Regulatory Assets and Liabilities

Regulatory Assets

SCE's regulatory assets included on the consolidated balance sheets are:



(in millions)	September 30, 2018		December 31, 2017
Current:
Regulatory balancing accounts	$	694	$	484
Power contracts and energy derivatives	205		203
Other	14		16
Total current	913		703
Long-term:
Deferred income taxes, net of liabilities	3,411		3,143
Pensions and other postretirement benefits	262		271
Power contracts and energy derivatives	635		799
Unamortized investments, net of accumulated amortization	116		123
San Onofre¹	—		72
Unamortized loss on reacquired debt	157		168
Regulatory balancing accounts	204		143
Environmental Remediation	135		144
Wildfire insurance costs²	63		—
Other	63		51
Total long-term	5,046		4,914
Total regulatory assets	$	5,959	$	5,617


¹	In accordance with the Revised San Onofre Settlement Agreement, SCE wrote down the San Onofre regulatory asset and applied $72 million of the U.S. Department of Energy ("DOE") proceeds, previously reflected as a regulatory liability in the DOE litigation memorandum account, against the remaining San Onofre regulatory asset. See Note 12 for further information.


²	SCE requested approval from the CPUC to track and recover wildfire related costs including insurance premiums in excess of the amounts that will be ultimately approved in the 2018 GRC decision. See Note 12 for further information.

Regulatory Liabilities

SCE's regulatory liabilities included on the consolidated balance sheets are:



(in millions)	September 30, 2018		December 31, 2017
Current:
Regulatory balancing accounts	$	1,273	$	1,009
Energy derivatives	41		74
Other¹	285		38
Total current	1,599		1,121
Long-term:
Costs of removal	2,802		2,741
Re-measurement of deferred taxes	2,796		2,892
Recoveries in excess of ARO liabilities²	1,470		1,575
Regulatory balancing accounts	1,333		1,316
Other postretirement benefits	26		26
Other	36		64
Total long-term	8,463		8,614
Total regulatory liabilities	$	10,062	$	9,735


¹	During the nine months ended September 30, 2018, SCE recorded CPUC revenue based on the 2017 authorized revenue requirements adjusted for the July 2017 cost of capital decision and Tax Reform pending the outcome of the 2018 GRC. SCE recorded a regulatory liability primarily associated with these adjustments.

Represents the cumulative differences between ARO expenses and amounts collected in rates primarily for the decommissioning of SCE's nuclear generation facilities. Decommissioning costs recovered through rates are primarily placed in nuclear decommissioning trusts. This regulatory liability also represents the deferral of realized and unrealized gains and losses on the nuclear decommissioning trust investments. See Note 10 for further discussion.

Net Regulatory Balancing Accounts

The following table summarizes the significant components of regulatory balancing accounts included in the above tables of regulatory assets and liabilities:



(in millions)	September 30, 2018			December 31, 2017
Asset (liability)
Energy resource recovery account	$	690		$	464
New system generation balancing account	(98		)	(197		)
Public purpose programs and energy efficiency programs	(1,283		)	(1,145		)
Tax accounting memorandum account and pole loading balancing account	31			(259		)
Base revenue requirement balancing account	(678		)	(200		)
DOE litigation memorandum account¹	(69		)	(156		)
Greenhouse gas auction revenue	6			(22		)
FERC balancing accounts	(298		)	(205		)
Catastrophic event memorandum account	133			102
Other	(142		)	(80		)
Liability	$	(1,708	)	$	(1,698	)


¹	Represents proceeds from the DOE resulting from its failure to meet its obligation to begin accepting spent nuclear fuel from San Onofre. See Note 12 for further discussion.