Regulatory Assets and Liabilities

12 Months Ended

Dec. 31, 2020

Regulatory Assets and Liabilities Disclosure [Abstract]

Regulatory assets and liabilities are created for amounts that regulators may allow to be collected or may require to be paid back to customers in future electric and natural gas rates. PSCo would be required to recognize the write-off of regulatory assets and liabilities in net income or other comprehensive income if changes in the utility industry no longer allow for the application of regulatory accounting guidance under GAAP.

Components of regulatory assets:


(Millions of Dollars)	See Note(s)	Remaining Amortization Period	Dec. 31, 2020				Dec. 31, 2019
Regulatory Assets			Current		Noncurrent		Current		Noncurrent
Pension and retiree medical obligations	9	Various	$	28	$	478	$	23	$	494
Depreciation differences		One to 11 years	16		154		15		140
Net AROs (a)	1, 10	Various	—		132		—		119
Recoverable deferred taxes on AFUDC		Plant lives	—		110		—		105
Excess deferred taxes — TCJA	7	Various	3		56		3		55
Purchased power contract costs		Term of related contract	3		22		2		24
Property tax		Various	16		21		1		30
Conservation programs (b)	1	One to two years	11		11		8		11
Gas pipeline inspection costs		One to two years	—		9		—		8
Losses on reacquired debt		Term of related debt	1		3		1		4
Contract valuation adjustments (c)	1, 8	Term of related contract	6		—		3		—
Recoverable purchased natural gas and electric energy costs		Less than one year	6		—		—		—
Other		Various	31		63		8		48
Total regulatory assets			$	121	$	1,059	$	64	$	1,038

(a)Includes amounts recorded for future recovery of AROs.

(b)Includes costs for conservation programs, as well as incentives allowed in certain jurisdictions.

(c)Includes the fair value of certain long-term PPAs used to meet energy capacity requirements and valuation adjustments on natural gas commodity purchases.

Components of regulatory liabilities:


(Millions of Dollars)	See Note(s)	Remaining Amortization Period	Dec. 31, 2020				Dec. 31, 2019
Regulatory Liabilities			Current		Noncurrent		Current		Noncurrent
Deferred income tax adjustments and TCJA refunds (a)	7	Various	$	5	$	1,368	$	5	$	1,403
Plant removal costs	1, 10	Various	—		615		—		351
Effects of regulation on employee benefit costs (b)		Various	—		203		—		183
Renewable resources and environmental initiatives		Various	—		59		—		45
Revenue decoupling		One to two years	10		41		—		—
ITC deferrals	1	Various	—		40		—		26
Conservation programs (c)	1	Less than one year	39		—		30		—
Deferred electric, natural gas and steam production costs		Less than one year	17		—		8		—
Other		Various	29		11		26		29
Total regulatory liabilities			$	100	$	2,337	$	69	$	2,037

(a)Includes the revaluation of recoverable/regulated plant ADIT and revaluation impact of non-plant ADIT due to the TCJA.

(b)Includes regulatory amortization and certain 2018 TCJA benefits approved by the CPUC to offset the prepaid pension asset.

(c)Includes costs for conservation programs, as well as incentives allowed in certain jurisdictions.

At Dec. 31, 2020 and 2019, PSCo’s regulatory assets not earning a return primarily included the unfunded portion of pension and retiree medical obligations and net AROs. In addition, PSCo’s regulatory assets included $195 million and $160 million at Dec. 31, 2020 and 2019, respectively, of past expenditures not earning a return. Amounts are related to funded pension obligations, property taxes, various renewable resources and certain environmental initiatives.