Asset Retirement Obligations

12 Months Ended

Dec. 31, 2022

Asset Retirement Obligation Disclosure [Abstract]

10. ASSET RETIREMENT OBLIGATIONS

A liability for the present value of an ARO is recognized when incurred if the liability can be reasonably estimated. Uncertainty about the timing or method of settlement of a conditional ARO is factored into the measurement of the liability when sufficient information exists, but such uncertainty is not a basis upon which to avoid liability recognition.

The legal obligations associated with the retirement of long-lived tangible assets that result from their acquisition, construction, development and normal operation relate primarily to DESC’s regulated utility operations. As of December 31, 2022 and 2021, DESC has recorded AROs of $299 million and $287 million, respectively, for nuclear plant decommissioning. In addition, DESC has recorded AROs of $329 million and $312 million at December 31, 2022 and 2021, respectively, for other conditional obligations primarily related to other generation and distribution properties, including gas pipelines. All of the amounts recorded are based upon estimates which are subject to varying degrees of precision, particularly since such payments will be made many years in the future.

A reconciliation of the beginning and ending aggregate carrying amount of AROs is as follows:


(millions)	2022			2021
Beginning balance	$	599		$	597
Liabilities incurred		6			—
Liabilities settled		(1	)		—
Accretion expense		26			25
Revisions in estimated cash flows(1)		(2	)		(23	)
Ending balance	$	628		$	599

(1)

The decrease in 2021 is due to the remeasurement of gas pipeline AROs.