements.

37

THE DAYTON POWER AND LIGHT COMPANY

Condensed Statements of Shareholder's Equity

(Unaudited)

	Common Stock (a)
$ in millions	Outstanding Shares	Amount		Other Paid-in Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total
Balance, January 1, 2018	41,172,173	$	0.4	$	685.8		$	(36.2	)	$	(319.3	)	$	330.7
Net comprehensive income							1.1			15.7			16.8
Return of capital				(23.8		)							(23.8		)
Capital contributions from parent				80.0									80.0
Other (b)				(0.3		)	(1.1		)	1.0			(0.4		)
Balance, March 31, 2018	41,172,173	0.4		741.7			(36.2		)	(302.6		)	403.3
Net comprehensive income							0.8			15.0			15.8
Balance, June 30, 2018	41,172,173	0.4		741.7			(35.4		)	(287.6		)	419.1
Net comprehensive income / (loss)							0.6			31.2			31.8
Return of capital				(20.0		)							(20.0		)
Other				0.1									0.1
Balance, September 30, 2018	41,172,173	$	0.4	$	721.8		$	(34.8	)	$	(256.4	)	$	431.0

(a) $0.01 par value, 50,000,000 shares authorized.

(b) ASU 2016-01 “Recognition and Measurement of Financial Assets and Financial Liabilities” was effective as of January 1, 2018. This ASU requires the change in the fair value of equity instruments to be recorded in income rather than in Other Comprehensive Income. Equity Instruments were defined to include all mutual funds, regardless of the underlying investments. Therefore, as of January 1, 2018, AOCI of $1.7 million ($1.1 million net of tax) was reversed to Accumulated deficit.

	Common Stock (a)
$ in millions	Outstanding Shares	Amount		Other Paid-in Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total
Balance, January 1, 2019	41,172,173	$	0.4	$	711.8		$	(35.3	)	$	(231.6	)	$	445.3
Net comprehensive income							0.4			29.0			29.4
Other										(0.3		)	(0.3		)
Balance, March 31, 2019	41,172,173	0.4		711.8			(34.9		)	(202.9		)	474.4
Net comprehensive income							(0.9		)	29.8			28.9
Return of capital				(70.0		)							(70.0		)
Balance, June 30, 2019	41,172,173	0.4		641.8			(35.8		)	(173.1		)	433.3
Net comprehensive income / (loss)							1.6			44.9			46.5
Return of capital				(20.0		)							(20.0		)
Other				0.1						(0.1		)	—
Balance, September 30, 2019	41,172,173	$	0.4	$	621.9		$	(34.2	)	$	(128.3	)	$	459.8

(a) $0.01 par value, 50,000,000 shares authorized.

See Notes to Condensed Financial Statements.

38

The Dayton Power and Light Company

Notes to Condensed Financial Statements (Unaudited)

Note 1 – Overview and Summary of Significant Accounting Policies

Description of Business

DP&L is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 524,000 customers located in West Central Ohio. Additionally, DP&L provides retail SSO electric service to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio. As a result of Generation Separation, DP&L now only has one reportable segment, the Utility segment. In addition to DP&L's electric transmission and distribution businesses, the Utility segment includes revenues and costs associated with DP&L's investment in OVEC and the historical results of DP&L’s Beckjord and Hutchings Coal generating facilities, which have either been closed or sold. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. Following the issuance of the DRO in September 2018 and the resulting changes to the decoupling rider effective January 1, 2019, DP&L's distribution sales are primarily impacted by customer growth within our service territory. DP&L sells its proportional share of energy and capacity from its investment in OVEC into the wholesale market. DP&L is a subsidiary of DPL. The terms “we,” “us,” “our” and “ours” are used to refer to DP&L.

DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs.

DP&L employed 642 people as of September 30, 2019. Approximately 58% of DP&L employees are under a collective bargaining agreement, which expires October 31, 2020.

Financial Statement Presentation

DP&L does not have any subsidiaries.

We have evaluated subsequent events through the date this report is issued.

Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation.

These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2018.

In the opinion of our management, the Condensed Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2019; our results of operations for the three and nine months ended September 30, 2019 and 2018, our cash flows for the nine months ended September 30, 2019 and 2018 and the changes in our equity for the three and nine months ended September 30, 2019 and 2018. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, interim results for the three and nine months ended September 30, 2019 may not be indicative of our results that will be realized for the full year ending December 31, 2019.

The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: recognition of revenue including unbilled revenues, the carrying value of property, plant and equipment; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and

39

liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits.

Cash, Cash Equivalents, and Restricted Cash

The following table provides a summary of cash, cash equivalents, and restricted cash amounts reported on the Condensed Balance Sheet that reconcile to the total of such amounts as shown on the Condensed Statements of Cash Flows:

$ in millions	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	14.4	$	45.0
Restricted cash	17.6		21.2
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	32.0	$	66.2

Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities

DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2019 and 2018 were $13.0 million and $13.8 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2019 and 2018 were $37.3 million and $39.2 million, respectively.

New accounting pronouncements adopted in 2019 – The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the

40

plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $72.1 million in gross trade accounts receivable.

41

Note 2 – Supplemental Financial Information

Accounts receivable and Inventories are as follows at September 30, 2019 and December 31, 2018:

	September 30,			December 31,
$ in millions	2019			2018
Accounts receivable, net:
Customer receivables	$	50.0		$	53.3
Unbilled revenue	15.2			16.8
Amounts due from affiliates	3.2			2.3
Due from PJM transmission enhancement settlement	2.4			16.5
Other	1.3			2.4
Provision for uncollectible accounts	(0.4		)	(0.9		)
Total accounts receivable, net	$	71.7		$	90.4
Inventories, at average cost:
Materials and supplies	$	9.8		$	7.1
Other	—			0.6
Total inventories, at average cost	$	9.8		$	7.7

Accumulated Other Comprehensive Income / (Loss)

The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2019 and 2018 are as follows:

Details about Accumulated Other Comprehensive Income / (Loss) components	Affected line item in the Condensed Statements of Operations	Three months ended					Nine months ended
		September 30,					September 30,
$ in millions		2019		2018			2019			2018
Gains and losses on cash flow hedges (Note 5):
	Interest expense	$	—	$	(0.3	)	$	(0.1	)	$	(1.1	)
	Income tax expense	—		0.1			—			0.6
	Net of income taxes	—		(0.2		)	(0.1		)	(0.5		)
Amortization of defined benefit pension items (Note 8):
	Other expense	0.8		1.0			2.6			3.2
	Income tax expense / (benefit)	0.9		(0.2		)	(0.5		)	(0.7		)
	Net of income taxes	1.7		0.8			2.1			2.5
Total reclassifications for the period, net of income taxes		$	1.7	$	0.6		$	2.0		$	2.0

The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2019 are as follows:

$ in millions	Gains / (losses) on cash flow hedges			Change in unfunded pension and postretirement benefit obligation			Total
Balance at January 1, 2019	$	0.6		$	(35.9	)	$	(35.3	)
Other comprehensive loss before reclassifications	(0.9		)	—			(0.9		)
Amounts reclassified from AOCI to earnings	(0.1		)	2.1			2.0
Net current period other comprehensive income / (loss)	(1.0		)	2.1			1.1
Balance at September 30, 2019	$	(0.4	)	$	(33.8	)	$	(34.2	)

Note 3 – Regulatory Matters

DMR

On October 20, 2017, the PUCO approved DP&L’s 2017 ESP.  On January 7, 2019, the Ohio Consumers' Counsel appealed to the Supreme Court of Ohio the 2017 ESP with respect to the bypassability of the Reconciliation Rider and the exclusion of the DMR from the SEET. That proceeding has been stayed pending an appeal in a related case involving another utility.

42

Pursuant to the 2017 ESP, on January 22, 2019, DP&L filed a request with the PUCO for a two-year extension of its DMR through October 2022, in the proposed amount of $199.0 million for each of the two additional years. The extension request was set at a level expected to reduce debt obligations at both DP&L and DPL and to position DP&L to make capital expenditures to maintain and modernize its electric grid. DP&L’s DMP investments are contingent upon the PUCO approving the two-year extension of its DMR.

A rehearing process in DP&L's 2017 ESP case, including the DMR, remains pending. On August 1, 2019, DP&L filed a supplemental brief with the PUCO focused on the applicability of a recent court decision involving another Ohio utility’s DMR which is similar to, but not identical to, DP&L’s DMR.

Ohio House Bill 6

On July 23, 2019, the Governor of Ohio signed Ohio House Bill 6, which, among other things, does the following:

• beginning January 1, 2020, replaces DP&L’s non-bypassable Reconciliation Rider, permitting DP&L to defer, recover or credit the net proceeds from selling energy and capacity received as part of DP&L’s interest in OVEC and its OVEC-related costs through 2023, with a non-bypassable recovery mechanism for recovery of prudently incurred OVEC costs through 2030;

• eliminates the annual energy efficiency targets for Ohio utilities after 2020; and

• allows Ohio utilities to construct customer-sited renewable generation for mercantile customers or groups of mercantile customers, the costs of which may only be recovered from those customers.

Regulatory impact of tax reform

On January 10, 2018, the PUCO initiated a proceeding to consider the impacts of the TCJA to determine the appropriate course of action to pass benefits resulting from the legislation on to ratepayers. The PUCO also directed Ohio utilities to record deferred liabilities for the estimated reduction in federal income tax resulting from the TCJA beginning January 1, 2018. Beginning October 1, 2018, the new distribution rates approved in the DRO include the impacts of the decrease in current federal income taxes as a result of the TCJA. Under the terms of the stipulation approved in the DRO, DP&L agreed to file an application at the PUCO to refund eligible excess accumulated deferred income taxes and any related regulatory liability over a ten-year period. DP&L made such a filing on March 1, 2019. DP&L negotiated a unanimous stipulation with the parties in the proceeding, agreeing to return a total of $65.1 million, $83.2 million when including taxes associated with the refunds. This stipulation was approved by the PUCO on September 26, 2019. See Note 7 – Income Taxes for additional information. In connection with this stipulation, we reduced our long-term regulatory liability related to deferred income taxes by $23.4 million.

Note 4 – Fair Value

The fair value of current financial assets and liabilities, debt service reserves and other deposits approximate their reported carrying amounts. The estimated fair values of our assets and liabilities have been determined using available market information. By virtue of these amounts being estimates and based on hypothetical transactions to sell assets or transfer liabilities, the use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. For further information on our valuation techniques and policies, see Note 5—Fair Value in Item 8.—Financial Statements and Supplementary Data of our Form 10-K.

The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2019 and December 31, 2018. Further information about the fair value of our derivative instruments can be found in Note 5 – Derivative Instruments and Hedging Activities.

	September 30, 2019				December 31, 2018
$ in millions	Cost		Fair Value		Cost		Fair Value
Assets
Money market funds	$	0.2	$	0.2	$	0.4	$	0.4
Equity securities	2.3		3.9		2.4		3.5
Debt securities	4.1		4.1		4.1		4.0
Hedge funds	0.1		0.1		0.1		0.1
Tangible assets	0.1		0.1		0.1		0.1
Total assets	$	6.8	$	8.4	$	7.1	$	8.1
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities
Long-term debt	$	574.2	$	631.0	$	586.1	$	593.8

43

These financial instruments are not subject to master netting agreements or collateral requirements and as such are presented in the Condensed Balance Sheet at their gross fair value, except for Long-term debt, which is presented at amortized carrying value.

We did not have any transfers of the fair values of our financial instruments between Level 1, Level 2 or Level 3 of the fair value hierarchy during the nine months ended September 30, 2019 or 2018.

Master Trust Assets

DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans and these assets are not used for general operating purposes. On January 1, 2018, AOCI of $1.7 million ($1.1 million net of tax) was reversed to Accumulated Deficit and all future changes to fair value on the Master Trust Assets will be included in income in the period that the changes occur. Changes to fair value were not material for the nine months ended September 30, 2019 or 2018. These assets are primarily comprised of open-ended mutual funds, which are valued using the net asset value per unit. These investments are recorded at fair value within Other deferred assets on the Condensed Balance Sheets and classified as available for sale.

Long-term debt

The fair value of debt is based on current public market prices for disclosure purposes only. Unrealized gains or losses are not recognized in the financial statements as long-term debt is presented at carrying value, net of unamortized premium or discount and unamortized deferred financing costs in the financial statements. The long-term debt amounts include the current portion payable in the next twelve months and have maturities that range from 2020 to 2061.

The fair value of assets and liabilities at September 30, 2019 and December 31, 2018 and the respective category within the fair value hierarchy for DP&L is as follows:

$ in millions	Fair value at September 30, 2019 (a)								Fair value at December 31, 2018 (a)
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Master Trust assets
Money market funds	$	0.2	$	—	$	—	$	0.2	$	0.4	$	—	$	—	$	0.4
Equity securities	—		3.9		—		3.9		—		3.5		—		3.5
Debt securities	—		4.1		—		4.1		—		4.0		—		4.0
Hedge funds	—		0.1		—		0.1		—		0.1		—		0.1
Tangible assets	—		0.1		—		0.1		—		0.1		—		0.1
Total Master Trust assets	0.2		8.2		—		8.4		0.4		7.7		—		8.1
Derivative assets
Interest rate hedges	—		0.2		—		0.2		—		1.5		—		1.5
Total derivative assets	—		0.2		—		0.2		—		1.5		—		1.5
Total assets	$	0.2	$	8.4	$	—	$	8.6	$	0.4	$	9.2	$	—	$	9.6
Liabilities
Long-term debt	$	—	$	613.4	$	17.6	631.0		$	—	$	576.1	$	17.7	$	593.8
Total liabilities	$	—	$	613.4	$	17.6	$	631.0	$	—	$	576.1	$	17.7	$	593.8

(a) Includes credit valuation adjustment

Our financial instruments are valued using the market approach in the following categories:

• Level 1 inputs are used for money market accounts that are considered cash equivalents. The fair value is determined by reference to quoted market prices and other relevant information generated by market transactions.

• Level 2 inputs are used to value derivatives such as interest rate hedge contracts which are valued using a benchmark interest rate. Other Level 2 assets include open-ended mutual funds in the Master Trust, which are valued using the end of day NAV per unit.

• Level 3 inputs such as certain debt balances are considered a Level 3 input because the notes are not publicly traded. Our long-term debt is fair valued for disclosure purposes only.

44

All of the inputs to the fair value of our derivative instruments are from quoted market prices.

Our long-term debt is fair valued for disclosure purposes only and most of the fair values are determined using quoted market prices in inactive markets. These fair value inputs are considered Level 2 in the fair value hierarchy. As the Wright-Patterson Air Force Base note is not publicly traded, fair value is assumed to equal carrying value. These fair value inputs are considered Level 3 in the fair value hierarchy as there are no observable inputs. Additional Level 3 disclosures are not presented since our long-term debt is not recorded at fair value.

Note 5 – Derivative Instruments and Hedging Activities

In the normal course of business, DP&L enters into interest rate hedges to manage the interest rate risk of our variable rate debt. All of our derivative instruments are used for risk management purposes and are designated as cash flow hedges if they qualify under FASC 815 for accounting purposes. In prior periods, we have used commodity derivatives principally to manage the risk of changes in market prices for commodities.

Cash Flow Hedges

As part of our risk management processes, we identify the relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. The fair values of cash flow hedges determined by current public market prices will continue to fluctuate with changes in market prices up to contract expiration. With the adoption of ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities effective January 1, 2019, we will no longer be required to calculate effectiveness and thus the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item in the period in which it settles.

As of September 30, 2019, we have two interest rate swaps to hedge the variable interest on our $140.0 million variable interest rate tax-exempt First Mortgage Bonds. The interest rate swaps have a combined notional amount of $140.0 million and settle monthly based on a one-month LIBOR. On March 29, 2018, we settled $60.0 million of these interest rate swaps due to the partial repayment of the underlying debt and a gain of $0.8 million was recorded as a reduction to interest expense. Since the swap was partially settled, the remaining swaps were de-designated and then re-designated with a new hypothetical derivative. The AOCI associated with the remaining swaps will be amortized out of AOCI into interest expense over the remaining life of the underlying debt.

The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2019 and 2018:

	Three months ended
	September 30, 2019			September 30, 2018
	Interest			Interest
$ in millions (net of tax)	Rate Hedge			Rate Hedge
Beginning accumulated derivative gains / (losses) in AOCI	$	(0.3	)	$	1.6
Net losses associated with current period hedging transactions	(0.1		)	—
Net gains reclassified to earnings
Interest expense	—			(0.2		)
Ending accumulated derivative gains / (losses) in AOCI	$	(0.4	)	$	1.4
	Nine months ended
	September 30, 2019			September 30, 2018
	Interest			Interest
$ in millions (net of tax)	Rate Hedge			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	0.6		$	1.4
Net gains / (losses) associated with current period hedging transactions	(0.9		)	0.5
Net gains reclassified to earnings
Interest expense	(0.1		)	(0.5		)
Ending accumulated derivative gains / (losses) in AOCI	$	(0.4	)	$	1.4
Portion expected to be reclassified to earnings in the next twelve months	$	(0.2	)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)	11

45

Net gains or losses associated with the ineffective portion of the hedging transactions were immaterial in the prior year period presented.

Financial Statement Effect

DP&L has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. The fair value derivative position of DP&L's interest rate swaps are as follows:

Fair Values of Derivative Instruments
at September 30, 2019
				Gross Amounts Not Offset in the Condensed Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swap	Designated	$	0.2	$	—	$	—	$	0.2
Total assets		$	0.2	$	—	$	—	$	0.2

(a)    Includes credit valuation adjustment.

Fair Values of Derivative Instruments
at December 31, 2018
				Gross Amounts Not Offset in the Condensed Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swaps	Designated	$	0.9	$	—	$	—	$	0.9
Long-term derivative positions (presented in Other non-current assets)
Interest rate swaps	Designated	0.6		—		—		0.6
Total assets		$	1.5	$	—	$	—	$	1.5

(a)    Includes credit valuation adjustment.

Any prior year ineffectiveness on the interest rate hedges and the monthly settlement of the interest rate hedges is recorded in interest expense within the Condensed Statements of Operations.

46

Note 6 – Long-term Debt

The following table summarizes DP&L's long-term debt.

	Interest		September 30,			December 31,
$ in millions	Rate	Maturity	2019			2018
Term loan - rates from 4.50% - 4.53% (a) and 4.01% - 4.60% (b)		2022	$	—		$	436.1
First Mortgage Bonds	3.95%	2049	425.0			—
Tax-exempt First Mortgage Bonds - rates from 2.97% - 3.07% (a) and 1.52% - 1.92% (b)		2020	140.0			140.0
U.S. Government note	4.20%	2061	17.6			17.7
Unamortized deferred financing costs			(5.7		)	(6.3		)
Unamortized debt discounts and premiums, net			(2.7		)	(1.4		)
Total long-term debt			574.2			586.1
Less: current portion			(139.6		)	(4.6		)
Long-term debt, net of current portion			$	434.6		$	581.5

(a) Range of interest rates for the nine months ended September 30, 2019.

(b) Range of interest rates for the year ended December 31, 2018.

Deferred financing costs are amortized over the remaining life of the debt using the effective interest method. Premiums or discounts on long-term debt are amortized over the remaining life of the debt using the effective interest method.

Line of credit

At September 30, 2019 and December 31, 2018, DP&L had outstanding borrowings on its line of credit of $60.0 million and $0.0 million, respectively.

Significant transactions

On June 19, 2019, DP&L amended and restated its unsecured revolving credit facility. The revolving credit facility has a $175.0 million borrowing limit, with a $75.0 million letter of credit sublimit, a feature that provides DP&L the ability to increase the size of the facility by an additional $100.0 million, a maturity date of June 2024, and a provision that provides DP&L the option to request up to two one-year extensions of the maturity date.

On June 6, 2019, DP&L closed on a $425.0 million issuance of First Mortgage Bonds due 2049. These new bonds carry an interest rate of 3.95%. The proceeds of this issuance were used to repay in full the outstanding principal of $435.0 million of DP&L's variable rate Term Loan B credit agreement.

On March 30, 2018, DP&L commenced a redemption of $60.0 million of outstanding tax exempt First Mortgage Bonds due 2020 at par value (plus accrued and unpaid interest). These bonds were redeemed at par plus accrued interest on April 30, 2018 with cash on hand.

Long-term debt covenants and restrictions

DP&L’s Bond Purchase and Covenants Agreement (financing document entered into in connection with the sale of $200.0 million of variable rate tax-exempt First Mortgage Bonds, dated as of August 1, 2015) has two financial covenants. The first measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. DP&L’s Total Debt to Total Capitalization ratio shall not be greater than 0.65 to 1.00. Except that, after Generation Separation and the twelve-month period following (October 1, 2017 to September 30, 2018) the ratio shall be a) increased to 0.75 to 1.00 or b) suspended if DP&L’s long-term indebtedness is less than or equal to $750.0 million. Additionally, this covenant shall be suspended any time after separation during which DP&L maintains a rating of BBB- (or in the case of Moody’s Investors Service, Inc. Baa3) or higher with a stable outlook from at least one of Fitch Investors Service Inc., Standard & Poor’s Ratings Services or Moody’s Investors Service, Inc. The Total Debt to Capitalization covenant is calculated as the sum of DP&L’s current and long-term portion of debt, divided by the total of DP&L’s net worth and total debt. As of September 30, 2019, DP&L's ratings meet those requirements and this covenant is suspended for the quarter ended September 30, 2019.

The second financial covenant measures EBITDA to Interest Expense. The Total EBITDA to Interest Charges ratio is calculated, at the end of each fiscal quarter, by dividing EBITDA for the four prior fiscal quarters by the interest charges for the same period. The ratio, per the agreement, is to be not less than 2.50 to 1.00. This financial covenant was met with a ratio of 9.36 to 1.00 as of September 30, 2019.

47

DP&L's unsecured revolving credit facility has one financial covenant. The covenant measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. DP&L’s Total Debt to Total Capitalization ratio shall not be greater than 0.67 to 1.00. This financial covenant was met with a ratio of 0.58 to 1.00 as of September 30, 2019.

As of September 30, 2019, DP&L was in compliance with all debt covenants, including the financial covenants described above.

DP&L does not have any meaningful restrictions in its debt financing documents prohibiting dividends to its parent, DPL.

Substantially all property, plant & equipment of DP&L is subject to the lien of the mortgage securing DP&L’s First and Refunding Mortgage.

Note 7 – Income Taxes

The following table details the effective tax rates for the three and nine months ended September 30, 2019 and 2018.

	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
DP&L	(19.1)%	16.8%	4.7%	16.2%

Income tax expense for the nine months ended September 30, 2019 and 2018 was calculated using the estimated annual effective income tax rates for 2019 and 2018 of 4.5% and 17.1%, respectively. Management estimates the annual effective tax rate based on its forecast of annual pre-tax income. To the extent that actual pre-tax results for the year differ from the forecasts applied to the most recent interim period, the estimated rates could be materially different from the actual effective tax rates. DP&L’s effective combined state and federal income tax rate was (19.1)% and 4.7% for the three and nine months ended September 30, 2019, respectively. This is lower than the combined federal and state statutory rate of 21.6% primarily due to the net tax benefit related to the reversal of excess deferred taxes and the impact of the September 26, 2019 PUCO order which finalized the amount of excess deferred tax balances allocable to DP&L’s utility customers.

For the nine months ended September 30, 2019, DP&L’s current period effective tax rate for all operations was not materially different than the estimated annual effective rate.

Note 8 – Benefit Plans

DP&L sponsors a defined benefit pension plan for the majority of its employees.

We generally fund pension plan benefits as accrued in accordance with the minimum funding requirements of ERISA and, in addition, make voluntary contributions from time to time. There were $7.5 million in employer contributions during each of the nine months ended September 30, 2019 and 2018.

The amounts presented in the following tables for pension include the collective bargaining plan formula, the traditional management plan formula, the cash balance plan formula and the SERP, in the aggregate. The pension costs below have not been adjusted for amounts billed to the Service Company for former DP&L employees who are now employed by the Service Company or for amounts billed to AES Ohio Generation for employees employed by AES Ohio Generation that are still participants in the DP&L plan.

48

The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2019 and 2018 was:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Service cost	$	0.9		$	1.5		$	2.7		$	4.5
Interest cost	3.7			3.4			11.2			10.3
Expected return on plan assets	(5.0		)	(5.3		)	(15.0		)	(15.9		)
Amortization of unrecognized:
Prior service cost	0.4			0.4			1.3			1.1
Actuarial loss	1.8			2.4			5.3			7.1
Net periodic benefit cost	$	1.8		$	2.4		$	5.5		$	7.1

In addition, DP&L provides postretirement health care and life insurance benefits to certain retired employees, their spouses and eligible dependents. We have funded a portion of the union-eligible benefits using a Voluntary Employee Beneficiary Association Trust. These postretirement health care benefits and the related unfunded obligation of $9.0 million at September 30, 2019 and $9.2 million at December 31, 2018 were not material to the financial statements in the periods covered by this report.

Note 9 – Shareholder's Equity

Capital Contribution and Returns of Capital

During the nine months ended September 30, 2019, DP&L made returns of capital payments of $90.0 million to DPL.

During the nine months ended September 30, 2018, DP&L received an $80.0 million capital contribution from its parent, DPL. In addition, DP&L made returns of capital payments of $43.8 million to DPL.

Note 10 – Contractual Obligations, Commercial Commitments and Contingencies

Equity Ownership Interest

DP&L has a 4.9% equity ownership interest in OVEC, which is recorded using the cost method of accounting under GAAP. DP&L, along with several non-affiliated energy companies party to an OVEC arrangement, receive and pay for OVEC capacity and energy and are responsible for OVEC debt obligations and other fixed costs in proportion to their power participation ratios under the arrangement which, for DP&L, is the same as its equity ownership interest. At September 30, 2019, DP&L could be responsible for the repayment of 4.9%, or $67.2 million, of $1,371.3 million OVEC debt obligations if they came due, comprised of both fixed and variable rate securities with maturities from 2022 to 2040. OVEC could also seek additional contributions from DP&L to avoid a default in the event that other OVEC members defaulted on their respective OVEC obligations. One of the other OVEC members, with a 4.85% interest in OVEC, filed for bankruptcy protection and the bankruptcy court approved that member's rejection of the OVEC arrangement and its related obligations on July 31, 2018. We do not expect these events to have a material impact on our financial condition, results of operations or cash flows.

Contingencies

In the normal course of business, we are subject to various lawsuits, actions, proceedings, claims and other matters asserted under various laws and regulations. We believe the amounts provided in our Condensed Financial Statements, as prescribed by GAAP, are adequate considering the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of September 30, 2019, cannot be reasonably determined.

Environmental Matters

DP&L’s facilities and operations are subject to a wide range of federal, state and local environmental regulations and laws. The environmental issues that may affect us include:

• The federal CAA and state laws and regulations (including State Implementation Plans) which require compliance, obtaining permits and reporting as to air emissions;

49

• Litigation with federal and certain state governments and certain special interest groups;

• Rules and future rules issued by the USEPA, the Ohio EPA or other authorities associated with the federal Clean Water Act, which prohibits the discharge of pollutants into waters of the United States except pursuant to appropriate permits; and

• Solid and hazardous waste laws and regulations, which govern the management and disposal of certain waste.

In addition to imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at our facilities to comply, or to determine compliance, with such regulations. We record liabilities for loss contingencies related to environmental matters when a loss is probable of occurring and can be reasonably estimated in accordance with the provisions of GAAP. Accordingly, we have immaterial accruals for loss contingencies for environmental matters. We also have several environmental matters for which we have not accrued loss contingencies because the risk of loss is not probable, or a loss cannot be reasonably estimated. We evaluate the potential liability related to environmental matters quarterly and may revise our estimates. Such revisions in the estimates of the potential liabilities could have a material adverse effect on our results of operations, financial condition and cash flows.

Note 11 – Revenue

Revenue is primarily earned from retail and wholesale electricity sales and electricity transmission and distribution delivery services. Revenue is recognized upon transfer of control to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. Revenue is recorded net of any taxes assessed on and collected from customers, which are remitted to the governmental authorities. For further discussion of our Retail, Wholesale, RTO ancillary, and Capacity revenues, see Note 13 — Revenue in Item 8.—Financial Statements and Supplementary Data of our Form 10-K.

DP&L's revenue from contracts with customers was $187.0 million and $186.1 million for the three months ended September 30, 2019 and 2018, respectively, and $554.4 million and $532.1 million for the nine months ended September 30, 2019 and 2018, respectively. The following table presents our revenue from contracts with customers and other revenue for the three and nine months ended September 30, 2019 and 2018:

	Three months ended				Nine months ended
	September 30,				September 30,
$ in millions	2019		2018		2019		2018
Retail revenue
Retail revenue from contracts with customers	$	170.5	$	168.4	$	503.8	$	469.3
Other retail revenue (a)	3.8		12.6		14.9		31.4
Wholesale revenue
Wholesale revenue from contracts with customers	4.4		4.9		12.8		24.6
RTO ancillary revenue	11.0		10.8		32.8		32.4
Capacity revenue	1.1		2.0		5.0		5.8
Miscellaneous revenue	0.3		—		0.9		—
Total revenues	$	191.1	$	198.7	$	570.2	$	563.5

(a) Other retail revenue primarily includes alternative revenue programs not accounted for under FASC 606.

The balances of receivables from contracts with customers were $65.2 million and $70.1 million as of September 30, 2019 and December 31, 2018, respectively. Payment terms for all receivables from contracts with customers are typically within 30 days.

Note 12 – Dispositions

Beckjord Facility – On February 26, 2018, DP&L and its co-owners of the retired Beckjord Facility agreed to transfer their interests in the retired Facility to a third party, including their obligations to remediate the Facility and its site, and the transfer occurred on that same date. As a result, DP&L recognized a loss on the transfer of $12.4 million and made cash expenditures of $14.5 million, inclusive of cash expenditures for the transfer charges. The Beckjord Facility was retired in 2014, and, as such, the income / (loss) from continuing operations before income tax related to the Beckjord Facility was immaterial for the three and nine months ended September 30, 2018, excluding the loss on transfer noted above.

50

Item 2 – Management's Discussion and Analysis of Financial Condition and Results of Operations

This report includes the combined filing of DPL and DP&L. On November 28, 2011, DPL became an indirectly wholly-owned subsidiary of AES, a global power company. Throughout this report, the terms “we,” “us,” “our” and “ours” are used to refer to both DPL and DP&L, respectively and together, unless the context indicates otherwise. Discussions or areas of this report that apply only to DPL or DP&L will clearly be noted in the section.

FORWARD-LOOKING INFORMATION

The following discussion contains forward-looking statements and should be read in conjunction with the accompanying Condensed Consolidated Financial Statements and related footnotes of DPL and the Condensed Financial Statements and related footnotes of DP&L included in Part I – Financial Information, the risk factors in Item 1A to Part I of our Form 10-K for the fiscal year ended December 31, 2018 and our “Forward-Looking Statements” section of this Form 10-Q. For a list of certain abbreviations or acronyms in this discussion, see the Glossary at the beginning of this Form 10-Q.

OVERVIEW OF OUR BUSINESS

DPL is an indirectly wholly-owned subsidiary of AES.

DPL has three primary subsidiaries, DP&L, AES Ohio Generation and MVIC. DP&L is a public utility providing electric transmission and distribution services in West Central Ohio. AES Ohio Generation owns an undivided interest in a coal-fired generating facility and sells all of its energy and capacity into the wholesale market. AES Ohio Generation also owns two retired coal-fired facilities. MVIC is our captive insurance company that provides insurance services to DP&L and our other subsidiaries. For additional information, see Item 1 – Business of our Form 10-K. All of DPL's subsidiaries are wholly-owned.

As an electric public utility in Ohio, DP&L provides regulated transmission and distribution services to its customers as well as retail SSO electric service. DP&L's sales reflect the general economic conditions, seasonal weather patterns and the growth of energy efficiency initiatives.

EXECUTIVE SUMMARY

DPL

Compared with the prior year, DPL's net income from continuing operations before income taxes was higher by $6.7 million, or 34%, for the three months ended September 30, 2019 and higher by $9.3 million, or 68%, for the nine months ended September 30, 2019, primarily due to factors including, but not limited to:

	Three months ended			Nine months ended
	September 30,			September 30,
$ in millions	2019 vs. 2018			2019 vs. 2018
Decrease due to a higher loss on early extinguishment of debt in 2019, primarily due to the make-whole premium on the partial prepayment of the 7.25% Senior Notes due 2021	$	—		$	(38.5	)
Impact of the distribution rate order, including higher distribution rates, the DIR, and the decoupling rider	4.1			22.4
Increase due to the loss on transfer of the Beckjord facility in the first quarter of 2018	—			11.7
Increase due to lower interest expense from debt refinancings and payments made in 2018 and 2019	4.3			10.7
Other	(1.7		)	3.0
Net change in income from continuing operations before income tax	$	6.7		$	9.3

51

DP&L

Compared with the prior year, DP&L's net income from continuing operations before income taxes was higher by $0.2 million, or 1%, for the three months ended September 30, 2019 and higher by $34.9 million, or 47%, for the nine months ended September 30, 2019, primarily due to factors including, but not limited to:

	Three months ended			Nine months ended
	September 30,			September 30,
$ in millions	2019 vs. 2018			2019 vs. 2018
Impact of the distribution rate order, including higher distribution rates, the DIR, and the decoupling rider	4.1			$	22.4
Increase due to the loss on transfer of the Beckjord facility in the first quarter of 2018	—			11.7
Other	(3.9		)	0.8
Net change in income before income tax	$	0.2		$	34.9

52

RESULTS OF OPERATIONS HIGHLIGHTS – DPL

DPL’s results of operations include the results of its subsidiaries, including its principal subsidiary DP&L. All material intercompany accounts and transactions have been eliminated in consolidation. A separate discussion of the results of operations for DP&L is presented elsewhere in this report.

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Revenues:
Retail	$	174.3		$	180.6		$	518.7		$	499.9
Wholesale	9.2			10.5			23.4			41.3
RTO ancillary	11.1			10.7			33.0			32.5
Capacity revenues	2.2			3.7			9.2			10.5
Miscellaneous revenues	2.2			2.2			7.9			7.3
Total revenues	199.0			207.7			592.2			591.5
Operating costs and expenses
Net fuel cost	5.2			4.6			13.0			12.7
Purchased power:
Purchased power	60.5			68.1			176.0			187.8
RTO charges	5.7			15.5			18.3			48.9
RTO capacity charges	0.3			—			0.7			2.2
Net purchased power cost	66.5			83.6			195.0			238.9
Operation and maintenance	44.2			37.3			142.3			118.3
Depreciation and amortization	17.7			19.7			54.1			58.8
Taxes other than income taxes	20.9			19.0			58.5			54.5
Other, net	—			1.6			0.9			14.6
Total operating costs and expenses	154.5			165.8			463.8			497.8
Operating income	44.5			41.9			128.4			93.7
Other income / (expense), net:
Interest expense	(18.3		)	(22.6		)	(63.7		)	(74.4		)
Loss on early extinguishment of debt	—			—			(44.9		)	(6.4		)
Other income	0.3			0.5			3.2			0.8
Total other expense, net	(18.0		)	(22.1		)	(105.4		)	(80.0		)
Income from continuing operations before income tax (a)	$	26.5		$	19.8		$	23.0		$	13.7

(a) For purposes of discussing operating results, we present and discuss Income from continuing operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance.

DPL – Revenues

Retail customers, especially residential and commercial customers, consume more electricity during warmer and colder weather than they do during mild temperatures. Therefore, our retail sales volume is impacted by the number of heating and cooling degree-days occurring during a year. Cooling degree-days typically have a more significant impact than heating degree-days since some residential customers do not use electricity to heat their homes. Because of the impact of the decoupling rider (effective January 1, 2019) and because DPL's generation has greatly decreased in recent years due to plant sales and closures, weather has a minimal impact on our net operating results.

	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
Heating degree-days (a)	—	47	3,206	3,498
Cooling degree-days (a)	975	811	1,361	1,262

(a) Heating and cooling degree-days are a measure of the relative heating or cooling required for a home or business. The heating degrees in a day are calculated as the degrees that the average actual daily temperature is below 65 degrees Fahrenheit. For example, if the average temperature on March 20th was 40 degrees Fahrenheit, the heating degrees for that day would be the 25-degree difference between 65 degrees and 40 degrees. Similarly, cooling degrees in a day are calculated as the degrees that the average actual daily temperature is above 65 degrees Fahrenheit.

53

DPL's electric sales and billed customers were as follows:

ELECTRIC SALES AND CUSTOMERS (a)
	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
Retail electric sales (b)	3,858	3,858	10,731	10,943
Wholesale electric sales (c)	369	310	808	989
Total electric sales	4,227	4,168	11,539	11,932
Billed electric customers (end of period)			523,915	523,535

(a) Electric sales are presented in millions of kWh.

(b) DPL retail electric sales represent the total transmission and distribution retail sales for the periods presented. SSO sales were 1,037 kWh and 2,972 kWh for the three and nine months ended September 30, 2019, respectively, and 1,056 kWh and 2,995 kWh for the three and nine months ended September 30, 2018, respectively.

(c) Included within DPL wholesale electric sales are DP&L's 4.9% share of the generation output of OVEC and the generation output of Conesville.

We sell our share of the generation from Conesville and OVEC into the wholesale market which covers a multi-state area and settles on an hourly basis throughout the year. Factors impacting our wholesale sales volume each hour of the year include wholesale market prices; retail demand throughout the entire wholesale market area; availability of our generating plant and non-affiliated generating plants to sell into the wholesale market; contracted wholesale sales and our variable generation costs. Our goal is to make wholesale sales when it is profitable to do so.

During the three months ended September 30, 2019, revenue decreased $8.7 million to $199.0 million compared to $207.7 million in the same period of the prior year, and, during the nine months ended September 30, 2019, revenue increased $0.7 million to $592.2 million compared to $591.5 million in the same period of the prior year. These changes were primarily the result of changes in the components of revenue shown below:

	Three months ended			Nine months ended
	September 30,			September 30,
$ in millions	2019 vs. 2018			2019 vs. 2018
Retail
Rate
Increase in energy efficiency and USF revenue rate riders	$	9.7		$	30.1
Increase in base distribution rates due to the DRO	6.3			21.0
Increase due to the DIR, which was effective with the DRO	5.6			16.7
Decrease in the TCRR due to lower transmission costs and the impact of DP&L passing back the benefits of the PJM Transmission Enhancement Settlement to customers	(12.3		)	(27.3		)
Decrease due to energy efficiency lost revenues recorded in the prior year	(5.0		)	(16.7		)
Other	(2.1		)	10.3
Net change in retail rate	2.2			34.1
Volume
Decrease in volume is primarily due to demand in the prior year. The decoupling rider approved in the DRO became effective January 1, 2019 and is designed to eliminate the impacts of weather and demand on DP&L's residential and commercial customers resulting in less of a demand impact in the current year.	(8.2		)	(15.6		)
Other miscellaneous	(0.3		)	0.3
Total retail change	(6.3		)	18.8
Wholesale
Decrease for the nine months ended September 30, 2019 is due to lower volumes as DP&L is no longer serving the load of certain other parties through their competitive bid process and lower wholesale prices	(1.3		)	(17.9		)
RTO ancillary and capacity revenues
RTO ancillary and capacity revenues	(1.1		)	(0.8		)
Other
Miscellaneous revenues	—			0.6
Net change in revenues	$	(8.7	)	$	0.7

54

DPL – Net Purchased Power

During the three months ended September 30, 2019, net purchased power decreased $17.1 million to $66.5 million compared to $83.6 million in the same period of the prior year, and, during the nine months ended September 30, 2019, net purchased power decreased $43.9 million to $195.0 million compared to $238.9 million in the same period of the prior year. These changes were primarily the result of changes in the cost of purchased power shown below.

	Three months ended			Nine months ended
	September 30,			September 30,
$ in millions	2019 vs. 2018			2019 vs. 2018
Net purchased power
Purchased power
Rate
Increase / (decrease) due to pricing in the competitive bid process	(1.4		)	1.3
Volume
Lower purchases in the nine months ended September 30, 2019 as DP&L stopped purchasing power to serve the load of certain other parties through their competitive bid process after May of 2018	(6.2		)	(13.1		)
Total purchased power change	(7.6		)	(11.8		)
RTO charges
Decrease due to lower transmission and congestion charges, including a decrease due to benefits of the PJM Transmission Enhancement Settlement. RTO charges are incurred by DP&L as a member of PJM and primarily include transmission charges within our network, which are incurred and charged to customers in the transmission rider	(9.8		)	(30.6		)
RTO capacity charges
Increase / (decrease) due to capacity costs	0.3			(1.5		)
Net change in purchased power	$	(17.1	)	$	(43.9	)

DPL – Operation and Maintenance

During the three and nine months ended September 30, 2019, Operation and Maintenance expense increased $6.9 million and $24.0 million, respectively, compared to the same periods in the prior year. The main drivers of these changes are as follows:

	Three months ended			Nine months ended
	September 30,			September 30,
$ in millions	2019 vs. 2018			2019 vs. 2018
Increase in alternative energy and energy efficiency programs (a)	$	7.4		$	20.0
Increase in uncollectible expenses for the low-income payment program, which is funded by the USF revenue rate rider (a)	3.1			9.3
Decrease due to prior year write-off of previously deferred rate case costs no longer deemed probable for recovery	—			(5.3		)
Decrease in amortization of previously deferred regulatory costs, including rate case costs, certain transmission costs, and various costs collected under the regulatory compliance rider (a)	(2.0		)	(1.7		)
Other, net	(1.6		)	1.7
Net change in operation and maintenance expense	$	6.9		$	24.0

(a)    There is a corresponding offset in Revenues associated with these programs.

DPL – Depreciation and Amortization

During the three and nine months ended September 30, 2019, Depreciation and amortization decreased $2.0 million and $4.7 million respectively, compared to the same periods in the prior year. The decrease was primarily due to lower software amortization and lower depreciation expense recorded at Conesville in 2019.

DPL – Taxes Other Than Income Taxes

During the three and nine months ended September 30, 2019, Taxes other than income taxes increased $1.9 million and $4.0 million respectively, compared to the same periods in the prior year. The increase for the nine months ended September 30, 2019 was primarily the result of a favorable adjustment recorded in the second quarter of 2018 related to 2017 Ohio property taxes to reflect actual payments made in 2018.

55

DPL – Operating Expenses - Other

During the nine months ended September 30, 2018, DPL recorded other operating expenses of $14.6 million primarily due to the loss on the transfer of business interests in the Beckjord facility of $11.7 million and a $2.8 million fixed-asset impairment charge recorded on Conesville.

DPL – Interest Expense

During the three and nine months ended September 30, 2019, Interest expense decreased $4.3 million and $10.7 million respectively, compared to the same periods in the prior year. The decrease was primarily the result of the reduction and refinancing of debt at DPL and DP&L in 2018 and 2019.

DPL – Loss on Early Extinguishment of Debt

During the nine months ended September 30, 2019, Loss on early extinguishment of debt increased $38.5 million, compared to the same period in the prior year. The increase was primarily due to the make-whole premium payment of $41.4 million related to the $400.0 million partial redemption of the $780.0 million 7.25% Notes due 2021 in the second quarter of 2019, partially offset by the make-whole premium payment of $5.1 million related to the $101.0 million partial redemption of the 6.75% Senior Notes due 2019 in the second quarter of 2018.

DPL – Income Tax Expense / (Benefit) From Continuing Operations

Income tax expense of $3.1 million during the three months ended September 30, 2018 changed to an Income tax benefit of $9.4 million during the three months ended September 30, 2019. The change of $12.5 million was primarily due to the impact of the September 26, 2019 PUCO order, which finalized the amount of excess deferred tax balances allocable to DP&L’s utility customers.

Income tax expense of $1.5 million during the nine months ended September 30, 2018 changed to an income tax benefit of $12.6 million during the nine months ended September 30, 2019. The change of $14.1 million was primarily due to the impact of the September 26, 2019 PUCO order, which finalized the amount of excess deferred tax balances allocable to DP&L’s utility customers.

DPL – Discontinued Operations

Net income from discontinued operations was $(0.5) million and $25.8 million for the three and nine months ended September 30, 2019, respectively, compared to $4.3 million and $29.2 million for the three and nine months ended September 30, 2018, respectively. This income relates to the generation components of Miami Fort, Zimmer, Stuart, Killen and the Peaker assets, which were disposed of either by sale or retirement in recent years. See Part I, Item 1, Note 14 – Discontinued Operations in the Notes to DPL's Condensed Consolidated Financial Statements for further discussion.

RESULTS OF OPERATIONS BY SEGMENT - DPL

DPL has presented the results of operations of Miami Fort Station, Zimmer Station, the Peaker Assets, Stuart Station, and Killen Station as discontinued operations as a group of components for all periods presented. For more information, see Part I, Item 1, Note 14 – Discontinued Operations of Notes to DPL's Condensed Consolidated Financial Statements. As such, AES Ohio Generation only has operating activity coming from its undivided ownership interest in Conesville, which does not meet the thresholds to be a separate reportable operating segment. Therefore, DPL manages its business through one reportable operating segment, the Utility segment. The primary segment performance measure is income / (loss) from continuing operations before income tax as management has concluded that this measure best reflects the underlying business performance of DPL and is the most relevant measure considered in DPL’s internal evaluation of the financial performance of its segment. The Utility segment is discussed further below.

Utility Segment

The Utility segment is comprised of DP&L’s electric transmission and distribution businesses, which distribute electricity to residential, commercial, industrial and governmental customers. DP&L distributes electricity to more than 524,000 retail customers located in a 6,000-square mile area of West Central Ohio. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses recording regulatory assets when incurred costs are expected to be recovered in future customer rates and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. The Utility segment includes revenues and costs associated with our investment in OVEC and the historical results of DP&L’s Beckjord Facility, which was closed in 2014 and transferred to a third party in the first quarter of 2018, and

56

Hutchings Coal generating facility, which was closed in 2013. These assets did not transfer to AES Ohio Generation as part of DP&L's Generation Separation on October 1, 2017. Thus, they are grouped within the Utility segment for segment reporting purposes. In addition, regulatory deferrals and collections, which include fuel deferrals in historical periods, are included in the Utility segment.

Included within the “Other” column are other businesses that do not meet the GAAP requirements for disclosure as reportable segments as well as certain corporate costs, which include interest expense and loss on early extinguishment of debt on DPL's long-term debt as well as adjustments related to purchase accounting from the Merger. DPL's undivided interest in Conesville is included within the "Other" column as it does not meet the requirement for disclosure as a reportable operating segment, since the results of operations of the other EGUs are presented as discontinued operations. The accounting policies of the reportable segment are the same as those described in Note 1 – Overview and Summary of Significant Accounting Policies of our 10-K. Intersegment sales, costs of sales and expenses are eliminated in consolidation. Certain shared and corporate costs are allocated between "Other" and the Utility reporting segment.

See Part I, Item 1, Note 11 – Business Segments of Notes to DPL's Condensed Consolidated Financial Statements for additional information regarding DPL’s reportable segment.

The following table presents DPL’s Income / (loss) from continuing operations before income tax by business segment:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Utility	$	37.7		$	37.5		$	108.8		$	73.9
Other	(11.2		)	(17.7		)	(85.8		)	(60.2		)
Income from continuing operations before income tax (a)	$	26.5		$	19.8		$	23.0		$	13.7

(a) For purposes of discussing operating results, we present and discuss Income from continuing operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance.

RESULTS OF OPERATIONS HIGHLIGHTS – DPL – Utility Segment

The results of operations of the Utility segment for DPL are identical in all material respects and for all periods presented to those of DP&L, which are included in Part I, Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations (RESULTS OF OPERATIONS HIGHLIGHTS – DP&L) of this Form 10-Q.

57

RESULTS OF OPERATIONS HIGHLIGHTS – DP&L

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Revenues:
Retail	$	174.3		$	181.0		$	518.7		$	500.7
Wholesale	4.4			4.9			12.8			24.6
RTO ancillary	11.0			10.8			32.8			32.4
Capacity revenues	1.1			2.0			5.0			5.8
Miscellaneous revenues	0.3			—			0.9			—
Total revenues	191.1			198.7			570.2			563.5
Operating costs and expenses
Net fuel cost	0.6			0.1			2.0			1.7
Purchased power:
Purchased power	60.4			67.7			175.7			186.7
RTO charges	5.5			15.3			17.6			46.8
RTO capacity charges	—			—			—			2.2
Net purchased power cost	65.9			83.0			193.3			235.7
Operation and maintenance	42.2			33.8			135.2			105.9
Depreciation and amortization	17.4			19.1			52.9			56.5
Taxes other than income taxes	20.8			19.0			58.2			54.3
Loss / (gain) on asset disposal	(0.1		)	—			—			0.1
Loss on disposal of business	—			—			—			12.4
Total operating costs and expenses	146.8			155.0			441.6			466.6
Operating income	44.3			43.7			128.6			96.9
Other income / (expense), net:
Interest expense	(6.1		)	(5.8		)	(19.9		)	(20.5		)
Loss on early extinguishment of debt	—			—			—			(0.6		)
Other income / (expense)	(0.5		)	(0.4		)	0.1			(1.9		)
Total other expense, net	(6.6		)	(6.2		)	(19.8		)	(23.0		)
Income before income tax (a)	$	37.7		$	37.5		$	108.8		$	73.9

(a) For purposes of discussing operating results, we present and discuss Income before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information used by management to make decisions regarding our financial performance.

DP&L – Revenues

Retail customers, especially residential and commercial customers, consume more electricity during warmer and colder weather than they do during mild temperatures. Therefore, our retail sales volume is impacted by the number of heating and cooling degree-days occurring during a year. Cooling degree-days typically have a more significant impact than heating degree-days since some residential customers do not use electricity to heat their homes. Because of the impact of the decoupling rider (effective January 1, 2019) weather has a minimal impact on our net operating results.

We sell our share of the generation from OVEC into the wholesale market which covers a multi-state area and settles on an hourly basis throughout the year. Factors impacting our wholesale sales volume each hour of the year include wholesale market prices; retail demand throughout the entire wholesale market area; and availability of OVEC generating plants to sell into the wholesale market.

58

DP&L's electric sales and billed customers were as follows:

ELECTRIC SALES AND CUSTOMERS (a)
	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
Retail electric sales (b)	3,858	3,858	10,731	10,943
Wholesale electric sales (c)	151	156	421	608
Total electric sales	4,009	4,014	11,152	11,551
Billed electric customers (end of period)			523,915	523,535

(a) Electric sales are presented in millions of kWh.

(b) DP&L retail electric sales represent the total transmission and distribution retail sales for the periods presented. SSO sales were 1,037 kWh and 2,972 kWh for the three and nine months ended September 30, 2019, respectively, and 1,056 kWh and 2,995 kWh for the three and nine months ended September 30, 2018, respectively.

(c) Included within DP&L wholesale electric sales are DP&L's 4.9% share of the generation output of OVEC.

During the three months ended September 30, 2019, revenue decreased $7.6 million to $191.1 million compared to $198.7 million in the same period of the prior year, and, during the nine months ended September 30, 2019, revenue increased $6.7 million to $570.2 million compared to $563.5 million in the same period of the prior year. These changes were primarily the result of changes in the components of revenue shown below:

	Three months ended			Nine months ended
	September 30,			September 30,
$ in millions	2019 vs. 2018			2019 vs. 2018
Retail
Rate
Increase in energy efficiency and USF revenue rate riders	$	9.7		$	30.1
Increase in base distribution rates due to the DRO	6.3			21.0
Increase due to the DIR, which was effective with the DRO	5.6			16.7
Decrease in the TCRR due to lower transmission costs and the impact of DP&L passing back the benefits of the PJM Transmission Enhancement Settlement to customers	(12.3		)	(27.3		)
Decrease due to energy efficiency lost revenues recorded in the prior year	(5.0		)	(16.7		)
Other	(2.5		)	9.5
Net change in retail rate	1.8			33.3
Volume
Decrease in volume is primarily due to demand in the prior year. The decoupling rider approved in the DRO became effective January 1, 2019 and is designed to eliminate the impacts of weather and demand on DP&L's residential and commercial customers resulting in less of a demand impact in the current year.	(8.2		)	(15.6		)
Other miscellaneous	(0.3		)	0.3
Total retail change	(6.7		)	18.0
Wholesale
Decrease in volumes due to no longer serving the load of certain other parties through their competitive bid process and lower wholesale prices	(0.5		)	(11.8		)
RTO ancillary and capacity revenues
RTO ancillary and capacity revenues	(0.7		)	(0.4		)
Other
Miscellaneous revenues	0.3			0.9
Net change in revenues	$	(7.6	)	$	6.7

59

DP&L – Net Purchased Power

During the three months ended September 30, 2019, net purchased power decreased $17.1 million to $65.9 million compared to $83.0 million in the same period of the prior year, and, during the nine months ended September 30, 2019, net purchased power decreased $42.4 million to $193.3 million compared to $235.7 million in the same period of the prior year. These changes were primarily the result of changes in the cost of purchased power shown below.

	Three months ended			Nine months ended
	September 30,			September 30,
$ in millions	2019 vs. 2018			2019 vs. 2018
Net purchased power
Purchased power
Rate
Increase / (decrease) due to pricing in the competitive bid process	$	(1.1	)	$	2.0
Volume
Lower purchases in the nine months ended September 30, 2019 as DP&L stopped purchasing power to serve the load of certain other parties through their competitive bid process after May of 2018	(6.2		)	(13.0		)
Total purchased power change	(7.3		)	(11.0		)
RTO charges
Decrease due to lower transmission and congestion charges, including a decrease due to benefits of the PJM Transmission Enhancement Settlement. RTO charges are incurred by DP&L as a member of PJM and primarily include transmission charges within our network, which are incurred and charged to customers in the transmission rider	(9.8		)	(29.2		)
RTO capacity charges
Decrease due to capacity costs at OVEC	—			(2.2		)
Net change in purchased power	$	(17.1	)	$	(42.4	)

DP&L – Operation and Maintenance

During the three and nine months ended September 30, 2019, Operation and Maintenance expense increased $8.4 million and $29.3 million, respectively, compared to the same periods in the prior year. The main drivers of these changes are as follows:

	Three months ended			Nine months ended
	September 30,			September 30,
$ in millions	2019 vs. 2018			2019 vs. 2018
Increase in alternative energy and energy efficiency programs (a)	$	7.4		$	20.0
Increase in uncollectible expenses for the low-income payment program, which is funded by the USF revenue rate rider (a)	3.1			9.3
Increase in costs charged from the Service Company for services provided	2.9			5.3
Decrease due to prior year write-off of previously deferred rate case costs	—			(5.3		)
Decrease in amortization of previously deferred regulatory costs, including rate case costs, certain transmission costs, and various costs collected under the regulatory compliance rider (a)	(2.0		)	(1.7		)
Other, net	(3.0		)	1.7
Net change in operation and maintenance expense	$	8.4		$	29.3

(a)    There is a corresponding offset in Revenues associated with these programs.

DP&L – Depreciation and Amortization

During the three and nine months ended September 30, 2019, Depreciation and amortization decreased $1.7 million and $3.6 million, respectively, compared to the same periods in the prior year. The decrease was primarily due to lower software amortization in 2019.

DP&L – Taxes Other Than Income Taxes

During the three and nine months ended September 30, 2019, Taxes other than income taxes increased $1.8 million and $3.9 million, respectively, compared to the same periods in the prior year. The increase for the nine months ended September 30, 2019 was primarily the result of a favorable adjustment made in 2018 for 2017 Ohio property taxes to reflect actual payments.

DP&L – Loss on Disposal of Business

During the nine months ended September 30, 2018, DP&L recorded a loss on disposal of business of $12.4 million due to the loss on the transfer of business interests in the Beckjord facility.

60

DP&L – Income Tax Expense / (Benefit)

Income tax expense of $6.3 million during the three months ended September 30, 2018 changed to a benefit of $7.2 million during the three months ended September 30, 2019 primarily due to the impact of the September 26, 2019 PUCO order, which finalized the amount of excess deferred tax balances allocable to DP&L’s utility customers.

During the nine months ended September 30, 2019, Income tax expense decreased $6.9 million, compared to the same period in the prior year primarily due to the impact of the September 26, 2019 PUCO order, which finalized the amount of excess deferred tax balances allocable to DP&L’s utility customers, partially offset by higher pre-tax income in the current year as compared to the prior year.

61

KEY TRENDS AND UNCERTAINTIES

Following the issuance of the DRO in September 2018 and the resulting changes to the decoupling rider, we expect that our financial results will be less driven by retail demand and weather but will be impacted by customer growth within our service territory. In addition, DPL's and DP&L's financial results are likely to be driven by other factors including, but not limited to:

• regulatory outcomes;

• the passage of new legislation, implementation of regulations or other changes in regulation;

• timely recovery of transmission and distribution expenditures; and

• with respect to DPL, exiting generation assets currently owned by AES Ohio Generation.

Regulatory Environment

DPL’s, DP&L’s and our other subsidiaries’ facilities and operations are subject to a wide range of regulations and laws by federal, state and local authorities. As well as imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at these facilities and operations in an effort to comply, or to determine compliance, with such regulations. We record liabilities for losses that are probable and can be reasonably estimated. In addition to matters discussed or updated herein, our 2018 Form 10-K and Forms 10-Q previously filed with the SEC during 2019 describe other regulatory matters which have not materially changed since those filings.

Ohio Regulatory Proceedings

DMR

On October 20, 2017, the PUCO approved DP&L’s 2017 ESP.  On January 7, 2019, the Ohio Consumers' Counsel appealed to the Supreme Court of Ohio the 2017 ESP with respect to the bypassability of the Reconciliation Rider and the exclusion of the DMR from the SEET. That proceeding has been stayed pending an appeal in a related case involving another utility.

Pursuant to the 2017 ESP, on January 22, 2019, DP&L filed a request with the PUCO for a two-year extension of its DMR through October 2022, in the proposed amount of $199.0 million for each of the two additional years. The extension request was set at a level expected to reduce debt obligations at both DP&L and DPL and to position DP&L to make capital expenditures to maintain and modernize its electric grid. DP&L’s DMP investments are contingent upon the PUCO approving the two-year extension of its DMR.

A rehearing process in DP&L's 2017 ESP case, including the DMR, remains pending. On August 1, 2019, DP&L filed a supplemental brief with the PUCO focused on the applicability of a recent court decision involving another Ohio utility’s DMR which is similar to, but not identical to, DP&L’s DMR.

Ohio House Bill 6

On July 23, 2019, the Governor of Ohio signed Ohio House Bill 6, which, among other things, does the following:

• beginning January 1, 2020, replaces DP&L’s non-bypassable Reconciliation Rider, permitting DP&L to defer, recover or credit the net proceeds from selling energy and capacity received as part of DP&L’s interest in OVEC and its OVEC-related costs through 2023, with a non-bypassable recovery mechanism for recovery of prudently incurred OVEC costs through 2030;

• eliminates the annual energy efficiency targets for Ohio utilities after 2020; and

• allows Ohio utilities to construct customer-sited renewable generation for mercantile customers or groups of mercantile customers, the costs of which may only be recovered from those customers.

Regulatory impact of tax reform

On September 26, 2019 the PUCO approved a unanimous stipulation agreeing to return a total of $65.1 million, $83.2 million when including taxes associated with the refunds, to distribution customers.

See Part I, Item 1, Note 3 – Regulatory Matters of Notes to DPL's Condensed Consolidated Financial Statements and Part I, Item 1, Note 3 – Regulatory Matters of Notes to DP&L's Condensed Financial Statements for further information regarding regulatory matters.

62

United States Tax Law Reform

Considering the significant changes to the U.S. tax system enacted in 2017, the U.S. Treasury Department and Internal Revenue Service have issued numerous regulations. While certain regulations are now final, there are many regulations that are proposed and still others anticipated to be issued in proposed form. The final version of any regulations may vary from the proposed form. When final, these regulations may materially impact our effective tax rate. Certain of the proposed regulations, when final, may have retroactive effect to January 1, 2018 or January 1, 2019.

Environmental Matters

In addition to imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at our facilities to comply, or to determine compliance, with such regulations. We record liabilities for loss contingencies related to environmental matters when a loss is probable of occurring and can be reasonably estimated in accordance with the provisions of GAAP. Accordingly, we have immaterial accruals for loss contingencies for environmental matters. We also have several environmental matters for which we have not accrued loss contingencies because the risk of loss is not probable, or a loss cannot be reasonably estimated. We evaluate the potential liability related to environmental matters quarterly and may revise our estimates. Such revisions in the estimates of the potential liabilities could have a material adverse effect on our results of operations, financial condition and cash flows. We refer to the discussion in “Item 1. Business - Environmental Matters” in our 2018 Form 10-K for a discussion of certain recent developments in environmental laws and regulations.

We have several pending environmental matters associated with our stations. Some of these matters could have a material adverse effect on our results of operations, financial condition and cash flows.

Because of DPL’s decision to retire its Stuart and Killen generating stations, the sale of its ownership interest in the Miami Fort and Zimmer generating stations and the planned 2020 retirement of Conesville, the following environmental regulations and requirements are now not expected to have a material impact on DPL:

• The CAA and the following regulations:

• CSAPR and associated updates;

• MATS and any associated regulatory or judicial processes;

• NAAQS; and

• the Affordable Clean Energy Rule.

Additionally, because of the retirement of Stuart and Killen noted above, the following environmental regulations and requirements are not expected to have a material impact on DPL with respect to either of the two generating stations:

• water intake regulations finalized by the USEPA on May 19, 2014 and

• revised technology-based regulations governing water discharges from steam electric generating facilities, finalized by the USEPA on November 3, 2015.

Clean Water Act Regulation of Water Discharge

On January 7, 2013, the Ohio EPA issued a final NPDES permit to the Stuart Station which included a compliance schedule for performing a study to justify an alternate thermal limitation or take undefined measures to meet certain temperature limits. On February 1, 2013, DP&L appealed various aspects of the final permit to the ERAC. On August 8, 2019, the ERAC dismissed the appeal in response to a Joint Motion to Dismiss.

Notice of Potential Liability for Third Party Disposal Site

On October 16, 2019, DP&L received a special notice that USEPA considers DP&L, along with other parties, to be a PRP for the clean-up of hazardous substances at a third-party landfill known as the Tremont City Barrel Site, located near Dayton, Ohio. While DP&L is currently unable to predict the outcome of this matter, if DP&L were required to contribute to the clean-up of the site, it could have a material adverse effect on our business, financial condition or results of operations.

Regulation of Waste Disposal

The USEPA's final CCR rule became effective in October 2015. Generally, the rule regulates CCR as nonhazardous solid waste and establishes national minimum criteria for existing and new CCR landfills and existing and new CCR ash ponds, including location restrictions, design and operating criteria, groundwater monitoring, corrective action and closure requirements and post-closure care. On December 16, 2016, President Obama signed into law the

63

Water Infrastructure Improvements for the Nation Act ("WIIN Act"), which includes provisions to implement the CCR rule through a state permitting program, or if the state chooses not to participate, a possible federal permit program. The USEPA has indicated that they will implement a phased approach to amending the CCR rule. In July 2018, the USEPA published final CCR rule amendments (Phase One, Part One) in the Federal Register. In August 2018, the D.C. Circuit Court issued a decision in certain CCR litigation matters, which may result in additional revisions to the CCR rule. In October 2018, some environmental groups filed a petition for review challenging the USEPA's final CCR rule amendments (Phase One, Part One) which have since been remanded without vacatur to the USEPA. On August 14, 2019, the USEPA published amendments to the CCR rule relating to the CCR rule’s criteria for determining beneficial use and the regulation of CCR piles, among other revisions. On November 4, 2019, the USEPA signed additional amendments to the CCR Rule titled “A Holistic Approach To Closure Part A: Deadline To Initiate Closure.” The October 2015 CCR rule, current or proposed amendments to the October 2015 CCR rule, the results of groundwater monitoring data or the outcome of CCR-related litigation could have a material impact on our business, financial condition and results of operations.

CAPITAL RESOURCES AND LIQUIDITY

DPL and DP&L had unrestricted cash and cash equivalents of $36.8 million and $14.4 million, respectively, at September 30, 2019. At that date, neither DPL nor DP&L had short-term investments. DPL and DP&L had aggregate principal amounts of long-term debt outstanding of $1,378.2 million and $582.6 million, respectively.

Approximately $139.6 million of DPL's long-term debt, including $139.6 million of DP&L's long-term debt, matures within twelve months of the balance sheet date. From time to time, we may elect to repurchase our outstanding debt through cash purchases, privately negotiated transactions or otherwise when management believes such repurchases are favorable to make. The amounts involved in any such repurchases may be material. See Part I, Item 1, Note 6 – Long-term Debt of Notes to DPL's Condensed Consolidated Financial Statements and Part I, Item 1, Note 6 – Long-term Debt of Notes to DP&L's Condensed Financial Statements.

We depend on timely and continued access to capital markets to manage our liquidity needs. The inability to raise capital on favorable terms, to refinance existing indebtedness or to fund operations and other commitments during times of political or economic uncertainty could have a material adverse effect on our results of operations, financial condition and cash flows. In addition, changes in the timing of tariff increases or delays in regulatory determinations could affect the cash flows and results of operations of our businesses.

Our discussion of DPL’s financial condition, liquidity and capital requirements include the results of its principal subsidiary DP&L.

CASH FLOWS

DPL’s financial condition, liquidity and capital requirements include the consolidated results of its principal subsidiary DP&L. All material intercompany accounts and transactions have been eliminated in consolidation.

Cash Flow Analysis - DPL

The following table summarizes the cash flows of DPL:

DPL	Nine months ended September 30,
$ in millions	2019			2018
Net cash provided by operating activities	$	136.3		$	152.9
Net cash provided by / (used in) investing activities	(125.9		)	157.5
Net cash used in financing activities	(67.7		)	(249.4		)
Decrease in cash and restricted cash of discontinued operations and held-for-sale businesses	—			1.5
Net change	(57.3		)	62.5
Balance at beginning of period	111.7			24.9
Cash, cash equivalents, and restricted cash at end of period	$	54.4		$	87.4

64

DPL – Change in cash flows from operating activities

	Nine months ended September 30,						$ change
$ in millions	2019			2018			2019 vs. 2018
Net income	$	61.4		$	41.4		$	20.0
Depreciation and amortization	34.2			62.4			(28.2		)
Deferred income taxes	(8.7		)	(17.8		)	9.1
Loss on early extinguishment of debt	44.9			6.4			38.5
Other adjustments to Net income	5.1			19.8			(14.7		)
Net income, adjusted for non-cash items	136.9			112.2			24.7
Net change in operating assets and liabilities	(0.6		)	40.7			(41.3		)
Net cash provided by operating activities	$	136.3		$	152.9		$	(16.6	)

The net change in operating assets and liabilities during the nine months ended September 30, 2019 compared to the nine months ended September 30, 2018 was driven by the following:

$ in millions	$ Change
Decrease from accrued taxes primarily due to higher current portion of income tax expense in prior year compared to the current year	(23.9		)
Decrease from inventory primarily due a significant decrease in inventory balances in 2018 due to the closure of the Stuart and Killen plants	(17.9		)
Decrease from accounts receivable is primarily due to prior year collections of the remaining amounts due from partners in jointly-owned stations	(16.4		)
Increase from accounts payable is primarily due to timing of payments	12.3
Other	4.6
Net decrease in cash from changes in operating assets and liabilities	$	(41.3	)

DPL – Cash flows from investing activities

Net cash provided by / (used in) investing activities was $(125.9) million for the nine months ended September 30, 2019 compared to $157.5 million for the nine months ended September 30, 2018. The investing activity for the nine months ended September 30, 2019 primarily relates to capital expenditures of $122.4 million, which increased from the prior year mainly due to significant storm restoration efforts in the third quarter of 2019. The investing activity for the nine months ended September 30, 2018 primarily relates to proceeds from the sale of business of $234.9 million due to the sale of the Peaker assets, and proceeds of $10.6 million related to the June transmission swap with Duke and AEP. This was partially offset by capital expenditures of $75.8 million and a payment on the disposal of Beckjord of $14.5 million.

DPL – Cash flows from financing activities

Net cash used in financing activities was $(67.7) million for the nine months ended September 30, 2019 compared to $(249.4) million from financing activities for the nine months ended September 30, 2018. The financing activity for the nine months ended September 30, 2019 is primarily due to debt repayments, including early payment premiums, of $978.0 million, and $9.2 million of payments of deferred financing costs. This was partially offset by debt issuances, net of discount, of $821.7 million, and net revolving credit facility borrowings of $98.0 million. The financing activity for the nine months ended September 30, 2018 is primarily due to debt repayments of $239.4 million.

Cash Flow Analysis - DP&L

The following table summarizes the cash flows of DP&L:

DP&L	Nine months ended September 30,
$ in millions	2019			2018
Net cash provided by operating activities	$	138.9		$	113.2
Net cash used in investing activities	(124.6		)	(69.0		)
Net cash used in financing activities	(48.5		)	(37.1		)
Net change	(34.2		)	7.1
Balance at beginning of period	66.2			5.6
Cash, cash equivalents, and restricted cash at end of period	$	32.0		$	12.7

65

DP&L – Change in cash flows from operating activities

	Nine months ended September 30,						$ change
$ in millions	2019			2018			2019 vs. 2018
Net income	$	103.7		$	61.9		$	41.8
Depreciation and amortization	52.9			56.5			(3.6		)
Deferred income taxes	(17.2		)	(7.5		)	(9.7		)
Other adjustments to Net income	—			13.0			(13.0		)
Net income, adjusted for non-cash items	139.4			123.9			15.5
Net change in operating assets and liabilities	(0.5		)	(10.7		)	10.2
Net cash provided by operating activities	$	138.9		$	113.2		$	25.7

The net change in operating assets and liabilities during the nine months ended September 30, 2019 compared to the nine months ended September 30, 2018 was driven by the following:

$ in millions	$ Change
Increase from accounts receivable primarily due to higher rates following the DRO	$	22.2
Decrease from accrued taxes primarily due to higher current portion of income tax expense in prior year compared to the current year	(6.9		)
Other	(5.1		)
Net increase in cash from changes in operating assets and liabilities	$	10.2

DP&L – Cash flows from investing activities

Net cash used in investing activities was $(124.6) million for the nine months ended September 30, 2019 compared to $(69.0) million for the nine months ended September 30, 2018. The investing activity for the nine months ended September 30, 2019 primarily represents capital expenditures of $121.1 million, which increased from the prior year mainly due to significant storm restoration efforts in the third quarter of 2019. The investing activity for the nine months ended September 30, 2018 is primarily capital expenditures of $65.0 million and a payment on the disposal of Beckjord of $14.5 million. This was partially offset by proceeds of $10.6 million related to the June transmission swap with Duke and AEP.

DP&L – Cash flows from financing activities

Net cash used in financing activities was $(48.5) million for the nine months ended September 30, 2019 compared to $(37.1) million from financing activities for the nine months ended September 30, 2018. The financing activity for the nine months ended September 30, 2019 is primarily due to returns of capital paid to parent of $90.0 million, debt repayments, including early payment premium, of $436.1 million, and payments of deferred financing costs of $4.6 million. This was partially offset by debt issuances, net of discount, of $422.3 million. The financing activity for the nine months ended September 30, 2018 is primarily related to $63.3 million of debt repayments and returns of capital paid to parent of $43.8 million. This was partially offset by an $80.0 million capital contribution from DPL.

LIQUIDITY

We expect our existing sources of liquidity to remain sufficient to meet our anticipated operating needs. Our business is capital intensive, requiring significant resources to fund operating expenses, construction expenditures, scheduled debt maturities, debt carrying costs and, for DP&L, dividend payments to DPL. In 2019 and subsequent years, we expect to satisfy these requirements with a combination of cash from operations and funds from debt financing as internal liquidity needs and market conditions warrant. We also expect that the borrowing capacity under bank credit facilities will continue to be available to us to manage working capital requirements during these periods.

At September 30, 2019, DP&L and DPL have access to the following revolving credit facilities:

$ in millions	Type	Maturity	Commitment		Amounts available as of September 30, 2019
DP&L	Revolving	June 2024	$	175.0	$	113.9
DPL	Revolving	June 2023	125.0		75.9
			$	300.0	$	189.8

DP&L has an unsecured revolving credit agreement with a syndicated bank group with a borrowing limit of $175.0 million and a $75.0 million letter of credit sublimit, as well as a feature that provides DP&L the ability to increase the size of the facility by an additional $100.0 million. This facility expires in June 2024. At September 30, 2019, there was one letter of credit in the amount of $1.1 million outstanding under this facility, and $60.0 million in borrowings,

66

with the remaining $113.9 million available to DP&L. Fees associated with this letter of credit facility were not material during the nine months ended September 30, 2019 or 2018.

DPL has a revolving credit facility of $125.0 million, with a $75.0 million letter of credit sublimit and a feature that provides DPL the ability to increase the size of the facility by an additional $50.0 million. This facility is secured by a pledge of common stock that DPL owns in DP&L, limited to the amount permitted to be pledged under certain Indentures dated October 3, 2011 and April 17, 2019 between DPL and Wells Fargo Bank, NA and U.S. Bank National Association, respectively, as Trustee. The facility expires in June 2023. At September 30, 2019, there were six letters of credit in the aggregate amount of $11.1 million outstanding and $38.0 million in borrowings, with the remaining $75.9 million available to DPL. Fees associated with this facility were not material during the nine months ended September 30, 2019 or 2018.

Capital Requirements

Planned construction additions for 2019 relate primarily to new investments in and upgrades to DP&L’s transmission and distribution system. Capital projects are subject to continuing review and are revised considering changes in financial and economic conditions, load forecasts, legislative and regulatory developments and changing environmental requirements, among other factors.

DPL is projecting to spend an estimated $657.0 million in capital projects for the period 2019 through 2021, of which $649.0 million is projected to be spent by DP&L. These amounts include expected spending under DP&L's Distribution Modernization Plan filed with the PUCO in December 2018. On January 22, 2019, DP&L filed a request with the PUCO for a two-year extension of its DMR through October 2022, in the proposed amount of $199.0 million for each of the two additional years. The request was made pursuant to the PUCO’s October 20, 2017 ESP order, which approved the DMR and had the option for DP&L to file for a two-year extension. The extension request was set at a level expected to reduce debt obligations at both DP&L and DPL and to position DP&L to make capital expenditures to maintain and modernize its electric grid. To that end, DP&L’s DMP investments are contingent upon the PUCO approving the two-year extension of its DMR.

DP&L is subject to the mandatory reliability standards of NERC and Reliability First Corporation (RFC), one of the eight NERC regions, of which DP&L is a member. DP&L anticipates spending approximately $221.0 million within the next five years to reinforce its 138-kV system to comply with NERC standards. Our ability to complete capital projects and the reliability of future service will be affected by our financial condition, the availability of internal funds and the reasonable cost of external funds. We expect to finance our construction additions with a combination of cash on hand, short-term financing, long-term debt and cash flows from operations.

Long-term debt covenants

For information regarding our long-term debt covenants, see Part I, Item 1, Note 6 – Long-term Debt of Notes to DPL's Condensed Consolidated Financial Statements and Part I, Item 1, Note 6 – Long-term Debt of Notes to DP&L's Condensed Financial Statements.

Debt and Credit Ratings

The following table presents, as of the filing of this report, the debt ratings and outlook for DPL and DP&L, along with the effective or affirmed date of each rating.

	DPL	DP&L	Outlook	Effective or Affirmed
Fitch Ratings	BBB(a) / BBB-(b)	A- (c)	Stable	October 2018
Moody's Investors Service, Inc.	Ba1 (b)	A3 (c)	Stable	June 2019
Standard & Poor's Financial Services LLC	BBB- (b)	BBB+ (c)	Negative	October 2019

(a) Rating relates to DPL’s Senior secured debt.

(b) Rating relates to DPL's Senior unsecured debt.

(c) Rating relates to DP&L’s Senior secured debt.

67

The following table presents, as of the filing of this report, the credit ratings (issuer/corporate rating) and outlook for DPL and DP&L, along with the effective or affirmed date of each rating.

	DPL	DP&L	Outlook	Effective or Affirmed
Fitch Ratings	BBB-	BBB	Stable	October 2018
Moody's Investors Service, Inc.	Ba1	Baa2	Stable	June 2019
Standard & Poor's Financial Services LLC	BBB-	BBB-	Negative	October 2019

If the rating agencies were to reduce our debt or credit ratings, our borrowing costs may increase, our potential pool of investors and funding resources may be reduced, and we may be required to post additional collateral under selected contracts. These events could have an adverse effect on our results of operations, financial condition and cash flows. In addition, any such reduction in our debt or credit ratings may adversely affect the trading price of our outstanding debt securities.

Off-Balance Sheet Arrangements

For information on guarantees, commercial commitments, and contractual obligations, see Part I, Item 1, Note 10 – Contractual Obligations, Commercial Commitments and Contingencies of Notes to DPL's Condensed Consolidated Financial Statements and Part I, Item 1, Note 10 – Contractual Obligations, Commercial Commitments and Contingencies of Notes to DP&L's Condensed Financial Statements.

MARKET RISK

We are subject to certain market risks including, but not limited to, changes in commodity prices for electricity and fluctuations in interest rates. Our Risk Management Committee (RMC), comprised of members of senior management, is responsible for establishing risk management policies and the monitoring and reporting of risk exposures. The RMC meets on a regular basis with the objective of identifying, assessing and quantifying material risk issues and developing strategies to manage these risks.

The disclosures presented in this section are based upon a number of assumptions; actual effects may differ. The safe harbor provided in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 shall apply to the disclosures contained in this section. For further information regarding market risk, see Item 1A.—Risk Factors and Item 7A - Quantitative and Qualitative Disclosures about Market Risk of our Form 10-K. Our businesses may incur substantial costs and liabilities and be exposed to price volatility as a result of risks associated with the electricity markets, which could have a material adverse effect on our results of operations, financial condition and cash flows. In addition, we may not be adequately hedged against our exposure to changes in interest rates.

Interest Rate Risk

Because of our normal investing and borrowing activities, our financial results are exposed to fluctuations in interest rates which we manage through our regular financing activities. We maintain both cash on deposit and investments in cash equivalents that may be affected by adverse interest rate fluctuations. DPL has fixed-rate long-term debt. DP&L has both fixed-rate and variable-rate long-term debt. The variable-rate debt is comprised of bank held tax-exempt bonds. The variable-rate bonds bear interest based on an underlying interest rate index, typically LIBOR. Market indexes can be affected by market demand, supply, market interest rates and other economic conditions. As of September 30, 2019, the effect of a 100-basis-point change in interest rates would be approximately $1.2 million for DPL and $1.2 million for DP&L. See Part I, Item 1, Note 6 – Long-term Debt of Notes to DPL's Condensed Consolidated Financial Statements and Part I, Item 1, Note 6 – Long-term Debt of Notes to DP&L's Condensed Financial Statements.

As of September 30, 2019, we have two interest rate swaps to hedge the variable interest on our $140.0 million variable interest rate tax-exempt First Mortgage Bonds. The interest rate swaps have a combined notional amount of $140.0 million and settle monthly based on a one-month LIBOR.

Long-term debt maturities and repayments occurring in the next twelve months are discussed under "CAPITAL RESOURCES AND LIQUIDITY".

68

Critical Accounting Estimates

DPL’s Condensed Consolidated Financial Statements and DP&L’s Condensed Financial Statements are prepared in accordance with GAAP. In connection with the preparation of these financial statements, our management is required to make assumptions, estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and the related disclosure of contingent liabilities. These assumptions, estimates and judgments are based on our historical experience and assumptions that we believe to be reasonable at the time. However, because future events and their effects cannot be determined with certainty, the determination of estimates requires the exercise of judgment. Our critical accounting estimates are those which require assumptions to be made about matters that are highly uncertain.

Different estimates could have a material effect on our financial results. Judgments and uncertainties affecting the application of these policies and estimates may result in materially different amounts being reported under different conditions or circumstances. Historically, however, recorded estimates have not differed materially from actual results. Significant items subject to such judgments include: the carrying value of property, plant and equipment; unbilled revenues; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; assets and liabilities related to employee benefits and intangible assets. Refer to our Form 10-K for the year ended December 31, 2018 for a complete listing of our critical accounting policies and estimates. We have reviewed and determined that these remain as critical accounting policies as of and for the nine months ended September 30, 2019.

Item 3 – Quantitative and Qualitative Disclosures about Market Risk

See the “MARKET RISK” section in Item 2 of this Part I, which is incorporated by reference into this item.

Item 4 – Controls and Procedures

Disclosure Controls and Procedures

DPL and DP&L, under the supervision and with the participation of its management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), evaluated the effectiveness of our “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of September 30, 2019, to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and include controls and procedures designed to ensure that information required to be disclosed by us in such reports is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosures.

Changes in Internal Controls over Financial Reporting

We periodically review our internal controls over financial reporting as part of our efforts to ensure compliance with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002. In addition, we routinely review our system of internal controls over financial reporting to identify potential changes to our processes and systems that may improve controls and increase efficiency, while ensuring that we maintain an effective internal controls environment. Changes may include such activities as implementing new, more efficient systems, migrating certain processes to our shared services organizations, formalizing policies and procedures, improving segregation of duties and increasing monitoring controls. During the second quarter of 2019, we implemented a new core enterprise resource planning (ERP) system, which we expect to enhance our system of internal controls over financial reporting. As a result of this implementation, we modified certain existing internal controls as well as implemented new controls and procedures related to the new ERP. We continued to evaluate the design and operating effectiveness of these internal controls during the third quarter of 2019.

Except with respect to the implementation of the ERP, there were no changes in our internal controls over financial reporting that occurred in the third quarter of 2019 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting. We will continue to monitor the internal control structure over financial reporting to ensure that the design is proper and operating effectively.

69

Part II – Other Information

Item 1 – Legal Proceedings

In the normal course of business, we are subject to various lawsuits, actions, claims, and other proceedings. We are also, from time to time, involved in other reviews, investigations and proceedings by governmental and regulatory agencies regarding our business, certain of which may result in adverse judgments, settlements, fines, penalties, injunctions or other relief. We have accrued in our Financial Statements for litigation and claims where it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. We believe the amounts provided in our Financial Statements, as prescribed by GAAP, for these matters are adequate considering the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims and other matters (including those matters noted below), and to comply with applicable laws and regulations will not exceed the amounts reflected in our Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided for in our Financial Statements, cannot be reasonably determined, but could be material.

Our Form 10-K for the fiscal year ended December 31, 2018 and Forms 10-Q for the quarters ended March 31, and June 30, 2019 and the Notes to DPL’s Consolidated Financial Statements and DP&L’s Financial Statements included therein contain descriptions of certain legal proceedings in which we are or were involved. The information in or incorporated by reference into this Item 1 to Part II is limited to certain recent developments concerning our legal proceedings and new legal proceedings, since the filing of such Forms 10-K and 10-Q, and should be read in conjunction with such Forms 10-K and 10-Q.

The following information is incorporated by reference into this Item: information about the legal proceedings contained in Part I, Item 2 – Management's Discussion and Analysis of Financial Condition and Results of Operations and Part I, Item 1, Note 3 – Regulatory Matters of Notes to DPL's Condensed Consolidated Financial Statements and Part I, Item 1, Note 3 – Regulatory Matters of Notes to DP&L's Condensed Financial Statements of this Quarterly Report on Form 10-Q.

Item 1A – Risk Factors

A listing of the risk factors that we consider to be the most significant to a decision to invest in our securities is provided in our Form 10-K for the fiscal year ended December 31, 2018. As of September 30, 2019, there have been no material changes with respect to the risk factors disclosed in our Form 10-K. If any of the events described in our risk factors occur, it could have a material adverse effect on our results of operations, financial condition and cash flows.

The risks and uncertainties described in our risk factors are not the only ones we face. In addition, new risks may emerge at any time, and we cannot predict those risks or estimate the extent to which they may affect our business or financial performance. Our risk factors should be read in conjunction with the other detailed information concerning DPL and DP&L set forth in the Notes to DPL’s and DP&L’s Financial Statements found in Part I, Item 1, and the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections included in our filings.

Item 2 – Unregistered Sale of Equity Securities and Use of Proceeds

None

Item 3 – Defaults Upon Senior Securities

None

Item 4 – Mine Safety Disclosures

Not applicable.

70

Item 5 – Other Information

None

Item 6 – Exhibits

DPL	DP&L	Exhibit Number	Exhibit	Location
X		31(a)	Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith as Exhibit 31(a)
X		31(b)	Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith as Exhibit 31(b)
	X	31(c)	Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith as Exhibit 31(c)
	X	31(d)	Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith as Exhibit 31(d)
X		32(a)	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Filed herewith as Exhibit 32(a)
X		32(b)	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Filed herewith as Exhibit 32(b)
	X	32(c)	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Filed herewith as Exhibit 32(c)
	X	32(d)	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Filed herewith as Exhibit 32(d)
X	X	101.INS	XBRL Instance	Filed herewith as Exhibit 101.INS
X	X	101.SCH	XBRL Taxonomy Extension Schema	Filed herewith as Exhibit 101.SCH
X	X	101.CAL	XBRL Taxonomy Extension Calculation Linkbase	Filed herewith as Exhibit 101.CAL
X	X	101.DEF	XBRL Taxonomy Extension Definition Linkbase	Filed herewith as Exhibit 101.DEF
X	X	101.LAB	XBRL Taxonomy Extension Label Linkbase	Filed herewith as Exhibit 101.LAB
X	X	101.PRE	XBRL Taxonomy Extension Presentation Linkbase	Filed herewith as Exhibit 101.PRE

Exhibits referencing File No. 1-9052 have been filed by DPL Inc. and those referencing File No. 1-2385 have been filed by The Dayton Power and Light Company.

71

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, DPL Inc. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		DPL Inc.
		(Registrant)
Date:	November 5, 2019	/s/ Gustavo Garavaglia
		Gustavo Garavaglia
		Chief Financial Officer
		(principal financial officer)
	November 5, 2019	/s/ Karin M. Nyhuis
		Karin M. Nyhuis
		Controller
		(principal accounting officer)

72

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, The Dayton Power and Light Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		The Dayton Power and Light Company
		(Registrant)
Date:	November 5, 2019	/s/ Gustavo Garavaglia
		Gustavo Garavaglia
		Vice President and Chief Financial Officer
		(principal financial officer)
	November 5, 2019	/s/ Karin M. Nyhuis
		Karin M. Nyhuis
		Controller
		(principal accounting officer)

73

EX-31.A

Exhibit 31(a)

CERTIFICATIONS

I, Barry J. Bentley, certify that:

1. I have reviewed this quarterly report on Form 10-Q of DPL Inc. ;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2019

/s/ Barry J. Bentley

Barry J. Bentley

Interim President and Chief Executive Officer

EX-31.B

Exhibit 31(b)

CERTIFICATIONS

I, Gustavo Garavaglia, certify that:

1. I have reviewed this quarterly report on Form 10-Q of DPL Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2019

/s/ Gustavo Garavaglia

Gustavo Garavaglia

Chief Financial Officer

EX-31.C

 Exhibit 31(c)

CERTIFICATIONS

I, Vincent Parisi, certify that:

1. I have reviewed this quarterly report on Form 10-Q of The Dayton Power and Light Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2019

/s/ Vincent Parisi

Vincent Parisi

President and Chief Executive Officer

EX-31.D

Exhibit 31(d)

CERTIFICATIONS

I, Gustavo Garavaglia, certify that:

1. I have reviewed this quarterly report on Form 10-Q of The Dayton Power and Light Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2019

/s/ Gustavo Garavaglia

Gustavo Garavaglia

Vice President and Chief Financial Officer

EX-32.A

Exhibit 32(a)

DPL Inc.

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

The undersigned officer of DPL Inc. (the “Issuer”) hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Issuer’s Quarterly Report on Form 10-Q for the period ended September 30, 2019, which this certificate accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained therein fairly presents, in all material respects, the financial condition and results of operations of the Issuer as of the dates and for the periods expressed therein.

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this statement required by Section 906 of the Sarbanes-Oxley Act of 2002, has been provided to the Issuer and will be retained by the Issuer and furnished to the Securities and Exchange Commission or its staff upon request.

Signed:

/s/ Barry J. Bentley

Barry J. Bentley

Interim President and Chief Executive Officer

Date: November 5, 2019

The foregoing certificate is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Issuer’s Annual Report or as a separate disclosure document.

EX-32.B

Exhibit 32(b)

DPL Inc.

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

The undersigned officer of DPL Inc. (the “Issuer”) hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Issuer’s Quarterly Report on Form 10-Q for the period ended September 30, 2019, which this certificate accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained therein fairly presents, in all material respects, the financial condition and results of operations of the Issuer as of the dates and for the periods expressed therein.

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this statement required by Section 906 of the Sarbanes-Oxley Act of 2002, has been provided to the Issuer and will be retained by the Issuer and furnished to the Securities and Exchange Commission or its staff upon request.

Signed:

/s/ Gustavo Garavaglia

Gustavo Garavaglia

Chief Financial Officer

Date: November 5, 2019

The foregoing certificate is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Issuer’s Annual Report or as a separate disclosure document.

EX-32.C

Exhibit 32(c)

The Dayton Power and Light Company

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

The undersigned officer of The Dayton Power and Light Company (the “Issuer”) hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Issuer’s Quarterly Report on Form 10-Q for the period ended September 30, 2019, which this certificate accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained therein fairly presents, in all material respects, the financial condition and results of operations of the Issuer as of the dates and for the periods expressed therein.

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this statement required by Section 906 of the Sarbanes-Oxley Act of 2002, has been provided to the Issuer and will be retained by the Issuer and furnished to the Securities and Exchange Commission or its staff upon request.

Signed:

/s/ Vincent Parisi

Vincent Parisi

President and Chief Executive Officer

Date: November 5, 2019

The foregoing certificate is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Issuer’s Annual Report or as a separate disclosure document.

EX-32.D

Exhibit 32(d)

The Dayton Power and Light Company

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

The undersigned officer of The Dayton Power and Light Company (the “Issuer”) hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Issuer’s Quarterly Report on Form 10-Q for the period ended September 30, 2019, which this certificate accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained therein fairly presents, in all material respects, the financial condition and results of operations of the Issuer as of the dates and for the periods expressed therein.

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this statement required by Section 906 of the Sarbanes-Oxley Act of 2002, has been provided to the Issuer and will be retained by the Issuer and furnished to the Securities and Exchange Commission or its staff upon request.

Signed:

/s/ Gustavo Garavaglia

Gustavo Garavaglia

Vice President and Chief Financial Officer

Date: November 5, 2019

The foregoing certificate is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Issuer’s Annual Report or as a separate disclosure document.

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities:
Net income	$ 61.4	$ 41.4
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization	34.2	62.4
Amortization of Debt Issuance Costs	4.3	4.4
Gain (Loss) on Extinguishment of Debt	(44.9)	(6.4)
Deferred income taxes	(8.7)	(17.8)
Impairment of Long-Lived Assets Held-for-use	0.0	2.8
Gain (Loss) on Disposition of Business, Including Discontinued Operation	(0.1)	13.2
Gain (Loss) on Sale of Assets and Asset Impairment Charges	0.9	(0.6)
Changes in certain assets and liabilities:
Accounts receivable, net	18.0	34.4
Inventories	(3.2)	14.7
Taxes applicable to subsequent years	56.2	57.7
Deferred regulatory costs, net	2.9	(4.1)
Accounts payable	(5.1)	(17.4)
Accrued taxes	(71.0)	(47.1)
Accrued interest	12.9	13.4
Increase (Decrease) in Obligation, Pension and Other Postretirement Benefits	(9.3)	(4.0)
Other	(2.0)	(6.9)
Net Cash Provided by (Used in) Operating Activities	136.3	152.9
Cash flows from investing activities:
Capital expenditures	(122.4)	(75.8)
Proceeds from disposal and sale of business	0.0	234.9
Payments for Removal Costs	0.0	(14.5)
Proceeds from Sale of Property, Plant, and Equipment	0.0	10.6
Proceeds from Insurance Settlement, Investing Activities	0.0	2.8
Payments to Acquire Intangible Assets	3.6	0.0
Other investing activities, net	0.1	(0.5)
Net cash provided by / (used in) investing activities	(125.9)	157.5
Cash flows from financing activities:
Payments of Deferred Finance Costs	(9.2)	0.0
Repayments of Lines of Credit	(35.0)	(40.0)
Proceeds from Issuance of Long-term Debt	821.7	0.0
Proceeds from Lines of Credit	133.0	30.0
Retirement of long-term debt, including early payment premium	(978.0)	(239.4)
Proceeds from (Payments for) Other Financing Activities	(0.2)	0.0
Net cash used in financing activities	(67.7)	(249.4)
Cash, cash equivalents, and restricted cash:
Net Cash Provided by (Used in) Discontinued Operations	0.0	1.5
Restricted Cash and Cash Equivalents	54.4	87.4
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Excluding Exchange Rate Effect	(57.3)	62.5
Supplemental cash flow information:
Interest paid, net of amounts capitalized	47.1	55.2
Proceeds from Income Tax Refunds	1.3	(2.0)
Non-cash financing and investing activities:
Accruals for capital expenditures	2.3	7.6
Non-cash Proceeds from Sale of Business	0.0	4.1
Non-cash capital contribution	2.7	30.2
THE DAYTON POWER AND LIGHT COMPANY [Member]
Cash flows from operating activities:
Net income	103.7	61.9
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization	52.9	56.5
Gain (Loss) on Extinguishment of Debt	0.0	(0.6)
Deferred income taxes	(17.2)	(7.5)
Gain (Loss) on Disposition of Business	0.0	12.4
Changes in certain assets and liabilities:
Accounts receivable, net	18.9	(3.3)
Inventories	(2.1)	(0.2)
Taxes applicable to subsequent years	54.3	54.0
Deferred regulatory costs, net	2.9	(4.1)
Accounts payable	(4.8)	(1.1)
Accrued taxes	(65.6)	(58.7)
Accrued interest	6.0	(0.3)
Increase (Decrease) in Obligation, Pension and Other Postretirement Benefits	(9.3)	(3.1)
Other	(0.8)	6.1
Net Cash Provided by (Used in) Operating Activities	138.9	113.2
Cash flows from investing activities:
Capital expenditures	(121.1)	(65.0)
Payments for Removal Costs	0.0	(14.5)
Proceeds from Sale of Property, Plant, and Equipment	0.0	10.6
Proceeds from Insurance Settlement, Investing Activities	0.0	0.1
Other investing activities, net	(3.5)	(0.2)
Net cash provided by / (used in) investing activities	(124.6)	(69.0)
Cash flows from financing activities:
Payments of Deferred Finance Costs	(4.6)	0.0
Repayments of Lines of Credit	0.0	(40.0)
Proceeds from Issuance of Long-term Debt	422.3	0.0
Proceeds from Lines of Credit	60.0	30.0
Retirement of long-term debt, including early payment premium	(436.1)	(63.3)
Payments of Ordinary Dividends, Common Stock	(90.0)	(43.8)
Proceeds from Contributions from Parent	0.0	80.0
Proceeds from (Payments for) Other Financing Activities	(0.1)	0.0
Net cash used in financing activities	(48.5)	(37.1)
Cash, cash equivalents, and restricted cash:
Restricted Cash and Cash Equivalents	32.0
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Excluding Exchange Rate Effect	(34.2)	7.1
Supplemental cash flow information:
Interest paid, net of amounts capitalized	10.8	17.0
Income Taxes Paid, Net	19.0	8.3
Non-cash financing and investing activities:
Accruals for capital expenditures	2.0	7.2
Other Operating Income (Expense) [Member]
Adjustments to reconcile net income to net cash from operating activities:
Impairment of Long-Lived Assets Held-for-use	0.0	2.8
Gain (Loss) on Disposition of Business	$ 0.0	$ 11.7

XML

Debt (Long-term Debt) (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2019	May 07, 2019	Apr. 17, 2019	Mar. 31, 2019	Dec. 31, 2018	Mar. 30, 2018
Debt Instrument [Line Items]
Unamortized deferred finance costs	$ (5.8)				$ (4.3)
Unamortized debt discounts and premiums, net	(1.1)				(0.5)
Total long-term debt	1,362.9				1,475.9
Less: current portion	(139.6)				(103.6)
Long-term debt	1,223.3				1,372.3
Long-term Line of Credit					0.0
THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs	(5.7)				(6.3)
Unamortized deferred finance costs	(5.7)				(6.3)
Unamortized debt discounts and premiums, net	(2.7)				(1.4)
Unamortized debt discounts and premiums, net	(2.7)				(1.4)
Total long-term debt at subsidiary	574.2				586.1
Total long-term debt	574.2				586.1
Less: current portion	(139.6)				(4.6)
Long-term debt	$ 434.6				581.5
Long-term Line of Credit					0.0
Term Loan Maturing 2022 [Domain]
Debt Instrument [Line Items]
Debt instrument maturity year	Aug. 24, 2022
Term Loan Maturing 2022 [Domain] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Debt instrument maturity year	Aug. 24, 2022
Term Loan Maturing 2022 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 0.0				436.1
3.95% Senior Notes due 2049 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 425.0
Debt instrument maturity year	Jun. 15, 2049
Debt instrument interest percentage	3.95%
Pollution Control Series Maturing in August 2020 - 1.13% - 1.14% [Member]
Debt Instrument [Line Items]
Debt instrument maturity year	Aug. 01, 2020
Pollution Control Series Maturing in August 2020 - 1.13% - 1.14% [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 140.0				140.0
Debt instrument maturity year	Aug. 01, 2020
U.S. Government note maturing in February 2061 - 4.20% [Member]
Debt Instrument [Line Items]
Debt instrument maturity year	Feb. 01, 2061
Debt instrument interest percentage	4.20%
U.S. Government note maturing in February 2061 - 4.20% [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 17.6				17.7
Debt instrument maturity year	Feb. 01, 2061
Debt instrument interest percentage	4.20%
Senior unsecured due in October 2019 - 6.75% [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross					99.0	$ 200.0
Debt instrument maturity year	Oct. 01, 2019
Debt instrument interest percentage	6.75%			6.75%
Ten Year Senior Unsecured Bonds At435 Maturing At April152029 [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage			4.35%
Senior unsecured due in October 2021 - 7.25% [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 380.0	$ 380.0			780.0
Debt instrument maturity year	Oct. 01, 2021
Debt instrument interest percentage	7.25%			7.25%
4.35% Senior Notes due 2029 [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 400.0
Debt instrument maturity year	Apr. 15, 2029
Debt instrument interest percentage	4.35%
Note to DPL Capital Trust II Maturing in September 2031 - 8.125% [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross	$ 15.6				$ 15.6
Debt instrument maturity year	Sep. 01, 2031
Debt instrument interest percentage	8.125%
Maximum [Member] | Term Loan Maturing 2022 [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage	4.53%
Debt Instrument, Interest Rate, Effective Percentage					4.60%
Maximum [Member] | Term Loan Maturing 2022 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage	4.53%
Debt Instrument, Interest Rate, Effective Percentage					4.60%
Maximum [Member] | Pollution Control Series Maturing in August 2020 - 1.13% - 1.14% [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage					1.92%
Maximum [Member] | Zero Point Two Three To Zero Point Two Nine And Zero Point One Six To Zero Point Three Six Percentage Of Bonds Maturing In November Two Thousand Forty [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage	3.07%
Maximum [Member] | Zero Point Two Three To Zero Point Two Nine And Zero Point One Six To Zero Point Three Six Percentage Of Bonds Maturing In November Two Thousand Forty [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage	3.07%				1.92%
Minimum [Member] | Term Loan Maturing 2022 [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage					4.01%
Debt Instrument, Interest Rate, Effective Percentage	4.50%
Minimum [Member] | Term Loan Maturing 2022 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage					4.01%
Debt Instrument, Interest Rate, Effective Percentage	4.50%
Minimum [Member] | Pollution Control Series Maturing in August 2020 - 1.13% - 1.14% [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage					1.52%
Minimum [Member] | Zero Point Two Three To Zero Point Two Nine And Zero Point One Six To Zero Point Three Six Percentage Of Bonds Maturing In November Two Thousand Forty [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage	2.97%
Minimum [Member] | Zero Point Two Three To Zero Point Two Nine And Zero Point One Six To Zero Point Three Six Percentage Of Bonds Maturing In November Two Thousand Forty [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Debt instrument interest percentage	2.97%				1.52%

XML

Derivative Instruments and Hedging Activities (Outstanding Derivative Instruments) (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Mar. 31, 2018	Sep. 30, 2018	Sep. 30, 2019	Dec. 31, 2018	Mar. 29, 2018
Sale of Derivative Instruments Interest Rate Swap					$ (60.0)
Gain on sale of Derivative Instruments Interest Rate Swap		$ 0.8
THE DAYTON POWER AND LIGHT COMPANY [Member]
Sale of Derivative Instruments Interest Rate Swap					$ (60.0)
Gain on sale of Derivative Instruments Interest Rate Swap	$ 0.8
Designated as Hedging Instrument [Member] | Interest Rate Swap [Member]
Derivative, Notional Amount, Purchase (Sales), Net			$ 140.0
Designated as Hedging Instrument [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Swap [Member]
Derivative, Notional Amount, Purchase (Sales), Net			140.0
Derivative Financial Instruments, Assets [Member]
Derivative Asset, Fair Value, Gross Asset			0.2	$ 1.5
Derivative, Collateral, Obligation to Return Securities			0.0	0.0
Derivative, Collateral, Obligation to Return Cash			0.0	0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral			0.2	1.5
Derivative Financial Instruments, Assets [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Derivative Asset, Fair Value, Gross Asset			0.2	1.5
Derivative, Collateral, Obligation to Return Securities			0.0	0.0
Derivative, Collateral, Obligation to Return Cash			0.0	0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral			0.2	1.5
Cash Flow Hedging [Member] | Other Prepayments and Current Assets [Member] | Short-term Derivative Positions [Member] | Forward Contract Power [Member]
Derivative Asset, Fair Value, Gross Asset				0.9
Derivative, Collateral, Obligation to Return Securities				0.0
Derivative, Collateral, Obligation to Return Cash				0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral				0.9
Cash Flow Hedging [Member] | Other Prepayments and Current Assets [Member] | Short-term Derivative Positions [Member] | Interest Rate Swap [Member]
Derivative Asset, Fair Value, Gross Asset			0.2
Derivative, Collateral, Obligation to Return Securities			0.0
Derivative, Collateral, Obligation to Return Cash			0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral			0.2
Cash Flow Hedging [Member] | Other Prepayments and Current Assets [Member] | Short-term Derivative Positions [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Swap [Member]
Derivative Asset, Fair Value, Gross Asset			0.2	0.9
Derivative, Collateral, Obligation to Return Securities			0.0	0.0
Derivative, Collateral, Obligation to Return Cash			0.0	0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral			$ 0.2	0.9
Cash Flow Hedging [Member] | Other Deferred Asset [Member] | Long-term Derivative Positions [Member] | Interest Rate Swap [Member]
Derivative Asset, Fair Value, Gross Asset				0.6
Derivative, Collateral, Obligation to Return Securities				0.0
Derivative, Collateral, Obligation to Return Cash				0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral				0.6
Cash Flow Hedging [Member] | Other Deferred Asset [Member] | Long-term Derivative Positions [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Swap [Member]
Derivative Asset, Fair Value, Gross Asset				0.6
Derivative, Collateral, Obligation to Return Securities				0.0
Derivative, Collateral, Obligation to Return Cash				0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral				$ 0.6

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Net income	$ 35.4	$ 21.0	$ 61.4	$ 41.4
Derivative activity:
Change in derivative fair value, net of income tax	(0.2)	0.1	(1.0)	0.4
Reclassification of earnings, net of income tax	(0.4)	(0.2)	(0.9)	(0.6)
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives Related to Discontinued Operations, Net of Tax	(0.4)	0.0	(0.4)	2.8
Total change in fair value of derivatives	(1.0)	(0.1)	(2.3)	2.6
Pension and postretirement activity:
Reclassification to earnings, net of income tax	0.0	0.1	0.1	0.4
Total change in unfunded pension obligation	0.0	0.1	0.1	0.4
Other comprehensive income / (loss)	(1.0)	0.0	(2.2)	3.0
Net comprehensive income	34.4	21.0	59.2	44.4
THE DAYTON POWER AND LIGHT COMPANY [Member]
Net income	44.9	31.2	103.7	61.9
Derivative activity:
Change in derivative fair value, net of income tax	(0.1)	0.0	(0.9)	0.5
Reclassification of earnings, net of income tax	0.0	(0.2)	(0.1)	(0.5)
Total change in fair value of derivatives	(0.1)	(0.2)	(1.0)	0.0
Pension and postretirement activity:
Reclassification to earnings, net of income tax	1.7	0.8	2.1	2.5
Total change in unfunded pension obligation	1.7	0.8	2.1	2.5
Other comprehensive income / (loss)	1.6	0.6	1.1	2.5
Net comprehensive income	$ 46.5	$ 31.8	$ 104.8	$ 64.4

XML

Discontinued Operations

9 Months Ended

Sep. 30, 2019

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Discontinued Operations

Dispositions

Beckjord Facility – On February 26, 2018, DP&L and its co-owners of the retired Beckjord Facility agreed to transfer their interests in the retired Facility to a third party, including their obligations to remediate the Facility and its site,

and the transfer occurred on that same date. As a result, DPL recognized a loss on the transfer of $11.7 million and made cash expenditures of $14.5 million, inclusive of cash expenditures for the transfer charges. The Beckjord Facility was retired in 2014, and, as such, the income / (loss) from continuing operations before income tax related to the Beckjord Facility was immaterial for the three and nine months ended September 30, 2018, excluding the loss on transfer noted above. Prior to the transfer, the Beckjord Facility was included in the Utility segment.

Discontinued Operations

On December 8, 2017, DPL and AES Ohio Generation completed the sale of their entire undivided interest in the Miami Fort Station and the Zimmer Station. On March 27, 2018, DPL and AES Ohio Generation completed the sale of the Peaker assets to Kimura Power, LLC, and this transaction resulted in a loss on sale of $1.9 million for the nine months ended September 30, 2018. Further, on May 31, 2018, DPL and AES Ohio Generation retired the Stuart Station coal-fired and diesel-fired generating units and the Killen Station coal-fired generating unit and combustion turbine as planned.

Consequently, we determined that the disposal of this group of components, as a whole, represents a strategic shift to exit generation, and, as such, qualifies to be presented as discontinued operations. Therefore, the results of operations, assets and liabilities of this group of components were reported as such in the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets for all periods presented.

The following table summarizes the major categories of assets and liabilities at the dates indicated:

$ in millions	September 30, 2019			December 31, 2018
Accounts receivable, net	$	6.8		$	4.0
Taxes applicable to subsequent years	0.6			2.3
Prepayments and other current assets	0.9			2.4
Intangible assets, net of amortization	0.2			5.3
Total assets of the disposal group classified as assets of discontinued operations and held-for-sale businesses in the balance sheets	$	8.5		$	14.0
Accounts payable	$	4.3		$	3.9
Accrued taxes	2.4			3.1
Accrued and other current liabilities	3.2			5.2
Deferred income taxes (a)	(33.2		)	(39.8		)
Taxes payable	—			2.3
Accrued pension and other post-retirement benefits	—			9.7
Asset retirement obligations	70.4			90.4
Other non-current liabilities	15.2			6.6
Total liabilities of the disposal group classified as liabilities of discontinued operations and held-for-sale businesses in the balance sheets	$	62.3		$	81.4

(a) Deferred income taxes represent the tax asset position of the discontinued group of components, which were netted with liabilities on DPL prior to classification as discontinued operations.

The following table summarizes the revenues, operating costs, other expenses and income tax of discontinued operations for the periods indicated:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Revenues	$	10.1		$	15.6		$	41.0		$	141.8
Operating costs and other expenses	(10.5		)	(10.6		)	(8.2		)	(105.1		)
Income from discontinued operations	(0.4		)	5.0			32.8			36.7
Gain / (loss) from disposal of discontinued operations	—			0.3			0.1			(1.6		)
Income tax expense from discontinued operations	0.1			1.0			7.1			5.9
Net income from discontinued operations	$	(0.5	)	$	4.3		$	25.8		$	29.2

Cash flows related to discontinued operations are included in our Condensed Consolidated Statements of Cash Flows. Cash flows from operating activities for discontinued operations were $(0.5) million and $(7.2) million for the three months ended September 30, 2019 and 2018, respectively, and $12.4 million and $37.2 million for the nine months ended September 30, 2019 and 2018, respectively. Cash flows from investing activities for discontinued operations were $233.8 million for the nine months ended September 30, 2018. There were no cash flows from

investing activities for the three and nine months ended September 30, 2019 or for the three months ended September 30, 2018.

AROs of Discontinued Operations

DPL's retired Stuart and Killen generating facilities continue to carry ARO liabilities consisting primarily of river intake and discharge structures, coal unloading facilities, landfills and ash disposal facilities. In the first quarter of 2019, DPL reduced the ARO liability related to the Stuart and Killen ash ponds and landfills by a combined $22.5 million based on updated internal analyses that reduced estimated closure costs associated with these ash ponds and landfills. The remaining ARO liability related to Stuart and Killen is included in the Asset retirement obligations balance in the total liabilities of the disposal group classified as liabilities of discontinued operations and held-for-sale businesses in the balance sheets as of September 30, 2019 above. As these plants are no longer in service, the reduction to the ARO liability was also recorded as a credit to depreciation and amortization expense in the same amount. The credit to depreciation and amortization expense is included in operating costs and other expenses of discontinued operations for the nine months ended September 30, 2019 in the table above.

XML

Fair Value (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fair Value and Cost Of Non-Derivative Instruments

The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2019 and December 31, 2018. Further information about the fair value of our derivative instruments can be found in Note 5 – Derivative Instruments and Hedging Activities.

	September 30, 2019				December 31, 2018
$ in millions	Cost		Fair Value		Cost		Fair Value
Assets
Money market funds	$	0.2	$	0.2	$	0.4	$	0.4
Equity securities	2.3		3.9		2.4		3.5
Debt securities	4.1		4.1		4.1		4.0
Hedge funds	0.1		0.1		0.1		0.1
Tangible assets	0.1		0.1		0.1		0.1
Total Assets	$	6.8	$	8.4	$	7.1	$	8.1
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities
Long-term debt	$	1,362.9	$	1,451.3	$	1,475.9	$	1,519.6

Fair Value of Assets and Liabilities Measured on Recurring Basis

The fair value of assets and liabilities at September 30, 2019 and December 31, 2018 and the respective category within the fair value hierarchy for DPL is as follows:

$ in millions	Fair value at September 30, 2019 (a)								Fair value at December 31, 2018 (a)
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Master Trust assets
Money market funds	$	0.2	$	—	$	—	$	0.2	$	0.4	$	—	$	—	$	0.4
Equity securities	—		3.9		—		3.9		—		3.5		—		3.5
Debt securities	—		4.1		—		4.1		—		4.0		—		4.0
Hedge funds	—		0.1		—		0.1		—		0.1		—		0.1
Tangible assets	—		0.1		—		0.1		—		0.1		—		0.1
Total Master Trust assets	0.2		8.2		—		8.4		0.4		7.7		—		8.1
Derivative assets
Interest rate hedges	—		0.2		—		0.2		—		1.5		—		1.5
Total Derivative assets	—		0.2		—		0.2		—		1.5		—		1.5
Total Assets	$	0.2	$	8.4	$	—	$	8.6	$	0.4	$	9.2	$	—	$	9.6
Liabilities
Long-term debt	$	—	$	1,433.7	$	17.6	$	1,451.3	$	—	$	1,501.9	$	17.7	$	1,519.6
Total Liabilities	$	—	$	1,433.7	$	17.6	$	1,451.3	$	—	$	1,501.9	$	17.7	$	1,519.6

(a)

Includes credit valuation adjustment

THE DAYTON POWER AND LIGHT COMPANY [Member]

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fair Value and Cost Of Non-Derivative Instruments

The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2019 and December 31, 2018. Further information about the fair value of our derivative instruments can be found in Note 5 – Derivative Instruments and Hedging Activities.

	September 30, 2019				December 31, 2018
$ in millions	Cost		Fair Value		Cost		Fair Value
Assets
Money market funds	$	0.2	$	0.2	$	0.4	$	0.4
Equity securities	2.3		3.9		2.4		3.5
Debt securities	4.1		4.1		4.1		4.0
Hedge funds	0.1		0.1		0.1		0.1
Tangible assets	0.1		0.1		0.1		0.1
Total assets	$	6.8	$	8.4	$	7.1	$	8.1
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities
Long-term debt	$	574.2	$	631.0	$	586.1	$	593.8

Fair Value of Assets and Liabilities Measured on Recurring Basis

The fair value of assets and liabilities at September 30, 2019 and December 31, 2018 and the respective category within the fair value hierarchy for DP&L is as follows:

$ in millions	Fair value at September 30, 2019 (a)								Fair value at December 31, 2018 (a)
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Master Trust assets
Money market funds	$	0.2	$	—	$	—	$	0.2	$	0.4	$	—	$	—	$	0.4
Equity securities	—		3.9		—		3.9		—		3.5		—		3.5
Debt securities	—		4.1		—		4.1		—		4.0		—		4.0
Hedge funds	—		0.1		—		0.1		—		0.1		—		0.1
Tangible assets	—		0.1		—		0.1		—		0.1		—		0.1
Total Master Trust assets	0.2		8.2		—		8.4		0.4		7.7		—		8.1
Derivative assets
Interest rate hedges	—		0.2		—		0.2		—		1.5		—		1.5
Total derivative assets	—		0.2		—		0.2		—		1.5		—		1.5
Total assets	$	0.2	$	8.4	$	—	$	8.6	$	0.4	$	9.2	$	—	$	9.6
Liabilities
Long-term debt	$	—	$	613.4	$	17.6	631.0		$	—	$	576.1	$	17.7	$	593.8
Total liabilities	$	—	$	613.4	$	17.6	$	631.0	$	—	$	576.1	$	17.7	$	593.8

(a) Includes credit valuation adjustment

XML

Supplemental Financial Information (Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Millions	3 Months Ended			9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Jun. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period				$ 2.2
Other comprehensive loss before reclassifications				(1.0)
Amounts reclassified from AOCI to earnings				(1.2)
Other comprehensive income / (loss)	$ (1.0)	$ 0.0		(2.2)	$ 3.0
Balance, end of period	0.0			0.0
THE DAYTON POWER AND LIGHT COMPANY [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period				(35.3)
Other comprehensive loss before reclassifications				(0.9)
Amounts reclassified from AOCI to earnings				2.0
Other comprehensive income / (loss)	1.6	$ 0.6	$ 0.8	1.1	$ 2.5
Balance, end of period	(34.2)			(34.2)
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period				17.0
Other comprehensive loss before reclassifications				(1.0)
Amounts reclassified from AOCI to earnings				(1.3)
Other comprehensive income / (loss)				(2.3)
Balance, end of period	14.7			14.7
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period				0.6
Other comprehensive loss before reclassifications				(0.9)
Amounts reclassified from AOCI to earnings				(0.1)
Other comprehensive income / (loss)				(1.0)
Balance, end of period	(0.4)			(0.4)
Change in unfunded pension obligation [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period				(14.8)
Other comprehensive loss before reclassifications				0.0
Amounts reclassified from AOCI to earnings				0.1
Other comprehensive income / (loss)				0.1
Balance, end of period	(14.7)			(14.7)
Change in unfunded pension obligation [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period				(35.9)
Other comprehensive loss before reclassifications				0.0
Amounts reclassified from AOCI to earnings				2.1
Other comprehensive income / (loss)				2.1
Balance, end of period	$ (33.8)			$ (33.8)

XML

Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2019

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Disposal Groups, Including Discontinued Operations [Table Text Block]

The following table summarizes the major categories of assets and liabilities at the dates indicated:

$ in millions	September 30, 2019			December 31, 2018
Accounts receivable, net	$	6.8		$	4.0
Taxes applicable to subsequent years	0.6			2.3
Prepayments and other current assets	0.9			2.4
Intangible assets, net of amortization	0.2			5.3
Total assets of the disposal group classified as assets of discontinued operations and held-for-sale businesses in the balance sheets	$	8.5		$	14.0
Accounts payable	$	4.3		$	3.9
Accrued taxes	2.4			3.1
Accrued and other current liabilities	3.2			5.2
Deferred income taxes (a)	(33.2		)	(39.8		)
Taxes payable	—			2.3
Accrued pension and other post-retirement benefits	—			9.7
Asset retirement obligations	70.4			90.4
Other non-current liabilities	15.2			6.6
Total liabilities of the disposal group classified as liabilities of discontinued operations and held-for-sale businesses in the balance sheets	$	62.3		$	81.4

(a) Deferred income taxes represent the tax asset position of the discontinued group of components, which were netted with liabilities on DPL prior to classification as discontinued operations.

The following table summarizes the revenues, operating costs, other expenses and income tax of discontinued operations for the periods indicated:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Revenues	$	10.1		$	15.6		$	41.0		$	141.8
Operating costs and other expenses	(10.5		)	(10.6		)	(8.2		)	(105.1		)
Income from discontinued operations	(0.4		)	5.0			32.8			36.7
Gain / (loss) from disposal of discontinued operations	—			0.3			0.1			(1.6		)
Income tax expense from discontinued operations	0.1			1.0			7.1			5.9
Net income from discontinued operations	$	(0.5	)	$	4.3		$	25.8		$	29.2

XML

Supplemental Financial Information

9 Months Ended

Sep. 30, 2019

Supplemental Financial Information [Line Items]

Supplemental Financial Information

Supplemental Financial Information

Accounts receivable and Inventories are as follows at September 30, 2019 and December 31, 2018:

	September 30,			December 31,
$ in millions	2019			2018
Accounts receivable, net:
Customer receivables	$	51.1		$	55.8
Unbilled revenue	15.2			16.8
Amounts due from affiliates	0.2			—
Due from PJM transmission enhancement settlement	2.4			16.5
Other	1.3			2.3
Provision for uncollectible accounts	(0.4		)	(0.9		)
Total accounts receivable, net	$	69.8		$	90.5
Inventories, at average cost:
Fuel and limestone	$	3.0		$	1.9
Materials and supplies	10.0			8.3
Other	—			0.5
Total inventories, at average cost	$	13.0		$	10.7

Accumulated Other Comprehensive Income / (Loss)

The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2019 and 2018 are as follows:

Details about Accumulated Other Comprehensive Income / (Loss) components	Affected line item in the Condensed Consolidated Statements of Operations	Three months ended						Nine months ended
		September 30,						September 30,
$ in millions		2019			2018			2019			2018
Gains and losses on cash flow hedges (Note 5):
	Interest expense	$	(0.3	)	$	(0.3	)	$	(0.9	)	$	(0.9	)
	Income tax benefit / (expense)	(0.1		)	0.1			—			0.3
	Net of income taxes	(0.4		)	(0.2		)	(0.9		)	(0.6		)
	Loss from discontinued operations	—			—			—			4.3
	Income tax benefit from discontinued operations	(0.4		)	—			(0.4		)	(1.5		)
	Net of income taxes	(0.4		)	—			(0.4		)	2.8
Amortization of defined benefit pension items (Note 8):
	Other expense	0.1			0.2			0.2			0.5
	Income tax benefit	(0.1		)	(0.1		)	(0.1		)	(0.1		)
	Net of income taxes	—			0.1			0.1			0.4
Total reclassifications for the period, net of income taxes		$	(0.8	)	$	(0.1	)	$	(1.2	)	$	2.6

The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2019 are as follows:

$ in millions	Gains / (losses) on cash flow hedges			Change in unfunded pension and postretirement benefit obligation			Total
Balance at January 1, 2019	$	17.0		$	(14.8	)	$	2.2
Other comprehensive loss before reclassifications	(1.0		)	—			(1.0		)
Amounts reclassified from AOCI to earnings	(1.3		)	0.1			(1.2		)
Net current period other comprehensive income / (loss)	(2.3		)	0.1			(2.2		)
Balance at September 30, 2019	$	14.7		$	(14.7	)	$	—

Operating expenses - other

Operating expenses - other generally includes gains or losses on asset sales or dispositions, insurance recoveries, gains or losses on the sale of businesses and other expense or income from miscellaneous transactions. The components of Operating expenses - other are summarized as follows:

	Three months ended				Nine months ended
	September 30,				September 30,
$ in millions	2019		2018		2019		2018
Loss on disposal and sale of businesses	$	—	$	—	$	—	$	11.7
Fixed-asset impairment	—		1.6		—		2.8
Other	—		—		0.9		0.1
Net other expense / (income)	$	—	$	1.6	$	0.9	$	14.6

THE DAYTON POWER AND LIGHT COMPANY [Member]

Supplemental Financial Information [Line Items]

Supplemental Financial Information

Supplemental Financial Information

Accounts receivable and Inventories are as follows at September 30, 2019 and December 31, 2018:

	September 30,			December 31,
$ in millions	2019			2018
Accounts receivable, net:
Customer receivables	$	50.0		$	53.3
Unbilled revenue	15.2			16.8
Amounts due from affiliates	3.2			2.3
Due from PJM transmission enhancement settlement	2.4			16.5
Other	1.3			2.4
Provision for uncollectible accounts	(0.4		)	(0.9		)
Total accounts receivable, net	$	71.7		$	90.4
Inventories, at average cost:
Materials and supplies	$	9.8		$	7.1
Other	—			0.6
Total inventories, at average cost	$	9.8		$	7.7

Accumulated Other Comprehensive Income / (Loss)

The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2019 and 2018 are as follows:

Details about Accumulated Other Comprehensive Income / (Loss) components	Affected line item in the Condensed Statements of Operations	Three months ended					Nine months ended
		September 30,					September 30,
$ in millions		2019		2018			2019			2018
Gains and losses on cash flow hedges (Note 5):
	Interest expense	$	—	$	(0.3	)	$	(0.1	)	$	(1.1	)
	Income tax expense	—		0.1			—			0.6
	Net of income taxes	—		(0.2		)	(0.1		)	(0.5		)
Amortization of defined benefit pension items (Note 8):
	Other expense	0.8		1.0			2.6			3.2
	Income tax expense / (benefit)	0.9		(0.2		)	(0.5		)	(0.7		)
	Net of income taxes	1.7		0.8			2.1			2.5
Total reclassifications for the period, net of income taxes		$	1.7	$	0.6		$	2.0		$	2.0

The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2019 are as follows:

$ in millions	Gains / (losses) on cash flow hedges			Change in unfunded pension and postretirement benefit obligation			Total
Balance at January 1, 2019	$	0.6		$	(35.9	)	$	(35.3	)
Other comprehensive loss before reclassifications	(0.9		)	—			(0.9		)
Amounts reclassified from AOCI to earnings	(0.1		)	2.1			2.0
Net current period other comprehensive income / (loss)	(1.0		)	2.1			1.1
Balance at September 30, 2019	$	(0.4	)	$	(33.8	)	$	(34.2	)

XML

Debt Obligations

9 Months Ended

Sep. 30, 2019

Debt Instrument [Line Items]

Debt Obligations

Long-term Debt

The following table summarizes DPL's long-term debt.

	Interest		September 30,			December 31,
$ in millions	Rate	Maturity	2019			2018
Term loan - rates from 4.50% - 4.53% (a) and 4.01% - 4.60% (b)		2022	$	—		$	436.1
First Mortgage Bonds	3.95%	2049	425.0			—
Tax-exempt First Mortgage Bonds - rates from 2.97% - 3.07% (a) and 1.52% - 1.92% (b)		2020	140.0			140.0
U.S. Government note	4.20%	2061	17.6			17.7
Unamortized deferred financing costs			(5.7		)	(6.3		)
Unamortized debt discounts and premiums, net			(2.7		)	(1.4		)
Total long-term debt at DP&L			574.2			586.1
Senior unsecured bonds	6.75%	2019	—			99.0
Senior unsecured bonds	7.25%	2021	380.0			780.0
Senior unsecured notes	4.35%	2029	400.0			—
Note to DPL Capital Trust II (c)	8.125%	2031	15.6			15.6
Unamortized deferred financing costs			(5.8		)	(4.3		)
Unamortized debt discounts and premiums, net			(1.1		)	(0.5		)
Total long-term debt			1,362.9			1,475.9
Less: current portion			(139.6		)	(103.6		)
Long-term debt, net of current portion			$	1,223.3		$	1,372.3

(a) Range of interest rates for the nine months ended September 30, 2019.

(b) Range of interest rates for the year ended December 31, 2018.

(c) Note payable to related party.

Deferred financing costs are amortized over the remaining life of the debt using the effective interest method. Premiums or discounts on long-term debt are amortized over the remaining life of the debt using the effective interest method.

Line of credit

At September 30, 2019 and December 31, 2018, DPL had outstanding borrowings on its line of credit of $38.0 million and $0.0 million, respectively. At September 30, 2019 and December 31, 2018, DP&L had outstanding borrowings on its line of credit of $60.0 million and $0.0 million, respectively.

Significant transactions

On June 19, 2019, DP&L amended and restated its unsecured revolving credit facility. The revolving credit facility has a $175.0 million borrowing limit, with a $75.0 million letter of credit sublimit, a feature that provides DP&L the

ability to increase the size of the facility by an additional $100.0 million, a maturity date of June 2024, and a provision that provides DP&L the option to request up to two one-year extensions of the maturity date.

On June 6, 2019, DP&L closed on a $425.0 million issuance of First Mortgage Bonds due 2049. These new bonds carry an interest rate of 3.95%. The proceeds of this issuance were used to repay in full the outstanding principal of $435.0 million of DP&L's variable rate Term Loan B credit agreement.

On June 19, 2019, DPL amended and restated its secured revolving credit facility. The revolving credit facility has a $125.0 million borrowing limit, with a $75.0 million letter of credit sublimit, a feature that provides DPL the ability to increase the size of the facility by an additional $50.0 million, and a maturity date of June 2023.

On April 17, 2019, DPL closed a $400.0 million issuance of senior unsecured notes. These notes carry an interest rate of 4.35% and mature on April 15, 2029. Proceeds from the issuance and cash on hand were used to settle a partial redemption for $400.0 million of DPL's 7.25% senior unsecured notes maturing October 15, 2021, as discussed below. After the redemption, the DPL 7.25% senior notes due in 2021 have an outstanding balance of $380.0 million.

On April 8, 2019, DPL issued a Notice of Partial Redemption to the Trustee (Wells Fargo Bank N.A.) on the DPL 7.25% Senior Notes due 2021. DPL redeemed $400.0 million of the $780.0 million outstanding principal amount of these notes on May 7, 2019. These bonds were redeemed at par plus accrued interest and a make-whole premium of $41.4 million.

On March 4, 2019, DPL issued a Notice of Full Redemption to the Trustee (U.S. Bank) on the DPL 6.75% Senior Notes due 2019. DPL redeemed the remaining $99.0 million outstanding principal amount of these notes on April 4, 2019. These bonds were redeemed at par plus accrued interest and a make-whole premium of $1.5 million with cash on hand.

On March 30, 2018, DPL issued a Notice of Partial Redemption to the Trustee (U.S. Bank) on the DPL 6.75% Senior Notes due 2019. DPL redeemed $101.0 million of the $200.0 million outstanding principal amount of these notes at par plus accrued interest and a make-whole premium of $5.1 million on April 30, 2018 with cash on hand.

On March 30, 2018, DP&L commenced a redemption of $60.0 million of outstanding tax exempt First Mortgage Bonds due 2020 at par value (plus accrued and unpaid interest). These bonds were redeemed at par plus accrued interest on April 30, 2018 with cash on hand.

On March 27, 2018, DPL made a $70.0 million prepayment to eliminate the outstanding balance of its bank term loan in full. As of March 31, 2018, the term loan was fully paid off.

Long-term debt covenants and restrictions

DPL’s revolving credit agreement has two financial covenants. The first financial covenant, a Total Debt to EBITDA ratio, is calculated at the end of each fiscal quarter by dividing total debt at the end of the current quarter by consolidated EBITDA for the four prior fiscal quarters. The ratio in the agreement is not to exceed 7.00 to 1.00. As of September 30, 2019, this financial covenant was met with a ratio of 5.68 to 1.00.

The second financial covenant is an EBITDA to Interest Expense ratio that is calculated, at the end of each fiscal quarter, by dividing EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period. The ratio, per the agreement, is to be not less than 2.25 to 1.00. As of September 30, 2019, this financial covenant was met with a ratio of 2.99 to 1.00.

DPL’s secured revolving credit agreement also restricts dividend payments from DPL to AES, such that DPL cannot make dividend payments unless at the time of, and/or as a result of the distribution, (i) DPL’s leverage ratio does not exceed 0.67 to 1.00 and DPL’s interest coverage ratio is not less than 2.50 to 1.00 or, if such ratios are not within the parameters, (ii) DPL’s senior long-term debt rating from two of the three major credit rating agencies is at least investment grade. DPL is also restricted from making dividend and tax sharing payments from DPL to AES per its 2017 ESP. This order restricts dividend payments from DPL to AES during the term of the 2017 ESP and restricts tax sharing payments from DPL to AES during the term of the DMR.

DP&L’s Bond Purchase and Covenants Agreement (financing document entered into in connection with the sale of $200.0 million of variable rate tax-exempt First Mortgage Bonds, dated as of August 1, 2015) has two financial

covenants. The first measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. DP&L’s Total Debt to Total Capitalization ratio shall not be greater than 0.65 to 1.00. Except that, after Generation Separation and the twelve-month period following (October 1, 2017 to September 30, 2018) the ratio shall be a) increased to 0.75 to 1.00 or b) suspended if DP&L’s long-term indebtedness is less than or equal to $750.0 million. Additionally, this covenant shall be suspended any time after separation during which DP&L maintains a rating of BBB- (or in the case of Moody’s Investors Service, Inc. Baa3) or higher with a stable outlook from at least one of Fitch Investors Service Inc., Standard & Poor’s Ratings Services or Moody’s Investors Service, Inc. The Total Debt to Capitalization covenant is calculated as the sum of DP&L’s current and long-term portion of debt, divided by the total of DP&L’s net worth and total debt. As of September 30, 2019, DP&L's ratings meet those requirements and this covenant is suspended for the quarter ended September 30, 2019.

The second financial covenant measures EBITDA to Interest Expense. The Total Consolidated EBITDA to Consolidated Interest Charges ratio is calculated, at the end of each fiscal quarter, by dividing consolidated EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period. The ratio, per the agreement, is to be not less than 2.50 to 1.00. This financial covenant was met with a ratio of 9.36 to 1.00 as of September 30, 2019.

DP&L's unsecured revolving credit facility has one financial covenant. The covenant measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. DP&L’s Total Debt to Total Capitalization ratio shall not be greater than 0.67 to 1.00. This financial covenant was met with a ratio of 0.58 to 1.00 as of September 30, 2019.

As of September 30, 2019, DPL and DP&L were in compliance with all debt covenants, including the financial covenants described above.

DP&L does not have any meaningful restrictions in its debt financing documents prohibiting dividends to its parent, DPL.

Substantially all property, plant & equipment of DP&L is subject to the lien of the mortgage securing DP&L’s First and Refunding Mortgage.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Debt Instrument [Line Items]

Debt Obligations

Long-term Debt

The following table summarizes DP&L's long-term debt.

	Interest		September 30,			December 31,
$ in millions	Rate	Maturity	2019			2018
Term loan - rates from 4.50% - 4.53% (a) and 4.01% - 4.60% (b)		2022	$	—		$	436.1
First Mortgage Bonds	3.95%	2049	425.0			—
Tax-exempt First Mortgage Bonds - rates from 2.97% - 3.07% (a) and 1.52% - 1.92% (b)		2020	140.0			140.0
U.S. Government note	4.20%	2061	17.6			17.7
Unamortized deferred financing costs			(5.7		)	(6.3		)
Unamortized debt discounts and premiums, net			(2.7		)	(1.4		)
Total long-term debt			574.2			586.1
Less: current portion			(139.6		)	(4.6		)
Long-term debt, net of current portion			$	434.6		$	581.5

(a) Range of interest rates for the nine months ended September 30, 2019.

(b) Range of interest rates for the year ended December 31, 2018.

Deferred financing costs are amortized over the remaining life of the debt using the effective interest method. Premiums or discounts on long-term debt are amortized over the remaining life of the debt using the effective interest method.

Line of credit

At September 30, 2019 and December 31, 2018, DP&L had outstanding borrowings on its line of credit of $60.0 million and $0.0 million, respectively.

Significant transactions

On June 19, 2019, DP&L amended and restated its unsecured revolving credit facility. The revolving credit facility has a $175.0 million borrowing limit, with a $75.0 million letter of credit sublimit, a feature that provides DP&L the ability to increase the size of the facility by an additional $100.0 million, a maturity date of June 2024, and a provision that provides DP&L the option to request up to two one-year extensions of the maturity date.

On June 6, 2019, DP&L closed on a $425.0 million issuance of First Mortgage Bonds due 2049. These new bonds carry an interest rate of 3.95%. The proceeds of this issuance were used to repay in full the outstanding principal of $435.0 million of DP&L's variable rate Term Loan B credit agreement.

On March 30, 2018, DP&L commenced a redemption of $60.0 million of outstanding tax exempt First Mortgage Bonds due 2020 at par value (plus accrued and unpaid interest). These bonds were redeemed at par plus accrued interest on April 30, 2018 with cash on hand.

Long-term debt covenants and restrictions

DP&L’s Bond Purchase and Covenants Agreement (financing document entered into in connection with the sale of $200.0 million of variable rate tax-exempt First Mortgage Bonds, dated as of August 1, 2015) has two financial covenants. The first measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. DP&L’s Total Debt to Total Capitalization ratio shall not be greater than 0.65 to 1.00. Except that, after Generation Separation and the twelve-month period following (October 1, 2017 to September 30, 2018) the ratio shall be a) increased to 0.75 to 1.00 or b) suspended if DP&L’s long-term indebtedness is less than or equal to $750.0 million. Additionally, this covenant shall be suspended any time after separation during which DP&L maintains a rating of BBB- (or in the case of Moody’s Investors Service, Inc. Baa3) or higher with a stable outlook from at least one of Fitch Investors Service Inc., Standard & Poor’s Ratings Services or Moody’s Investors Service, Inc. The Total Debt to Capitalization covenant is calculated as the sum of DP&L’s current and long-term portion of debt, divided by the total of DP&L’s net worth and total debt. As of September 30, 2019, DP&L's ratings meet those requirements and this covenant is suspended for the quarter ended September 30, 2019.

The second financial covenant measures EBITDA to Interest Expense. The Total EBITDA to Interest Charges ratio is calculated, at the end of each fiscal quarter, by dividing EBITDA for the four prior fiscal quarters by the interest charges for the same period. The ratio, per the agreement, is to be not less than 2.50 to 1.00. This financial covenant was met with a ratio of 9.36 to 1.00 as of September 30, 2019.

DP&L's unsecured revolving credit facility has one financial covenant. The covenant measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. DP&L’s Total Debt to Total Capitalization ratio shall not be greater than 0.67 to 1.00. This financial covenant was met with a ratio of 0.58 to 1.00 as of September 30, 2019.

As of September 30, 2019, DP&L was in compliance with all debt covenants, including the financial covenants described above.

DP&L does not have any meaningful restrictions in its debt financing documents prohibiting dividends to its parent, DPL.

Substantially all property, plant & equipment of DP&L is subject to the lien of the mortgage securing DP&L’s First and Refunding Mortgage.

XML

Contractual Obligations, Commercial Commitments and Contingencies

9 Months Ended

Sep. 30, 2019

Entity Information [Line Items]

Contractual Obligations, Commercial Commitments and Contingencies

Contractual Obligations, Commercial Commitments and Contingencies

Guarantees

In the normal course of business, DPL enters into various agreements with its wholly-owned subsidiary, AES Ohio Generation, providing financial or performance assurance to third parties. These agreements are entered into primarily to support or enhance the creditworthiness otherwise attributed to this subsidiary on a stand-alone basis, thereby facilitating the extension of sufficient credit to accomplish this subsidiary's intended commercial purposes.

At September 30, 2019, DPL had $21.0 million of guarantees on behalf of AES Ohio Generation to third parties for future financial or performance assurance under such agreements. The guarantee arrangements entered into by DPL with these third parties cover select present and future obligations of AES Ohio Generation to such beneficiaries and are terminable by DPL upon written notice to the beneficiaries within a certain time. At

September 30, 2019 and December 31, 2018, we had no outstanding balance of obligations covered by these guarantees.

To date, DPL has not incurred any losses related to the guarantees of AES Ohio Generation’s obligations and we believe it is unlikely that DPL would be required to perform or incur any losses in the future associated with any of the above guarantees.

Equity Ownership Interest

DP&L has a 4.9% equity ownership interest in OVEC, which is recorded using the cost method of accounting under GAAP. DP&L, along with several non-affiliated energy companies party to an OVEC arrangement, receive and pay for OVEC capacity and energy and are responsible for OVEC debt obligations and other fixed costs in proportion to their power participation ratios under the arrangement which, for DP&L, is the same as its equity ownership interest. At September 30, 2019, DP&L could be responsible for the repayment of 4.9%, or $67.2 million, of $1,371.3 million OVEC debt obligations if they came due, comprised of both fixed and variable rate securities with maturities from 2022 to 2040. OVEC could also seek additional contributions from DP&L to avoid a default in the event that other OVEC members defaulted on their respective OVEC obligations. One of the other OVEC members, with a 4.85% interest in OVEC, filed for bankruptcy protection and the bankruptcy court approved that member's rejection of the OVEC arrangement and its related obligations on July 31, 2018. We do not expect these events to have a material impact on our financial condition, results of operations or cash flows.

Contingencies

In the normal course of business, we are subject to various lawsuits, actions, proceedings, claims and other matters asserted under various laws and regulations. We believe the amounts provided in our Condensed Consolidated Financial Statements, as prescribed by GAAP, are adequate considering the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Consolidated Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of September 30, 2019, cannot be reasonably determined.

Environmental Matters

DPL’s and DP&L’s facilities and operations are subject to a wide range of federal, state and local environmental regulations and laws. The environmental issues that may affect us include:

• The federal CAA and state laws and regulations (including State Implementation Plans) which require compliance, obtaining permits and reporting as to air emissions;

• Litigation with federal and certain state governments and certain special interest groups;

• Rules and future rules issued by the USEPA, the Ohio EPA or other authorities associated with the federal Clean Water Act, which prohibits the discharge of pollutants into waters of the United States except pursuant to appropriate permits; and

• Solid and hazardous waste laws and regulations, which govern the management and disposal of certain waste. The majority of solid waste created from the combustion of coal and fossil fuels consists of fly ash and other coal combustion by-products.

In addition to imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at our facilities to comply, or to determine compliance, with such regulations. We record liabilities for loss contingencies related to environmental matters when a loss is probable of occurring and can be reasonably estimated in accordance with the provisions of GAAP. Accordingly, we have immaterial accruals for loss contingencies for environmental matters. We also have several environmental matters for which we have not accrued loss contingencies because the risk of loss is not probable, or a loss cannot be reasonably estimated. We evaluate the potential liability related to environmental matters quarterly and may revise our estimates. Such revisions in the estimates of the potential liabilities could have a material adverse effect on our results of operations, financial condition and cash flows.

We have several pending environmental matters associated with our current and previously owned coal-fired generation units. Some of these matters could have a material adverse effect on our results of operations, financial condition and cash flows.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Entity Information [Line Items]

Contractual Obligations, Commercial Commitments and Contingencies

Contractual Obligations, Commercial Commitments and Contingencies

Equity Ownership Interest

DP&L has a 4.9% equity ownership interest in OVEC, which is recorded using the cost method of accounting under GAAP. DP&L, along with several non-affiliated energy companies party to an OVEC arrangement, receive and pay for OVEC capacity and energy and are responsible for OVEC debt obligations and other fixed costs in proportion to their power participation ratios under the arrangement which, for DP&L, is the same as its equity ownership interest. At September 30, 2019, DP&L could be responsible for the repayment of 4.9%, or $67.2 million, of $1,371.3 million OVEC debt obligations if they came due, comprised of both fixed and variable rate securities with maturities from 2022 to 2040. OVEC could also seek additional contributions from DP&L to avoid a default in the event that other OVEC members defaulted on their respective OVEC obligations. One of the other OVEC members, with a 4.85% interest in OVEC, filed for bankruptcy protection and the bankruptcy court approved that member's rejection of the OVEC arrangement and its related obligations on July 31, 2018. We do not expect these events to have a material impact on our financial condition, results of operations or cash flows.

Contingencies

In the normal course of business, we are subject to various lawsuits, actions, proceedings, claims and other matters asserted under various laws and regulations. We believe the amounts provided in our Condensed Financial Statements, as prescribed by GAAP, are adequate considering the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of September 30, 2019, cannot be reasonably determined.

Environmental Matters

DP&L’s facilities and operations are subject to a wide range of federal, state and local environmental regulations and laws. The environmental issues that may affect us include:

• The federal CAA and state laws and regulations (including State Implementation Plans) which require compliance, obtaining permits and reporting as to air emissions;

• Litigation with federal and certain state governments and certain special interest groups;

• Rules and future rules issued by the USEPA, the Ohio EPA or other authorities associated with the federal Clean Water Act, which prohibits the discharge of pollutants into waters of the United States except pursuant to appropriate permits; and

• Solid and hazardous waste laws and regulations, which govern the management and disposal of certain waste.

In addition to imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at our facilities to comply, or to determine compliance, with such regulations. We record liabilities for loss contingencies related to environmental matters when a loss is probable of occurring and can be reasonably estimated in accordance with the provisions of GAAP. Accordingly, we have immaterial accruals for loss contingencies for environmental matters. We also have several environmental matters for which we have not accrued loss contingencies because the risk of loss is not probable, or a loss cannot be reasonably estimated. We evaluate the potential liability related to environmental matters quarterly and may revise our estimates. Such revisions in the estimates of the potential liabilities could have a material adverse effect on our results of operations, financial condition and cash flows.

XML

Business Segments (Narrative) (Details) $ in Millions	9 Months Ended
	Sep. 30, 2019 USD ($) mi² customer segment	Dec. 31, 2018 USD ($)
Segment Reporting Information [Line Items]
Total assets	$ 1,816.3	$ 1,883.1
THE DAYTON POWER AND LIGHT COMPANY [Member]
Segment Reporting Information [Line Items]
Total assets	$ 1,779.4	1,819.6
Number of Operating Segments | segment	1
Approximate number of retail customers | customer	524,000
Service area, square miles | mi²	6,000
Operating Segments [Member] | Utility [Member]
Segment Reporting Information [Line Items]
Total assets	$ 1,779.4	1,819.6
Corporate, Non-Segment [Member]
Segment Reporting Information [Line Items]
Total assets	$ 36.9	$ 63.5

XML

Discontinued Operations (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2018	Dec. 31, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax	$ 0.0	$ 0.3	$ 0.1	$ (1.6)
Disposal Group, Including Discontinued Operation, Revenue	10.1	15.6	41.0	141.8
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net	6.8		6.8			$ 4.0
Disposal Group, Including Discontinued Operations, Taxes Applicable to Subsequent Years	0.6		0.6			2.3
Disposal Group, Including Discontinued Operation, Other Assets, Current	0.9		0.9			2.4
Disposal Group, Including Discontinued Operation, Intangible Assets	0.2		0.2			5.3
Disposal Group, Including Discontinued Operation, Assets	8.5		8.5			14.0
Disposal Group, Including Discontinued Operation, Accounts Payable	4.3		4.3			3.9
Disposal Group, Including Discontinued Operation, Accrued Income Tax Payable	2.4		2.4			3.1
Disposal Group, Including Discontinued Operation, Other Liabilities, Current	3.2		3.2			5.2
Disposal Group, Including Discontinued Operation, Deferred Tax Liabilities	(33.2)		(33.2)			(39.8)
Disposal Group, Including Discontinued Operation, Taxes Payable	0.0		0.0			2.3
Disposal Group, Including Discontinued Operation, Pension Plan Benefit Obligation	0.0		0.0			9.7
Asset Retirement Obligation, Held for Sale	70.4		70.4			90.4
Disposal Group, Including Discontinued Operation, Other Liabilities, Noncurrent	15.2		15.2			6.6
Disposal Group, Including Discontinued Operation, Liabilities	62.3		62.3			$ 81.4
Disposal Group, Including Discontinued Operation, Operating and Other Expenses	(10.5)	(10.6)	(8.2)	(105.1)
Disposal Group, Including Discontinued Operation, Asset Retirement Obligation, Revision of Estimate			22.5
Loss from discontinued operations before income taxes	(0.4)	5.0	32.8	36.7
Income tax expense from discontinued operations	0.1	1.0	7.1	5.9
Income (Loss) from Discontinued Operations, Net of Tax, Attributable to Parent	(0.5)	4.3	25.8	29.2
Cash Provided by (Used in) Operating Activities, Discontinued Operations	(0.5)	$ (7.2)	12.4	37.2
Cash flows from investing activities for discontinued operations	$ 0.0		$ 0.0	233.8
Subsidiaries [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Long Term Indebtedness, Less than or Equal to					$ 750.0
AES Ohio Generation peakers [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax				$ (1.9)

XML

Supplemental Financial Information (Reclassification out of ACOI) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Interest expense	$ (18.3)	$ (22.6)	$ (63.7)	$ (74.4)
Tax expense	9.4	(3.1)	12.6	(1.5)
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax	(0.4)	5.0	32.8	36.7
Discontinued Operation, Tax Effect of Discontinued Operation	(0.1)	(1.0)	(7.1)	(5.9)
Nonoperating Income (Expense)	(18.0)	(22.1)	(105.4)	(80.0)
Net income	35.4	21.0	61.4	41.4
THE DAYTON POWER AND LIGHT COMPANY [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Interest expense	(6.1)	(5.8)	(19.9)	(20.5)
Tax expense	7.2	(6.3)	(5.1)	(12.0)
Nonoperating Income (Expense)	(6.6)	(6.2)	(19.8)	(23.0)
Net income	44.9	31.2	103.7	61.9
Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Net income	(0.8)	(0.1)	(1.2)	2.6
Reclassification out of Accumulated Other Comprehensive Income [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Net income	1.7	0.6	2.0	2.0
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Interest expense	(0.3)	(0.3)	(0.9)	(0.9)
Tax expense	(0.1)	0.1	0.0	0.3
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax	0.0	0.0	0.0	4.3
Discontinued Operation, Tax Effect of Discontinued Operation	(0.4)	0.0	(0.4)	(1.5)
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax	(0.4)	0.0	(0.4)	2.8
Net income	(0.4)	(0.2)	(0.9)	(0.6)
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Interest expense	0.0	(0.3)	(0.1)	(1.1)
Tax expense	0.0	0.1	0.0	0.6
Net income	0.0	(0.2)	(0.1)	(0.5)
Amortization of defined benefit pension items [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Tax expense	(0.1)	(0.1)	(0.1)	(0.1)
Nonoperating Income (Expense)	0.1	0.2	0.2	0.5
Net income	0.0	0.1	0.1	0.4
Amortization of defined benefit pension items [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Tax expense	0.9	(0.2)	(0.5)	(0.7)
Nonoperating Income (Expense)	0.8	1.0	2.6	3.2
Net income	$ 1.7	$ 0.8	$ 2.1	$ 2.5

XML

Revenue (Tables)

9 Months Ended

Sep. 30, 2019

Disaggregation of Revenue [Table Text Block]

DPL's revenue from contracts with customers was $195.0 million and $195.1 million for the three months ended September 30, 2019 and 2018, respectively, and $576.5 million and $560.1 million for the nine months ended September 30, 2019 and 2018, respectively.

The following table presents our revenue from contracts with customers and other revenue by segment for the three and nine months ended September 30, 2019 and 2018:

$ in millions	Utility		Other			Adjustments and Eliminations			Total
	Three Months Ended September 30, 2019
Retail revenue
Retail revenue from contracts with customers	$	170.5	$	—		$	—		$	170.5
Other retail revenue (a)	3.8		—			—			3.8
Wholesale revenue
Wholesale revenue from contracts with customers	4.4		5.0			(0.2		)	9.2
RTO ancillary revenue	11.0		0.1			—			11.1
Capacity revenue	1.1		1.1			—			2.2
Miscellaneous revenue from contracts with customers (b)	—		2.0			—			2.0
Miscellaneous revenue	0.3		0.7			(0.8		)	0.2
Total revenues	$	191.1	$	8.9		$	(1.0	)	$	199.0
	Three Months Ended September 30, 2018
Retail revenue
Retail revenue from contracts with customers	$	168.4	$	—		$	(0.4	)	$	168.0
Other retail revenue (a)	12.6		—			—			12.6
Wholesale revenue
Wholesale revenue from contracts with customers	4.9		5.6			—			10.5
RTO ancillary revenue	10.8		(0.1		)	—			10.7
Capacity revenue	2.0		1.7			—			3.7
Miscellaneous revenue from contracts with customers (b)	—		2.2			—			2.2
Miscellaneous revenue	—		0.5			(0.5		)	—
Total revenues	$	198.7	$	9.9		$	(0.9	)	$	207.7
	Nine months ended September 30, 2019
Retail revenue
Retail revenue from contracts with customers	$	503.8	$	—		$	—		$	503.8
Other retail revenue (a)	14.9		—			—			14.9
Wholesale revenue
Wholesale revenue from contracts with customers	12.8		11.4			(0.8		)	23.4
RTO ancillary revenue	32.8		0.2			—			33.0
Capacity revenue	5.0		4.2			—			9.2
Miscellaneous revenue from contracts with customers (b)	—		7.1			—			7.1
Miscellaneous revenue	0.9		2.3			(2.4		)	0.8
Total revenues	$	570.2	$	25.2		$	(3.2	)	$	592.2
	Nine months ended September 30, 2018
Retail revenue
Retail revenue from contracts with customers	$	469.3	$	—		$	(0.8	)	$	468.5
Other retail revenue (a)	31.4		—			—			31.4
Wholesale revenue
Wholesale revenue from contracts with customers	24.6		16.7			—			41.3
RTO ancillary revenue	32.4		0.1			—			32.5
Capacity revenue	5.8		4.7			—			10.5
Miscellaneous revenue from contracts with customers (b)	—		7.3			—			7.3
Miscellaneous revenue	—		1.9			(1.9		)	—
Total revenues	$	563.5	$	30.7		$	(2.7	)	$	591.5

(a) Other retail revenue primarily includes alternative revenue programs not accounted for under FASC 606.

(b)

Miscellaneous revenue from contracts with customers primarily includes revenues for various services provided by Miami Valley Lighting.

Subsidiaries [Member]

Disaggregation of Revenue [Table Text Block]

DP&L's revenue from contracts with customers was $187.0 million and $186.1 million for the three months ended September 30, 2019 and 2018, respectively, and $554.4 million and $532.1 million for the nine months ended September 30, 2019 and 2018, respectively. The following table presents our revenue from contracts with customers and other revenue for the three and nine months ended September 30, 2019 and 2018:

	Three months ended				Nine months ended
	September 30,				September 30,
$ in millions	2019		2018		2019		2018
Retail revenue
Retail revenue from contracts with customers	$	170.5	$	168.4	$	503.8	$	469.3
Other retail revenue (a)	3.8		12.6		14.9		31.4
Wholesale revenue
Wholesale revenue from contracts with customers	4.4		4.9		12.8		24.6
RTO ancillary revenue	11.0		10.8		32.8		32.4
Capacity revenue	1.1		2.0		5.0		5.8
Miscellaneous revenue	0.3		—		0.9		—
Total revenues	$	191.1	$	198.7	$	570.2	$	563.5

(a) Other retail revenue primarily includes alternative revenue programs not accounted for under FASC 606.

XML

Business Segments

9 Months Ended

Sep. 30, 2019

Segment Reporting Information [Line Items]

Business Segments

Business Segments

DPL has presented the results of operations of Miami Fort Station, Zimmer Station, the Peaker Assets, Stuart Station, and Killen Station as discontinued operations as a group of components for all periods presented. For more information, see Note 14 – Discontinued Operations of Notes to DPL's Condensed Consolidated Financial Statements. As such, AES Ohio Generation only has operating activity coming from its undivided ownership interest in Conesville, which does not meet the thresholds to be a separate reportable operating segment. Therefore, DPL manages its business through one reportable operating segment, the Utility segment. The primary segment performance measure is income / (loss) from continuing operations before income tax as management has concluded that this measure best reflects the underlying business performance of DPL and is the most relevant measure considered in DPL’s internal evaluation of the financial performance of its segment. The Utility segment is discussed further below.

Utility Segment

The Utility segment is comprised of DP&L’s electric transmission and distribution businesses, which distribute electricity to residential, commercial, industrial and governmental customers. DP&L distributes electricity to more than 524,000 retail customers located in a 6,000-square mile area of West Central Ohio. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses recording regulatory assets when incurred costs are expected to be recovered in future customer rates and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. The Utility segment includes revenues and costs associated with our investment in OVEC and the historical results of DP&L’s Beckjord Facility, which was closed in 2014 and transferred to a third party in the first quarter of 2018, and Hutchings Coal generating facility, which was closed in 2013. These assets did not transfer to AES Ohio Generation as part of DP&L's Generation Separation on October 1, 2017. Thus, they are grouped within the Utility segment for segment reporting purposes. In addition, regulatory deferrals and collections, which include fuel deferrals in historical periods, are included in the Utility segment.

Included within the “Other” column are other businesses that do not meet the GAAP requirements for disclosure as reportable segments as well as certain corporate costs, which include interest expense and loss on early extinguishment of debt on DPL's long-term debt as well as adjustments related to purchase accounting from the Merger. DPL's undivided interest in Conesville is included within the "Other" column as it does not meet the requirement for disclosure as a reportable operating segment, since the results of operations of the other EGUs are presented as discontinued operations. The accounting policies of the reportable segment are the same as those described in Note 1 – Overview and Summary of Significant Accounting Policies of our 10-K. Intersegment sales, costs of sales and expenses are eliminated in consolidation. Certain shared and corporate costs are allocated between "Other" and the Utility reporting segment.

The following tables present financial information for DPL’s Utility reportable business segment:

$ in millions	Utility		Other			Adjustments and Eliminations			DPL Consolidated
Three months ended September 30, 2019
Revenues from external customers	$	190.9	$	8.1		$	—		$	199.0
Intersegment revenues	0.2		0.8			(1.0		)	—
Total revenues	$	191.1	$	8.9		$	(1.0	)	$	199.0
Depreciation and amortization	$	17.4	$	0.3		$	—		$	17.7
Interest expense	$	6.1	$	12.2		$	—		$	18.3
Income / (loss) from continuing operations before income tax	$	37.7	$	(11.2	)	$	—		$	26.5
Cash capital expenditures	$	58.9	$	0.1		$	—		$	59.0
$ in millions	Utility		Other (a)			Adjustments and Eliminations			DPL Consolidated
Three Months Ended September 30, 2018
Revenues from external customers	$	198.5	$	9.2		$	—		$	207.7
Intersegment revenues	0.2		0.7			(0.9		)	—
Total revenues	$	198.7	$	9.9		$	(0.9	)	$	207.7
Depreciation and amortization	$	19.1	$	0.6		$	—		$	19.7
Interest expense	$	5.8	$	16.8		$	—		$	22.6
Income / (loss) from continuing operations before income tax	$	37.5	$	(17.7	)	$	—		$	19.8
Cash capital expenditures	$	20.5	$	4.6		$	—		$	25.1
$ in millions	Utility		Other			Adjustments and Eliminations			DPL Consolidated
Nine months ended September 30, 2019
Revenues from external customers	$	569.4	$	22.8		$	—		$	592.2
Intersegment revenues	0.8		2.4			(3.2		)	—
Total revenues	$	570.2	$	25.2		$	(3.2	)	$	592.2
Depreciation and amortization	$	52.9	$	1.2		$	—		$	54.1
Interest expense	$	19.9	$	43.8		$	—		$	63.7
Loss on early extinguishment of debt	$	—	$	44.9		$	—		$	44.9
Income / (loss) from continuing operations before income tax	$	108.8	$	(85.8	)	$	—		$	23.0
Cash capital expenditures	$	121.1	$	1.3		$	—		$	122.4
$ in millions	Utility		Other (a)			Adjustments and Eliminations			DPL Consolidated
Nine months ended September 30, 2018
Revenues from external customers	$	562.9	$	28.6		$	—		$	591.5
Intersegment revenues	0.6		2.1			(2.7		)	—
Total revenues	$	563.5	$	30.7		$	(2.7	)	$	591.5
Depreciation and amortization	$	56.5	$	2.3		$	—		$	58.8
Interest expense	$	20.5	$	53.9		$	—		$	74.4
Income / (loss) from continuing operations before income tax	$	73.9	$	(60.2	)	$	—		$	13.7
Cash capital expenditures	$	65.0	$	10.8		$	—		$	75.8

(a) "Other" includes Cash capital expenditures related to assets of discontinued operations and held-for-sale businesses for the three and nine months ended September 30, 2018.

Total Assets	September 30, 2019		December 31, 2018
Utility	$	1,779.4	$	1,819.6
All Other (a)	36.9		63.5
DPL Consolidated	$	1,816.3	$	1,883.1

(a)

"All Other" includes Total assets related to the assets of discontinued operations and held-for-sale businesses and Eliminations for all periods presented.

XML

Regulatory Matters (Notes)

9 Months Ended

Sep. 30, 2019

Schedule of Regulatory Assets and Liabilities [Text Block]

Regulatory Matters

DMR

On October 20, 2017, the PUCO approved DP&L’s 2017 ESP.  On January 7, 2019, the Ohio Consumers' Counsel appealed to the Supreme Court of Ohio the 2017 ESP with respect to the bypassability of the Reconciliation Rider and the exclusion of the DMR from the SEET. That proceeding has been stayed pending an appeal in a related case involving another utility.

Pursuant to the 2017 ESP, on January 22, 2019, DP&L filed a request with the PUCO for a two-year extension of its DMR through October 2022, in the proposed amount of $199.0 million for each of the two additional years. The extension request was set at a level expected to reduce debt obligations at both DP&L and DPL and to position

DP&L to make capital expenditures to maintain and modernize its electric grid. DP&L’s DMP investments are contingent upon the PUCO approving the two-year extension of its DMR.

A rehearing process in DP&L's 2017 ESP case, including the DMR, remains pending. On August 1, 2019, DP&L filed a supplemental brief with the PUCO focused on the applicability of a recent court decision involving another Ohio utility’s DMR which is similar to, but not identical to, DP&L’s DMR.

Ohio House Bill 6

On July 23, 2019, the Governor of Ohio signed Ohio House Bill 6, which, among other things, does the following:

• beginning January 1, 2020, replaces DP&L’s non-bypassable Reconciliation Rider, permitting DP&L to defer, recover or credit the net proceeds from selling energy and capacity received as part of DP&L’s interest in OVEC and its OVEC-related costs through 2023, with a non-bypassable recovery mechanism for recovery of prudently incurred OVEC costs through 2030;

• eliminates the annual energy efficiency targets for Ohio utilities after 2020; and

• allows Ohio utilities to construct customer-sited renewable generation for mercantile customers or groups of mercantile customers, the costs of which may only be recovered from those customers.

Regulatory impact of tax reform

On January 10, 2018, the PUCO initiated a proceeding to consider the impacts of the TCJA to determine the appropriate course of action to pass benefits resulting from the legislation on to ratepayers. The PUCO also directed Ohio utilities to record deferred liabilities for the estimated reduction in federal income tax resulting from the TCJA beginning January 1, 2018. Beginning October 1, 2018, the new distribution rates approved in the DRO include the impacts of the decrease in current federal income taxes as a result of the TCJA. Under the terms of the stipulation approved in the DRO, DP&L agreed to file an application at the PUCO to refund eligible excess accumulated deferred income taxes and any related regulatory liability over a ten-year period. DP&L made such a filing on March 1, 2019. DP&L negotiated a unanimous stipulation with the parties in the proceeding, agreeing to return a total of $65.1 million, $83.2 million when including taxes associated with the refunds. This stipulation was approved by the PUCO on September 26, 2019. See Note 7 – Income Taxes for additional information. In connection with this stipulation, we reduced our long-term regulatory liability related to deferred income taxes by $23.4 million.

Subsidiaries [Member]

Schedule of Regulatory Assets and Liabilities [Text Block]

Regulatory Matters

DMR

On October 20, 2017, the PUCO approved DP&L’s 2017 ESP.  On January 7, 2019, the Ohio Consumers' Counsel appealed to the Supreme Court of Ohio the 2017 ESP with respect to the bypassability of the Reconciliation Rider and the exclusion of the DMR from the SEET. That proceeding has been stayed pending an appeal in a related case involving another utility.

Pursuant to the 2017 ESP, on January 22, 2019, DP&L filed a request with the PUCO for a two-year extension of its DMR through October 2022, in the proposed amount of $199.0 million for each of the two additional years. The extension request was set at a level expected to reduce debt obligations at both DP&L and DPL and to position DP&L to make capital expenditures to maintain and modernize its electric grid. DP&L’s DMP investments are contingent upon the PUCO approving the two-year extension of its DMR.

A rehearing process in DP&L's 2017 ESP case, including the DMR, remains pending. On August 1, 2019, DP&L filed a supplemental brief with the PUCO focused on the applicability of a recent court decision involving another Ohio utility’s DMR which is similar to, but not identical to, DP&L’s DMR.

Ohio House Bill 6

On July 23, 2019, the Governor of Ohio signed Ohio House Bill 6, which, among other things, does the following:

• beginning January 1, 2020, replaces DP&L’s non-bypassable Reconciliation Rider, permitting DP&L to defer, recover or credit the net proceeds from selling energy and capacity received as part of DP&L’s interest in OVEC and its OVEC-related costs through 2023, with a non-bypassable recovery mechanism for recovery of prudently incurred OVEC costs through 2030;

• eliminates the annual energy efficiency targets for Ohio utilities after 2020; and

• allows Ohio utilities to construct customer-sited renewable generation for mercantile customers or groups of mercantile customers, the costs of which may only be recovered from those customers.

Regulatory impact of tax reform

On January 10, 2018, the PUCO initiated a proceeding to consider the impacts of the TCJA to determine the appropriate course of action to pass benefits resulting from the legislation on to ratepayers. The PUCO also directed Ohio utilities to record deferred liabilities for the estimated reduction in federal income tax resulting from the TCJA beginning January 1, 2018. Beginning October 1, 2018, the new distribution rates approved in the DRO include the impacts of the decrease in current federal income taxes as a result of the TCJA. Under the terms of the stipulation approved in the DRO, DP&L agreed to file an application at the PUCO to refund eligible excess accumulated deferred income taxes and any related regulatory liability over a ten-year period. DP&L made such a filing on March 1, 2019. DP&L negotiated a unanimous stipulation with the parties in the proceeding, agreeing to return a total of $65.1 million, $83.2 million when including taxes associated with the refunds. This stipulation was approved by the PUCO on September 26, 2019. See Note 7 – Income Taxes for additional information. In connection with this stipulation, we reduced our long-term regulatory liability related to deferred income taxes by $23.4 million.

XML

Income Taxes

9 Months Ended

Sep. 30, 2019

Entity Information [Line Items]

Income Taxes

Income Taxes

The following table details the effective tax rates for the three and nine months ended September 30, 2019 and 2018.

	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
DPL	(35.6)%	16.3%	(9.8)%	15.2%

Income tax expense for the nine months ended September 30, 2019 and 2018 was calculated using the estimated annual effective income tax rates for 2019 and 2018 of (10.1)% and 16.8%, respectively. Management estimates the annual effective tax rate based on its forecast of annual pre-tax income. To the extent that actual pre-tax results for the year differ from the forecasts applied to the most recent interim period, the estimated rates could be materially different from the actual effective tax rates. DPL’s effective combined state and federal income tax rate for all operations was (35.6)% and (9.8)% for the three and nine months ended September 30, 2019, respectively. These rates are lower than the combined federal and state statutory rate of 21.6% primarily due to the flowthrough of the net tax benefit related to the reversal of excess deferred taxes of DP&L and the impact of the September 26, 2019 PUCO order which finalized the amount of excess deferred tax balances allocable to DP&L’s utility customers.

For the nine months ended September 30, 2019, DPL’s current period effective tax rate for all operations was not materially different than the estimated annual effective rate.

Per the terms of DP&L's 2017 ESP, DPL will not make any tax-sharing payments to AES and AES will forgo collection of the payments during the term of the DMR. As such, during the nine months ended September 30, 2019

and 2018, DPL converted $2.7 million and $30.2 million, respectively, of accrued tax sharing liabilities with AES to additional equity investment in DPL.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Entity Information [Line Items]

Income Taxes

Income Taxes

The following table details the effective tax rates for the three and nine months ended September 30, 2019 and 2018.

	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
DP&L	(19.1)%	16.8%	4.7%	16.2%

Income tax expense for the nine months ended September 30, 2019 and 2018 was calculated using the estimated annual effective income tax rates for 2019 and 2018 of 4.5% and 17.1%, respectively. Management estimates the annual effective tax rate based on its forecast of annual pre-tax income. To the extent that actual pre-tax results for the year differ from the forecasts applied to the most recent interim period, the estimated rates could be materially different from the actual effective tax rates. DP&L’s effective combined state and federal income tax rate was (19.1)% and 4.7% for the three and nine months ended September 30, 2019, respectively. This is lower than the combined federal and state statutory rate of 21.6% primarily due to the net tax benefit related to the reversal of excess deferred taxes and the impact of the September 26, 2019 PUCO order which finalized the amount of excess deferred tax balances allocable to DP&L’s utility customers.

For the nine months ended September 30, 2019, DP&L’s current period effective tax rate for all operations was not materially different than the estimated annual effective rate.

XML

Business Segments (Segment Financial Information) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Segment Reporting Information [Line Items]
External customer revenues	$ 199.0	$ 207.7	$ 592.2	$ 591.5
Intersegment revenues	0.0	0.0	0.0	0.0
Total revenues	199.0	207.7	592.2	591.5
Depreciation and amortization	17.7	19.7	54.1	58.8
Fuel Costs	5.2	4.6	13.0	12.7
Depreciation and amortization			34.2	62.4
Interest expense	18.3	22.6	63.7	74.4
Gain (Loss) on Extinguishment of Debt	0.0	0.0	(44.9)	(6.4)
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest	26.5	19.8	23.0	13.7
Net income / (loss) from continuing operations	35.9	16.7	35.6	12.2
Discontinued operations, net of tax	(0.5)	4.3	25.8	29.2
Net income/ (loss)	35.4	21.0	61.4	41.4
Capital expenditures	59.0	25.1	122.4	75.8
Total assets	1,816.3		1,816.3		$ 1,883.1
Operating Segments [Member] | Utility [Member]
Segment Reporting Information [Line Items]
External customer revenues	190.9	198.5	569.4	562.9
Intersegment revenues	0.2	0.2	0.8	0.6
Total revenues	191.1	198.7	570.2	563.5
Depreciation and amortization	17.4	19.1	52.9	56.5
Interest expense	6.1	5.8	19.9	20.5
Gain (Loss) on Extinguishment of Debt			0.0
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest	37.7	37.5	108.8	73.9
Capital expenditures	58.9	20.5	121.1	65.0
Total assets	1,779.4		1,779.4		1,819.6
Corporate, Non-Segment [Member]
Segment Reporting Information [Line Items]
External customer revenues	8.1	9.2	22.8	28.6
Intersegment revenues	0.8	0.7	2.4	2.1
Total revenues	8.9	9.9	25.2	30.7
Depreciation and amortization	0.3	0.6	1.2	2.3
Interest expense	12.2	16.8	43.8	53.9
Gain (Loss) on Extinguishment of Debt			(44.9)
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest	(11.2)	(17.7)	(85.8)	(60.2)
Capital expenditures	0.1	4.6	1.3	10.8
Total assets	36.9		36.9		63.5
Adjustments and Eliminations [Member]
Segment Reporting Information [Line Items]
External customer revenues	0.0	0.0	0.0	0.0
Intersegment revenues	(1.0)	(0.9)	(3.2)	(2.7)
Total revenues	(1.0)	(0.9)	(3.2)	(2.7)
Depreciation and amortization	0.0	0.0	0.0	0.0
Interest expense	0.0	0.0	0.0	0.0
Gain (Loss) on Extinguishment of Debt			0.0
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest	0.0	0.0	0.0	0.0
Capital expenditures	0.0	0.0	0.0	0.0
Subsidiaries [Member]
Segment Reporting Information [Line Items]
Gain (Loss) on Disposition of Business	0.0	0.0	0.0	(12.4)
Depreciation and amortization	17.4	19.1	52.9	56.5
Fuel Costs	0.6	0.1	2.0	1.7
Depreciation and amortization			52.9	56.5
Interest expense	6.1	5.8	19.9	20.5
Gain (Loss) on Extinguishment of Debt	0.0	0.0	0.0	(0.6)
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest	37.7	37.5	108.8	73.9
Net income/ (loss)	44.9	$ 31.2	103.7	$ 61.9
Total assets	$ 1,779.4		$ 1,779.4		$ 1,819.6

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2019	Dec. 31, 2018
Common Stock, Shares Authorized	1,500	1,500
Common stock, shares issued	1	1
Common stock, shares outstanding	1	1
THE DAYTON POWER AND LIGHT COMPANY [Member]
Common Stock, Shares Authorized	50,000,000	50,000,000
Common stock, shares outstanding	41,172,173	41,172,173
Common stock, par value (in USD per share)	$ 0.01	$ 0.01

XML

Debt (Narrative) (Details) $ in Millions					3 Months Ended	9 Months Ended		12 Months Ended
	Jun. 06, 2019 USD ($)	May 07, 2019 USD ($)	Apr. 17, 2019 USD ($)	Apr. 04, 2019 USD ($)	Mar. 31, 2019 USD ($)	Sep. 30, 2019 USD ($) fiscal_quarter debt_covenant	Sep. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)	Sep. 30, 2018 USD ($)	Apr. 30, 2018 USD ($)	Mar. 30, 2018 USD ($)	Aug. 03, 2015 USD ($)
Debt Instrument [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity						$ 125.0
Letter Of Credit Sublimit						75.0
Line of Credit Facility, Additional Borrowing Capacity						50.0
Long-term Line of Credit								$ 0.0
Proceeds from Issuance of Long-term Debt						821.7	$ 0.0
Retirement of long-term debt						$ 978.0	239.4
Debt Covenant, Debt to EBITDA Ratio, Maximum								7.00
Debt to EBITDA Ratio						5.68
Debt Covenant, Leverage Ratio, Maximum						0.67
Debt Covenant, Interest Coverage Ratio, Minimum						2.50		2.25
Interest Coverage Ratio						2.99
THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity						$ 175.0
Letter Of Credit Sublimit						75.0
Line of Credit Facility, Additional Borrowing Capacity						100.0
Long-term Line of Credit								$ 0.0
Proceeds from Issuance of Long-term Debt						422.3	0.0
Retirement of long-term debt						$ 436.1	$ 63.3
Long Term Indebtedness, Less than or Equal to									$ 750.0
Debt Covenant, Interest Coverage Ratio, Minimum						2.50
3.95% Senior Notes due 2049 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Extinguishment of Debt, Amount	$ 435.0
Long-term Debt, Gross						$ 425.0
Proceeds from Issuance of Long-term Debt	$ 425.0
Debt instrument interest percentage						3.95%
Senior unsecured due in October 2019 - 6.75% [Member]
Debt Instrument [Line Items]
Extinguishment of Debt, Amount				$ 99.0	$ 101.0
Long-term Debt, Gross								99.0			$ 200.0
Make Whole Premium				$ 1.5						$ 5.1
Debt instrument interest percentage					6.75%	6.75%
Variable Rate Notes Backed by Term Loan and First Mortgage Bonds [Member]
Debt Instrument [Line Items]
Extinguishment of Debt, Amount					$ 60.0
Variable Rate Notes Backed by Term Loan and First Mortgage Bonds [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Extinguishment of Debt, Amount						$ 60.0
Long-term Debt, Gross						140.0		140.0
Debt Instrument, Face Amount												$ 200.0
Bank term loan due in July 2020 - rates from: 2.44% - 2.45% [Member]
Debt Instrument [Line Items]
Extinguishment of Debt, Amount					$ 70.0
Term Loan Maturing 2022 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Long-term Debt, Gross						$ 0.0		436.1
Revolving Credit Agreement and Standby Letters of Credit [Member]
Debt Instrument [Line Items]
Number of financial covenants | debt_covenant						2
Revolving Credit Agreement and Standby Letters of Credit [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Number of financial covenants | debt_covenant						2
Number of prior quarters included in EBITDA to interest calculation | fiscal_quarter						4
Debt Covenant, Interest Coverage Ratio, Minimum						2.50
Interest Coverage Ratio						9.36
First Mortgage Bonds [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Debt Covenant, Total Debt to Total Capitalization Ratio, Maximum						0.65			0.75
DPL Revolving Credit Agreement and Term Loan Maturing July 2020 [Member]
Debt Instrument [Line Items]
Number of financial covenants | debt_covenant						2
Number of prior quarters included in EBITDA to interest calculation | fiscal_quarter						4
Number of prior quarters included in debt to EBITDA ratio | fiscal_quarter						4
Ten Year Senior Unsecured Bonds At435 Maturing At April152029 [Member]
Debt Instrument [Line Items]
Proceeds from Issuance of Long-term Debt			$ 400.0
Debt instrument interest percentage			4.35%
Ten Year Senior Unsecured Notes At725 Maturing At October152021 [Member]
Debt Instrument [Line Items]
Extinguishment of Debt, Amount		$ 400.0
Long-term Debt, Gross		380.0				$ 380.0		$ 780.0
Make Whole Premium		$ 41.4
Debt instrument interest percentage					7.25%	7.25%
Revolving Credit Facility [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument [Line Items]
Debt Covenant, Total Debt to Total Capitalization Ratio, Maximum						0.67
Total Debt to Total Capitalization Ratio						0.58

XML

Derivative Instruments and Hedging Activities (Narrative) (Details) $ in Millions	3 Months Ended	9 Months Ended
	Mar. 31, 2018 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($) Number_of_interest_rate_swaps	Mar. 29, 2018 USD ($)
Sale of Derivative Instruments Interest Rate Swap				$ 60.0
Gain on sale of Derivative Instruments Interest Rate Swap		$ 0.8
THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt Instrument, Number of Financial Covenants | Number_of_interest_rate_swaps			2
Sale of Derivative Instruments Interest Rate Swap				$ 60.0
Gain on sale of Derivative Instruments Interest Rate Swap	$ 0.8
One Point One Three To One Point One Seven Bonds Maturing In August Two Thousand Twenty [Member]
Long-term Debt, Gross			$ 140.0
One Point One Three To One Point One Seven Bonds Maturing In August Two Thousand Twenty [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Long-term Debt, Gross			140.0
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member]
Derivative, Notional Amount, Purchase (Sales), Net			140.0
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Derivative, Notional Amount, Purchase (Sales), Net			$ 140.0

XML

Condensed Consolidated Statements of Operations - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Revenues	$ 199.0	$ 207.7	$ 592.2	$ 591.5
Operating costs and expenses
Net fuel cost	5.2	4.6	13.0	12.7
Utilities Operating Expense, Purchased Power	66.5	83.6	195.0	238.9
Operating expenses:
Operation and maintenance	44.2	37.3	142.3	118.3
Depreciation and amortization	17.7	19.7	54.1	58.8
Taxes other than income taxes	20.9	19.0	58.5	54.5
Other Operating Income (Expense), Net	0.0	1.6	0.9	14.6
Other, net (Note 2)			0.9	(0.6)
Costs and Expenses	154.5	165.8	463.8	497.8
Operating income	44.5	41.9	128.4	93.7
Other income / (expense), net:
Interest expense	(18.3)	(22.6)	(63.7)	(74.4)
Loss on early extinguishment of debt	0.0	0.0	(44.9)	(6.4)
Other income	0.3	0.5	3.2	0.8
Total other expense, net	(18.0)	(22.1)	(105.4)	(80.0)
Income from continuing operations before income tax	26.5	19.8	23.0	13.7
Income tax expense / (benefit) from continuing operations	(9.4)	3.1	(12.6)	1.5
Net income from continuing operations	35.9	16.7	35.6	12.2
Income / (loss) from discontinued operations before income tax	(0.4)	5.0	32.8	36.7
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax	0.0	0.3	0.1	(1.6)
Income tax expense from discontinued operations	0.1	1.0	7.1	5.9
Net income / (loss) from discontinued operations	(0.5)	4.3	25.8	29.2
Net income	35.4	21.0	61.4	41.4
THE DAYTON POWER AND LIGHT COMPANY [Member]
Revenues	191.1	198.7	570.2	563.5
Operating costs and expenses
Net fuel cost	0.6	0.1	2.0	1.7
Utilities Operating Expense, Purchased Power	65.9	83.0	193.3	235.7
Operating expenses:
Operation and maintenance	42.2	33.8	135.2	105.9
Depreciation and amortization	17.4	19.1	52.9	56.5
Taxes other than income taxes	20.8	19.0	58.2	54.3
Gain (Loss) on Sale of Assets and Asset Impairment Charges, excluding Discontinued Operations	(0.1)	0.0	0.0	0.1
Gain (Loss) on Disposition of Business	0.0	0.0	0.0	12.4
Costs and Expenses	146.8	155.0	441.6	466.6
Operating income	44.3	43.7	128.6	96.9
Other income / (expense), net:
Interest expense	(6.1)	(5.8)	(19.9)	(20.5)
Loss on early extinguishment of debt	0.0	0.0	0.0	(0.6)
Other income	(0.5)	(0.4)	0.1	(1.9)
Total other expense, net	(6.6)	(6.2)	(19.8)	(23.0)
Income from continuing operations before income tax	37.7	37.5	108.8	73.9
Income tax expense / (benefit) from continuing operations	(7.2)	6.3	5.1	12.0
Net income	$ 44.9	$ 31.2	$ 103.7	$ 61.9

XML

Summary of Significant Accounting Policies (Policy)

9 Months Ended

Sep. 30, 2019

Significant Accounting Policies [Line Items]

Description of Business

Description of Business

DPL is a regional energy company organized in 1985 under the laws of Ohio. DPL has one reportable segment: the Utility segment. See Note 11 – Business Segments for more information relating to this reportable segment. The terms “we,” “us,” “our” and “ours” are used to refer to DPL and its subsidiaries.

DPL is an indirectly wholly-owned subsidiary of AES.

DP&L, a wholly-owned subsidiary of DPL, is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 524,000 customers located in West Central Ohio. Additionally, DP&L provides retail SSO electric service to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. Following the issuance of the DRO in September 2018 and the resulting changes to the decoupling rider effective January 1, 2019, DP&L's distribution sales are primarily impacted by customer growth within our service territory. DP&L sells its proportional share of energy and capacity from its investment in OVEC into the wholesale market.

DPL’s other primary subsidiaries include MVIC and AES Ohio Generation. MVIC is our captive insurance company that provides insurance services to DPL and our other subsidiaries. AES Ohio Generation's only operating asset is an undivided interest in Conesville. AES Ohio Generation sells all of its energy and capacity into the wholesale market. DPL's subsidiaries are all wholly-owned.

DPL also has a wholly-owned business trust, DPL Capital Trust II, formed for the purpose of issuing trust capital securities to investors.

DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs.

DPL and its subsidiaries employed 653 people as of September 30, 2019, of which 642 were employed by DP&L. Approximately 57% of all DPL employees are under a collective bargaining agreement, which expires October 31, 2020.

Financial Statement Presentation

Financial Statement Presentation

DPL’s Condensed Consolidated Financial Statements include the accounts of DPL and its wholly-owned subsidiaries except for DPL Capital Trust II, which is not consolidated, consistent with the provisions of GAAP. As of September 30, 2019, AES Ohio Generation has an undivided ownership interest in one coal-fired generating facility, which is included in the financial statements at a carrying value of zero as it has been fully impaired. Operating revenues and expenses of this facility are included on a pro rata basis in the corresponding lines in the Condensed Consolidated Statements of Operations.

Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation.

All material intercompany accounts and transactions are eliminated in consolidation. We have evaluated subsequent events through the date this report is issued.

These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim

report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2018.

In the opinion of our management, the Condensed Consolidated Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2019; our results of operations for the three and nine months ended September 30, 2019 and 2018, our cash flows for the nine months ended September 30, 2019 and 2018 and the changes in our equity for the three and nine months ended September 30, 2019 and 2018. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, interim results for the three and nine months ended September 30, 2019 may not be indicative of our results that will be realized for the full year ending December 31, 2019.

The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: recognition of revenue including unbilled revenues, the carrying value of property, plant and equipment; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits.

Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities

DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2019 and 2018 were $13.0 million and $13.8 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2019 and 2018 were $37.3 million and $39.2 million, respectively.

Recently Issued Accounting Standards

New accounting pronouncements adopted in 2019 – The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed consolidated financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Consolidated Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed consolidated financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed consolidated financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $70.2 million in gross trade accounts receivable.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Significant Accounting Policies [Line Items]

Description of Business

Description of Business

DP&L is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 524,000 customers located in West Central Ohio. Additionally, DP&L provides retail SSO electric service to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio. As a result of Generation Separation, DP&L now only has one reportable segment, the Utility segment. In addition to DP&L's electric transmission and distribution businesses, the Utility segment includes revenues and costs associated with DP&L's investment in OVEC and the historical results of DP&L’s Beckjord and Hutchings Coal generating facilities, which have either been closed or sold. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. Following the issuance of the DRO in September 2018 and the resulting changes to the decoupling rider effective January 1, 2019, DP&L's distribution sales are primarily impacted by customer growth within our service territory. DP&L sells its proportional share of energy and capacity from its investment in OVEC into the wholesale market. DP&L is a subsidiary of DPL. The terms “we,” “us,” “our” and “ours” are used to refer to DP&L.

DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs.

DP&L employed 642 people as of September 30, 2019. Approximately 58% of DP&L employees are under a collective bargaining agreement, which expires October 31, 2020.

Financial Statement Presentation

Financial Statement Presentation

DP&L does not have any subsidiaries.

We have evaluated subsequent events through the date this report is issued.

Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation.

These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2018.

In the opinion of our management, the Condensed Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2019; our results of operations for the three and nine months ended September 30, 2019 and 2018, our cash flows for the nine months ended September 30, 2019 and 2018 and the changes in our equity for the three and nine months ended September 30, 2019 and 2018. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, interim results for the three and nine months ended September 30, 2019 may not be indicative of our results that will be realized for the full year ending December 31, 2019.

The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: recognition of revenue including unbilled revenues, the carrying value of property, plant and equipment; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and

liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits.

Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities

DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2019 and 2018 were $13.0 million and $13.8 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2019 and 2018 were $37.3 million and $39.2 million, respectively.

Recently Issued Accounting Standards

New accounting pronouncements adopted in 2019 – The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the

plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $72.1 million in gross trade accounts receivable.

XML

Derivative Instruments and Hedging Activities (Tables)

9 Months Ended

Sep. 30, 2019

Derivative Instruments and Hedging Activities Disclosures [Line Items]

Gains or Losses Recognized in AOCI for the Cash Flow Hedges

The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2019 and 2018:

	Three months ended						Three months ended
	September 30, 2019						September 30, 2018
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	0.4		$	15.3		$	—		$	17.4
Net gains / (losses) associated with current period hedging transactions	—			(0.2		)	—			0.1
Net gains reclassified to earnings
Interest expense	—			(0.4		)	—			(0.2		)
(Income) / loss from discontinued operations	(0.4		)	—			—			—
Ending accumulated derivative gains in AOCI	$	—		$	14.7		$	—		$	17.3
	Nine months ended						Nine months ended
	September 30, 2019						September 30, 2018
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains / (losses) in AOCI	$	0.4		$	16.6		$	(2.8	)	$	17.5
Net gains / (losses) associated with current period hedging transactions	—			(1.0		)	—			0.4
Net (gains) / losses reclassified to earnings
Interest expense	—			(0.9		)	—			(0.6		)
(Income) / loss from discontinued operations	(0.4		)	—			2.8			—
Ending accumulated derivative gains in AOCI	$	—		$	14.7		$	—		$	17.3
Portion expected to be reclassified to earnings in the next twelve months				$	(1.2	)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)				11

Net gains or losses associated with the ineffective portion of the hedging transactions were immaterial in the prior year period presented.

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location

DPL has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. The fair value derivative position of DPL's interest rate swaps are as follows:

Fair Values of Derivative Instruments
at September 30, 2019
				Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Consolidated Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swap	Designated	$	0.2	$	—	$	—	$	0.2
Total assets		$	0.2	$	—	$	—	$	0.2

(a)    Includes credit valuation adjustment.

Fair Values of Derivative Instruments
at December 31, 2018
				Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Consolidated Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swaps	Designated	$	0.9	$	—	$	—	$	0.9
Long-term derivative positions (presented in Other non-current assets)
Interest rate swaps	Designated	0.6		—		—		0.6
Total assets		$	1.5	$	—	$	—	$	1.5

(a)    Includes credit valuation adjustment.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Derivative Instruments and Hedging Activities Disclosures [Line Items]

Gains or Losses Recognized in AOCI for the Cash Flow Hedges

The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2019 and 2018:

	Three months ended
	September 30, 2019			September 30, 2018
	Interest			Interest
$ in millions (net of tax)	Rate Hedge			Rate Hedge
Beginning accumulated derivative gains / (losses) in AOCI	$	(0.3	)	$	1.6
Net losses associated with current period hedging transactions	(0.1		)	—
Net gains reclassified to earnings
Interest expense	—			(0.2		)
Ending accumulated derivative gains / (losses) in AOCI	$	(0.4	)	$	1.4
	Nine months ended
	September 30, 2019			September 30, 2018
	Interest			Interest
$ in millions (net of tax)	Rate Hedge			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	0.6		$	1.4
Net gains / (losses) associated with current period hedging transactions	(0.9		)	0.5
Net gains reclassified to earnings
Interest expense	(0.1		)	(0.5		)
Ending accumulated derivative gains / (losses) in AOCI	$	(0.4	)	$	1.4
Portion expected to be reclassified to earnings in the next twelve months	$	(0.2	)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)	11

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location

DP&L has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. The fair value derivative position of DP&L's interest rate swaps are as follows:

Fair Values of Derivative Instruments
at September 30, 2019
				Gross Amounts Not Offset in the Condensed Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swap	Designated	$	0.2	$	—	$	—	$	0.2
Total assets		$	0.2	$	—	$	—	$	0.2

(a)    Includes credit valuation adjustment.

Fair Values of Derivative Instruments
at December 31, 2018
				Gross Amounts Not Offset in the Condensed Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swaps	Designated	$	0.9	$	—	$	—	$	0.9
Long-term derivative positions (presented in Other non-current assets)
Interest rate swaps	Designated	0.6		—		—		0.6
Total assets		$	1.5	$	—	$	—	$	1.5

(a)    Includes credit valuation adjustment.

XML

Derivative Instruments and Hedging Activities

9 Months Ended

Sep. 30, 2019

Derivative Instruments and Hedging Activities Disclosures [Line Items]

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

In the normal course of business, DPL enters into interest rate hedges to manage the interest rate risk of our variable rate debt. All of our derivative instruments are used for risk management purposes and are designated as cash flow hedges if they qualify under FASC 815 for accounting purposes. In prior periods, we have used commodity derivatives principally to manage the risk of changes in market prices for commodities.

Cash Flow Hedges

As part of our risk management processes, we identify the relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. The fair values of cash flow hedges determined by current public market prices will continue to fluctuate with changes in market prices up to contract expiration. With the adoption of ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities effective January 1, 2019, we will no longer be required to calculate effectiveness and thus the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item in the period in which it settles.

As of September 30, 2019, we have two interest rate swaps to hedge the variable interest on our $140.0 million variable interest rate tax-exempt First Mortgage Bonds. The interest rate swaps have a combined notional amount of $140.0 million and settle monthly based on a one-month LIBOR. On March 29, 2018, we settled $60.0 million of these interest rate swaps due to the partial repayment of the underlying debt and a gain of $0.8 million was recorded as a reduction to interest expense. Since the swap was partially settled, the remaining swaps were de-designated and then re-designated with a new hypothetical derivative. The AOCI associated with the remaining swaps will be amortized out of AOCI into interest expense over the remaining life of the underlying debt.

We had previously entered into interest rate derivative contracts to manage interest rate exposure related to anticipated borrowings of fixed-rate debt. These interest rate derivative contracts were settled in 2013 and we continue to amortize amounts out of AOCI into interest expense.

The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2019 and 2018:

	Three months ended						Three months ended
	September 30, 2019						September 30, 2018
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	0.4		$	15.3		$	—		$	17.4
Net gains / (losses) associated with current period hedging transactions	—			(0.2		)	—			0.1
Net gains reclassified to earnings
Interest expense	—			(0.4		)	—			(0.2		)
(Income) / loss from discontinued operations	(0.4		)	—			—			—
Ending accumulated derivative gains in AOCI	$	—		$	14.7		$	—		$	17.3
	Nine months ended						Nine months ended
	September 30, 2019						September 30, 2018
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains / (losses) in AOCI	$	0.4		$	16.6		$	(2.8	)	$	17.5
Net gains / (losses) associated with current period hedging transactions	—			(1.0		)	—			0.4
Net (gains) / losses reclassified to earnings
Interest expense	—			(0.9		)	—			(0.6		)
(Income) / loss from discontinued operations	(0.4		)	—			2.8			—
Ending accumulated derivative gains in AOCI	$	—		$	14.7		$	—		$	17.3
Portion expected to be reclassified to earnings in the next twelve months				$	(1.2	)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)				11

Net gains or losses associated with the ineffective portion of the hedging transactions were immaterial in the prior year period presented.

Financial Statement Effect

DPL has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. The fair value derivative position of DPL's interest rate swaps are as follows:

Fair Values of Derivative Instruments
at September 30, 2019
				Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Consolidated Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swap	Designated	$	0.2	$	—	$	—	$	0.2
Total assets		$	0.2	$	—	$	—	$	0.2

(a)    Includes credit valuation adjustment.

Fair Values of Derivative Instruments
at December 31, 2018
				Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Consolidated Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swaps	Designated	$	0.9	$	—	$	—	$	0.9
Long-term derivative positions (presented in Other non-current assets)
Interest rate swaps	Designated	0.6		—		—		0.6
Total assets		$	1.5	$	—	$	—	$	1.5

(a)    Includes credit valuation adjustment.

Any prior year ineffectiveness on the interest rate hedges and the monthly settlement of the interest rate hedges is recorded in interest expense within the Condensed Consolidated Statements of Operations.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Derivative Instruments and Hedging Activities Disclosures [Line Items]

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

In the normal course of business, DP&L enters into interest rate hedges to manage the interest rate risk of our variable rate debt. All of our derivative instruments are used for risk management purposes and are designated as cash flow hedges if they qualify under FASC 815 for accounting purposes. In prior periods, we have used commodity derivatives principally to manage the risk of changes in market prices for commodities.

Cash Flow Hedges

As part of our risk management processes, we identify the relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. The fair values of cash flow hedges determined by current public market prices will continue to fluctuate with changes in market prices up to contract expiration. With the adoption of ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities effective January 1, 2019, we will no longer be required to calculate effectiveness and thus the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item in the period in which it settles.

As of September 30, 2019, we have two interest rate swaps to hedge the variable interest on our $140.0 million variable interest rate tax-exempt First Mortgage Bonds. The interest rate swaps have a combined notional amount of $140.0 million and settle monthly based on a one-month LIBOR. On March 29, 2018, we settled $60.0 million of these interest rate swaps due to the partial repayment of the underlying debt and a gain of $0.8 million was recorded as a reduction to interest expense. Since the swap was partially settled, the remaining swaps were de-designated and then re-designated with a new hypothetical derivative. The AOCI associated with the remaining swaps will be amortized out of AOCI into interest expense over the remaining life of the underlying debt.

The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2019 and 2018:

	Three months ended
	September 30, 2019			September 30, 2018
	Interest			Interest
$ in millions (net of tax)	Rate Hedge			Rate Hedge
Beginning accumulated derivative gains / (losses) in AOCI	$	(0.3	)	$	1.6
Net losses associated with current period hedging transactions	(0.1		)	—
Net gains reclassified to earnings
Interest expense	—			(0.2		)
Ending accumulated derivative gains / (losses) in AOCI	$	(0.4	)	$	1.4
	Nine months ended
	September 30, 2019			September 30, 2018
	Interest			Interest
$ in millions (net of tax)	Rate Hedge			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	0.6		$	1.4
Net gains / (losses) associated with current period hedging transactions	(0.9		)	0.5
Net gains reclassified to earnings
Interest expense	(0.1		)	(0.5		)
Ending accumulated derivative gains / (losses) in AOCI	$	(0.4	)	$	1.4
Portion expected to be reclassified to earnings in the next twelve months	$	(0.2	)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)	11

Net gains or losses associated with the ineffective portion of the hedging transactions were immaterial in the prior year period presented.

Financial Statement Effect

DP&L has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. The fair value derivative position of DP&L's interest rate swaps are as follows:

Fair Values of Derivative Instruments
at September 30, 2019
				Gross Amounts Not Offset in the Condensed Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swap	Designated	$	0.2	$	—	$	—	$	0.2
Total assets		$	0.2	$	—	$	—	$	0.2

(a)    Includes credit valuation adjustment.

Fair Values of Derivative Instruments
at December 31, 2018
				Gross Amounts Not Offset in the Condensed Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Balance Sheets (a)		Financial Instruments with Same Counterparty in Offsetting Position		Cash Collateral		Net Fair Value
Assets
Short-term derivative positions (presented in Prepayments and other current assets)
Interest rate swaps	Designated	$	0.9	$	—	$	—	$	0.9
Long-term derivative positions (presented in Other non-current assets)
Interest rate swaps	Designated	0.6		—		—		0.6
Total assets		$	1.5	$	—	$	—	$	1.5

(a)    Includes credit valuation adjustment.

Any prior year ineffectiveness on the interest rate hedges and the monthly settlement of the interest rate hedges is recorded in interest expense within the Condensed Statements of Operations.

XML

Shareholder's Equity

9 Months Ended

Sep. 30, 2019

Class of Stock [Line Items]

Shareholder's Equity

Shareholder's Deficit

Capital Contributions from AES

DP&L's approved six-year 2017 ESP restricts DPL from making dividend payments to its parent company, AES, during the term of the ESP, as well as from making tax-sharing payments to AES during the term of the DMR. The 2017 ESP also requires that existing tax payments owed by DPL to AES, and similar tax payments that accrue during the term of the DMR, be converted into equity investments in DPL.

For the nine months ended September 30, 2019 and 2018, AES made capital contributions of $2.7 million and $30.2 million, respectively, by converting the amount owed to it by DPL related to tax-sharing payments for current tax liabilities.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Class of Stock [Line Items]

Shareholder's Equity

Shareholder's Equity

Capital Contribution and Returns of Capital

During the nine months ended September 30, 2019, DP&L made returns of capital payments of $90.0 million to DPL.

During the nine months ended September 30, 2018, DP&L received an $80.0 million capital contribution from its parent, DPL. In addition, DP&L made returns of capital payments of $43.8 million to DPL.

XML

Regulatory Matters (Details) - USD ($)			9 Months Ended
	Mar. 01, 2019	Jan. 22, 2019	Sep. 30, 2019	Dec. 31, 2018
Requested Distribution Modernization Rider annual revenue through filing		$ 199,000,000.0
Regulatory Assets, Noncurrent			$ 154,700,000	$ 152,600,000
Unbilled Revenue			15,200,000	16,800,000
Due from PJM transmission settlement			2,400,000	16,500,000
Refund of eligible excess ADIT and any related regulatory liability as required by the PUCO			65,100,000
Refund of eligible excess ADIT and any related regulatory liability as required by the PUCO, including taxes			83,200,000
Reduction of Long-term regulatory liability related to deferred income taxes			23.4
Subsidiaries [Member]
Requested Distribution Modernization Rider annual revenue through filing		$ 199,000,000.0
Regulatory Assets, Noncurrent			154,700,000	152,600,000
Unbilled Revenue			15,200,000	16,800,000
Due from PJM transmission settlement			2,400,000	$ 16,500,000
Refund of eligible excess ADIT and any related regulatory liability as required by the PUCO	$ 65,100,000
Refund of eligible excess ADIT and any related regulatory liability as required by the PUCO, including taxes			83,200,000
Reduction of Long-term regulatory liability related to deferred income taxes			$ 23.4

XML

Summary of Significant Accounting Policies (Narrative) (Details) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($) employee segment	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($) mi² employee customer generating_facility segment	Sep. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)	Jun. 30, 2018 USD ($)	Dec. 31, 2017 USD ($)
Significant Accounting Policies [Line Items]
Number of reportable segments | segment	1
Cash and Cash Equivalents, at Carrying Value	$ 36.8		$ 36.8		$ 90.5
Entity number of employees | employee	653		653
Employees under a collective bargaining agreement which expires in October-2011			57.00%
Excise taxes collected	$ 13.0	$ 13.8	$ 37.3	$ 39.2
Restricted Cash and Cash Equivalents, Current	17.6		17.6		21.2
Restricted Cash and Cash Equivalents	54.4	87.4	54.4	87.4	111.7		$ 24.9
Public Utilities, Property, Plant and Equipment, Generation or Processing	0.0		$ 0.0
THE DAYTON POWER AND LIGHT COMPANY [Member]
Significant Accounting Policies [Line Items]
Number of reportable segments | segment			1
Cash and Cash Equivalents, at Carrying Value	$ 14.4		$ 14.4		45.0
Approximate number of retail customers | customer			524,000
Service area, square miles | mi²			6,000
Number of Operating Segments | segment			1
Entity number of employees | employee	642		642
Employees under a collective bargaining agreement which expires in October-2011			58.00%
Number Of Generating Facilities | generating_facility			1
Excise taxes collected	$ 13.0	$ 13.8	$ 37.3	$ 39.2
Restricted Cash and Cash Equivalents, Current	17.6		17.6		21.2
Restricted Cash and Cash Equivalents	32.0		32.0		$ 66.2	$ 12.7	$ 5.6
Accounting Standards Update 2016-13 [Member]
Significant Accounting Policies [Line Items]
Accounts Receivable, before Allowance for Credit Loss, Current	70.2		70.2
Accounting Standards Update 2016-13 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Significant Accounting Policies [Line Items]
Accounts Receivable, before Allowance for Credit Loss, Current	$ 72.1		$ 72.1

XML

Benefit Plans (Tables)

9 Months Ended

Sep. 30, 2019

Entity Information [Line Items]

Schedule of Net Periodic Benefit Cost / (Income)

The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2019 and 2018 was:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Service cost	$	0.9		$	1.5		$	2.7		$	4.5
Interest cost	3.7			3.4			11.2			10.3
Expected return on plan assets	(5.0		)	(5.3		)	(15.0		)	(15.9		)
Amortization of unrecognized:
Prior service cost	0.3			0.3			0.9			0.8
Actuarial loss	1.1			1.6			3.2			4.8
Net periodic benefit cost	$	1.0		$	1.5		$	3.0		$	4.5

THE DAYTON POWER AND LIGHT COMPANY [Member]

Entity Information [Line Items]

Schedule of Net Periodic Benefit Cost / (Income)

The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2019 and 2018 was:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Service cost	$	0.9		$	1.5		$	2.7		$	4.5
Interest cost	3.7			3.4			11.2			10.3
Expected return on plan assets	(5.0		)	(5.3		)	(15.0		)	(15.9		)
Amortization of unrecognized:
Prior service cost	0.4			0.4			1.3			1.1
Actuarial loss	1.8			2.4			5.3			7.1
Net periodic benefit cost	$	1.8		$	2.4		$	5.5		$	7.1

XML

Contractual Obligations, Commercial Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Public Utility, Property, Plant and Equipment [Line Items]
Due to third parties, current	$ 0.0	$ 0.0
AES Ohio Generation [Member]
Public Utility, Property, Plant and Equipment [Line Items]
Third party guarantees	$ 21.0
Debt Obligation on 4.9% Equity Ownership [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Public Utility, Property, Plant and Equipment [Line Items]
Equity ownership interest	4.90%
Equity ownership interest aggregate cost	$ 67.2
Electric Generation Company [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Public Utility, Property, Plant and Equipment [Line Items]
Debt obligation	$ 1,371.3
Other OVEC Member [Member]
Public Utility, Property, Plant and Equipment [Line Items]
Equity ownership interest	4.85%
Other OVEC Member [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Public Utility, Property, Plant and Equipment [Line Items]
Equity ownership interest	4.85%

XML

Dispositions (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest	$ 26.5	$ 19.8	$ 23.0	$ 13.7
Property, Plant and Equipment, Additions	59.0	25.1	122.4	75.8
Beckjord [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest				(11.7)
Property, Plant and Equipment, Additions				14.5
Subsidiaries [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (Loss) on Disposition of Business	0.0	0.0	0.0	(12.4)
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest	$ 37.7	$ 37.5	$ 108.8	73.9
Subsidiaries [Member] | Beckjord [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest				(12.4)
Property, Plant and Equipment, Additions				$ 14.5

XML

Income Taxes (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended						9 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Sep. 30, 2019	Sep. 30, 2018
Entity Information [Line Items]
Effective Income Tax Rate Reconciliation, at Combined Federal and State Statutory Income Tax Rate, Percent							21.60%
Estimated annual effective income tax rate							(10.10%)	16.80%
Effective Income Tax Rate Reconciliation, Including Discontinued Operations, Percent	(35.60%)			16.30%			(9.80%)	15.20%
Non-cash capital contribution	$ 2.7	$ (1.5)	$ 1.5	$ 3.5	$ (17.9)	$ 44.6	$ 2.7	$ 30.2
THE DAYTON POWER AND LIGHT COMPANY [Member]
Entity Information [Line Items]
Effective income tax rates				16.80%				16.20%
Effective Income Tax Rate Reconciliation, at Combined Federal and State Statutory Income Tax Rate, Percent							21.60%
Estimated annual effective income tax rate							4.50%	17.10%
Effective Income Tax Rate Reconciliation, Including Discontinued Operations, Percent	(19.10%)						4.70%

XML

Statement of Equity Statement - USD ($) $ in Millions	Total	Common Stock [Member]	Other Additional Capital [Member]	AOCI Attributable to Parent [Member]	Retained Earnings [Member]	Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member]	Subsidiaries [Member]	Subsidiaries [Member] Common Stock [Member]	Subsidiaries [Member] Other Additional Capital [Member]	Subsidiaries [Member] AOCI Attributable to Parent [Member]	Subsidiaries [Member] Retained Earnings [Member]	Subsidiaries [Member] Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member]
Shares, Issued		1						41,172,173
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ (584.3)	$ 0.0	$ 2,330.4	$ 0.8	$ (2,915.5)		$ 330.7	$ 0.4	$ 685.8	$ (36.2)	$ (319.3)
Other Comprehensive Income (Loss), Net of Tax				3.3						1.1
Net Income (Loss) Attributable to Parent					16.9						15.7
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	20.2						16.8
Non-cash capital contribution	44.6		44.6
Stockholders' Equity, Other	0.0			(1.0)	1.0		(0.4)		(0.3)	(1.1)	1.0
Dividends, Common Stock, Cash							(23.8)		(23.8)
Proceeds from Contributions from Parent							(80.0)		80.0
Other Comprehensive Income (Loss), Net of Tax	3.0						2.5
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	44.4						64.4
Non-cash capital contribution	30.2
Proceeds from Contributions from Parent							(80.0)
AOCI reclassed to Retained Earnings before tax | Adjustments for New Accounting Pronouncement [Member]	1.6						1.7
AOCI reclassed to Retained Earnings, net of tax | Adjustments for New Accounting Pronouncement [Member]	1.0						1.1
Shares, Issued		1						41,172,173
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(519.5)	$ 0.0	2,375.0	3.1	(2,897.6)		403.3	$ 0.4	741.7	(36.2)	(302.6)
Other Comprehensive Income (Loss), Net of Tax				(0.3)			0.8
Net Income (Loss) Attributable to Parent					3.5		15.0
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	3.2						15.8
Non-cash capital contribution	(17.9)		(17.9)
Stockholders' Equity, Other	$ 0.1		0.1
Common Stock, Shares Authorized	1,500
Shares, Issued		1						41,172,173
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ (534.1)	$ 0.0	2,357.2	2.8	(2,894.1)		419.1	$ 0.4	741.7	(35.4)	(287.6)
Other Comprehensive Income (Loss), Net of Tax	0.0						0.6
Net Income (Loss) Attributable to Parent	21.0						31.2
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	21.0						31.8
Non-cash capital contribution	3.5		3.5
Stockholders' Equity, Other	0.1		0.1				0.1		0.1
Dividends, Common Stock, Cash							$ (20.0)		(20.0)
Common stock, par value (in USD per share)							$ 0.01
Common Stock, Shares Authorized							50,000,000
Shares, Issued		1						41,172,173
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ (509.5)	$ 0.0	2,360.8	2.8	(2,873.1)		$ 431.0	$ 0.4	721.8	(34.8)	(256.4)
Common stock, par value (in USD per share)							$ 0.01
Common Stock, Shares Authorized	1,500						50,000,000
Shares, Issued		1						41,172,173
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ (471.7)	$ 0.0	2,370.5	2.2	(2,844.4)		$ 445.3	$ 0.4	711.8	(35.3)	(231.6)
Other Comprehensive Income (Loss), Net of Tax				(0.4)						0.4
Net Income (Loss) Attributable to Parent					42.1						29.0
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	41.7						29.4
Non-cash capital contribution	1.5		1.5
Stockholders' Equity, Other	0.1		0.1				(0.3)				(0.3)
Other Comprehensive Income (Loss), Net of Tax	(2.2)					$ (2.3)	1.1					$ (1.0)
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	59.2						104.8
Non-cash capital contribution	2.7
Proceeds from Contributions from Parent							0.0
Shares, Issued		1						41,172,173
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(428.4)	$ 0.0	2,372.1	1.8	(2,802.3)		474.4	$ 0.4	711.8	(34.9)	(202.9)
Other Comprehensive Income (Loss), Net of Tax				(0.8)						(0.9)
Net Income (Loss) Attributable to Parent					(16.1)						29.8
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(16.9)						28.9
Non-cash capital contribution	(1.5)		(1.5)
Proceeds from Contributions from Parent							70.0		(70.0)
Shares, Issued		1						41,172,173
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(446.8)	$ 0.0	2,370.6	1.0	(2,818.4)		433.3	$ 0.4	641.8	(35.8)	(173.1)
Other Comprehensive Income (Loss), Net of Tax	(1.0)						1.6
Net Income (Loss) Attributable to Parent	35.4						44.9
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	34.4						46.5
Non-cash capital contribution	2.7		2.7
Stockholders' Equity, Other	$ 0.1		0.1				0.0		(0.1)		0.1
Dividends, Common Stock, Cash							$ (20.0)		(20.0)
Common stock, par value (in USD per share)							$ 0.01
Common Stock, Shares Authorized	1,500						50,000,000
Shares, Issued		1						41,172,173
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ (409.6)	$ 0.0	$ 2,373.4	$ 0.0	$ (2,783.0)		$ 459.8	$ 0.4	$ 621.9	$ (34.2)	$ (128.3)

XML

Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income tax (expense)/benefit on unrealized gains (losses) related to available-for-sale securities	$ 0.0	$ 0.0	$ 0.0	$ 0.0
Income tax (expense) benefit on reclassification to earnings	0.0	0.0	0.0	0.0
AOCI reclassed to Retained Earnings, income tax	0.0	0.0	0.0	0.0
Income tax (expense)/benefit on unrealized gains (losses) related to derivative activity	(0.1)	0.0	0.1	(0.2)
Income tax (expense)/benefit on reclassification of earnings related to derivative activity	(0.1)	0.1	0.0	0.3
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives Related to Discontinued Operations, Tax	(0.4)	0.0	(0.4)	(1.5)
Other Comprehensive (Income) Loss, Defined Benefit Plan, Prior Service Cost (Credit), Reclassification Adjustment from AOCI, Tax	0.0	0.0	0.0	0.0
Other Comprehensive Income (Loss), Defined Benefit Plan, Gain (Loss) Arising During Period, Tax	0.0	0.0	0.0	0.0
Income tax (expense)/benefit on reclassification of earnings related to pension and postretirement activity	(0.1)	(0.1)	(0.1)	(0.1)
THE DAYTON POWER AND LIGHT COMPANY [Member]
Income tax (expense)/benefit on unrealized gains (losses) related to available-for-sale securities	0.0	0.0	0.0	0.0
Income tax (expense) benefit on reclassification to earnings	0.0	0.0	0.0	0.0
AOCI reclassed to Retained Earnings, income tax	0.0	0.0	0.0	0.0
Income tax (expense)/benefit on unrealized gains (losses) related to derivative activity	0.0	(0.1)	0.2	(0.1)
Income tax (expense)/benefit on reclassification of earnings related to derivative activity	0.0	0.1	0.0	0.6
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives Related to Discontinued Operations, Tax	0.0	0.0	0.0	0.0
Other Comprehensive (Income) Loss, Defined Benefit Plan, Prior Service Cost (Credit), Reclassification Adjustment from AOCI, Tax	0.0	0.0	0.0	0.0
Other Comprehensive Income (Loss), Defined Benefit Plan, Gain (Loss) Arising During Period, Tax	0.0	0.0	0.0	0.0
Income tax (expense)/benefit on reclassification of earnings related to pension and postretirement activity	$ 0.9	$ (0.2)	$ (0.5)	$ (0.7)

XML

Derivative Instruments and Hedging Activities (Gains or Losses Recognized in AOCI for the Cash Flow Hedges) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Forward Contract Power [Member]
Accumulated Derivative Gain/Loss in AOCI [Roll Forward]
Beginning accumulated derivative gain / (loss) in AOCI	$ 0.4	$ 0.0	$ 0.4	$ (2.8)
Net gains / (losses) associated with current period hedging transactions	0.0	0.0	0.0	0.0
Ending accumulated derivative gain / (loss) in AOCI	0.0	0.0	0.0	0.0
Portion expected to be reclassified to earnings in the next twelve months
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)
Interest Rate Contract [Member]
Accumulated Derivative Gain/Loss in AOCI [Roll Forward]
Beginning accumulated derivative gain / (loss) in AOCI	15.3	17.4	$ 16.6	17.5
Net gains / (losses) associated with current period hedging transactions	(0.2)	0.1	(1.0)	0.4
Ending accumulated derivative gain / (loss) in AOCI	14.7	17.3	14.7	17.3
Portion expected to be reclassified to earnings in the next twelve months	(1.2)		$ (1.2)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)			11 months
THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Contract [Member]
Accumulated Derivative Gain/Loss in AOCI [Roll Forward]
Beginning accumulated derivative gain / (loss) in AOCI	(0.3)	1.6	$ 0.6	1.4
Net gains / (losses) associated with current period hedging transactions	(0.1)	0.0	(0.9)	0.5
Ending accumulated derivative gain / (loss) in AOCI	(0.4)	1.4	(0.4)	1.4
Portion expected to be reclassified to earnings in the next twelve months	(0.2)		$ (0.2)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)			11 months
Interest Expense [Member] | Forward Contract Power [Member]
Accumulated Derivative Gain/Loss in AOCI [Roll Forward]
Net gains losses reclassified to earnings	0.0	0.0	$ 0.0	0.0
Interest Expense [Member] | Interest Rate Contract [Member]
Accumulated Derivative Gain/Loss in AOCI [Roll Forward]
Net gains losses reclassified to earnings	(0.4)	(0.2)	(0.9)	(0.6)
Interest Expense [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Contract [Member]
Accumulated Derivative Gain/Loss in AOCI [Roll Forward]
Net gains losses reclassified to earnings	0.0	(0.2)	(0.1)	(0.5)
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member] | Forward Contract Power [Member]
Accumulated Derivative Gain/Loss in AOCI [Roll Forward]
Net gains losses reclassified to earnings	(0.4)	0.0	(0.4)	2.8
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member] | Interest Rate Contract [Member]
Accumulated Derivative Gain/Loss in AOCI [Roll Forward]
Net gains losses reclassified to earnings	$ 0.0	$ 0.0	$ 0.0	$ 0.0

XML

Fair Value (Fair Value and Cost of Non-Derivative Instruments) (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Cost [Member]
Total Assets	$ 6.8	$ 7.1
Cost [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Assets	6.8	7.1
Fair Value [Member]
Total Master Trust Assets, Fair Value	8.4	8.1
Total Assets	8.4	8.1
Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	8.4	8.1
Total Assets	8.4	8.1
Money Market Funds [Member] | Cost [Member]
Total Master Trust Assets, Cost	0.2	0.4
Money Market Funds [Member] | Cost [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Cost	0.2	0.4
Money Market Funds [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	0.2	0.4
Money Market Funds [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.2	0.4
Equity Securities [Member] | Cost [Member]
Total Master Trust Assets, Cost	2.3	2.4
Equity Securities [Member] | Cost [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Cost	2.3	2.4
Equity Securities [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	3.9	3.5
Equity Securities [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	3.9	3.5
Debt Securities [Member] | Cost [Member]
Total Master Trust Assets, Cost	4.1	4.1
Debt Securities [Member] | Cost [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Cost	4.1	4.1
Debt Securities [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	4.1	4.0
Debt Securities [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	4.1	4.0
Hedge Funds [Member] | Cost [Member]
Total Master Trust Assets, Cost	0.1	0.1
Hedge Funds [Member] | Cost [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Cost	0.1	0.1
Hedge Funds [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Hedge Funds [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Tangible Assets [Member] | Cost [Member]
Total Master Trust Assets, Cost	0.1	0.1
Tangible Assets [Member] | Cost [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Cost	0.1	0.1
Tangible Assets [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Tangible Assets [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Debt [Member] | Cost [Member]
Debt, Cost	1,362.9	1,475.9
Debt [Member] | Cost [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt, Cost	574.2	586.1
Debt [Member] | Fair Value [Member]
Debt, Fair Value	1,451.3	1,519.6
Debt [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt, Fair Value	$ 631.0	$ 593.8

XML

Dispositions (Notes)

9 Months Ended

Sep. 30, 2019

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Discontinued Operations

Dispositions

Beckjord Facility – On February 26, 2018, DP&L and its co-owners of the retired Beckjord Facility agreed to transfer their interests in the retired Facility to a third party, including their obligations to remediate the Facility and its site,

and the transfer occurred on that same date. As a result, DPL recognized a loss on the transfer of $11.7 million and made cash expenditures of $14.5 million, inclusive of cash expenditures for the transfer charges. The Beckjord Facility was retired in 2014, and, as such, the income / (loss) from continuing operations before income tax related to the Beckjord Facility was immaterial for the three and nine months ended September 30, 2018, excluding the loss on transfer noted above. Prior to the transfer, the Beckjord Facility was included in the Utility segment.

Discontinued Operations

On December 8, 2017, DPL and AES Ohio Generation completed the sale of their entire undivided interest in the Miami Fort Station and the Zimmer Station. On March 27, 2018, DPL and AES Ohio Generation completed the sale of the Peaker assets to Kimura Power, LLC, and this transaction resulted in a loss on sale of $1.9 million for the nine months ended September 30, 2018. Further, on May 31, 2018, DPL and AES Ohio Generation retired the Stuart Station coal-fired and diesel-fired generating units and the Killen Station coal-fired generating unit and combustion turbine as planned.

Consequently, we determined that the disposal of this group of components, as a whole, represents a strategic shift to exit generation, and, as such, qualifies to be presented as discontinued operations. Therefore, the results of operations, assets and liabilities of this group of components were reported as such in the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets for all periods presented.

The following table summarizes the major categories of assets and liabilities at the dates indicated:

$ in millions	September 30, 2019			December 31, 2018
Accounts receivable, net	$	6.8		$	4.0
Taxes applicable to subsequent years	0.6			2.3
Prepayments and other current assets	0.9			2.4
Intangible assets, net of amortization	0.2			5.3
Total assets of the disposal group classified as assets of discontinued operations and held-for-sale businesses in the balance sheets	$	8.5		$	14.0
Accounts payable	$	4.3		$	3.9
Accrued taxes	2.4			3.1
Accrued and other current liabilities	3.2			5.2
Deferred income taxes (a)	(33.2		)	(39.8		)
Taxes payable	—			2.3
Accrued pension and other post-retirement benefits	—			9.7
Asset retirement obligations	70.4			90.4
Other non-current liabilities	15.2			6.6
Total liabilities of the disposal group classified as liabilities of discontinued operations and held-for-sale businesses in the balance sheets	$	62.3		$	81.4

(a) Deferred income taxes represent the tax asset position of the discontinued group of components, which were netted with liabilities on DPL prior to classification as discontinued operations.

The following table summarizes the revenues, operating costs, other expenses and income tax of discontinued operations for the periods indicated:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Revenues	$	10.1		$	15.6		$	41.0		$	141.8
Operating costs and other expenses	(10.5		)	(10.6		)	(8.2		)	(105.1		)
Income from discontinued operations	(0.4		)	5.0			32.8			36.7
Gain / (loss) from disposal of discontinued operations	—			0.3			0.1			(1.6		)
Income tax expense from discontinued operations	0.1			1.0			7.1			5.9
Net income from discontinued operations	$	(0.5	)	$	4.3		$	25.8		$	29.2

Cash flows related to discontinued operations are included in our Condensed Consolidated Statements of Cash Flows. Cash flows from operating activities for discontinued operations were $(0.5) million and $(7.2) million for the three months ended September 30, 2019 and 2018, respectively, and $12.4 million and $37.2 million for the nine months ended September 30, 2019 and 2018, respectively. Cash flows from investing activities for discontinued operations were $233.8 million for the nine months ended September 30, 2018. There were no cash flows from

investing activities for the three and nine months ended September 30, 2019 or for the three months ended September 30, 2018.

AROs of Discontinued Operations

DPL's retired Stuart and Killen generating facilities continue to carry ARO liabilities consisting primarily of river intake and discharge structures, coal unloading facilities, landfills and ash disposal facilities. In the first quarter of 2019, DPL reduced the ARO liability related to the Stuart and Killen ash ponds and landfills by a combined $22.5 million based on updated internal analyses that reduced estimated closure costs associated with these ash ponds and landfills. The remaining ARO liability related to Stuart and Killen is included in the Asset retirement obligations balance in the total liabilities of the disposal group classified as liabilities of discontinued operations and held-for-sale businesses in the balance sheets as of September 30, 2019 above. As these plants are no longer in service, the reduction to the ARO liability was also recorded as a credit to depreciation and amortization expense in the same amount. The credit to depreciation and amortization expense is included in operating costs and other expenses of discontinued operations for the nine months ended September 30, 2019 in the table above.

Subsidiaries [Member]

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Discontinued Operations

Dispositions

Beckjord Facility – On February 26, 2018, DP&L and its co-owners of the retired Beckjord Facility agreed to transfer their interests in the retired Facility to a third party, including their obligations to remediate the Facility and its site, and the transfer occurred on that same date. As a result, DP&L recognized a loss on the transfer of $12.4 million and made cash expenditures of $14.5 million, inclusive of cash expenditures for the transfer charges. The Beckjord Facility was retired in 2014, and, as such, the income / (loss) from continuing operations before income tax related to the Beckjord Facility was immaterial for the three and nine months ended September 30, 2018, excluding the loss on transfer noted above.

XML

Supplemental Financial Information (Tables)

9 Months Ended

Sep. 30, 2019

Supplemental Financial Information [Line Items]

Schedule of Supplemental Financial Information

Accounts receivable and Inventories are as follows at September 30, 2019 and December 31, 2018:

	September 30,			December 31,
$ in millions	2019			2018
Accounts receivable, net:
Customer receivables	$	51.1		$	55.8
Unbilled revenue	15.2			16.8
Amounts due from affiliates	0.2			—
Due from PJM transmission enhancement settlement	2.4			16.5
Other	1.3			2.3
Provision for uncollectible accounts	(0.4		)	(0.9		)
Total accounts receivable, net	$	69.8		$	90.5
Inventories, at average cost:
Fuel and limestone	$	3.0		$	1.9
Materials and supplies	10.0			8.3
Other	—			0.5
Total inventories, at average cost	$	13.0		$	10.7

Reclassification out of Accumulated Other Comprehensive Income

The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2019 and 2018 are as follows:

Details about Accumulated Other Comprehensive Income / (Loss) components	Affected line item in the Condensed Consolidated Statements of Operations	Three months ended						Nine months ended
		September 30,						September 30,
$ in millions		2019			2018			2019			2018
Gains and losses on cash flow hedges (Note 5):
	Interest expense	$	(0.3	)	$	(0.3	)	$	(0.9	)	$	(0.9	)
	Income tax benefit / (expense)	(0.1		)	0.1			—			0.3
	Net of income taxes	(0.4		)	(0.2		)	(0.9		)	(0.6		)
	Loss from discontinued operations	—			—			—			4.3
	Income tax benefit from discontinued operations	(0.4		)	—			(0.4		)	(1.5		)
	Net of income taxes	(0.4		)	—			(0.4		)	2.8
Amortization of defined benefit pension items (Note 8):
	Other expense	0.1			0.2			0.2			0.5
	Income tax benefit	(0.1		)	(0.1		)	(0.1		)	(0.1		)
	Net of income taxes	—			0.1			0.1			0.4
Total reclassifications for the period, net of income taxes		$	(0.8	)	$	(0.1	)	$	(1.2	)	$	2.6

Schedule of Accumulated Other Comprehensive Income (Loss)

The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2019 are as follows:

$ in millions	Gains / (losses) on cash flow hedges			Change in unfunded pension and postretirement benefit obligation			Total
Balance at January 1, 2019	$	17.0		$	(14.8	)	$	2.2
Other comprehensive loss before reclassifications	(1.0		)	—			(1.0		)
Amounts reclassified from AOCI to earnings	(1.3		)	0.1			(1.2		)
Net current period other comprehensive income / (loss)	(2.3		)	0.1			(2.2		)
Balance at September 30, 2019	$	14.7		$	(14.7	)	$	—

Schedule of Other Operating Cost and Expense, by Component [Table Text Block]

The components of Operating expenses - other are summarized as follows:

	Three months ended				Nine months ended
	September 30,				September 30,
$ in millions	2019		2018		2019		2018
Loss on disposal and sale of businesses	$	—	$	—	$	—	$	11.7
Fixed-asset impairment	—		1.6		—		2.8
Other	—		—		0.9		0.1
Net other expense / (income)	$	—	$	1.6	$	0.9	$	14.6

THE DAYTON POWER AND LIGHT COMPANY [Member]

Supplemental Financial Information [Line Items]

Schedule of Supplemental Financial Information

Accounts receivable and Inventories are as follows at September 30, 2019 and December 31, 2018:

	September 30,			December 31,
$ in millions	2019			2018
Accounts receivable, net:
Customer receivables	$	50.0		$	53.3
Unbilled revenue	15.2			16.8
Amounts due from affiliates	3.2			2.3
Due from PJM transmission enhancement settlement	2.4			16.5
Other	1.3			2.4
Provision for uncollectible accounts	(0.4		)	(0.9		)
Total accounts receivable, net	$	71.7		$	90.4
Inventories, at average cost:
Materials and supplies	$	9.8		$	7.1
Other	—			0.6
Total inventories, at average cost	$	9.8		$	7.7

Reclassification out of Accumulated Other Comprehensive Income

The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2019 and 2018 are as follows:

Details about Accumulated Other Comprehensive Income / (Loss) components	Affected line item in the Condensed Statements of Operations	Three months ended					Nine months ended
		September 30,					September 30,
$ in millions		2019		2018			2019			2018
Gains and losses on cash flow hedges (Note 5):
	Interest expense	$	—	$	(0.3	)	$	(0.1	)	$	(1.1	)
	Income tax expense	—		0.1			—			0.6
	Net of income taxes	—		(0.2		)	(0.1		)	(0.5		)
Amortization of defined benefit pension items (Note 8):
	Other expense	0.8		1.0			2.6			3.2
	Income tax expense / (benefit)	0.9		(0.2		)	(0.5		)	(0.7		)
	Net of income taxes	1.7		0.8			2.1			2.5
Total reclassifications for the period, net of income taxes		$	1.7	$	0.6		$	2.0		$	2.0

Schedule of Accumulated Other Comprehensive Income (Loss)

The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2019 are as follows:

$ in millions	Gains / (losses) on cash flow hedges			Change in unfunded pension and postretirement benefit obligation			Total
Balance at January 1, 2019	$	0.6		$	(35.9	)	$	(35.3	)
Other comprehensive loss before reclassifications	(0.9		)	—			(0.9		)
Amounts reclassified from AOCI to earnings	(0.1		)	2.1			2.0
Net current period other comprehensive income / (loss)	(1.0		)	2.1			1.1
Balance at September 30, 2019	$	(0.4	)	$	(33.8	)	$	(34.2	)

XML

Income Taxes (Tables)

9 Months Ended

Sep. 30, 2019

Entity Information [Line Items]

Schedule of Effective Income Tax Rates

The following table details the effective tax rates for the three and nine months ended September 30, 2019 and 2018.

	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
DPL	(35.6)%	16.3%	(9.8)%	15.2%

THE DAYTON POWER AND LIGHT COMPANY [Member]

Entity Information [Line Items]

Schedule of Effective Income Tax Rates

The following table details the effective tax rates for the three and nine months ended September 30, 2019 and 2018.

	Three months ended		Nine months ended
	September 30,		September 30,
	2019	2018	2019	2018
DP&L	(19.1)%	16.8%	4.7%	16.2%

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 36.8		$ 36.8		$ 90.5
Restricted cash	17.6		17.6		21.2
Accounts receivable, net	69.8		69.8		90.5
Inventories	13.0		13.0		10.7
Taxes applicable to subsequent years	18.2		18.2		72.6
Regulatory assets, current	40.2		40.2		41.1
Prepayments and other current assets	9.3		9.3		12.9
Assets Held-for-sale, Not Part of Disposal Group, Current	8.3		8.3		8.7
Total current assets	213.2		213.2		348.2
Property, plant & equipment:
Property, plant & equipment	1,664.2		1,664.2		1,615.6
Less: Accumulated depreciation and amortization	(350.3)		(350.3)		(310.8)
Property, plant and equipment, net of depreciation	1,313.9		1,313.9		1,304.8
Construction work in process	94.5		94.5		32.2
Total net property, plant & equipment	1,408.4		1,408.4		1,337.0
Other non-current assets:
Regulatory assets, non-current	154.7		154.7		152.6
Intangible assets, net of amortization	19.3		19.3		18.4
Other non-current assets	20.5		20.5		21.6
Disposal Group, Including Discontinued Operation, Assets, Noncurrent	0.2		0.2		5.3
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax	(0.4)	$ (0.2)	(0.9)	$ (0.6)
Total other non-current assets	194.7		194.7		197.9
Total assets	1,816.3		1,816.3		1,883.1
Current liabilities:
Current portion of long-term debt	237.6		237.6		103.6
Accounts payable	52.9		52.9		58.1
Accrued taxes	78.5		78.5		76.7
Accrued interest	27.2		27.2		14.3
Security deposits	20.3		20.3		21.3
Regulatory liabilities, current	36.5		36.5		34.9
Other current liabilities	21.4		21.4		22.0
Liabilities Held for Sale, Current	9.9		9.9		12.2
Total current liabilities	484.3		484.3		343.1
Non-current liabilities:
Long-term debt	1,223.3		1,223.3		1,372.3
Deferred taxes	119.0		119.0		116.1
Taxes payable	3.7		3.7		76.1
Regulatory liabilities, non-current	252.3		252.3		278.3
Pension, retiree and other benefits	73.9		73.9		82.3
Asset Retirement Obligations, Noncurrent	9.5		9.5		9.4
Other deferred credits	7.5		7.5		8.0
Disposal Group, Including Discontinued Operation, Liabilities, Noncurrent	52.4		52.4		69.2
Total non-current liabilities	1,741.6		1,741.6		2,011.7
Commitments and contingencies
Common shareholder's equity:
Common stock	0.0		0.0		0.0
Other paid-in capital	2,373.4		2,373.4		2,370.5
Accumulated other comprehensive income	0.0		0.0		2.2
Retained earnings/ (deficit)	(2,783.0)		(2,783.0)		(2,844.4)
Total common shareholder's equity	(409.6)	(509.5)	(409.6)	(509.5)	(471.7)
Total liabilities and shareholder's equity	1,816.3		1,816.3		1,883.1
THE DAYTON POWER AND LIGHT COMPANY [Member]
Current assets:
Cash and cash equivalents	14.4		14.4		45.0
Restricted cash	17.6		17.6		21.2
Accounts receivable, net	71.7		71.7		90.4
Inventories	9.8		9.8		7.7
Taxes applicable to subsequent years	18.1		18.1		72.4
Regulatory assets, current	40.2		40.2		41.1
Income Taxes Receivable, Current	17.4		17.4		19.6
Prepayments and other current assets	8.6		8.6		13.3
Total current assets	197.8		197.8		310.7
Property, plant & equipment:
Property, plant & equipment	2,306.5		2,306.5		2,274.4
Less: Accumulated depreciation and amortization	(1,010.4)		(1,010.4)		(988.0)
Property, plant and equipment, net of depreciation	1,296.1		1,296.1		1,286.4
Construction work in process	93.0		93.0		31.7
Total net property, plant & equipment	1,389.1		1,389.1		1,318.1
Other non-current assets:
Regulatory assets, non-current	154.7		154.7		152.6
Intangible assets, net of amortization	18.1		18.1		17.2
Other non-current assets	19.7		19.7		21.0
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax	0.0	(0.2)	(0.1)	(0.5)
Total other non-current assets	192.5		192.5		190.8
Total assets	1,779.4		1,779.4		1,819.6
Current liabilities:
Current portion of long-term debt	199.6		199.6		4.6
Accounts payable	51.1		51.1		55.8
Accrued taxes	78.5		78.5		75.7
Accrued interest	6.5		6.5		0.4
Security deposits	20.3		20.3		21.3
Regulatory liabilities, current	36.5		36.5		34.9
Other current liabilities	16.8		16.8		17.5
Total current liabilities	409.3		409.3		210.2
Non-current liabilities:
Long-term debt	434.6		434.6		581.5
Deferred taxes	132.5		132.5		131.7
Taxes payable	4.9		4.9		77.1
Regulatory liabilities, non-current	252.3		252.3		278.3
Pension, retiree and other benefits	73.9		73.9		83.2
Asset Retirement Obligation	4.7		4.7		4.7
Other deferred credits	7.4		7.4		7.6
Total non-current liabilities	910.3		910.3		1,164.1
Commitments and contingencies
Common shareholder's equity:
Common stock	0.4		0.4		0.4
Other paid-in capital	621.9		621.9		711.8
Accumulated other comprehensive income	(34.2)		(34.2)		(35.3)
Retained earnings/ (deficit)	(128.3)		(128.3)		(231.6)
Total common shareholder's equity	459.8	$ 431.0	459.8	$ 431.0	445.3
Total liabilities and shareholder's equity	$ 1,779.4		$ 1,779.4		$ 1,819.6

XML

Derivative Instruments and Hedging Activities (Fair Value and Balance Sheet Location (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Total Assets [Member]
Derivative Asset, Fair Value	$ 0.2	$ 1.5
Derivative, Collateral, Obligation to Return Securities	0.0	0.0
Derivative, Collateral, Obligation to Return Cash	0.0	0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral	0.2	1.5
Total Assets [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Derivative Asset, Fair Value	0.2	1.5
Derivative, Collateral, Obligation to Return Securities	0.0	0.0
Derivative, Collateral, Obligation to Return Cash	0.0	0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral	0.2	1.5
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Short-term Derivative Positions [Member] | Other Prepayments and Current Assets [Member]
Derivative Asset, Fair Value	0.2
Derivative, Collateral, Obligation to Return Securities	0.0
Derivative, Collateral, Obligation to Return Cash	0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral	0.2
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Short-term Derivative Positions [Member] | Other Prepayments and Current Assets [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Derivative Asset, Fair Value	0.2	0.9
Derivative, Collateral, Obligation to Return Securities	0.0	0.0
Derivative, Collateral, Obligation to Return Cash	0.0	0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral	$ 0.2	0.9
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Long-term Derivative Positions [Member] | Other Deferred Asset [Member]
Derivative Asset, Fair Value		0.6
Derivative, Collateral, Obligation to Return Securities		0.0
Derivative, Collateral, Obligation to Return Cash		0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral		0.6
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Long-term Derivative Positions [Member] | Other Deferred Asset [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Derivative Asset, Fair Value		0.6
Derivative, Collateral, Obligation to Return Securities		0.0
Derivative, Collateral, Obligation to Return Cash		0.0
Derivative Asset, Fair Value, Amount Offset Against Collateral		$ 0.6

XML

Fair Value (Fair Value of Assets and Liabilities Measured on Recurring Basis) (Details) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Level 1 [Member]
Total Master Trust Assets, Fair Value	$ 0.2	$ 0.4
Total Derivative Assets	0.0	0.0
Total Assets	0.2	0.4
Total Liabilities	0.0	0.0
Level 1 [Member] | Interest Rate Contract [Member]
Total Derivative Assets	0.0	0.0
Level 1 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.2	0.4
Total Derivative Assets	0.0	0.0
Total Assets	0.2	0.4
Total Liabilities	0.0	0.0
Level 1 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Contract [Member]
Total Derivative Assets	0.0	0.0
Level 2 [Member]
Total Master Trust Assets, Fair Value	8.2	7.7
Total Derivative Assets	0.2	1.5
Total Assets	8.4	9.2
Total Liabilities	1,433.7	1,501.9
Level 2 [Member] | Interest Rate Contract [Member]
Total Derivative Assets	0.2	1.5
Level 2 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	8.2	7.7
Total Derivative Assets	0.2	1.5
Total Assets	8.4	9.2
Total Liabilities	613.4	576.1
Level 2 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Contract [Member]
Total Derivative Assets	0.2	1.5
Level 3 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Total Derivative Assets	0.0	0.0
Total Assets	0.0	0.0
Total Liabilities	17.6	17.7
Level 3 [Member] | Interest Rate Contract [Member]
Total Derivative Assets	0.0	0.0
Level 3 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Total Derivative Assets	0.0	0.0
Total Assets	0.0	0.0
Total Liabilities	17.6	17.7
Level 3 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Contract [Member]
Total Derivative Assets	0.0	0.0
Fair Value [Member]
Total Master Trust Assets, Fair Value	8.4	8.1
Total Derivative Assets	0.2	1.5
Total Assets	8.6	9.6
Total Liabilities	1,451.3	1,519.6
Fair Value [Member] | Interest Rate Contract [Member]
Total Derivative Assets	0.2	1.5
Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	8.4	8.1
Total Derivative Assets	0.2	1.5
Total Assets	8.6	9.6
Total Liabilities	631.0	593.8
Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | Interest Rate Contract [Member]
Total Derivative Assets	0.2	1.5
Money Market Funds [Member] | Level 1 [Member]
Total Master Trust Assets, Fair Value	0.2	0.4
Money Market Funds [Member] | Level 1 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.2	0.4
Money Market Funds [Member] | Level 2 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Money Market Funds [Member] | Level 2 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Money Market Funds [Member] | Level 3 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Money Market Funds [Member] | Level 3 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Money Market Funds [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	0.2	0.4
Money Market Funds [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.2	0.4
Equity Securities [Member] | Level 1 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Equity Securities [Member] | Level 1 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Equity Securities [Member] | Level 2 [Member]
Total Master Trust Assets, Fair Value	3.9	3.5
Equity Securities [Member] | Level 2 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	3.9	3.5
Equity Securities [Member] | Level 3 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Equity Securities [Member] | Level 3 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Equity Securities [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	3.9	3.5
Equity Securities [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	3.9	3.5
Debt Securities [Member] | Level 1 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Debt Securities [Member] | Level 1 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Debt Securities [Member] | Level 2 [Member]
Total Master Trust Assets, Fair Value	4.1	4.0
Debt Securities [Member] | Level 2 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	4.1	4.0
Debt Securities [Member] | Level 3 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Debt Securities [Member] | Level 3 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Debt Securities [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	4.1	4.0
Debt Securities [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	4.1	4.0
Hedge Funds [Member] | Level 1 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Hedge Funds [Member] | Level 1 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Hedge Funds [Member] | Level 2 [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Hedge Funds [Member] | Level 2 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Hedge Funds [Member] | Level 3 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Hedge Funds [Member] | Level 3 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Hedge Funds [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Hedge Funds [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Tangible Assets [Member] | Level 1 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Tangible Assets [Member] | Level 1 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Tangible Assets [Member] | Level 2 [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Tangible Assets [Member] | Level 2 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Tangible Assets [Member] | Level 3 [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Tangible Assets [Member] | Level 3 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.0	0.0
Tangible Assets [Member] | Fair Value [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Tangible Assets [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Total Master Trust Assets, Fair Value	0.1	0.1
Debt [Member] | Level 1 [Member]
Debt	0.0	0.0
Debt [Member] | Level 1 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt	0.0	0.0
Debt [Member] | Level 2 [Member]
Debt	1,433.7	1,501.9
Debt [Member] | Level 2 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt	613.4	576.1
Debt [Member] | Level 3 [Member]
Debt	17.6	17.7
Debt [Member] | Level 3 [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt	17.6	17.7
Debt [Member] | Fair Value [Member]
Debt	1,451.3	1,519.6
Debt [Member] | Fair Value [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member]
Debt	$ 631.0	$ 593.8

XML

Document and Entity Information	9 Months Ended
	Sep. 30, 2019 shares
Entity Registrant Name	DPL INC
Entity Central Index Key	0000787250
Document Type	10-Q
Document Period End Date	Sep. 30, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding	1
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Shell Company	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
THE DAYTON POWER AND LIGHT COMPANY [Member]
Entity Registrant Name	DAYTON POWER & LIGHT CO
Entity Central Index Key	0000027430
Document Type	10-Q
Amendment Flag	false
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding	41,172,173
Entity Emerging Growth Company	false
Entity Small Business	false

XML

Benefit Plans (Net Periodic Benefit Cost (Income)) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Pension [Member]
Contributions by employer			$ 7.5	$ 7.5
Service cost	$ 0.9	$ 1.5	2.7	4.5
Interest cost	3.7	3.4	11.2	10.3
Expected return on assets	(5.0)	(5.3)	(15.0)	(15.9)
Prior service cost	0.3	0.3	0.9	0.8
Actuarial loss / (gain)	1.1	1.6	3.2	4.8
Net periodic benefit cost	1.0	1.5	3.0	4.5
Postretirement [Member]
Defined Benefit Plan, Funded (Unfunded) Status of Plan	9.0		9.0		$ 9.2
THE DAYTON POWER AND LIGHT COMPANY [Member] | Pension [Member]
Contributions by employer			7.5	7.5
Service cost	0.9	1.5	2.7	4.5
Interest cost	3.7	3.4	11.2	10.3
Expected return on assets	(5.0)	(5.3)	(15.0)	(15.9)
Prior service cost	0.4	0.4	1.3	1.1
Actuarial loss / (gain)	1.8	2.4	5.3	7.1
Net periodic benefit cost	1.8	$ 2.4	5.5	$ 7.1
THE DAYTON POWER AND LIGHT COMPANY [Member] | Postretirement [Member]
Defined Benefit Plan, Funded (Unfunded) Status of Plan	$ 9.0		$ 9.0		$ 9.2

XML

Overview and Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2019

Significant Accounting Policies [Line Items]

Overview and Summary of Significant Accounting Policies

Overview and Summary of Significant Accounting Policies

Description of Business

DPL is a regional energy company organized in 1985 under the laws of Ohio. DPL has one reportable segment: the Utility segment. See Note 11 – Business Segments for more information relating to this reportable segment. The terms “we,” “us,” “our” and “ours” are used to refer to DPL and its subsidiaries.

DPL is an indirectly wholly-owned subsidiary of AES.

DP&L, a wholly-owned subsidiary of DPL, is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 524,000 customers located in West Central Ohio. Additionally, DP&L provides retail SSO electric service to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. Following the issuance of the DRO in September 2018 and the resulting changes to the decoupling rider effective January 1, 2019, DP&L's distribution sales are primarily impacted by customer growth within our service territory. DP&L sells its proportional share of energy and capacity from its investment in OVEC into the wholesale market.

DPL’s other primary subsidiaries include MVIC and AES Ohio Generation. MVIC is our captive insurance company that provides insurance services to DPL and our other subsidiaries. AES Ohio Generation's only operating asset is an undivided interest in Conesville. AES Ohio Generation sells all of its energy and capacity into the wholesale market. DPL's subsidiaries are all wholly-owned.

DPL also has a wholly-owned business trust, DPL Capital Trust II, formed for the purpose of issuing trust capital securities to investors.

DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs.

DPL and its subsidiaries employed 653 people as of September 30, 2019, of which 642 were employed by DP&L. Approximately 57% of all DPL employees are under a collective bargaining agreement, which expires October 31, 2020.

Financial Statement Presentation

DPL’s Condensed Consolidated Financial Statements include the accounts of DPL and its wholly-owned subsidiaries except for DPL Capital Trust II, which is not consolidated, consistent with the provisions of GAAP. As of September 30, 2019, AES Ohio Generation has an undivided ownership interest in one coal-fired generating facility, which is included in the financial statements at a carrying value of zero as it has been fully impaired. Operating revenues and expenses of this facility are included on a pro rata basis in the corresponding lines in the Condensed Consolidated Statements of Operations.

Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation.

All material intercompany accounts and transactions are eliminated in consolidation. We have evaluated subsequent events through the date this report is issued.

These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim

report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2018.

In the opinion of our management, the Condensed Consolidated Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2019; our results of operations for the three and nine months ended September 30, 2019 and 2018, our cash flows for the nine months ended September 30, 2019 and 2018 and the changes in our equity for the three and nine months ended September 30, 2019 and 2018. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, interim results for the three and nine months ended September 30, 2019 may not be indicative of our results that will be realized for the full year ending December 31, 2019.

The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: recognition of revenue including unbilled revenues, the carrying value of property, plant and equipment; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits.

Cash, Cash Equivalents, and Restricted Cash

The following table provides a summary of cash, cash equivalents, and restricted cash amounts reported on the Condensed Consolidated Balance Sheet that reconcile to the total of such amounts as shown on the Condensed Consolidated Statements of Cash Flows:

$ in millions	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	36.8	$	90.5
Restricted cash	17.6		21.2
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	54.4	$	111.7

Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities

DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2019 and 2018 were $13.0 million and $13.8 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2019 and 2018 were $37.3 million and $39.2 million, respectively.

New accounting pronouncements adopted in 2019 – The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed consolidated financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Consolidated Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed consolidated financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed consolidated financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $70.2 million in gross trade accounts receivable.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Significant Accounting Policies [Line Items]

Overview and Summary of Significant Accounting Policies

Overview and Summary of Significant Accounting Policies

Description of Business

DP&L is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 524,000 customers located in West Central Ohio. Additionally, DP&L provides retail SSO electric service to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio. As a result of Generation Separation, DP&L now only has one reportable segment, the Utility segment. In addition to DP&L's electric transmission and distribution businesses, the Utility segment includes revenues and costs associated with DP&L's investment in OVEC and the historical results of DP&L’s Beckjord and Hutchings Coal generating facilities, which have either been closed or sold. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. Following the issuance of the DRO in September 2018 and the resulting changes to the decoupling rider effective January 1, 2019, DP&L's distribution sales are primarily impacted by customer growth within our service territory. DP&L sells its proportional share of energy and capacity from its investment in OVEC into the wholesale market. DP&L is a subsidiary of DPL. The terms “we,” “us,” “our” and “ours” are used to refer to DP&L.

DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs.

DP&L employed 642 people as of September 30, 2019. Approximately 58% of DP&L employees are under a collective bargaining agreement, which expires October 31, 2020.

Financial Statement Presentation

DP&L does not have any subsidiaries.

We have evaluated subsequent events through the date this report is issued.

Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation.

These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2018.

In the opinion of our management, the Condensed Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2019; our results of operations for the three and nine months ended September 30, 2019 and 2018, our cash flows for the nine months ended September 30, 2019 and 2018 and the changes in our equity for the three and nine months ended September 30, 2019 and 2018. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, interim results for the three and nine months ended September 30, 2019 may not be indicative of our results that will be realized for the full year ending December 31, 2019.

The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: recognition of revenue including unbilled revenues, the carrying value of property, plant and equipment; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and

liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits.

Cash, Cash Equivalents, and Restricted Cash

The following table provides a summary of cash, cash equivalents, and restricted cash amounts reported on the Condensed Balance Sheet that reconcile to the total of such amounts as shown on the Condensed Statements of Cash Flows:

$ in millions	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	14.4	$	45.0
Restricted cash	17.6		21.2
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	32.0	$	66.2

Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities

DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2019 and 2018 were $13.0 million and $13.8 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2019 and 2018 were $37.3 million and $39.2 million, respectively.

New accounting pronouncements adopted in 2019 – The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the

plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $72.1 million in gross trade accounts receivable.

XML

Debt (Tables)

9 Months Ended

Sep. 30, 2019

Debt Instrument [Line Items]

Long-term Debt

The following table summarizes DPL's long-term debt.

	Interest		September 30,			December 31,
$ in millions	Rate	Maturity	2019			2018
Term loan - rates from 4.50% - 4.53% (a) and 4.01% - 4.60% (b)		2022	$	—		$	436.1
First Mortgage Bonds	3.95%	2049	425.0			—
Tax-exempt First Mortgage Bonds - rates from 2.97% - 3.07% (a) and 1.52% - 1.92% (b)		2020	140.0			140.0
U.S. Government note	4.20%	2061	17.6			17.7
Unamortized deferred financing costs			(5.7		)	(6.3		)
Unamortized debt discounts and premiums, net			(2.7		)	(1.4		)
Total long-term debt at DP&L			574.2			586.1
Senior unsecured bonds	6.75%	2019	—			99.0
Senior unsecured bonds	7.25%	2021	380.0			780.0
Senior unsecured notes	4.35%	2029	400.0			—
Note to DPL Capital Trust II (c)	8.125%	2031	15.6			15.6
Unamortized deferred financing costs			(5.8		)	(4.3		)
Unamortized debt discounts and premiums, net			(1.1		)	(0.5		)
Total long-term debt			1,362.9			1,475.9
Less: current portion			(139.6		)	(103.6		)
Long-term debt, net of current portion			$	1,223.3		$	1,372.3

(a) Range of interest rates for the nine months ended September 30, 2019.

(b) Range of interest rates for the year ended December 31, 2018.

(c)

Note payable to related party.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Debt Instrument [Line Items]

Long-term Debt

The following table summarizes DP&L's long-term debt.

	Interest		September 30,			December 31,
$ in millions	Rate	Maturity	2019			2018
Term loan - rates from 4.50% - 4.53% (a) and 4.01% - 4.60% (b)		2022	$	—		$	436.1
First Mortgage Bonds	3.95%	2049	425.0			—
Tax-exempt First Mortgage Bonds - rates from 2.97% - 3.07% (a) and 1.52% - 1.92% (b)		2020	140.0			140.0
U.S. Government note	4.20%	2061	17.6			17.7
Unamortized deferred financing costs			(5.7		)	(6.3		)
Unamortized debt discounts and premiums, net			(2.7		)	(1.4		)
Total long-term debt			574.2			586.1
Less: current portion			(139.6		)	(4.6		)
Long-term debt, net of current portion			$	434.6		$	581.5

(a) Range of interest rates for the nine months ended September 30, 2019.

(b) Range of interest rates for the year ended December 31, 2018.

XML

Revenue (Notes)

9 Months Ended

Sep. 30, 2019

Revenue from Contract with Customer [Text Block]

Revenue

Revenue is primarily earned from retail and wholesale electricity sales and electricity transmission and distribution delivery services. Revenue is recognized upon transfer of control to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. Revenue is recorded net of any taxes assessed on and collected from customers, which are remitted to the governmental authorities. For further discussion of our Retail, Wholesale, RTO ancillary, and Capacity revenues, see Note 14 — Revenue in Item 8.—Financial Statements and Supplementary Data of our Form 10-K.

DPL's revenue from contracts with customers was $195.0 million and $195.1 million for the three months ended September 30, 2019 and 2018, respectively, and $576.5 million and $560.1 million for the nine months ended September 30, 2019 and 2018, respectively.

The following table presents our revenue from contracts with customers and other revenue by segment for the three and nine months ended September 30, 2019 and 2018:

$ in millions	Utility		Other			Adjustments and Eliminations			Total
	Three Months Ended September 30, 2019
Retail revenue
Retail revenue from contracts with customers	$	170.5	$	—		$	—		$	170.5
Other retail revenue (a)	3.8		—			—			3.8
Wholesale revenue
Wholesale revenue from contracts with customers	4.4		5.0			(0.2		)	9.2
RTO ancillary revenue	11.0		0.1			—			11.1
Capacity revenue	1.1		1.1			—			2.2
Miscellaneous revenue from contracts with customers (b)	—		2.0			—			2.0
Miscellaneous revenue	0.3		0.7			(0.8		)	0.2
Total revenues	$	191.1	$	8.9		$	(1.0	)	$	199.0
	Three Months Ended September 30, 2018
Retail revenue
Retail revenue from contracts with customers	$	168.4	$	—		$	(0.4	)	$	168.0
Other retail revenue (a)	12.6		—			—			12.6
Wholesale revenue
Wholesale revenue from contracts with customers	4.9		5.6			—			10.5
RTO ancillary revenue	10.8		(0.1		)	—			10.7
Capacity revenue	2.0		1.7			—			3.7
Miscellaneous revenue from contracts with customers (b)	—		2.2			—			2.2
Miscellaneous revenue	—		0.5			(0.5		)	—
Total revenues	$	198.7	$	9.9		$	(0.9	)	$	207.7
	Nine months ended September 30, 2019
Retail revenue
Retail revenue from contracts with customers	$	503.8	$	—		$	—		$	503.8
Other retail revenue (a)	14.9		—			—			14.9
Wholesale revenue
Wholesale revenue from contracts with customers	12.8		11.4			(0.8		)	23.4
RTO ancillary revenue	32.8		0.2			—			33.0
Capacity revenue	5.0		4.2			—			9.2
Miscellaneous revenue from contracts with customers (b)	—		7.1			—			7.1
Miscellaneous revenue	0.9		2.3			(2.4		)	0.8
Total revenues	$	570.2	$	25.2		$	(3.2	)	$	592.2
	Nine months ended September 30, 2018
Retail revenue
Retail revenue from contracts with customers	$	469.3	$	—		$	(0.8	)	$	468.5
Other retail revenue (a)	31.4		—			—			31.4
Wholesale revenue
Wholesale revenue from contracts with customers	24.6		16.7			—			41.3
RTO ancillary revenue	32.4		0.1			—			32.5
Capacity revenue	5.8		4.7			—			10.5
Miscellaneous revenue from contracts with customers (b)	—		7.3			—			7.3
Miscellaneous revenue	—		1.9			(1.9		)	—
Total revenues	$	563.5	$	30.7		$	(2.7	)	$	591.5

(a) Other retail revenue primarily includes alternative revenue programs not accounted for under FASC 606.

(b) Miscellaneous revenue from contracts with customers primarily includes revenues for various services provided by Miami Valley Lighting.

The balances of receivables from contracts with customers were $66.3 million and $72.6 million as of September 30, 2019 and December 31, 2018, respectively. Payment terms for all receivables from contracts with customers are typically within 30 days.

Subsidiaries [Member]

Revenue from Contract with Customer [Text Block]

Revenue

Revenue is primarily earned from retail and wholesale electricity sales and electricity transmission and distribution delivery services. Revenue is recognized upon transfer of control to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. Revenue is recorded net of any taxes assessed on and collected from customers, which are remitted to the governmental authorities. For further discussion of our Retail, Wholesale, RTO ancillary, and Capacity revenues, see Note 13 — Revenue in Item 8.—Financial Statements and Supplementary Data of our Form 10-K.

DP&L's revenue from contracts with customers was $187.0 million and $186.1 million for the three months ended September 30, 2019 and 2018, respectively, and $554.4 million and $532.1 million for the nine months ended September 30, 2019 and 2018, respectively. The following table presents our revenue from contracts with customers and other revenue for the three and nine months ended September 30, 2019 and 2018:

	Three months ended				Nine months ended
	September 30,				September 30,
$ in millions	2019		2018		2019		2018
Retail revenue
Retail revenue from contracts with customers	$	170.5	$	168.4	$	503.8	$	469.3
Other retail revenue (a)	3.8		12.6		14.9		31.4
Wholesale revenue
Wholesale revenue from contracts with customers	4.4		4.9		12.8		24.6
RTO ancillary revenue	11.0		10.8		32.8		32.4
Capacity revenue	1.1		2.0		5.0		5.8
Miscellaneous revenue	0.3		—		0.9		—
Total revenues	$	191.1	$	198.7	$	570.2	$	563.5

(a) Other retail revenue primarily includes alternative revenue programs not accounted for under FASC 606.

The balances of receivables from contracts with customers were $65.2 million and $70.1 million as of September 30, 2019 and December 31, 2018, respectively. Payment terms for all receivables from contracts with customers are typically within 30 days.

XML

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2019

Related Party Transaction [Line Items]

New Accounting Pronouncements, Policy [Policy Text Block]

New accounting pronouncements adopted in 2019 – The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed consolidated financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Consolidated Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed consolidated financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed consolidated financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $70.2 million in gross trade accounts receivable.

Schedule of Cash and Cash Equivalents [Table Text Block]

The following table provides a summary of cash, cash equivalents, and restricted cash amounts reported on the Condensed Consolidated Balance Sheet that reconcile to the total of such amounts as shown on the Condensed Consolidated Statements of Cash Flows:

$ in millions	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	36.8	$	90.5
Restricted cash	17.6		21.2
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	54.4	$	111.7

Schedule of New Accounting Pronouncements

– The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed consolidated financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Consolidated Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our consolidated financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed consolidated financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed consolidated financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $70.2 million in gross trade accounts receivable.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Related Party Transaction [Line Items]

New Accounting Pronouncements, Policy [Policy Text Block]

New accounting pronouncements adopted in 2019 – The following table provides a brief description of recently adopted accounting pronouncements that had an impact on our financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or did not have a material impact on our financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2018-02, Income Statement — Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from AOCI	This amendment allows a reclassification of the stranded tax effects resulting from the implementation of the Tax Cuts and Jobs Act from AOCI to retained earnings at the election of the filer. Because this amendment only relates to the reclassification of the income tax effects of the Tax Cuts and Jobs Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected.	January 1, 2019	We have not elected to reclassify any amounts to retained earnings. Our accounting policy for releasing the income tax effects from AOCI occurs on a portfolio basis.
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities	The standard updates the hedge accounting model to expand the ability to hedge nonfinancial and financial risk components, reduce complexity, and ease certain documentation and assessment requirements. When facts and circumstances are the same as at the previous quantitative test, a subsequent quantitative effectiveness test is not required. The standard also eliminates the requirement to separately measure and report hedge ineffectiveness. For cash flow hedges, this means that the entire change in the fair value of a hedging instrument will be recorded in other comprehensive income and amounts deferred will be reclassified to earnings in the same income statement line as the hedged item. Transition method: modified retrospective with the cumulative effect adjustment recorded to the opening balance of retained earnings as of the initial application date. Prospective for presentation and disclosures.	January 1, 2019	The adoption of this standard had no material impact on our condensed financial statements.
2016-02, 2018-01, 2018-10, 2018-11 Leases (Topic 842)	See "Adoption of FASC Topic 842, Leases" below.	January 1, 2019	See impact upon adoption of the standard below.

Adoption of FASC Topic 842, "Leases"

On January 1, 2019, we adopted ASU 2016-02 Leases and its subsequent corresponding updates (“FASC 842”). Under this standard, lessees are required to recognize assets and liabilities for most leases and recognize expenses in a manner similar to the current accounting method. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance eliminates current real estate-specific provisions.

Under FASC 842, it is expected that fewer contracts will contain a lease. However, due to the elimination of the real estate-specific guidance and changes to certain lessor classification criteria, more leases will qualify as sales-type leases and direct financing leases. Under these two models, a lessor will derecognize the asset and will recognize a net investment in a lease. According to FASC 842, the net investment in the lease includes the fair value of the

plant after the contract period but does not include variable payments such as margin on the sale of energy. Therefore, the net investment in the lease could be significantly different than the carrying amount of the underlying asset at lease commencement. In such circumstances, the difference between the initially recognized net investment in the lease and the carrying amount of the underlying asset is recognized as a gain/loss at lease commencement.

During the course of adopting FASC 842, we applied various practical expedients including:

• The package of practical expedients (applied to all leases) that allowed lessees and lessors not to reassess:

a. whether any expired or existing contracts are or contain leases,

b. lease classification for any expired or existing leases, and

c. whether initial direct costs for any expired or existing leases qualify for capitalization under FASC 842.

• The transition practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements, and

• The transition practical expedient for lessees that allowed businesses to not separate lease and non-lease components. We applied the practical expedient to all classes of underlying assets when valuing right-of-use assets and lease liabilities. Contracts where we are the lessor were separated between the lease and non-lease components.

We applied the modified retrospective method of adoption and elected to continue to apply the guidance in FASC 840 Leases to the comparative periods presented in the year of adoption. Under this transition method, we applied the transition provisions starting at the date of adoption.

The adoption of FASC 842 did not have a material impact on our Condensed Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective – The following table provides a brief description of recent accounting pronouncements that could have a material impact on our financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our financial statements.

ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2016-13, 2019-04, 2019-05, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	See discussion of the ASU below.	January 1, 2020	We will adopt the standard on January 1, 2020; see below for the evaluation of the impact of the adoption on the condensed financial statements.

ASU 2016-13 and its subsequent corresponding updates will update the impairment model for financial assets measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities will be required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. For available-for-sale debt securities with unrealized losses, entities will measure credit losses as it is done today, except that the losses will be recognized as an allowance rather than a reduction in the amortized cost of the securities. There are various transition methods available upon adoption.

We are currently evaluating the impact of adopting the standard on our condensed financial statements; however, it is expected that the new current expected credit loss model will primarily impact the calculation of expected credit losses on $72.1 million in gross trade accounts receivable.

Schedule of Cash and Cash Equivalents [Table Text Block]

The following table provides a summary of cash, cash equivalents, and restricted cash amounts reported on the Condensed Balance Sheet that reconcile to the total of such amounts as shown on the Condensed Statements of Cash Flows:

$ in millions	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	14.4	$	45.0
Restricted cash	17.6		21.2
Cash, Cash Equivalents, and Restricted Cash, End of Period	$	32.0	$	66.2

XML

Fair Value

9 Months Ended

Sep. 30, 2019

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fair Value

Fair Value

The fair value of current financial assets and liabilities, debt service reserves and other deposits approximate their reported carrying amounts. The estimated fair values of our assets and liabilities have been determined using available market information. By virtue of these amounts being estimates and based on hypothetical transactions to sell assets or transfer liabilities, the use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. For further information on our valuation techniques and policies, see Note 5—Fair Value in Item 8.—Financial Statements and Supplementary Data of our Form 10-K.

The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2019 and December 31, 2018. Further information about the fair value of our derivative instruments can be found in Note 5 – Derivative Instruments and Hedging Activities.

	September 30, 2019				December 31, 2018
$ in millions	Cost		Fair Value		Cost		Fair Value
Assets
Money market funds	$	0.2	$	0.2	$	0.4	$	0.4
Equity securities	2.3		3.9		2.4		3.5
Debt securities	4.1		4.1		4.1		4.0
Hedge funds	0.1		0.1		0.1		0.1
Tangible assets	0.1		0.1		0.1		0.1
Total Assets	$	6.8	$	8.4	$	7.1	$	8.1
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities
Long-term debt	$	1,362.9	$	1,451.3	$	1,475.9	$	1,519.6

These financial instruments are not subject to master netting agreements or collateral requirements and as such are presented in the Condensed Consolidated Balance Sheet at their gross fair value, except for Long-term debt, which is presented at amortized carrying value.

We did not have any transfers of the fair values of our financial instruments between Level 1, Level 2 or Level 3 of the fair value hierarchy during the nine months ended September 30, 2019 or 2018.

Master Trust Assets

DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans and these assets are not used for general operating purposes. On January 1, 2018, AOCI of $1.6 million ($1.0 million net of tax) was reversed to Accumulated Deficit and all future changes to fair value on the Master Trust Assets will be included in income in the period that the changes occur. Changes to fair value were not material for the nine months ended September 30, 2019 or 2018. These assets are primarily comprised of open-ended mutual funds, which are valued using the net asset value per unit. These investments are recorded at fair value within Other deferred assets on the Condensed Consolidated Balance Sheets and classified as available for sale.

Long-term debt

The fair value of debt is based on current public market prices for disclosure purposes only. Unrealized gains or losses are not recognized in the financial statements as long-term debt is presented at carrying value, net of unamortized premium or discount and unamortized deferred financing costs in the financial statements. The long-term debt amounts include the current portion payable in the next twelve months and have maturities that range from 2020 to 2061.

The fair value of assets and liabilities at September 30, 2019 and December 31, 2018 and the respective category within the fair value hierarchy for DPL is as follows:

$ in millions	Fair value at September 30, 2019 (a)								Fair value at December 31, 2018 (a)
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Master Trust assets
Money market funds	$	0.2	$	—	$	—	$	0.2	$	0.4	$	—	$	—	$	0.4
Equity securities	—		3.9		—		3.9		—		3.5		—		3.5
Debt securities	—		4.1		—		4.1		—		4.0		—		4.0
Hedge funds	—		0.1		—		0.1		—		0.1		—		0.1
Tangible assets	—		0.1		—		0.1		—		0.1		—		0.1
Total Master Trust assets	0.2		8.2		—		8.4		0.4		7.7		—		8.1
Derivative assets
Interest rate hedges	—		0.2		—		0.2		—		1.5		—		1.5
Total Derivative assets	—		0.2		—		0.2		—		1.5		—		1.5
Total Assets	$	0.2	$	8.4	$	—	$	8.6	$	0.4	$	9.2	$	—	$	9.6
Liabilities
Long-term debt	$	—	$	1,433.7	$	17.6	$	1,451.3	$	—	$	1,501.9	$	17.7	$	1,519.6
Total Liabilities	$	—	$	1,433.7	$	17.6	$	1,451.3	$	—	$	1,501.9	$	17.7	$	1,519.6

(a) Includes credit valuation adjustment

Our financial instruments are valued using the market approach in the following categories:

• Level 1 inputs are used for money market accounts that are considered cash equivalents. The fair value is determined by reference to quoted market prices and other relevant information generated by market transactions.

• Level 2 inputs are used to value derivatives such as interest rate hedge contracts which are valued using a benchmark interest rate. Other Level 2 assets include open-ended mutual funds in the Master Trust, which are valued using the end of day NAV per unit.

• Level 3 inputs such as certain debt balances are considered a Level 3 input because the notes are not publicly traded. Our long-term debt is fair valued for disclosure purposes only.

All of the inputs to the fair value of our derivative instruments are from quoted market prices.

Our long-term debt is fair valued for disclosure purposes only and most of the fair values are determined using quoted market prices in inactive markets. These fair value inputs are considered Level 2 in the fair value hierarchy. As the Wright-Patterson Air Force Base note is not publicly traded, fair value is assumed to equal carrying value. These fair value inputs are considered Level 3 in the fair value hierarchy as there are no observable inputs. Additional Level 3 disclosures are not presented since our long-term debt is not recorded at fair value.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fair Value

Fair Value

The fair value of current financial assets and liabilities, debt service reserves and other deposits approximate their reported carrying amounts. The estimated fair values of our assets and liabilities have been determined using available market information. By virtue of these amounts being estimates and based on hypothetical transactions to sell assets or transfer liabilities, the use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. For further information on our valuation techniques and policies, see Note 5—Fair Value in Item 8.—Financial Statements and Supplementary Data of our Form 10-K.

The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2019 and December 31, 2018. Further information about the fair value of our derivative instruments can be found in Note 5 – Derivative Instruments and Hedging Activities.

	September 30, 2019				December 31, 2018
$ in millions	Cost		Fair Value		Cost		Fair Value
Assets
Money market funds	$	0.2	$	0.2	$	0.4	$	0.4
Equity securities	2.3		3.9		2.4		3.5
Debt securities	4.1		4.1		4.1		4.0
Hedge funds	0.1		0.1		0.1		0.1
Tangible assets	0.1		0.1		0.1		0.1
Total assets	$	6.8	$	8.4	$	7.1	$	8.1
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities
Long-term debt	$	574.2	$	631.0	$	586.1	$	593.8

These financial instruments are not subject to master netting agreements or collateral requirements and as such are presented in the Condensed Balance Sheet at their gross fair value, except for Long-term debt, which is presented at amortized carrying value.

We did not have any transfers of the fair values of our financial instruments between Level 1, Level 2 or Level 3 of the fair value hierarchy during the nine months ended September 30, 2019 or 2018.

Master Trust Assets

DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans and these assets are not used for general operating purposes. On January 1, 2018, AOCI of $1.7 million ($1.1 million net of tax) was reversed to Accumulated Deficit and all future changes to fair value on the Master Trust Assets will be included in income in the period that the changes occur. Changes to fair value were not material for the nine months ended September 30, 2019 or 2018. These assets are primarily comprised of open-ended mutual funds, which are valued using the net asset value per unit. These investments are recorded at fair value within Other deferred assets on the Condensed Balance Sheets and classified as available for sale.

Long-term debt

The fair value of debt is based on current public market prices for disclosure purposes only. Unrealized gains or losses are not recognized in the financial statements as long-term debt is presented at carrying value, net of unamortized premium or discount and unamortized deferred financing costs in the financial statements. The long-term debt amounts include the current portion payable in the next twelve months and have maturities that range from 2020 to 2061.

The fair value of assets and liabilities at September 30, 2019 and December 31, 2018 and the respective category within the fair value hierarchy for DP&L is as follows:

$ in millions	Fair value at September 30, 2019 (a)								Fair value at December 31, 2018 (a)
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Master Trust assets
Money market funds	$	0.2	$	—	$	—	$	0.2	$	0.4	$	—	$	—	$	0.4
Equity securities	—		3.9		—		3.9		—		3.5		—		3.5
Debt securities	—		4.1		—		4.1		—		4.0		—		4.0
Hedge funds	—		0.1		—		0.1		—		0.1		—		0.1
Tangible assets	—		0.1		—		0.1		—		0.1		—		0.1
Total Master Trust assets	0.2		8.2		—		8.4		0.4		7.7		—		8.1
Derivative assets
Interest rate hedges	—		0.2		—		0.2		—		1.5		—		1.5
Total derivative assets	—		0.2		—		0.2		—		1.5		—		1.5
Total assets	$	0.2	$	8.4	$	—	$	8.6	$	0.4	$	9.2	$	—	$	9.6
Liabilities
Long-term debt	$	—	$	613.4	$	17.6	631.0		$	—	$	576.1	$	17.7	$	593.8
Total liabilities	$	—	$	613.4	$	17.6	$	631.0	$	—	$	576.1	$	17.7	$	593.8

(a) Includes credit valuation adjustment

Our financial instruments are valued using the market approach in the following categories:

• Level 1 inputs are used for money market accounts that are considered cash equivalents. The fair value is determined by reference to quoted market prices and other relevant information generated by market transactions.

• Level 2 inputs are used to value derivatives such as interest rate hedge contracts which are valued using a benchmark interest rate. Other Level 2 assets include open-ended mutual funds in the Master Trust, which are valued using the end of day NAV per unit.

• Level 3 inputs such as certain debt balances are considered a Level 3 input because the notes are not publicly traded. Our long-term debt is fair valued for disclosure purposes only.

All of the inputs to the fair value of our derivative instruments are from quoted market prices.

Our long-term debt is fair valued for disclosure purposes only and most of the fair values are determined using quoted market prices in inactive markets. These fair value inputs are considered Level 2 in the fair value hierarchy. As the Wright-Patterson Air Force Base note is not publicly traded, fair value is assumed to equal carrying value. These fair value inputs are considered Level 3 in the fair value hierarchy as there are no observable inputs. Additional Level 3 disclosures are not presented since our long-term debt is not recorded at fair value.

XML

Benefit Plans

9 Months Ended

Sep. 30, 2019

Entity Information [Line Items]

Pension and Postretirement Benefits

Benefit Plans

DP&L sponsors a defined benefit pension plan for the majority of its employees.

We generally fund pension plan benefits as accrued in accordance with the minimum funding requirements of ERISA and, in addition, make voluntary contributions from time to time. There were $7.5 million in employer contributions during each of the nine months ended September 30, 2019 and 2018.

The amounts presented in the following tables for pension include the collective bargaining plan formula, the traditional management plan formula, the cash balance plan formula and the SERP, in the aggregate. The pension costs below have not been adjusted for amounts billed to the Service Company for former DP&L employees who are now employed by the Service Company that are still participants in the DP&L plan.

The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2019 and 2018 was:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Service cost	$	0.9		$	1.5		$	2.7		$	4.5
Interest cost	3.7			3.4			11.2			10.3
Expected return on plan assets	(5.0		)	(5.3		)	(15.0		)	(15.9		)
Amortization of unrecognized:
Prior service cost	0.3			0.3			0.9			0.8
Actuarial loss	1.1			1.6			3.2			4.8
Net periodic benefit cost	$	1.0		$	1.5		$	3.0		$	4.5

In addition, DP&L provides postretirement health care and life insurance benefits to certain retired employees, their spouses and eligible dependents. We have funded a portion of the union-eligible benefits using a Voluntary Employee Beneficiary Association Trust. These postretirement health care benefits and the related unfunded obligation of $9.0 million at September 30, 2019 and $9.2 million at December 31, 2018 were not material to the financial statements in the periods covered by this report.

THE DAYTON POWER AND LIGHT COMPANY [Member]

Entity Information [Line Items]

Pension and Postretirement Benefits

Benefit Plans

DP&L sponsors a defined benefit pension plan for the majority of its employees.

We generally fund pension plan benefits as accrued in accordance with the minimum funding requirements of ERISA and, in addition, make voluntary contributions from time to time. There were $7.5 million in employer contributions during each of the nine months ended September 30, 2019 and 2018.

The amounts presented in the following tables for pension include the collective bargaining plan formula, the traditional management plan formula, the cash balance plan formula and the SERP, in the aggregate. The pension costs below have not been adjusted for amounts billed to the Service Company for former DP&L employees who are now employed by the Service Company or for amounts billed to AES Ohio Generation for employees employed by AES Ohio Generation that are still participants in the DP&L plan.

The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2019 and 2018 was:

	Three months ended						Nine months ended
	September 30,						September 30,
$ in millions	2019			2018			2019			2018
Service cost	$	0.9		$	1.5		$	2.7		$	4.5
Interest cost	3.7			3.4			11.2			10.3
Expected return on plan assets	(5.0		)	(5.3		)	(15.0		)	(15.9		)
Amortization of unrecognized:
Prior service cost	0.4			0.4			1.3			1.1
Actuarial loss	1.8			2.4			5.3			7.1
Net periodic benefit cost	$	1.8		$	2.4		$	5.5		$	7.1

In addition, DP&L provides postretirement health care and life insurance benefits to certain retired employees, their spouses and eligible dependents. We have funded a portion of the union-eligible benefits using a Voluntary Employee Beneficiary Association Trust. These postretirement health care benefits and the related unfunded obligation of $9.0 million at September 30, 2019 and $9.2 million at December 31, 2018 were not material to the financial statements in the periods covered by this report.

XML

Supplemental Financial Information (Supplemental Financial Information) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Supplemental Financial Information [Line Items]
Impairment of Long-Lived Assets Held-for-use			$ 0.0	$ 2.8
Gain (Loss) on Sale of Assets and Asset Impairment Charges			(0.9)	0.6
Customer receivables	$ 51.1		51.1		$ 55.8
Unbilled Revenue	15.2		15.2		16.8
Amounts due from partners in jointly owned stations	0.2		0.2		0.0
Due from PJM transmission settlement	2.4		2.4		16.5
Other	1.3		1.3		2.3
Provision for uncollectible accounts	(0.4)		(0.4)		(0.9)
Total accounts receivable, net	69.8		69.8		90.5
Fuel and limestone	3.0		3.0		1.9
Plant materials and supplies	10.0		10.0		8.3
Other	0.0		0.0		0.5
Total inventories, at average cost	13.0		13.0		10.7
Other Operating Income (Expense), Net	0.0	$ (1.6)	(0.9)	(14.6)
THE DAYTON POWER AND LIGHT COMPANY [Member]
Supplemental Financial Information [Line Items]
Gain (Loss) on Disposition of Business	0.0	0.0	0.0	12.4
Customer receivables	50.0		50.0		53.3
Unbilled Revenue	15.2		15.2		16.8
Amounts due from partners in jointly owned stations	3.2		3.2		2.3
Due from PJM transmission settlement	2.4		2.4		16.5
Other	1.3		1.3		2.4
Provision for uncollectible accounts	(0.4)		(0.4)		(0.9)
Total accounts receivable, net	71.7		71.7		90.4
Plant materials and supplies	9.8		9.8		7.1
Other	0.0		0.0		0.6
Total inventories, at average cost	9.8		9.8		$ 7.7
Other Operating Income (Expense) [Member]
Supplemental Financial Information [Line Items]
Gain (Loss) on Disposition of Business	0.0	0.0	0.0	11.7
Impairment of Long-Lived Assets Held-for-use	0.0	1.6	0.0	2.8
Other Cost and Expense, Operating	0.0	0.0	(0.9)	(0.1)
Other Operating Income (Expense), Net	$ 0.0	$ (1.6)	$ (0.9)	$ (14.6)

XML

Business Segments (Tables)

9 Months Ended

Sep. 30, 2019

Segment Reporting Information [Line Items]

Financial Reporting for Reportable Business Segments

The following tables present financial information for DPL’s Utility reportable business segment:

$ in millions	Utility		Other			Adjustments and Eliminations			DPL Consolidated
Three months ended September 30, 2019
Revenues from external customers	$	190.9	$	8.1		$	—		$	199.0
Intersegment revenues	0.2		0.8			(1.0		)	—
Total revenues	$	191.1	$	8.9		$	(1.0	)	$	199.0
Depreciation and amortization	$	17.4	$	0.3		$	—		$	17.7
Interest expense	$	6.1	$	12.2		$	—		$	18.3
Income / (loss) from continuing operations before income tax	$	37.7	$	(11.2	)	$	—		$	26.5
Cash capital expenditures	$	58.9	$	0.1		$	—		$	59.0
$ in millions	Utility		Other (a)			Adjustments and Eliminations			DPL Consolidated
Three Months Ended September 30, 2018
Revenues from external customers	$	198.5	$	9.2		$	—		$	207.7
Intersegment revenues	0.2		0.7			(0.9		)	—
Total revenues	$	198.7	$	9.9		$	(0.9	)	$	207.7
Depreciation and amortization	$	19.1	$	0.6		$	—		$	19.7
Interest expense	$	5.8	$	16.8		$	—		$	22.6
Income / (loss) from continuing operations before income tax	$	37.5	$	(17.7	)	$	—		$	19.8
Cash capital expenditures	$	20.5	$	4.6		$	—		$	25.1
$ in millions	Utility		Other			Adjustments and Eliminations			DPL Consolidated
Nine months ended September 30, 2019
Revenues from external customers	$	569.4	$	22.8		$	—		$	592.2
Intersegment revenues	0.8		2.4			(3.2		)	—
Total revenues	$	570.2	$	25.2		$	(3.2	)	$	592.2
Depreciation and amortization	$	52.9	$	1.2		$	—		$	54.1
Interest expense	$	19.9	$	43.8		$	—		$	63.7
Loss on early extinguishment of debt	$	—	$	44.9		$	—		$	44.9
Income / (loss) from continuing operations before income tax	$	108.8	$	(85.8	)	$	—		$	23.0
Cash capital expenditures	$	121.1	$	1.3		$	—		$	122.4
$ in millions	Utility		Other (a)			Adjustments and Eliminations			DPL Consolidated
Nine months ended September 30, 2018
Revenues from external customers	$	562.9	$	28.6		$	—		$	591.5
Intersegment revenues	0.6		2.1			(2.7		)	—
Total revenues	$	563.5	$	30.7		$	(2.7	)	$	591.5
Depreciation and amortization	$	56.5	$	2.3		$	—		$	58.8
Interest expense	$	20.5	$	53.9		$	—		$	74.4
Income / (loss) from continuing operations before income tax	$	73.9	$	(60.2	)	$	—		$	13.7
Cash capital expenditures	$	65.0	$	10.8		$	—		$	75.8

(a) "Other" includes Cash capital expenditures related to assets of discontinued operations and held-for-sale businesses for the three and nine months ended September 30, 2018.

Total Assets	September 30, 2019		December 31, 2018
Utility	$	1,779.4	$	1,819.6
All Other (a)	36.9		63.5
DPL Consolidated	$	1,816.3	$	1,883.1

(a) "All Other" includes Total assets related to the assets of discontinued operations and held-for-sale businesses and Eliminations for all periods presented.

XML

Fair Value (Narrative) (Details) - Adjustments for New Accounting Pronouncement [Member] $ in Millions	9 Months Ended
	Sep. 30, 2018 USD ($)
AOCI reclassed to Retained Earnings before tax	$ 1.6
AOCI reclassed to Retained Earnings, net of tax	1.0
THE DAYTON POWER AND LIGHT COMPANY [Member]
AOCI reclassed to Retained Earnings before tax	1.7
AOCI reclassed to Retained Earnings, net of tax	$ 1.1

XML

Shareholder's Equity (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended						9 Months Ended
	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Class of Stock [Line Items]
Non-cash capital contribution	$ 2.7	$ (1.5)	$ 1.5	$ 3.5	$ (17.9)	$ 44.6	$ 2.7	$ 30.2
Common Stock, Shares Authorized	1,500				1,500		1,500		1,500
Common stock, shares outstanding	1						1		1
THE DAYTON POWER AND LIGHT COMPANY [Member]
Class of Stock [Line Items]
Common Stock, Shares Authorized	50,000,000			50,000,000			50,000,000	50,000,000	50,000,000
Par value common shares (in USD per share)	$ 0.01			$ 0.01			$ 0.01	$ 0.01	$ 0.01
Common stock, shares outstanding	41,172,173						41,172,173		41,172,173
Proceeds from Contributions from Parent		$ (70.0)				$ 80.0	$ 0.0	$ 80.0
Payments of Ordinary Dividends, Common Stock							$ 90.0	$ 43.8

XML

Revenue (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Revenue from Contract with Customer, Excluding Assessed Tax	$ 195.0	$ 195.1	$ 576.5	$ 560.1
Alternative Revenue Programs Accounts Receivable, Gross	0.0		0.0		$ 0.0
RTO Revenue	11.1	10.7	33.0	32.5
RTO Capacity Revenue	2.2	3.7	9.2	10.5
Revenues	199.0	207.7	592.2	591.5
Contract with Customer, Asset, Gross	66.3		66.3		72.6
Corporate, Non-Segment [Member]
RTO Revenue	0.1	(0.1)	0.2	0.1
RTO Capacity Revenue	1.1	1.7	4.2	4.7
Revenues	8.9	9.9	25.2	30.7
Adjustments and Eliminations [Member]
RTO Revenue	0.0	0.0	0.0	0.0
RTO Capacity Revenue	0.0	0.0	0.0	0.0
Revenues	(1.0)	(0.9)	(3.2)	(2.7)
Utility [Member]
RTO Revenue	11.0	10.8	32.8	32.4
RTO Capacity Revenue	1.1	2.0	5.0	5.8
Revenues	191.1	198.7	570.2	563.5
Subsidiaries [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	187.0	186.1	554.4	532.1
Alternative Revenue Programs Accounts Receivable, Gross	0.0		0.0		0.0
RTO Revenue	11.0	10.8	32.8	32.4
RTO Capacity Revenue	1.1	2.0	5.0	5.8
Revenues	191.1	198.7	570.2	563.5
Contract with Customer, Asset, Gross	65.2		65.2		$ 70.1
Other Revenues [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	2.0	2.2	7.1	7.3
Other non-606 revenue	0.2	0.0	0.8	0.0
Other Revenues [Member] | Corporate, Non-Segment [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	2.0	2.2	7.1	7.3
Other non-606 revenue	0.7	0.5	2.3	1.9
Other Revenues [Member] | Adjustments and Eliminations [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	0.0	0.0	0.0	0.0
Other non-606 revenue	(0.8)	(0.5)	(2.4)	(1.9)
Other Revenues [Member] | Utility [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	0.0	0.0	0.0	0.0
Other non-606 revenue	0.3	0.0	0.9	0.0
Other Revenues [Member] | Subsidiaries [Member]
Other non-606 revenue	0.3	0.0	0.9	0.0
Wholesale Revenue [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	9.2	10.5	23.4	41.3
Wholesale Revenue [Member] | Corporate, Non-Segment [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	5.0	5.6	11.4	16.7
Wholesale Revenue [Member] | Adjustments and Eliminations [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	(0.2)	0.0	(0.8)	0.0
Wholesale Revenue [Member] | Utility [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	4.4	4.9	12.8	24.6
Wholesale Revenue [Member] | Subsidiaries [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	4.4	4.9	12.8	24.6
Retail Revenue [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	170.5	168.0	503.8	468.5
Other non-606 revenue	3.8	12.6	14.9	31.4
Retail Revenue [Member] | Corporate, Non-Segment [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	0.0	0.0	0.0	0.0
Other non-606 revenue	0.0	0.0	0.0	0.0
Retail Revenue [Member] | Adjustments and Eliminations [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	0.0	(0.4)	0.0	(0.8)
Other non-606 revenue	0.0	0.0	0.0	0.0
Retail Revenue [Member] | Utility [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	170.5	168.4	503.8	469.3
Other non-606 revenue	3.8	12.6	14.9	31.4
Retail Revenue [Member] | Subsidiaries [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	170.5	168.4	503.8	469.3
Other non-606 revenue	$ 3.8	$ 12.6	$ 14.9	$ 31.4