Pension and OPEB

9 Months Ended

Sep. 30, 2023

Defined Benefit Plan Disclosure [Line Items]

Pension and Other Postretirement Benefits (OPEB)

Pension and Other Postretirement Benefits (OPEB)

PSEG sponsors and Services administers qualified and nonqualified pension plans and OPEB plans covering PSEG’s and its participating affiliates’ current and former employees who meet certain eligibility criteria.

PSEG and PSE&G 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 are required to be measured as of the date of their respective year-end Consolidated Balance Sheets.

The following table provides the components of net periodic benefit costs (credits) relating to all qualified and nonqualified pension and OPEB plans on an aggregate basis for PSEG, excluding Servco. Net periodic pension benefit costs are reduced in 2023 as a result of an accounting order from the BPU authorizing PSE&G to modify its method for calculating the amortization of the net actuarial gain or loss component of pension expense for rate making purposes. See Note 5. Rate Filings. Amounts shown do not reflect the impacts of capitalization, co-owner allocations and the 2023 BPU accounting order. Only the service cost component is eligible for capitalization, when applicable.

	Pension Benefits				OPEB				Pension Benefits				OPEB
	Three Months Ended				Three Months Ended				Nine Months Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022
	Millions
Components of Net Periodic Benefit (Credits) Costs
Service Cost (included in O&M Expense)	$	23	$	35	$	1	$	2	$	68	$	106	$	3	$	5
Non-Service Components of Pension and OPEB (Credits) Costs
Interest Cost	62		42		10		6		200		125		31		19
Expected Return on Plan Assets	(87)		(120)		(8)		(11)		(278)		(362)		(25)		(32)
Amortization of Net
Prior Service Credit	—		—		(13)		(32)		—		—		(39)		(96)
Actuarial Loss (Gain)	19		15		(1)		4		67		45		(2)		11
Settlement Charge Resulting from Pension Lift-Out	332		—		—		—		332		—		—		—
Non-Service Components of Pension and OPEB (Credits) Costs	326		(63)		(12)		(33)		321		(192)		(35)		(98)
Total Benefit (Credits) Costs	$	349	$	(28)	$	(11)	$	(31)	$	389	$	(86)	$	(32)	$	(93)

Pension and OPEB (credits) costs for PSE&G and PSEG Power & Other are detailed as follows:

	Pension Benefits				OPEB				Pension Benefits				OPEB
	Three Months Ended				Three Months Ended				Nine Months Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022
	Millions
PSE&G	$	10	$	(18)	$	(11)	$	(27)	$	37	$	(53)	$	(31)	$	(82)
PSEG Power & Other	339		(10)		—		(4)		352		(33)		(1)		(11)
Total Benefit (Credits) Costs	$	349	$	(28)	$	(11)	$	(31)	$	389	$	(86)	$	(32)	$	(93)

PSEG does not plan to contribute to its pension and OPEB plans in 2023.

In July 2023, PSEG and Fiduciary Counselors Inc., as independent fiduciary of the Pension Plan of Public Service Enterprise Group Incorporated and Pension Plan of Public Service Enterprise Group Incorporated II (together, the Plans), entered into a commitment agreement (for a “lift-out”) with The Prudential Insurance Company of America (the Insurer) under which the Plans agreed to purchase a nonparticipating single premium group annuity contract that has transferred to the Insurer approximately $1 billion of the Plans’ defined benefit pension obligations and associated Plan assets related to certain pension benefits. The contract covers approximately 2,000 retirees from PSEG Power & Other, excluding Services (Participants). To the extent provided in the contract, the Insurer has made an irrevocable commitment, and will be solely responsible, to pay benefits of each Participant that are due on and after December 31, 2023. The transaction will result in no changes to the amount of benefits payable to Participants.

PSEG completed the transaction in August 2023. As a result of the transaction, PSEG recognized a one-time settlement charge of $332 million ($239 million, net of tax) in the third quarter of 2023 related to the immediate recognition of unamortized net actuarial loss associated with the portion of the pension involved in the transaction.

Servco Pension and OPEB

Servco sponsors a qualified pension plan and OPEB plan covering its employees who meet certain eligibility criteria. Under the OSA, employee benefit costs for these plans are funded by LIPA. See Note 4. Variable Interest Entity. These obligations, as well as the offsetting long-term receivable, are separately presented on the Condensed Consolidated Balance Sheet of PSEG.

Servco amounts are not included in any of the preceding pension and OPEB cost disclosures. 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. As of September 30, 2023, Servco completed its entire 2023 annual planned contribution to its pension plan. Servco’s pension-related revenues and costs were $9 million and $15 million for the three months ended September 30, 2023 and 2022, respectively, and $18 million and $30 million for the nine months ended September 30, 2023 and 2022, respectively. The OPEB-related revenues earned and costs incurred were $3 million and $2 million for the three months ended September 30, 2023 and 2022, respectively, and $9 million and $7 million for the nine months ended September 30, 2023 and 2022, respectively.

Public Service Electric and Gas Company [Member]

Defined Benefit Plan Disclosure [Line Items]

Pension and Other Postretirement Benefits (OPEB)

Pension and Other Postretirement Benefits (OPEB)

PSEG sponsors and Services administers qualified and nonqualified pension plans and OPEB plans covering PSEG’s and its participating affiliates’ current and former employees who meet certain eligibility criteria.

PSEG and PSE&G 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 are required to be measured as of the date of their respective year-end Consolidated Balance Sheets.

The following table provides the components of net periodic benefit costs (credits) relating to all qualified and nonqualified pension and OPEB plans on an aggregate basis for PSEG, excluding Servco. Net periodic pension benefit costs are reduced in 2023 as a result of an accounting order from the BPU authorizing PSE&G to modify its method for calculating the amortization of the net actuarial gain or loss component of pension expense for rate making purposes. See Note 5. Rate Filings. Amounts shown do not reflect the impacts of capitalization, co-owner allocations and the 2023 BPU accounting order. Only the service cost component is eligible for capitalization, when applicable.

	Pension Benefits				OPEB				Pension Benefits				OPEB
	Three Months Ended				Three Months Ended				Nine Months Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022
	Millions
Components of Net Periodic Benefit (Credits) Costs
Service Cost (included in O&M Expense)	$	23	$	35	$	1	$	2	$	68	$	106	$	3	$	5
Non-Service Components of Pension and OPEB (Credits) Costs
Interest Cost	62		42		10		6		200		125		31		19
Expected Return on Plan Assets	(87)		(120)		(8)		(11)		(278)		(362)		(25)		(32)
Amortization of Net
Prior Service Credit	—		—		(13)		(32)		—		—		(39)		(96)
Actuarial Loss (Gain)	19		15		(1)		4		67		45		(2)		11
Settlement Charge Resulting from Pension Lift-Out	332		—		—		—		332		—		—		—
Non-Service Components of Pension and OPEB (Credits) Costs	326		(63)		(12)		(33)		321		(192)		(35)		(98)
Total Benefit (Credits) Costs	$	349	$	(28)	$	(11)	$	(31)	$	389	$	(86)	$	(32)	$	(93)

Pension and OPEB (credits) costs for PSE&G and PSEG Power & Other are detailed as follows:

	Pension Benefits				OPEB				Pension Benefits				OPEB
	Three Months Ended				Three Months Ended				Nine Months Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022
	Millions
PSE&G	$	10	$	(18)	$	(11)	$	(27)	$	37	$	(53)	$	(31)	$	(82)
PSEG Power & Other	339		(10)		—		(4)		352		(33)		(1)		(11)
Total Benefit (Credits) Costs	$	349	$	(28)	$	(11)	$	(31)	$	389	$	(86)	$	(32)	$	(93)

PSEG does not plan to contribute to its pension and OPEB plans in 2023.

In July 2023, PSEG and Fiduciary Counselors Inc., as independent fiduciary of the Pension Plan of Public Service Enterprise Group Incorporated and Pension Plan of Public Service Enterprise Group Incorporated II (together, the Plans), entered into a commitment agreement (for a “lift-out”) with The Prudential Insurance Company of America (the Insurer) under which the Plans agreed to purchase a nonparticipating single premium group annuity contract that has transferred to the Insurer approximately $1 billion of the Plans’ defined benefit pension obligations and associated Plan assets related to certain pension benefits. The contract covers approximately 2,000 retirees from PSEG Power & Other, excluding Services (Participants). To the extent provided in the contract, the Insurer has made an irrevocable commitment, and will be solely responsible, to pay benefits of each Participant that are due on and after December 31, 2023. The transaction will result in no changes to the amount of benefits payable to Participants.

PSEG completed the transaction in August 2023. As a result of the transaction, PSEG recognized a one-time settlement charge of $332 million ($239 million, net of tax) in the third quarter of 2023 related to the immediate recognition of unamortized net actuarial loss associated with the portion of the pension involved in the transaction.

Servco Pension and OPEB

Servco sponsors a qualified pension plan and OPEB plan covering its employees who meet certain eligibility criteria. Under the OSA, employee benefit costs for these plans are funded by LIPA. See Note 4. Variable Interest Entity. These obligations, as well as the offsetting long-term receivable, are separately presented on the Condensed Consolidated Balance Sheet of PSEG.

Servco amounts are not included in any of the preceding pension and OPEB cost disclosures. 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. As of September 30, 2023, Servco completed its entire 2023 annual planned contribution to its pension plan. Servco’s pension-related revenues and costs were $9 million and $15 million for the three months ended September 30, 2023 and 2022, respectively, and $18 million and $30 million for the nine months ended September 30, 2023 and 2022, respectively. The OPEB-related revenues earned and costs incurred were $3 million and $2 million for the three months ended September 30, 2023 and 2022, respectively, and $9 million and $7 million for the nine months ended September 30, 2023 and 2022, respectively.