Asset Retirement Obligations (MEC) (MidAmerican Energy Company and Subsidiaries [Member])

12 Months Ended

Dec. 31, 2012

MidAmerican Energy Company and Subsidiaries [Member]

Asset Retirement Obligations Disclosure [Line Items]

Asset Retirement Obligation Disclosure [Text Block]

(12) Asset Retirement Obligations

MidAmerican Energy estimates its ARO liabilities based upon detailed engineering calculations of the amount and timing of the future cash spending for a third party to perform the required work. Spending estimates are escalated for inflation and then discounted at a credit-adjusted, risk-free rate. Changes in estimates could occur for a number of reasons, including plan revisions, inflation and changes in the amount and timing of the expected work.

MidAmerican Energy does not recognize liabilities for AROs for which the fair value cannot be reasonably estimated. Due to the indeterminate removal date, the fair value of the associated liabilities on certain transmission, distribution and other assets cannot currently be estimated, and no amounts are recognized on the Consolidated Financial Statements other than those included in the cost of removal regulatory liability established via approved depreciation rates in accordance with accepted regulatory practices. These accruals totaled $629 million and $603 million as of December 31, 2012 and 2011, respectively.

The following table presents MidAmerican Energy's ARO liabilities by asset type as of December 31, (in millions):

	2012		2011
Quad Cities Station	$	243	$	230
Thermal facilities	24		23
Wind generating facilities	48		36
Other	3		4
Total asset retirement obligations	$	318	$	293
Quad Cities Station nuclear decommissioning trust funds(1)	$	337	$	306

(1) Refer to Note 5 for a discussion of the Quad Cities Station nuclear decommissioning trust funds.

The following table reconciles the beginning and ending balances of MidAmerican Energy's ARO liabilities for the years ended December 31, (in millions):

	2012			2011
Beginning balance	$	293		$	220
Change in estimated costs	—			50
Additions	10			10
Retirements	(1		)	—
Accretion	16			13
Ending balance	$	318		$	293

The 2011 change in estimated costs is primarily the result of a new valuation study conducted by the operator of Quad Cities Station, consistent with its practice of periodically performing such studies. The revision decreased regulatory liabilities and did not impact net income.