Pension, OPEB and Savings Plans

12 Months Ended

Dec. 31, 2018

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Pension, OPEB and Savings Plans

Pension, Other Postretirement Benefits (OPEB) and Savings Plans

PSEG sponsors qualified and nonqualified pension plans and OPEB plans covering PSEG’s and its participating affiliates’ current and former employees who meet certain eligibility criteria. Eligible employees participate in non-contributory pension and OPEB plans sponsored by PSEG and administered by Services. In addition, represented and nonrepresented employees are eligible for participation in PSEG’s two defined contribution plans described below.

PSEG, PSE&G and Power are required to record the under or over funded positions of their defined benefit pension and OPEB plans on their respective balance sheets. Such funding positions of each PSEG company are required to be measured as of the date of its respective year-end Consolidated Balance Sheets. For underfunded plans, the liability is equal to the difference between the plan’s benefit obligation and the fair value of plan assets. For defined benefit pension plans, the benefit obligation is the projected benefit obligation. For OPEB plans, the benefit obligation is the accumulated postretirement benefit obligation. In addition, GAAP requires that the total unrecognized costs for defined benefit pension and OPEB plans be recorded as an after-tax charge to Accumulated Other Comprehensive Income (Loss), a separate component of Stockholders’ Equity. However, for PSE&G, because the amortization of the unrecognized costs is being collected from customers, the accumulated unrecognized costs are recorded as a Regulatory Asset. The unrecognized costs represent actuarial gains or losses and prior service costs which had not been expensed.

For PSE&G, the Regulatory Asset is amortized and recorded as net periodic pension cost in the Consolidated Statements of Operations. For Power, the charge to Accumulated Other Comprehensive Income (Loss) is amortized and recorded as net periodic pension cost in the Consolidated Statements of Operations.

In December 2018, PSEG amended certain provisions of its OPEB plans applicable to all current and future Medicare-eligible retirees and spouses who receive or will receive subsidized healthcare from PSEG. Effective January 1, 2021, the PSEG-sponsored Medicare-eligible plans will be replaced by a Medicare private exchange. For each Medicare-eligible retiree and spouse, PSEG will provide annual credits to a Health Reimbursement Arrangement, which can be used to pay for medical, prescription drug, and dental plan premiums, as well as certain out-of-pocket costs. The amendment resulted in a $559 million reduction in PSEG’s OPEB obligation as of December 31, 2018.

Amounts for Servco are not included in any of the following pension and OPEB benefit information for PSEG and its affiliates but rather are separately disclosed later in this note.

The following table provides a roll-forward of the changes in the benefit obligation and the fair value of plan assets during each of the two years in the periods ended December 31, 2018 and 2017. It also provides the funded status of the plans and the amounts recognized and amounts not recognized on the Consolidated Balance Sheets at the end of both years.

	Pension Benefits						Other Benefits
	2018			2017			2018			2017
	Millions
Change in Benefit Obligation
Benefit Obligation at Beginning of Year (A)	$	6,359		$	5,772		$	1,976		$	1,754
Service Cost	130			114			18			17
Interest Cost	208			204			66			63
Actuarial (Gain) Loss	(460		)	564			(222		)	199
Gross Benefits Paid	(316		)	(295		)	(76		)	(57		)
Plan Amendments	—			—			(559		)	—
Benefit Obligation at End of Year (A)	$	5,921		$	6,359		$	1,203		$	1,976
Change in Plan Assets
Fair Value of Assets at Beginning of Year	$	5,812		$	5,193		$	511		$	420
Actual Return on Plan Assets	(388		)	903			(36		)	77
Employer Contributions	12			11			89			71
Gross Benefits Paid	(316		)	(295		)	(76		)	(57		)
Fair Value of Assets at End of Year	$	5,120		$	5,812		$	488		$	511
Funded Status
Funded Status (Plan Assets less Benefit Obligation)	$	(801	)	$	(547	)	$	(715	)	$	(1,465	)
Additional Amounts Recognized in the Consolidated Balance Sheets
Current Accrued Benefit Cost	(10		)	(10		)	(11		)	(10		)
Noncurrent Accrued Benefit Cost	(791		)	(537		)	(704		)	(1,455		)
Amounts Recognized	$	(801	)	$	(547	)	$	(715	)	$	(1,465	)
Additional Amounts Recognized in Accumulated Other Comprehensive Income (Loss), Regulated Assets and Deferred Assets (B)
Prior Service Cost	$	(28	)	$	(46	)	$	(561	)	$	(3	)
Net Actuarial Loss	2,005			1,721			420			629
Total	$	1,977		$	1,675		$	(141	)	$	626

(A) Represents projected benefit obligation for pension benefits and the accumulated postretirement benefit obligation for other benefits. The vested benefit obligation is the actuarial present value of the vested benefits to which the employee is currently entitled but based on the employee’s expected date of separation of retirement.

(B) Includes $619 million ($360 million, after-tax) and $683 million ($406 million, after-tax) in Accumulated Other Comprehensive Loss related to Pension and OPEB as of December 31, 2018 and 2017, respectively. Also includes Regulatory Assets of $1,090 million and Deferred Assets of $127 million as of December 31, 2018 and Regulatory Assets of $1,485 million and Deferred Assets of $133 million as of December 31, 2017.

The pension benefits table above provides information relating to the funded status of the qualified and nonqualified pension and OPEB plans on an aggregate basis. As of December 31, 2018, PSEG had funded approximately 86% of its projected benefit obligation. This percentage does not include $224 million of assets in the Rabbi Trust as of December 31, 2018 which were used partially to fund the nonqualified pension plans. As of December 31, 2018, the nonqualified pension plans included in the projected benefit obligation in the above table were $156 million.

Accumulated Benefit Obligation

The accumulated benefit obligation for all PSEG’s defined benefit pension plans was $5.7 billion as of December 31, 2018 and $6.1 billion as of December 31, 2017.

The following table provides the components of net periodic benefit cost relating to all qualified and nonqualified pension and OPEB plans on an aggregate basis for PSEG, excluding Servco for the years ended December 31, 2018, 2017 and 2016. Amounts shown do not reflect the impacts of capitalization and co-owner allocations. Effective with the adoption of ASU 2017-07 on January 1, 2018, only the service cost component is eligible for capitalization, when applicable. For additional information, see Note 2. Recent Accounting Standards.

	Pension Benefits Years Ended December 31,									Other Benefits Years Ended December 31,
	2018			2017			2016			2018			2017			2016
	Millions
Components of Net Periodic Benefit (Credits) Costs
Service Cost (included in O&M Expense)	$	130		$	114		$	109		$	18		$	17		$	17
Non-Service Components of Pension and OPEB (Credits) Costs
Interest Cost	208			204			202			66			63			59
Expected Return on Plan Assets	(441		)	(394		)	(394		)	(41		)	(34		)	(31		)
Amortization of Net
Prior Service Credit	(18		)	(18		)	(19		)	(1		)	(11		)	(14		)
Actuarial Loss	85			97			158			64			51			40
Non-Service Components of Pension and OPEB (Credits) Costs	(166		)	(111		)	(53		)	88			69			54
Total Benefit (Credits) Costs	$	(36	)	$	3		$	56		$	106		$	86		$	71

Pension costs and OPEB costs for PSEG, PSE&G and Power are detailed as follows:

	Pension Benefits Years Ended December 31,								Other Benefits Years Ended December 31,
	2018			2017			2016		2018		2017		2016
	Millions
PSE&G	$	(31	)	$	(4	)	$	29	$	68	$	54	$	43
Power	(9		)	1			16		32		27		23
Other	4			6			11		6		5		5
Total Benefit (Credits) Costs	$	(36	)	$	3		$	56	$	106	$	86	$	71

The following table provides the pre-tax changes recognized in Accumulated Other Comprehensive Income (Loss), Regulatory Assets and Deferred Assets:

	Pension						OPEB
	2018			2017			2018			2017
	Millions
Net Actuarial (Gain) Loss in Current Period	$	369		$	55		$	(145	)	$	156
Amortization of Net Actuarial Gain (Loss)	(85		)	(97		)	(64		)	(50		)
Prior Service Cost (Credit) in current period	—			—			(559		)	—
Amortization of Prior Service Credit	18			18			1			11
Total	$	302		$	(24	)	$	(767	)	$	117

Amounts that are expected to be amortized from Accumulated Other Comprehensive Loss, Regulatory Assets and Deferred Assets into Net Periodic Benefit Cost in 2019 are as follows:

	Pension Benefits			Other Benefits
	2019			2019
	Millions
Actuarial Loss	$	107		$	50
Prior Service Credit	$	(18	)	$	(128	)

The following assumptions were used to determine the benefit obligations and net periodic benefit costs:

	Pension Benefits						Other Benefits
	2018		2017		2016		2018			2017			2016
Weighted-Average Assumptions Used to Determine Benefit Obligations as of December 31
Discount Rate	4.41	%	3.73	%	4.29	%	4.31		%	3.76		%	4.37		%
Rate of Compensation Increase	3.90	%	3.90	%	3.61	%	3.90		%	3.90		%	3.61		%
Weighted-Average Assumptions Used to Determine Net Periodic Benefit Cost for Years Ended December 31
Discount Rate	3.73	%	4.29	%	4.54	%	3.76		%	4.37		%	4.58		%
Service Cost Interest Rate	3.88	%	4.53	%	4.81	%	3.90		%	4.64		%	4.87		%
Interest Cost Interest Rate	3.35	%	3.63	%	3.75	%	3.39		%	3.69		%	3.76		%
Expected Return on Plan Assets	7.80	%	7.80	%	8.00	%	7.80		%	7.80		%	8.00		%
Rate of Compensation Increase	3.90	%	3.61	%	3.61	%	3.90		%	3.61		%	3.61		%
Assumed Health Care Cost Trend Rates as of December 31
Health Care Costs
Immediate Rate							7.28		%	7.93		%	7.55		%
Ultimate Rate							4.75		%	4.75		%	4.75		%
Year Ultimate Rate Reached							2026			2026			2025
							Millions
Effect of a 1% Increase in the Assumed Rate of Increase in Health Care Benefit Costs
Total of Service Cost and Interest Cost							$	1		$	13		$	11
Postretirement Benefit Obligation							$	21		$	240		$	191
Effect of a 1% Decrease in the Assumed Rate of Increase in Health Care Benefit Costs
Total of Service Cost and Interest Cost							$	(1	)	$	(10	)	$	(9	)
Postretirement Benefit Obligation							$	(20	)	$	(198	)	$	(160	)

Plan Assets

The investments of pension and OPEB plans are held in a trust account by the Trustee and consist of an undivided interest in an investment account of the Master Trust. The investments in the pension and OPEB plans are measured at fair value within a hierarchy that prioritizes the inputs to fair value measurements into three levels. See Note 18. Fair Value Measurements for more information on fair value guidance. Use of the Master Trust permits the commingling of pension plan assets and OPEB plan assets for investment and administrative purposes. Although assets of the plans are commingled in the Master Trust, the Trustee maintains supporting records for the purpose of allocating the net gain or loss of the investment account to the respective participating plans. The net investment income of the investment assets is allocated by the Trustee to each participating plan based on the relationship of the interest of each plan to the total of the interests of the participating plans. As of December 31, 2018, the pension plan interest and OPEB plan interest in such assets of the Master Trust were approximately 91% and 9%, respectively.

The following tables present information about the investments measured at fair value on a recurring basis as of December 31, 2018 and 2017, including the fair value measurements and the levels of inputs used in determining those fair values.

	Recurring Fair Value Measurements as of December 31, 2018
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Cash Equivalents (A)	$	99	$	88	$	11	$	—
Equity Securities
Common Stock (B)	1,156		1,156		—		—
Commingled (C)	1,338		960		378		—
Preferred Stock (B)	7		7		—		—
Other (D)	1		1		—		—
Debt Securities (E)
U.S. Treasury	526		—		526		—
Government—Other	302		—		302		—
Corporate	948		—		948		—
Subtotal Fair Value	$	4,377	$	2,212	$	2,165	$	—
Measured at net asset value practical expedient
Commingled—Equities (F)	1,208
Private Equity (G)	10
Total Fair Value (H)	$	5,595

	Recurring Fair Value Measurements as of December 31, 2017
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Cash Equivalents (A)	$	133	$	117	$	16	$	—
Equity Securities
Common Stock (B)	1,275		1,275		—		—
Commingled (C)	1,401		1,218		183		—
Preferred Stock (B)	6		6		—		—
Debt Securities (E)
U.S. Treasury	571		—		571		—
Government—Other	272		—		272		—
Corporate	963		—		963		—
Subtotal Fair Value	$	4,621	$	2,616	$	2,005	$	—
Measured at net asset value practical expedient
Commingled—Equities (F)	1,675
Private Equity (G)	14
Total Fair Value (H)	$	6,310

(A) The Collective Investment Fund publishes a daily net asset value (NAV) which participants may use for daily redemptions without restrictions (Level 1). Certain temporary investments are valued using inputs such as time-to-maturity, coupon rate, quality rating and current yield (Level 2).

(B) Common stocks and preferred stocks are measured using observable data in active markets and considered Level 1.

(C) Commingled Funds that allow daily redemption at their daily published NAV without restrictions are classified as Level 1. Commingled Funds that publish daily NAV but with certain near-term redemption restrictions which prevent redemption at the published daily NAV are classified as Level 2.

(D) Investment in a publicly traded limited partnership.

(E) Debt securities include mainly investment grade corporate and municipal bonds, U.S. Treasury obligations and Federal Agency asset-backed securities with a wide range of maturities. These investments are valued using an evaluated pricing approach that varies by asset class and reflects observable market information such as the most recent exchange price or quoted bid for similar securities. Market-based standard inputs typically include benchmark yields, reported trades, broker/dealer quotes and issuer spreads or the most recent quotes for similar securities which are a Level 2 measure.

(F) Certain commingled equity funds are not included in the fair value hierarchy as they are measured at fair value using the NAV per share (or its equivalent) practical expedient. These funds do not meet the definition of readily determinable fair value due to limitations in published NAV (last business day of the month) and include certain redemption restrictions ranging from one to fifteen days advance notice prior to redemption days and limitations on withdrawals over 25% of the total fund. The objectives of these funds are mainly tracking the S&P Index or achieving long-term growth through investment in foreign equity securities and the MSCI Emerging Markets Index.

(G) Private equity investments primarily include various limited partnerships that invest in either operating companies through acquisitions or developing a portfolio of non-US distressed investments to maximize total return on capital. These investments are valued at NAV (or its equivalent) on an annual basis and have significant redemption restrictions preventing redemption until fund liquidation and limited ability to sell these investments. Fund liquidation is not expected to occur for several more years. These investments have been removed from the fair value hierarchy in accordance with the guidance on NAV practical expedient.

(H) Excludes net receivables of $14 million and $13 million at December 31, 2018 and 2017, respectively, which consist of interest, dividends and receivables and payables related to pending securities sales and purchases.

The following table provides the percentage of fair value of total plan assets for each major category of plan assets held for the qualified pension and OPEB plans as of the measurement date, December 31:

	As of December 31,
Investments	2018		2017
Equity Securities	66	%	69	%
Debt Securities	32		29
Other Investments	2		2
Total Percentage	100	%	100	%

PSEG utilizes forecasted returns, risk, and correlation of all asset classes in order to develop an efficient portfolio. PSEG’s latest asset/liability study indicates that a long-term target asset allocation of 70% equities and 30% fixed income is consistent with the funds’ financial objectives. Derivative financial instruments are used by the plans’ investment managers primarily to adjust the fixed income duration of the portfolio and hedge the currency risk component of foreign investments. The expected long-term rate of return on plan assets was 7.8% for 2018 and will be 7.8% for 2019. This expected return was determined based on the study discussed above, including a premium for active management and considered the plans’ historical annualized rate of return since inception.

Plan Contributions

PSEG has no planned contributions to its pension plans in 2019. PSEG plans to make discretionary contributions of $10 million into its OPEB plan during 2019.

Estimated Future Benefit Payments

The following pension benefit and postretirement benefit payments are expected to be paid to plan participants.

Year	Pension Benefits		Other Benefits
	Millions
2019	$	345	$	91
2020	341		95
2021	352		87
2022	364		88
2023	373		89
2024-2028	2,004		428
Total	$	3,779	$	878

401(k) Plans

PSEG sponsors two 401(k) plans, which are defined contribution retirement plans subject to the Employee Retirement Income Security Act (ERISA). Eligible represented employees of PSEG’s subsidiaries participate in the PSEG Employee Savings Plan (Savings Plan), while eligible non-represented employees of PSEG’s subsidiaries participate in the PSEG Thrift and Tax-Deferred Savings Plan (Thrift Plan). Eligible employees may contribute up to 50% of their compensation to these plans, not to exceed the Internal Revenue Service (IRS) maximums, including any catch-up contributions for those employees age 50 and above. PSEG matches 50% of such employee contributions up to 7% of pay for Savings Plan participants and up to 8% of pay for Thrift Plan participants. The amount paid for employer matching contributions to the plans for PSEG, PSE&G and Power are detailed as follows:

	Thrift Plan and Savings Plan
	Years Ended December 31,
	2018		2017		2016
	Millions
PSE&G	$	26	$	25	$	24
Power	10		11		12
Other	5		5		5
Total Employer Matching Contributions	$	41	$	41	$	41

Servco Pension and OPEB

At the direction of LIPA, effective January 1, 2014, Servco established benefit plans that provide substantially the same benefits to its employees as those previously provided by National Grid Electric Services LLC (NGES), the predecessor T&D system manager for LIPA. Since the vast majority of Servco’s employees had worked under NGES’ T&D operations services arrangement with LIPA, Servco’s plans provide certain of those employees with pension and OPEB vested credit for prior years’ services earned while working for NGES. The benefit plans cover all employees of Servco for current service. Under the OSA, all of these and any future employee benefit costs are to be funded by LIPA. See Note 5. Variable Interest Entity. These obligations, as well as the offsetting long-term receivable, are separately presented on the Consolidated Balance Sheet of PSEG.

The following table provides a roll-forward of the changes in Servco’s benefit obligation and the fair value of its plan assets during the years ended December 31, 2018 and 2017. It also provides the funded status of the plans and the amounts recognized and amounts not recognized on the Consolidated Balance Sheets at the end of both years.

	Pension Benefits						Other Benefits
	2018			2017			2018			2017
	Millions
Change in Benefit Obligation
Benefit Obligation at Beginning of Year	$	320		$	262		$	542		$	452
Service Cost	30			27			18			15
Interest Cost	12			11			20			19
Actuarial (Gain) Loss	(38		)	22			(73		)	60
Gross Benefits Paid	(3		)	(2		)	(6		)	(4		)
Plan Amendments	—			—			—			—
Benefit Obligation at End of Year (A)	$	321		$	320		$	501		$	542
Change in Plan Assets
Fair Value of Assets at Beginning of Year	$	191		$	134		$	—		$	—
Actual Return on Plan Assets	(16		)	24			—			—
Employer Contributions	40			35			6			4
Gross Benefits Paid	(3		)	(2		)	(6		)	(4		)
Fair Value of Assets at End of Year	$	212		$	191		$	—		$	—
Funded Status
Funded Status (Plan Assets less Benefit Obligation)	$	(109	)	$	(129	)	$	(501	)	$	(542	)
Additional Amounts Recognized in the Consolidated Balance Sheets
Accrued Pension Costs of Servco	$	(109	)	$	(129	)	N/A			N/A
OPEB Costs of Servco	N/A			N/A			(501		)	(542		)
Amounts Recognized (B)	$	(109	)	$	(129	)	$	(501	)	$	(542	)

(A) Represents projected benefit obligation for pension benefits and the accumulated postretirement benefit obligation for other benefits. The vested benefit obligation is the actuarial present value of the vested benefits to which the employee is currently entitled but based on the employee’s expected date of separation of retirement.

(B) Amounts equal to the accrued pension and OPEB costs of Servco are offset in Long-Term Receivable of VIE on PSEG’s Consolidated Balance Sheets.

Pension and OPEB costs of Servco are accounted for according to the OSA. Servco recognizes expenses for contributions to its pension plan trusts and for OPEB payments made to retirees. Operating Revenues are recognized for the reimbursement of these costs. The pension-related revenues and costs for 2018, 2017 and 2016 were $40 million, $35 million and $28 million, respectively. Servco has contributed its entire planned contribution amount to its pension plan trusts during 2018. The OPEB-related revenues earned and costs incurred were $6 million, $4 million and $2 million in 2018, 2017 and 2016, respectively. The following assumptions were used to determine the benefit obligations of Servco:

	Pension Benefits						Other Benefits
	2018		2017		2016		2018			2017			2016
Weighted-Average Assumptions Used to Determine Benefit Obligations as of December 31
Discount Rate	4.60	%	3.90	%	4.61	%	4.67		%	3.96		%	4.71		%
Rate of Compensation Increase	3.25	%	3.25	%	3.25	%	3.25		%	3.25		%	3.25		%
Assumed Health Care Cost Trend Rates as of December 31
Health Care Costs
Immediate Rate							8.03		%	7.69		%	7.55		%
Ultimate Rate							4.75		%	4.75		%	4.75		%
Year Ultimate Rate Reached							2026			2026			2025
							Millions
Effect of a 1% Increase in the Assumed Rate of Increase in Health Care Benefit Costs
Postretirement Benefit Obligation							$	108		$	131		$	97
Effect of a 1% Decrease in the Assumed Rate of Increase in Health Care Benefit Costs
Postretirement Benefit Obligation							$	(83	)	$	(99	)	$	(75	)

Plan Assets

All the investments of Servco’s pension plans are held in a trust account by the Trustee and consist of an undivided interest in an investment account of the Master Trust. The investments in the pension are measured at fair value within a hierarchy that prioritizes the inputs to fair value measurements into three levels. See Note 18. Fair Value Measurements for more information on fair value guidance. The Actuary maintains supporting records for the purpose of allocating the net gain or loss of the investment account to the respective participating plans. The net investment income of the investment assets is allocated by the Actuary to each participating plan based on the relationship of the interest of each plan to the total of the interests of the participating plans.

The following tables present information about Servco’s investments measured at fair value on a recurring basis as of December 31, 2018 and 2017, including the fair value measurements and the levels of inputs used in determining those fair values.

	Recurring Fair Value Measurements as of December 31, 2018
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Commingled Equities (A)	$	141	$	—	$	141	$	—
Commingled Bonds (A)	71		—		71		—
Total	$	212	$	—	$	212	$	—

	Recurring Fair Value Measurements as of December 31, 2017
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Commingled Equities (A)	$	137	$	—	$	137	$	—
Commingled Bonds (A)	54		—		54		—
Total	$	191	$	—	$	191	$	—

(A) Investments in commingled equity and bond funds have a readily determinable fair value as they publish a daily NAV available to investors which is the basis for current transactions and contain certain redemption restrictions requiring advance notice of one to two days for withdrawals (Level 2).

The following table provides the percentage of fair value of total plan assets for each major category of plan assets held for the qualified pension and OPEB plans of Servco as of the measurement date, December 31:

	As of December 31,
Investments	2018		2017
Equity Securities	67	%	72	%
Debt Securities	33		28
Total Percentage	100	%	100	%

Servco utilizes forecasted returns, risk, and correlation of all asset classes in order to develop an efficient portfolio. The results from Servco’s latest asset/liability study indicated that a long-term target asset allocation of 70% equities and 30% fixed income is consistent with the funds’ financial objectives. The expected long-term rate of return on plan assets was 7.6% for 2018 and will be 7.6% for 2019. This expected return was determined based on the study discussed above, including a premium for active management.

Plan Contributions

Servco plans to contribute $28 million into its pension plan during 2019.

Estimated Future Benefit Payments

The following pension benefit and postretirement benefit payments are expected to be paid to Servco’s plan participants:

Year	Pension Benefits		Other Benefits
	Millions
2019	$	4	$	6
2020	6		8
2021	7		10
2022	9		12
2023	11		14
2024-2028	91		99
Total	$	128	$	149

Servco 401(k) Plans

Servco sponsors two 401(k) plans, which are defined contribution retirement plans subject to ERISA. Eligible non-represented employees of Servco participate in the Long Island Electric Utility Servco LLC Incentive Thrift Plan I (Thrift Plan I), and eligible represented employees of Servco participate in the Long Island Electric Utility Servco LLC Incentive Thrift Plan II (Thrift Plan II). Participants in the plans may contribute up to 50% of their eligible compensation to these plans, not to exceed the IRS maximums, including any catch-up contributions for those employees age 50 and above. Servco does not provide an employer match or core contribution for employees in Thrift Plan II. For employees in Thrift Plan I, Servco matches 50% of such employee contributions up to 8% of eligible compensation and provides core contributions (based on years of service and age) to employees who do not participate in Servco’s Retirement Income Plan. The amounts expensed by Servco for employer matching contributions for the years ended December 31, 2018, 2017 and 2016 were $7 million, $6 million and $5 million, respectively, and pursuant to the OSA, Servco recognizes Operating Revenues for the reimbursement of these costs.

PSE&G [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Pension, OPEB and Savings Plans

Pension, Other Postretirement Benefits (OPEB) and Savings Plans

PSEG sponsors qualified and nonqualified pension plans and OPEB plans covering PSEG’s and its participating affiliates’ current and former employees who meet certain eligibility criteria. Eligible employees participate in non-contributory pension and OPEB plans sponsored by PSEG and administered by Services. In addition, represented and nonrepresented employees are eligible for participation in PSEG’s two defined contribution plans described below.

PSEG, PSE&G and Power are required to record the under or over funded positions of their defined benefit pension and OPEB plans on their respective balance sheets. Such funding positions of each PSEG company are required to be measured as of the date of its respective year-end Consolidated Balance Sheets. For underfunded plans, the liability is equal to the difference between the plan’s benefit obligation and the fair value of plan assets. For defined benefit pension plans, the benefit obligation is the projected benefit obligation. For OPEB plans, the benefit obligation is the accumulated postretirement benefit obligation. In addition, GAAP requires that the total unrecognized costs for defined benefit pension and OPEB plans be recorded as an after-tax charge to Accumulated Other Comprehensive Income (Loss), a separate component of Stockholders’ Equity. However, for PSE&G, because the amortization of the unrecognized costs is being collected from customers, the accumulated unrecognized costs are recorded as a Regulatory Asset. The unrecognized costs represent actuarial gains or losses and prior service costs which had not been expensed.

For PSE&G, the Regulatory Asset is amortized and recorded as net periodic pension cost in the Consolidated Statements of Operations. For Power, the charge to Accumulated Other Comprehensive Income (Loss) is amortized and recorded as net periodic pension cost in the Consolidated Statements of Operations.

In December 2018, PSEG amended certain provisions of its OPEB plans applicable to all current and future Medicare-eligible retirees and spouses who receive or will receive subsidized healthcare from PSEG. Effective January 1, 2021, the PSEG-sponsored Medicare-eligible plans will be replaced by a Medicare private exchange. For each Medicare-eligible retiree and spouse, PSEG will provide annual credits to a Health Reimbursement Arrangement, which can be used to pay for medical, prescription drug, and dental plan premiums, as well as certain out-of-pocket costs. The amendment resulted in a $559 million reduction in PSEG’s OPEB obligation as of December 31, 2018.

Amounts for Servco are not included in any of the following pension and OPEB benefit information for PSEG and its affiliates but rather are separately disclosed later in this note.

The following table provides a roll-forward of the changes in the benefit obligation and the fair value of plan assets during each of the two years in the periods ended December 31, 2018 and 2017. It also provides the funded status of the plans and the amounts recognized and amounts not recognized on the Consolidated Balance Sheets at the end of both years.

	Pension Benefits						Other Benefits
	2018			2017			2018			2017
	Millions
Change in Benefit Obligation
Benefit Obligation at Beginning of Year (A)	$	6,359		$	5,772		$	1,976		$	1,754
Service Cost	130			114			18			17
Interest Cost	208			204			66			63
Actuarial (Gain) Loss	(460		)	564			(222		)	199
Gross Benefits Paid	(316		)	(295		)	(76		)	(57		)
Plan Amendments	—			—			(559		)	—
Benefit Obligation at End of Year (A)	$	5,921		$	6,359		$	1,203		$	1,976
Change in Plan Assets
Fair Value of Assets at Beginning of Year	$	5,812		$	5,193		$	511		$	420
Actual Return on Plan Assets	(388		)	903			(36		)	77
Employer Contributions	12			11			89			71
Gross Benefits Paid	(316		)	(295		)	(76		)	(57		)
Fair Value of Assets at End of Year	$	5,120		$	5,812		$	488		$	511
Funded Status
Funded Status (Plan Assets less Benefit Obligation)	$	(801	)	$	(547	)	$	(715	)	$	(1,465	)
Additional Amounts Recognized in the Consolidated Balance Sheets
Current Accrued Benefit Cost	(10		)	(10		)	(11		)	(10		)
Noncurrent Accrued Benefit Cost	(791		)	(537		)	(704		)	(1,455		)
Amounts Recognized	$	(801	)	$	(547	)	$	(715	)	$	(1,465	)
Additional Amounts Recognized in Accumulated Other Comprehensive Income (Loss), Regulated Assets and Deferred Assets (B)
Prior Service Cost	$	(28	)	$	(46	)	$	(561	)	$	(3	)
Net Actuarial Loss	2,005			1,721			420			629
Total	$	1,977		$	1,675		$	(141	)	$	626

(A) Represents projected benefit obligation for pension benefits and the accumulated postretirement benefit obligation for other benefits. The vested benefit obligation is the actuarial present value of the vested benefits to which the employee is currently entitled but based on the employee’s expected date of separation of retirement.

(B) Includes $619 million ($360 million, after-tax) and $683 million ($406 million, after-tax) in Accumulated Other Comprehensive Loss related to Pension and OPEB as of December 31, 2018 and 2017, respectively. Also includes Regulatory Assets of $1,090 million and Deferred Assets of $127 million as of December 31, 2018 and Regulatory Assets of $1,485 million and Deferred Assets of $133 million as of December 31, 2017.

The pension benefits table above provides information relating to the funded status of the qualified and nonqualified pension and OPEB plans on an aggregate basis. As of December 31, 2018, PSEG had funded approximately 86% of its projected benefit obligation. This percentage does not include $224 million of assets in the Rabbi Trust as of December 31, 2018 which were used partially to fund the nonqualified pension plans. As of December 31, 2018, the nonqualified pension plans included in the projected benefit obligation in the above table were $156 million.

Accumulated Benefit Obligation

The accumulated benefit obligation for all PSEG’s defined benefit pension plans was $5.7 billion as of December 31, 2018 and $6.1 billion as of December 31, 2017.

The following table provides the components of net periodic benefit cost relating to all qualified and nonqualified pension and OPEB plans on an aggregate basis for PSEG, excluding Servco for the years ended December 31, 2018, 2017 and 2016. Amounts shown do not reflect the impacts of capitalization and co-owner allocations. Effective with the adoption of ASU 2017-07 on January 1, 2018, only the service cost component is eligible for capitalization, when applicable. For additional information, see Note 2. Recent Accounting Standards.

	Pension Benefits Years Ended December 31,									Other Benefits Years Ended December 31,
	2018			2017			2016			2018			2017			2016
	Millions
Components of Net Periodic Benefit (Credits) Costs
Service Cost (included in O&M Expense)	$	130		$	114		$	109		$	18		$	17		$	17
Non-Service Components of Pension and OPEB (Credits) Costs
Interest Cost	208			204			202			66			63			59
Expected Return on Plan Assets	(441		)	(394		)	(394		)	(41		)	(34		)	(31		)
Amortization of Net
Prior Service Credit	(18		)	(18		)	(19		)	(1		)	(11		)	(14		)
Actuarial Loss	85			97			158			64			51			40
Non-Service Components of Pension and OPEB (Credits) Costs	(166		)	(111		)	(53		)	88			69			54
Total Benefit (Credits) Costs	$	(36	)	$	3		$	56		$	106		$	86		$	71

Pension costs and OPEB costs for PSEG, PSE&G and Power are detailed as follows:

	Pension Benefits Years Ended December 31,								Other Benefits Years Ended December 31,
	2018			2017			2016		2018		2017		2016
	Millions
PSE&G	$	(31	)	$	(4	)	$	29	$	68	$	54	$	43
Power	(9		)	1			16		32		27		23
Other	4			6			11		6		5		5
Total Benefit (Credits) Costs	$	(36	)	$	3		$	56	$	106	$	86	$	71

The following table provides the pre-tax changes recognized in Accumulated Other Comprehensive Income (Loss), Regulatory Assets and Deferred Assets:

	Pension						OPEB
	2018			2017			2018			2017
	Millions
Net Actuarial (Gain) Loss in Current Period	$	369		$	55		$	(145	)	$	156
Amortization of Net Actuarial Gain (Loss)	(85		)	(97		)	(64		)	(50		)
Prior Service Cost (Credit) in current period	—			—			(559		)	—
Amortization of Prior Service Credit	18			18			1			11
Total	$	302		$	(24	)	$	(767	)	$	117

Amounts that are expected to be amortized from Accumulated Other Comprehensive Loss, Regulatory Assets and Deferred Assets into Net Periodic Benefit Cost in 2019 are as follows:

	Pension Benefits			Other Benefits
	2019			2019
	Millions
Actuarial Loss	$	107		$	50
Prior Service Credit	$	(18	)	$	(128	)

The following assumptions were used to determine the benefit obligations and net periodic benefit costs:

	Pension Benefits						Other Benefits
	2018		2017		2016		2018			2017			2016
Weighted-Average Assumptions Used to Determine Benefit Obligations as of December 31
Discount Rate	4.41	%	3.73	%	4.29	%	4.31		%	3.76		%	4.37		%
Rate of Compensation Increase	3.90	%	3.90	%	3.61	%	3.90		%	3.90		%	3.61		%
Weighted-Average Assumptions Used to Determine Net Periodic Benefit Cost for Years Ended December 31
Discount Rate	3.73	%	4.29	%	4.54	%	3.76		%	4.37		%	4.58		%
Service Cost Interest Rate	3.88	%	4.53	%	4.81	%	3.90		%	4.64		%	4.87		%
Interest Cost Interest Rate	3.35	%	3.63	%	3.75	%	3.39		%	3.69		%	3.76		%
Expected Return on Plan Assets	7.80	%	7.80	%	8.00	%	7.80		%	7.80		%	8.00		%
Rate of Compensation Increase	3.90	%	3.61	%	3.61	%	3.90		%	3.61		%	3.61		%
Assumed Health Care Cost Trend Rates as of December 31
Health Care Costs
Immediate Rate							7.28		%	7.93		%	7.55		%
Ultimate Rate							4.75		%	4.75		%	4.75		%
Year Ultimate Rate Reached							2026			2026			2025
							Millions
Effect of a 1% Increase in the Assumed Rate of Increase in Health Care Benefit Costs
Total of Service Cost and Interest Cost							$	1		$	13		$	11
Postretirement Benefit Obligation							$	21		$	240		$	191
Effect of a 1% Decrease in the Assumed Rate of Increase in Health Care Benefit Costs
Total of Service Cost and Interest Cost							$	(1	)	$	(10	)	$	(9	)
Postretirement Benefit Obligation							$	(20	)	$	(198	)	$	(160	)

Plan Assets

The investments of pension and OPEB plans are held in a trust account by the Trustee and consist of an undivided interest in an investment account of the Master Trust. The investments in the pension and OPEB plans are measured at fair value within a hierarchy that prioritizes the inputs to fair value measurements into three levels. See Note 18. Fair Value Measurements for more information on fair value guidance. Use of the Master Trust permits the commingling of pension plan assets and OPEB plan assets for investment and administrative purposes. Although assets of the plans are commingled in the Master Trust, the Trustee maintains supporting records for the purpose of allocating the net gain or loss of the investment account to the respective participating plans. The net investment income of the investment assets is allocated by the Trustee to each participating plan based on the relationship of the interest of each plan to the total of the interests of the participating plans. As of December 31, 2018, the pension plan interest and OPEB plan interest in such assets of the Master Trust were approximately 91% and 9%, respectively.

The following tables present information about the investments measured at fair value on a recurring basis as of December 31, 2018 and 2017, including the fair value measurements and the levels of inputs used in determining those fair values.

	Recurring Fair Value Measurements as of December 31, 2018
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Cash Equivalents (A)	$	99	$	88	$	11	$	—
Equity Securities
Common Stock (B)	1,156		1,156		—		—
Commingled (C)	1,338		960		378		—
Preferred Stock (B)	7		7		—		—
Other (D)	1		1		—		—
Debt Securities (E)
U.S. Treasury	526		—		526		—
Government—Other	302		—		302		—
Corporate	948		—		948		—
Subtotal Fair Value	$	4,377	$	2,212	$	2,165	$	—
Measured at net asset value practical expedient
Commingled—Equities (F)	1,208
Private Equity (G)	10
Total Fair Value (H)	$	5,595

	Recurring Fair Value Measurements as of December 31, 2017
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Cash Equivalents (A)	$	133	$	117	$	16	$	—
Equity Securities
Common Stock (B)	1,275		1,275		—		—
Commingled (C)	1,401		1,218		183		—
Preferred Stock (B)	6		6		—		—
Debt Securities (E)
U.S. Treasury	571		—		571		—
Government—Other	272		—		272		—
Corporate	963		—		963		—
Subtotal Fair Value	$	4,621	$	2,616	$	2,005	$	—
Measured at net asset value practical expedient
Commingled—Equities (F)	1,675
Private Equity (G)	14
Total Fair Value (H)	$	6,310

(A) The Collective Investment Fund publishes a daily net asset value (NAV) which participants may use for daily redemptions without restrictions (Level 1). Certain temporary investments are valued using inputs such as time-to-maturity, coupon rate, quality rating and current yield (Level 2).

(B) Common stocks and preferred stocks are measured using observable data in active markets and considered Level 1.

(C) Commingled Funds that allow daily redemption at their daily published NAV without restrictions are classified as Level 1. Commingled Funds that publish daily NAV but with certain near-term redemption restrictions which prevent redemption at the published daily NAV are classified as Level 2.

(D) Investment in a publicly traded limited partnership.

(E) Debt securities include mainly investment grade corporate and municipal bonds, U.S. Treasury obligations and Federal Agency asset-backed securities with a wide range of maturities. These investments are valued using an evaluated pricing approach that varies by asset class and reflects observable market information such as the most recent exchange price or quoted bid for similar securities. Market-based standard inputs typically include benchmark yields, reported trades, broker/dealer quotes and issuer spreads or the most recent quotes for similar securities which are a Level 2 measure.

(F) Certain commingled equity funds are not included in the fair value hierarchy as they are measured at fair value using the NAV per share (or its equivalent) practical expedient. These funds do not meet the definition of readily determinable fair value due to limitations in published NAV (last business day of the month) and include certain redemption restrictions ranging from one to fifteen days advance notice prior to redemption days and limitations on withdrawals over 25% of the total fund. The objectives of these funds are mainly tracking the S&P Index or achieving long-term growth through investment in foreign equity securities and the MSCI Emerging Markets Index.

(G) Private equity investments primarily include various limited partnerships that invest in either operating companies through acquisitions or developing a portfolio of non-US distressed investments to maximize total return on capital. These investments are valued at NAV (or its equivalent) on an annual basis and have significant redemption restrictions preventing redemption until fund liquidation and limited ability to sell these investments. Fund liquidation is not expected to occur for several more years. These investments have been removed from the fair value hierarchy in accordance with the guidance on NAV practical expedient.

(H) Excludes net receivables of $14 million and $13 million at December 31, 2018 and 2017, respectively, which consist of interest, dividends and receivables and payables related to pending securities sales and purchases.

The following table provides the percentage of fair value of total plan assets for each major category of plan assets held for the qualified pension and OPEB plans as of the measurement date, December 31:

	As of December 31,
Investments	2018		2017
Equity Securities	66	%	69	%
Debt Securities	32		29
Other Investments	2		2
Total Percentage	100	%	100	%

PSEG utilizes forecasted returns, risk, and correlation of all asset classes in order to develop an efficient portfolio. PSEG’s latest asset/liability study indicates that a long-term target asset allocation of 70% equities and 30% fixed income is consistent with the funds’ financial objectives. Derivative financial instruments are used by the plans’ investment managers primarily to adjust the fixed income duration of the portfolio and hedge the currency risk component of foreign investments. The expected long-term rate of return on plan assets was 7.8% for 2018 and will be 7.8% for 2019. This expected return was determined based on the study discussed above, including a premium for active management and considered the plans’ historical annualized rate of return since inception.

Plan Contributions

PSEG has no planned contributions to its pension plans in 2019. PSEG plans to make discretionary contributions of $10 million into its OPEB plan during 2019.

Estimated Future Benefit Payments

The following pension benefit and postretirement benefit payments are expected to be paid to plan participants.

Year	Pension Benefits		Other Benefits
	Millions
2019	$	345	$	91
2020	341		95
2021	352		87
2022	364		88
2023	373		89
2024-2028	2,004		428
Total	$	3,779	$	878

401(k) Plans

PSEG sponsors two 401(k) plans, which are defined contribution retirement plans subject to the Employee Retirement Income Security Act (ERISA). Eligible represented employees of PSEG’s subsidiaries participate in the PSEG Employee Savings Plan (Savings Plan), while eligible non-represented employees of PSEG’s subsidiaries participate in the PSEG Thrift and Tax-Deferred Savings Plan (Thrift Plan). Eligible employees may contribute up to 50% of their compensation to these plans, not to exceed the Internal Revenue Service (IRS) maximums, including any catch-up contributions for those employees age 50 and above. PSEG matches 50% of such employee contributions up to 7% of pay for Savings Plan participants and up to 8% of pay for Thrift Plan participants. The amount paid for employer matching contributions to the plans for PSEG, PSE&G and Power are detailed as follows:

	Thrift Plan and Savings Plan
	Years Ended December 31,
	2018		2017		2016
	Millions
PSE&G	$	26	$	25	$	24
Power	10		11		12
Other	5		5		5
Total Employer Matching Contributions	$	41	$	41	$	41

Servco Pension and OPEB

At the direction of LIPA, effective January 1, 2014, Servco established benefit plans that provide substantially the same benefits to its employees as those previously provided by National Grid Electric Services LLC (NGES), the predecessor T&D system manager for LIPA. Since the vast majority of Servco’s employees had worked under NGES’ T&D operations services arrangement with LIPA, Servco’s plans provide certain of those employees with pension and OPEB vested credit for prior years’ services earned while working for NGES. The benefit plans cover all employees of Servco for current service. Under the OSA, all of these and any future employee benefit costs are to be funded by LIPA. See Note 5. Variable Interest Entity. These obligations, as well as the offsetting long-term receivable, are separately presented on the Consolidated Balance Sheet of PSEG.

The following table provides a roll-forward of the changes in Servco’s benefit obligation and the fair value of its plan assets during the years ended December 31, 2018 and 2017. It also provides the funded status of the plans and the amounts recognized and amounts not recognized on the Consolidated Balance Sheets at the end of both years.

	Pension Benefits						Other Benefits
	2018			2017			2018			2017
	Millions
Change in Benefit Obligation
Benefit Obligation at Beginning of Year	$	320		$	262		$	542		$	452
Service Cost	30			27			18			15
Interest Cost	12			11			20			19
Actuarial (Gain) Loss	(38		)	22			(73		)	60
Gross Benefits Paid	(3		)	(2		)	(6		)	(4		)
Plan Amendments	—			—			—			—
Benefit Obligation at End of Year (A)	$	321		$	320		$	501		$	542
Change in Plan Assets
Fair Value of Assets at Beginning of Year	$	191		$	134		$	—		$	—
Actual Return on Plan Assets	(16		)	24			—			—
Employer Contributions	40			35			6			4
Gross Benefits Paid	(3		)	(2		)	(6		)	(4		)
Fair Value of Assets at End of Year	$	212		$	191		$	—		$	—
Funded Status
Funded Status (Plan Assets less Benefit Obligation)	$	(109	)	$	(129	)	$	(501	)	$	(542	)
Additional Amounts Recognized in the Consolidated Balance Sheets
Accrued Pension Costs of Servco	$	(109	)	$	(129	)	N/A			N/A
OPEB Costs of Servco	N/A			N/A			(501		)	(542		)
Amounts Recognized (B)	$	(109	)	$	(129	)	$	(501	)	$	(542	)

(A) Represents projected benefit obligation for pension benefits and the accumulated postretirement benefit obligation for other benefits. The vested benefit obligation is the actuarial present value of the vested benefits to which the employee is currently entitled but based on the employee’s expected date of separation of retirement.

(B) Amounts equal to the accrued pension and OPEB costs of Servco are offset in Long-Term Receivable of VIE on PSEG’s Consolidated Balance Sheets.

Pension and OPEB costs of Servco are accounted for according to the OSA. Servco recognizes expenses for contributions to its pension plan trusts and for OPEB payments made to retirees. Operating Revenues are recognized for the reimbursement of these costs. The pension-related revenues and costs for 2018, 2017 and 2016 were $40 million, $35 million and $28 million, respectively. Servco has contributed its entire planned contribution amount to its pension plan trusts during 2018. The OPEB-related revenues earned and costs incurred were $6 million, $4 million and $2 million in 2018, 2017 and 2016, respectively. The following assumptions were used to determine the benefit obligations of Servco:

	Pension Benefits						Other Benefits
	2018		2017		2016		2018			2017			2016
Weighted-Average Assumptions Used to Determine Benefit Obligations as of December 31
Discount Rate	4.60	%	3.90	%	4.61	%	4.67		%	3.96		%	4.71		%
Rate of Compensation Increase	3.25	%	3.25	%	3.25	%	3.25		%	3.25		%	3.25		%
Assumed Health Care Cost Trend Rates as of December 31
Health Care Costs
Immediate Rate							8.03		%	7.69		%	7.55		%
Ultimate Rate							4.75		%	4.75		%	4.75		%
Year Ultimate Rate Reached							2026			2026			2025
							Millions
Effect of a 1% Increase in the Assumed Rate of Increase in Health Care Benefit Costs
Postretirement Benefit Obligation							$	108		$	131		$	97
Effect of a 1% Decrease in the Assumed Rate of Increase in Health Care Benefit Costs
Postretirement Benefit Obligation							$	(83	)	$	(99	)	$	(75	)

Plan Assets

All the investments of Servco’s pension plans are held in a trust account by the Trustee and consist of an undivided interest in an investment account of the Master Trust. The investments in the pension are measured at fair value within a hierarchy that prioritizes the inputs to fair value measurements into three levels. See Note 18. Fair Value Measurements for more information on fair value guidance. The Actuary maintains supporting records for the purpose of allocating the net gain or loss of the investment account to the respective participating plans. The net investment income of the investment assets is allocated by the Actuary to each participating plan based on the relationship of the interest of each plan to the total of the interests of the participating plans.

The following tables present information about Servco’s investments measured at fair value on a recurring basis as of December 31, 2018 and 2017, including the fair value measurements and the levels of inputs used in determining those fair values.

	Recurring Fair Value Measurements as of December 31, 2018
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Commingled Equities (A)	$	141	$	—	$	141	$	—
Commingled Bonds (A)	71		—		71		—
Total	$	212	$	—	$	212	$	—

	Recurring Fair Value Measurements as of December 31, 2017
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Commingled Equities (A)	$	137	$	—	$	137	$	—
Commingled Bonds (A)	54		—		54		—
Total	$	191	$	—	$	191	$	—

(A) Investments in commingled equity and bond funds have a readily determinable fair value as they publish a daily NAV available to investors which is the basis for current transactions and contain certain redemption restrictions requiring advance notice of one to two days for withdrawals (Level 2).

The following table provides the percentage of fair value of total plan assets for each major category of plan assets held for the qualified pension and OPEB plans of Servco as of the measurement date, December 31:

	As of December 31,
Investments	2018		2017
Equity Securities	67	%	72	%
Debt Securities	33		28
Total Percentage	100	%	100	%

Servco utilizes forecasted returns, risk, and correlation of all asset classes in order to develop an efficient portfolio. The results from Servco’s latest asset/liability study indicated that a long-term target asset allocation of 70% equities and 30% fixed income is consistent with the funds’ financial objectives. The expected long-term rate of return on plan assets was 7.6% for 2018 and will be 7.6% for 2019. This expected return was determined based on the study discussed above, including a premium for active management.

Plan Contributions

Servco plans to contribute $28 million into its pension plan during 2019.

Estimated Future Benefit Payments

The following pension benefit and postretirement benefit payments are expected to be paid to Servco’s plan participants:

Year	Pension Benefits		Other Benefits
	Millions
2019	$	4	$	6
2020	6		8
2021	7		10
2022	9		12
2023	11		14
2024-2028	91		99
Total	$	128	$	149

Servco 401(k) Plans

Servco sponsors two 401(k) plans, which are defined contribution retirement plans subject to ERISA. Eligible non-represented employees of Servco participate in the Long Island Electric Utility Servco LLC Incentive Thrift Plan I (Thrift Plan I), and eligible represented employees of Servco participate in the Long Island Electric Utility Servco LLC Incentive Thrift Plan II (Thrift Plan II). Participants in the plans may contribute up to 50% of their eligible compensation to these plans, not to exceed the IRS maximums, including any catch-up contributions for those employees age 50 and above. Servco does not provide an employer match or core contribution for employees in Thrift Plan II. For employees in Thrift Plan I, Servco matches 50% of such employee contributions up to 8% of eligible compensation and provides core contributions (based on years of service and age) to employees who do not participate in Servco’s Retirement Income Plan. The amounts expensed by Servco for employer matching contributions for the years ended December 31, 2018, 2017 and 2016 were $7 million, $6 million and $5 million, respectively, and pursuant to the OSA, Servco recognizes Operating Revenues for the reimbursement of these costs.

Power [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Pension, OPEB and Savings Plans

Pension, Other Postretirement Benefits (OPEB) and Savings Plans

PSEG sponsors qualified and nonqualified pension plans and OPEB plans covering PSEG’s and its participating affiliates’ current and former employees who meet certain eligibility criteria. Eligible employees participate in non-contributory pension and OPEB plans sponsored by PSEG and administered by Services. In addition, represented and nonrepresented employees are eligible for participation in PSEG’s two defined contribution plans described below.

PSEG, PSE&G and Power are required to record the under or over funded positions of their defined benefit pension and OPEB plans on their respective balance sheets. Such funding positions of each PSEG company are required to be measured as of the date of its respective year-end Consolidated Balance Sheets. For underfunded plans, the liability is equal to the difference between the plan’s benefit obligation and the fair value of plan assets. For defined benefit pension plans, the benefit obligation is the projected benefit obligation. For OPEB plans, the benefit obligation is the accumulated postretirement benefit obligation. In addition, GAAP requires that the total unrecognized costs for defined benefit pension and OPEB plans be recorded as an after-tax charge to Accumulated Other Comprehensive Income (Loss), a separate component of Stockholders’ Equity. However, for PSE&G, because the amortization of the unrecognized costs is being collected from customers, the accumulated unrecognized costs are recorded as a Regulatory Asset. The unrecognized costs represent actuarial gains or losses and prior service costs which had not been expensed.

For PSE&G, the Regulatory Asset is amortized and recorded as net periodic pension cost in the Consolidated Statements of Operations. For Power, the charge to Accumulated Other Comprehensive Income (Loss) is amortized and recorded as net periodic pension cost in the Consolidated Statements of Operations.

In December 2018, PSEG amended certain provisions of its OPEB plans applicable to all current and future Medicare-eligible retirees and spouses who receive or will receive subsidized healthcare from PSEG. Effective January 1, 2021, the PSEG-sponsored Medicare-eligible plans will be replaced by a Medicare private exchange. For each Medicare-eligible retiree and spouse, PSEG will provide annual credits to a Health Reimbursement Arrangement, which can be used to pay for medical, prescription drug, and dental plan premiums, as well as certain out-of-pocket costs. The amendment resulted in a $559 million reduction in PSEG’s OPEB obligation as of December 31, 2018.

Amounts for Servco are not included in any of the following pension and OPEB benefit information for PSEG and its affiliates but rather are separately disclosed later in this note.

The following table provides a roll-forward of the changes in the benefit obligation and the fair value of plan assets during each of the two years in the periods ended December 31, 2018 and 2017. It also provides the funded status of the plans and the amounts recognized and amounts not recognized on the Consolidated Balance Sheets at the end of both years.

	Pension Benefits						Other Benefits
	2018			2017			2018			2017
	Millions
Change in Benefit Obligation
Benefit Obligation at Beginning of Year (A)	$	6,359		$	5,772		$	1,976		$	1,754
Service Cost	130			114			18			17
Interest Cost	208			204			66			63
Actuarial (Gain) Loss	(460		)	564			(222		)	199
Gross Benefits Paid	(316		)	(295		)	(76		)	(57		)
Plan Amendments	—			—			(559		)	—
Benefit Obligation at End of Year (A)	$	5,921		$	6,359		$	1,203		$	1,976
Change in Plan Assets
Fair Value of Assets at Beginning of Year	$	5,812		$	5,193		$	511		$	420
Actual Return on Plan Assets	(388		)	903			(36		)	77
Employer Contributions	12			11			89			71
Gross Benefits Paid	(316		)	(295		)	(76		)	(57		)
Fair Value of Assets at End of Year	$	5,120		$	5,812		$	488		$	511
Funded Status
Funded Status (Plan Assets less Benefit Obligation)	$	(801	)	$	(547	)	$	(715	)	$	(1,465	)
Additional Amounts Recognized in the Consolidated Balance Sheets
Current Accrued Benefit Cost	(10		)	(10		)	(11		)	(10		)
Noncurrent Accrued Benefit Cost	(791		)	(537		)	(704		)	(1,455		)
Amounts Recognized	$	(801	)	$	(547	)	$	(715	)	$	(1,465	)
Additional Amounts Recognized in Accumulated Other Comprehensive Income (Loss), Regulated Assets and Deferred Assets (B)
Prior Service Cost	$	(28	)	$	(46	)	$	(561	)	$	(3	)
Net Actuarial Loss	2,005			1,721			420			629
Total	$	1,977		$	1,675		$	(141	)	$	626

(A) Represents projected benefit obligation for pension benefits and the accumulated postretirement benefit obligation for other benefits. The vested benefit obligation is the actuarial present value of the vested benefits to which the employee is currently entitled but based on the employee’s expected date of separation of retirement.

(B) Includes $619 million ($360 million, after-tax) and $683 million ($406 million, after-tax) in Accumulated Other Comprehensive Loss related to Pension and OPEB as of December 31, 2018 and 2017, respectively. Also includes Regulatory Assets of $1,090 million and Deferred Assets of $127 million as of December 31, 2018 and Regulatory Assets of $1,485 million and Deferred Assets of $133 million as of December 31, 2017.

The pension benefits table above provides information relating to the funded status of the qualified and nonqualified pension and OPEB plans on an aggregate basis. As of December 31, 2018, PSEG had funded approximately 86% of its projected benefit obligation. This percentage does not include $224 million of assets in the Rabbi Trust as of December 31, 2018 which were used partially to fund the nonqualified pension plans. As of December 31, 2018, the nonqualified pension plans included in the projected benefit obligation in the above table were $156 million.

Accumulated Benefit Obligation

The accumulated benefit obligation for all PSEG’s defined benefit pension plans was $5.7 billion as of December 31, 2018 and $6.1 billion as of December 31, 2017.

The following table provides the components of net periodic benefit cost relating to all qualified and nonqualified pension and OPEB plans on an aggregate basis for PSEG, excluding Servco for the years ended December 31, 2018, 2017 and 2016. Amounts shown do not reflect the impacts of capitalization and co-owner allocations. Effective with the adoption of ASU 2017-07 on January 1, 2018, only the service cost component is eligible for capitalization, when applicable. For additional information, see Note 2. Recent Accounting Standards.

	Pension Benefits Years Ended December 31,									Other Benefits Years Ended December 31,
	2018			2017			2016			2018			2017			2016
	Millions
Components of Net Periodic Benefit (Credits) Costs
Service Cost (included in O&M Expense)	$	130		$	114		$	109		$	18		$	17		$	17
Non-Service Components of Pension and OPEB (Credits) Costs
Interest Cost	208			204			202			66			63			59
Expected Return on Plan Assets	(441		)	(394		)	(394		)	(41		)	(34		)	(31		)
Amortization of Net
Prior Service Credit	(18		)	(18		)	(19		)	(1		)	(11		)	(14		)
Actuarial Loss	85			97			158			64			51			40
Non-Service Components of Pension and OPEB (Credits) Costs	(166		)	(111		)	(53		)	88			69			54
Total Benefit (Credits) Costs	$	(36	)	$	3		$	56		$	106		$	86		$	71

Pension costs and OPEB costs for PSEG, PSE&G and Power are detailed as follows:

	Pension Benefits Years Ended December 31,								Other Benefits Years Ended December 31,
	2018			2017			2016		2018		2017		2016
	Millions
PSE&G	$	(31	)	$	(4	)	$	29	$	68	$	54	$	43
Power	(9		)	1			16		32		27		23
Other	4			6			11		6		5		5
Total Benefit (Credits) Costs	$	(36	)	$	3		$	56	$	106	$	86	$	71

The following table provides the pre-tax changes recognized in Accumulated Other Comprehensive Income (Loss), Regulatory Assets and Deferred Assets:

	Pension						OPEB
	2018			2017			2018			2017
	Millions
Net Actuarial (Gain) Loss in Current Period	$	369		$	55		$	(145	)	$	156
Amortization of Net Actuarial Gain (Loss)	(85		)	(97		)	(64		)	(50		)
Prior Service Cost (Credit) in current period	—			—			(559		)	—
Amortization of Prior Service Credit	18			18			1			11
Total	$	302		$	(24	)	$	(767	)	$	117

Amounts that are expected to be amortized from Accumulated Other Comprehensive Loss, Regulatory Assets and Deferred Assets into Net Periodic Benefit Cost in 2019 are as follows:

	Pension Benefits			Other Benefits
	2019			2019
	Millions
Actuarial Loss	$	107		$	50
Prior Service Credit	$	(18	)	$	(128	)

The following assumptions were used to determine the benefit obligations and net periodic benefit costs:

	Pension Benefits						Other Benefits
	2018		2017		2016		2018			2017			2016
Weighted-Average Assumptions Used to Determine Benefit Obligations as of December 31
Discount Rate	4.41	%	3.73	%	4.29	%	4.31		%	3.76		%	4.37		%
Rate of Compensation Increase	3.90	%	3.90	%	3.61	%	3.90		%	3.90		%	3.61		%
Weighted-Average Assumptions Used to Determine Net Periodic Benefit Cost for Years Ended December 31
Discount Rate	3.73	%	4.29	%	4.54	%	3.76		%	4.37		%	4.58		%
Service Cost Interest Rate	3.88	%	4.53	%	4.81	%	3.90		%	4.64		%	4.87		%
Interest Cost Interest Rate	3.35	%	3.63	%	3.75	%	3.39		%	3.69		%	3.76		%
Expected Return on Plan Assets	7.80	%	7.80	%	8.00	%	7.80		%	7.80		%	8.00		%
Rate of Compensation Increase	3.90	%	3.61	%	3.61	%	3.90		%	3.61		%	3.61		%
Assumed Health Care Cost Trend Rates as of December 31
Health Care Costs
Immediate Rate							7.28		%	7.93		%	7.55		%
Ultimate Rate							4.75		%	4.75		%	4.75		%
Year Ultimate Rate Reached							2026			2026			2025
							Millions
Effect of a 1% Increase in the Assumed Rate of Increase in Health Care Benefit Costs
Total of Service Cost and Interest Cost							$	1		$	13		$	11
Postretirement Benefit Obligation							$	21		$	240		$	191
Effect of a 1% Decrease in the Assumed Rate of Increase in Health Care Benefit Costs
Total of Service Cost and Interest Cost							$	(1	)	$	(10	)	$	(9	)
Postretirement Benefit Obligation							$	(20	)	$	(198	)	$	(160	)

Plan Assets

The investments of pension and OPEB plans are held in a trust account by the Trustee and consist of an undivided interest in an investment account of the Master Trust. The investments in the pension and OPEB plans are measured at fair value within a hierarchy that prioritizes the inputs to fair value measurements into three levels. See Note 18. Fair Value Measurements for more information on fair value guidance. Use of the Master Trust permits the commingling of pension plan assets and OPEB plan assets for investment and administrative purposes. Although assets of the plans are commingled in the Master Trust, the Trustee maintains supporting records for the purpose of allocating the net gain or loss of the investment account to the respective participating plans. The net investment income of the investment assets is allocated by the Trustee to each participating plan based on the relationship of the interest of each plan to the total of the interests of the participating plans. As of December 31, 2018, the pension plan interest and OPEB plan interest in such assets of the Master Trust were approximately 91% and 9%, respectively.

The following tables present information about the investments measured at fair value on a recurring basis as of December 31, 2018 and 2017, including the fair value measurements and the levels of inputs used in determining those fair values.

	Recurring Fair Value Measurements as of December 31, 2018
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Cash Equivalents (A)	$	99	$	88	$	11	$	—
Equity Securities
Common Stock (B)	1,156		1,156		—		—
Commingled (C)	1,338		960		378		—
Preferred Stock (B)	7		7		—		—
Other (D)	1		1		—		—
Debt Securities (E)
U.S. Treasury	526		—		526		—
Government—Other	302		—		302		—
Corporate	948		—		948		—
Subtotal Fair Value	$	4,377	$	2,212	$	2,165	$	—
Measured at net asset value practical expedient
Commingled—Equities (F)	1,208
Private Equity (G)	10
Total Fair Value (H)	$	5,595

	Recurring Fair Value Measurements as of December 31, 2017
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Cash Equivalents (A)	$	133	$	117	$	16	$	—
Equity Securities
Common Stock (B)	1,275		1,275		—		—
Commingled (C)	1,401		1,218		183		—
Preferred Stock (B)	6		6		—		—
Debt Securities (E)
U.S. Treasury	571		—		571		—
Government—Other	272		—		272		—
Corporate	963		—		963		—
Subtotal Fair Value	$	4,621	$	2,616	$	2,005	$	—
Measured at net asset value practical expedient
Commingled—Equities (F)	1,675
Private Equity (G)	14
Total Fair Value (H)	$	6,310

(A) The Collective Investment Fund publishes a daily net asset value (NAV) which participants may use for daily redemptions without restrictions (Level 1). Certain temporary investments are valued using inputs such as time-to-maturity, coupon rate, quality rating and current yield (Level 2).

(B) Common stocks and preferred stocks are measured using observable data in active markets and considered Level 1.

(C) Commingled Funds that allow daily redemption at their daily published NAV without restrictions are classified as Level 1. Commingled Funds that publish daily NAV but with certain near-term redemption restrictions which prevent redemption at the published daily NAV are classified as Level 2.

(D) Investment in a publicly traded limited partnership.

(E) Debt securities include mainly investment grade corporate and municipal bonds, U.S. Treasury obligations and Federal Agency asset-backed securities with a wide range of maturities. These investments are valued using an evaluated pricing approach that varies by asset class and reflects observable market information such as the most recent exchange price or quoted bid for similar securities. Market-based standard inputs typically include benchmark yields, reported trades, broker/dealer quotes and issuer spreads or the most recent quotes for similar securities which are a Level 2 measure.

(F) Certain commingled equity funds are not included in the fair value hierarchy as they are measured at fair value using the NAV per share (or its equivalent) practical expedient. These funds do not meet the definition of readily determinable fair value due to limitations in published NAV (last business day of the month) and include certain redemption restrictions ranging from one to fifteen days advance notice prior to redemption days and limitations on withdrawals over 25% of the total fund. The objectives of these funds are mainly tracking the S&P Index or achieving long-term growth through investment in foreign equity securities and the MSCI Emerging Markets Index.

(G) Private equity investments primarily include various limited partnerships that invest in either operating companies through acquisitions or developing a portfolio of non-US distressed investments to maximize total return on capital. These investments are valued at NAV (or its equivalent) on an annual basis and have significant redemption restrictions preventing redemption until fund liquidation and limited ability to sell these investments. Fund liquidation is not expected to occur for several more years. These investments have been removed from the fair value hierarchy in accordance with the guidance on NAV practical expedient.

(H) Excludes net receivables of $14 million and $13 million at December 31, 2018 and 2017, respectively, which consist of interest, dividends and receivables and payables related to pending securities sales and purchases.

The following table provides the percentage of fair value of total plan assets for each major category of plan assets held for the qualified pension and OPEB plans as of the measurement date, December 31:

	As of December 31,
Investments	2018		2017
Equity Securities	66	%	69	%
Debt Securities	32		29
Other Investments	2		2
Total Percentage	100	%	100	%

PSEG utilizes forecasted returns, risk, and correlation of all asset classes in order to develop an efficient portfolio. PSEG’s latest asset/liability study indicates that a long-term target asset allocation of 70% equities and 30% fixed income is consistent with the funds’ financial objectives. Derivative financial instruments are used by the plans’ investment managers primarily to adjust the fixed income duration of the portfolio and hedge the currency risk component of foreign investments. The expected long-term rate of return on plan assets was 7.8% for 2018 and will be 7.8% for 2019. This expected return was determined based on the study discussed above, including a premium for active management and considered the plans’ historical annualized rate of return since inception.

Plan Contributions

PSEG has no planned contributions to its pension plans in 2019. PSEG plans to make discretionary contributions of $10 million into its OPEB plan during 2019.

Estimated Future Benefit Payments

The following pension benefit and postretirement benefit payments are expected to be paid to plan participants.

Year	Pension Benefits		Other Benefits
	Millions
2019	$	345	$	91
2020	341		95
2021	352		87
2022	364		88
2023	373		89
2024-2028	2,004		428
Total	$	3,779	$	878

401(k) Plans

PSEG sponsors two 401(k) plans, which are defined contribution retirement plans subject to the Employee Retirement Income Security Act (ERISA). Eligible represented employees of PSEG’s subsidiaries participate in the PSEG Employee Savings Plan (Savings Plan), while eligible non-represented employees of PSEG’s subsidiaries participate in the PSEG Thrift and Tax-Deferred Savings Plan (Thrift Plan). Eligible employees may contribute up to 50% of their compensation to these plans, not to exceed the Internal Revenue Service (IRS) maximums, including any catch-up contributions for those employees age 50 and above. PSEG matches 50% of such employee contributions up to 7% of pay for Savings Plan participants and up to 8% of pay for Thrift Plan participants. The amount paid for employer matching contributions to the plans for PSEG, PSE&G and Power are detailed as follows:

	Thrift Plan and Savings Plan
	Years Ended December 31,
	2018		2017		2016
	Millions
PSE&G	$	26	$	25	$	24
Power	10		11		12
Other	5		5		5
Total Employer Matching Contributions	$	41	$	41	$	41

Servco Pension and OPEB

At the direction of LIPA, effective January 1, 2014, Servco established benefit plans that provide substantially the same benefits to its employees as those previously provided by National Grid Electric Services LLC (NGES), the predecessor T&D system manager for LIPA. Since the vast majority of Servco’s employees had worked under NGES’ T&D operations services arrangement with LIPA, Servco’s plans provide certain of those employees with pension and OPEB vested credit for prior years’ services earned while working for NGES. The benefit plans cover all employees of Servco for current service. Under the OSA, all of these and any future employee benefit costs are to be funded by LIPA. See Note 5. Variable Interest Entity. These obligations, as well as the offsetting long-term receivable, are separately presented on the Consolidated Balance Sheet of PSEG.

The following table provides a roll-forward of the changes in Servco’s benefit obligation and the fair value of its plan assets during the years ended December 31, 2018 and 2017. It also provides the funded status of the plans and the amounts recognized and amounts not recognized on the Consolidated Balance Sheets at the end of both years.

	Pension Benefits						Other Benefits
	2018			2017			2018			2017
	Millions
Change in Benefit Obligation
Benefit Obligation at Beginning of Year	$	320		$	262		$	542		$	452
Service Cost	30			27			18			15
Interest Cost	12			11			20			19
Actuarial (Gain) Loss	(38		)	22			(73		)	60
Gross Benefits Paid	(3		)	(2		)	(6		)	(4		)
Plan Amendments	—			—			—			—
Benefit Obligation at End of Year (A)	$	321		$	320		$	501		$	542
Change in Plan Assets
Fair Value of Assets at Beginning of Year	$	191		$	134		$	—		$	—
Actual Return on Plan Assets	(16		)	24			—			—
Employer Contributions	40			35			6			4
Gross Benefits Paid	(3		)	(2		)	(6		)	(4		)
Fair Value of Assets at End of Year	$	212		$	191		$	—		$	—
Funded Status
Funded Status (Plan Assets less Benefit Obligation)	$	(109	)	$	(129	)	$	(501	)	$	(542	)
Additional Amounts Recognized in the Consolidated Balance Sheets
Accrued Pension Costs of Servco	$	(109	)	$	(129	)	N/A			N/A
OPEB Costs of Servco	N/A			N/A			(501		)	(542		)
Amounts Recognized (B)	$	(109	)	$	(129	)	$	(501	)	$	(542	)

(A) Represents projected benefit obligation for pension benefits and the accumulated postretirement benefit obligation for other benefits. The vested benefit obligation is the actuarial present value of the vested benefits to which the employee is currently entitled but based on the employee’s expected date of separation of retirement.

(B) Amounts equal to the accrued pension and OPEB costs of Servco are offset in Long-Term Receivable of VIE on PSEG’s Consolidated Balance Sheets.

Pension and OPEB costs of Servco are accounted for according to the OSA. Servco recognizes expenses for contributions to its pension plan trusts and for OPEB payments made to retirees. Operating Revenues are recognized for the reimbursement of these costs. The pension-related revenues and costs for 2018, 2017 and 2016 were $40 million, $35 million and $28 million, respectively. Servco has contributed its entire planned contribution amount to its pension plan trusts during 2018. The OPEB-related revenues earned and costs incurred were $6 million, $4 million and $2 million in 2018, 2017 and 2016, respectively. The following assumptions were used to determine the benefit obligations of Servco:

	Pension Benefits						Other Benefits
	2018		2017		2016		2018			2017			2016
Weighted-Average Assumptions Used to Determine Benefit Obligations as of December 31
Discount Rate	4.60	%	3.90	%	4.61	%	4.67		%	3.96		%	4.71		%
Rate of Compensation Increase	3.25	%	3.25	%	3.25	%	3.25		%	3.25		%	3.25		%
Assumed Health Care Cost Trend Rates as of December 31
Health Care Costs
Immediate Rate							8.03		%	7.69		%	7.55		%
Ultimate Rate							4.75		%	4.75		%	4.75		%
Year Ultimate Rate Reached							2026			2026			2025
							Millions
Effect of a 1% Increase in the Assumed Rate of Increase in Health Care Benefit Costs
Postretirement Benefit Obligation							$	108		$	131		$	97
Effect of a 1% Decrease in the Assumed Rate of Increase in Health Care Benefit Costs
Postretirement Benefit Obligation							$	(83	)	$	(99	)	$	(75	)

Plan Assets

All the investments of Servco’s pension plans are held in a trust account by the Trustee and consist of an undivided interest in an investment account of the Master Trust. The investments in the pension are measured at fair value within a hierarchy that prioritizes the inputs to fair value measurements into three levels. See Note 18. Fair Value Measurements for more information on fair value guidance. The Actuary maintains supporting records for the purpose of allocating the net gain or loss of the investment account to the respective participating plans. The net investment income of the investment assets is allocated by the Actuary to each participating plan based on the relationship of the interest of each plan to the total of the interests of the participating plans.

The following tables present information about Servco’s investments measured at fair value on a recurring basis as of December 31, 2018 and 2017, including the fair value measurements and the levels of inputs used in determining those fair values.

	Recurring Fair Value Measurements as of December 31, 2018
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Commingled Equities (A)	$	141	$	—	$	141	$	—
Commingled Bonds (A)	71		—		71		—
Total	$	212	$	—	$	212	$	—

	Recurring Fair Value Measurements as of December 31, 2017
			Quoted Market Prices for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	Millions
Commingled Equities (A)	$	137	$	—	$	137	$	—
Commingled Bonds (A)	54		—		54		—
Total	$	191	$	—	$	191	$	—

(A) Investments in commingled equity and bond funds have a readily determinable fair value as they publish a daily NAV available to investors which is the basis for current transactions and contain certain redemption restrictions requiring advance notice of one to two days for withdrawals (Level 2).

The following table provides the percentage of fair value of total plan assets for each major category of plan assets held for the qualified pension and OPEB plans of Servco as of the measurement date, December 31:

	As of December 31,
Investments	2018		2017
Equity Securities	67	%	72	%
Debt Securities	33		28
Total Percentage	100	%	100	%

Servco utilizes forecasted returns, risk, and correlation of all asset classes in order to develop an efficient portfolio. The results from Servco’s latest asset/liability study indicated that a long-term target asset allocation of 70% equities and 30% fixed income is consistent with the funds’ financial objectives. The expected long-term rate of return on plan assets was 7.6% for 2018 and will be 7.6% for 2019. This expected return was determined based on the study discussed above, including a premium for active management.

Plan Contributions

Servco plans to contribute $28 million into its pension plan during 2019.

Estimated Future Benefit Payments

The following pension benefit and postretirement benefit payments are expected to be paid to Servco’s plan participants:

Year	Pension Benefits		Other Benefits
	Millions
2019	$	4	$	6
2020	6		8
2021	7		10
2022	9		12
2023	11		14
2024-2028	91		99
Total	$	128	$	149

Servco 401(k) Plans

Servco sponsors two 401(k) plans, which are defined contribution retirement plans subject to ERISA. Eligible non-represented employees of Servco participate in the Long Island Electric Utility Servco LLC Incentive Thrift Plan I (Thrift Plan I), and eligible represented employees of Servco participate in the Long Island Electric Utility Servco LLC Incentive Thrift Plan II (Thrift Plan II). Participants in the plans may contribute up to 50% of their eligible compensation to these plans, not to exceed the IRS maximums, including any catch-up contributions for those employees age 50 and above. Servco does not provide an employer match or core contribution for employees in Thrift Plan II. For employees in Thrift Plan I, Servco matches 50% of such employee contributions up to 8% of eligible compensation and provides core contributions (based on years of service and age) to employees who do not participate in Servco’s Retirement Income Plan. The amounts expensed by Servco for employer matching contributions for the years ended December 31, 2018, 2017 and 2016 were $7 million, $6 million and $5 million, respectively, and pursuant to the OSA, Servco recognizes Operating Revenues for the reimbursement of these costs.