Asset Retirement Obligations

12 Months Ended

Dec. 31, 2023

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, 2023 and 2022, DESC has recorded AROs of $311 million and $299 million, respectively, for nuclear plant decommissioning. In addition, DESC has recorded AROs of $420 million and $329 million at December 31, 2023 and 2022, 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)	2023			2022
Beginning balance	$	628		$	599
Liabilities incurred		7			6
Liabilities settled		(14	)		(1	)
Accretion expense		29			26
Revisions in estimated cash flows(1)		81			(2	)
Ending balance	$	731		$	628

(1)

In 2023, there was an increase in estimated costs associated with certain coal-fired generating units, including revisions following the approval of closure plans for a facility previously taken out of service.