Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Details of Income Tax Expense for Continuing Operations Including Noncontrolling Interests

Year Ended December 31,	2023			2022			2021
(millions)
Current:
Federal	$	91		$	(69	)	$	(52	)
State		(70	)		(3	)		(39	)
Total current expense (benefit)		21			(72	)		(91	)
Deferred:
Federal
Taxes before operating loss carryforwards and investment tax credits		(72	)		135			61
Tax utilization expense (benefit) of operating loss carryforwards		43			33			34
State		95			36			7
Total deferred expense		66			204			102
Investment tax credits		(2	)		(1	)		(2	)
Total income tax expense	$	85		$	131		$	9

Schedule of Effective Income Tax Rate Reconciliation

Year Ended December 31,	2023			2022			2021
U.S. statutory rate		21.0	%		21.0	%		21.0	%
Increases (reductions) resulting from:
State taxes, net of federal benefit		4.1			4.7			5.6
AFUDC - equity		—			—			(0.4	)
Amortization of federal investment tax credits		(0.3	)		(0.2	)		(0.6	)
Reversal of excess deferred income taxes		(4.7	)		(4.6	)		(8.1	)
Changes in unrecognized tax benefits		(2.2	)		—			(15.8	)
Prior period adjustments		—			—			1.6
Other		(0.2	)		(0.2	)		0.5
Effective tax rate		17.7	%		20.7	%		3.8	%

Schedule of Deferred Income Taxes

DESC’s deferred income taxes consist of the following:

At December 31,	2023			2022
(millions)
Deferred income taxes:
Total deferred income tax assets	$	728		$	892
Total deferred income tax liabilities		2,033			2,107
Total net deferred income tax liabilities	$	1,305		$	1,215
Total deferred income taxes:
Depreciation method and plant basis differences	$	1,203		$	1,164
Excess deferred income taxes		(212	)		(219	)
Unrecovered nuclear plant cost		450			479
DESC rate refund		(67	)		(89	)
Toshiba Settlement		(147	)		(162	)
Nuclear decommissioning		(51	)		(44	)
Deferred state income taxes		274			275
Federal benefit of deferred state income taxes		(60	)		(60	)
Deferred fuel, purchased energy and gas costs		32			107
Pension benefits		35			51
Other postretirement benefits		(17	)		(32	)
Loss and credit carryforwards		(185	)		(313	)
Other		50			58
Total net deferred income tax liabilities	$	1,305		$	1,215
Deferred investment tax credits		13			15
Total deferred taxes and deferred investment tax credits	$	1,318		$	1,230

Summary of Tax Credit Carryforwards

At December 31, 2023, DESC had the following deductible loss and credit carryforwards:

(millions)	Deductible Amount		Deferred Tax Asset		Expiration Period
Federal losses	$	533	$	112	2037
Federal production and other credits		—		30	2041-2043
State losses		878		44	2037-2042
State investment and other credits		—		37	2026-2031
Total	$	1,411	$	223

Schedule of Unrecognized Tax Benefits Roll Forward

A reconciliation of changes in DESC’s unrecognized tax benefits follows:

(millions)	2023			2022			2021
Balance at January 1,	$	68		$	62		$	138
Increases-prior period positions		5			6			6
Decreases-prior period positions		(11	)		(1	)		(57	)
Increases-current period positions		—			1			1
Settlements with tax authorities		—			—			(26	)
Balance at December 31,	$	62		$	68		$	62

Certain unrecognized tax benefits, or portions thereof, if recognized, would affect the effective tax rate. Changes in these unrecognized tax benefits may result from remeasurement of amounts expected to be realized, settlements with tax authorities and expiration of statutes of limitations. If recognized, all the unrecognized tax benefits would impact the effective tax rate.