Subsidiary Debt (Notes)

12 Months Ended

Dec. 31, 2016

BHE's direct and indirect subsidiaries are organized as legal entities separate and apart from BHE and its other subsidiaries. Pursuant to separate financing agreements, substantially all of PacifiCorp's electric utility properties; the equity interest of MidAmerican Funding's subsidiary; MidAmerican Energy's electric utility properties in the state of Iowa; substantially all of Nevada Power's and Sierra Pacific's properties in the state of Nevada; the long-term customer contracts of Kern River; AltaLink's transmission properties; and substantially all of the assets of the subsidiaries of BHE Renewables are pledged or encumbered to support or otherwise provide the security for their related subsidiary debt. It should not be assumed that the assets of any subsidiary will be available to satisfy BHE's obligations or the obligations of its other subsidiaries. However, unrestricted cash or other assets which are available for distribution may, subject to applicable law, regulatory commitments and the terms of financing and ring-fencing arrangements for such parties, be advanced, loaned, paid as dividends or otherwise distributed or contributed to BHE or affiliates thereof. The long-term debt of subsidiaries may include provisions that allow BHE's subsidiaries to redeem it in whole or in part at any time. These provisions generally include make-whole premiums.

Distributions at these separate legal entities are limited by various covenants including, among others, leverage ratios, interest coverage ratios and debt service coverage ratios. As of December 31, 2016, all subsidiaries were in compliance with their long-term debt covenants.

Long-term debt of subsidiaries consists of the following, including fair value adjustments and unamortized premiums, discounts and debt issuance costs, as of December 31 (in millions):



	Par Value		2016		2015

PacifiCorp	$	7,120	$	7,079	$	7,159
MidAmerican Funding	4,657		4,592		4,560
NV Energy	4,569		4,582		4,860
Northern Powergrid	2,351		2,379		2,772
BHE Pipeline Group	995		990		1,040
BHE Transmission	4,068		4,058		3,467
BHE Renewables	3,716		3,674		3,356
Total subsidiary debt	$	27,476	$	27,354	$	27,214

Reflected as:
Current liabilities			$	606	$	1,148
Noncurrent liabilities			26,748		26,066
Total subsidiary debt			$	27,354	$	27,214

PacifiCorp

PacifiCorp's long-term debt consists of the following, including unamortized premiums, discounts and debt issuance costs, as of December 31 (dollars in millions):



	Par Value		2016		2015
First mortgage bonds:
3.85% to 8.53%, due through 2021	$	1,272	$	1,269	$	1,271
2.95% to 8.27%, due 2022 to 2026	1,829		1,820		1,819
7.70% due 2031	300		298		298
5.25% to 6.10%, due 2034 to 2036	850		843		843
5.75% to 6.35%, due 2037 to 2039	2,150		2,134		2,133
4.10% due 2042	300		297		297
Variable-rate series, tax-exempt bond obligations (2016-0.69% to 0.86%; 2015-0.01% to 0.22%):
Due 2017 to 2018	91		91		91
Due 2018 to 2025⁽¹⁾	108		108		107
Due 2024⁽¹⁾⁽²⁾	143		142		196
Due 2024 to 2025⁽²⁾	50		50		59
Capital lease obligations - 8.75% to 14.61%, due through 2035	27		27		45
Total PacifiCorp	$	7,120	$	7,079	$	7,159


(1)	Supported by $255 million and $310 million of fully available letters of credit issued under committed bank arrangements as of December 31, 2016 and 2015, respectively.


(2)	Secured by pledged first mortgage bonds registered to and held by the tax-exempt bond trustee generally with the same interest rates, maturity dates and redemption provisions as the tax-exempt bond obligations.

The issuance of PacifiCorp's first mortgage bonds is limited by available property, earnings tests and other provisions of PacifiCorp's mortgage. Approximately $26 billion of PacifiCorp's eligible property (based on original cost) was subject to the lien of the mortgage as of December 31, 2016.

MidAmerican Funding

MidAmerican Funding's long-term debt consists of the following, including fair value adjustments and unamortized premiums, discounts and debt issuance costs, as of December 31 (dollars in millions):



	Par Value		2016		2015
MidAmerican Funding:
6.927% Senior Bonds, due 2029	$	325	$	291	$	289

MidAmerican Energy:
Tax-exempt bond obligations -
Variable-rate tax-exempt bond obligation series: (2016-0.76%, 2015-0.03%), due 2023-2046	220		219		194
First Mortgage Bonds:
2.40%, due 2019	500		499		499
3.70%, due 2023	250		248		248
3.50%, due 2024	500		501		502
4.80%, due 2043	350		345		345
4.40%, due 2044	400		394		394
4.25%, due 2046	450		445		444
Notes:
5.95% Series, due 2017	250		250		250
5.3% Series, due 2018	350		350		349
6.75% Series, due 2031	400		396		395
5.75% Series, due 2035	300		298		298
5.8% Series, due 2036	350		347		347
Transmission upgrade obligation, 4.45% and 3.42% due through 2035 and 2036, respectively	10		7		4
Capital lease obligations - 4.16%, due through 2020	2		2		2
Total MidAmerican Energy	4,332		4,301		4,271
Total MidAmerican Funding	$	4,657	$	4,592	$	4,560

In February 2017, MidAmerican Energy issued $375 million of its 3.10% First Mortgage Bonds due May 2027 and $475 million of its 3.95% First Mortgage Bonds due August 2047. An amount equal to the net proceeds will be used to finance capital expenditures, disbursed during the period from February 2, 2016 to February 1, 2017, with respect to investments in MidAmerican Energy's 551-megawatt Wind X and 2,000-megawatt Wind XI projects, which were previously financed with MidAmerican Energy's general funds.

In January 2017, MidAmerican Energy provided notice to holders of its $250 million of 5.95% Senior Notes due July 2017 that MidAmerican Energy would redeem such notes in full through optional redemption on February 27, 2017.

Pursuant to MidAmerican Energy's mortgage dated September 9, 2013, MidAmerican Energy's first mortgage bonds, currently and from time to time outstanding, are secured by a first mortgage lien on substantially all of its electric generating, transmission and distribution property within the state of Iowa, subject to certain exceptions and permitted encumbrances. As of December 31, 2016, MidAmerican Energy's eligible property subject to the lien of the mortgage totaled approximately $15 billion based on original cost. Additionally, MidAmerican Energy's senior notes outstanding are equally and ratably secured with the first mortgage bonds as required by the indentures under which the senior notes were issued.

NV Energy

NV Energy's long-term debt consists of the following, including fair value adjustments and unamortized premiums, discounts and debt issuance costs, as of December 31 (dollars in millions):



	Par Value		2016		2015
NV Energy -
6.250% Senior Notes, due 2020	$	315	$	363	$	373

Nevada Power:
General and refunding mortgage securities:
5.950% Series M, due 2016	—		—		210
6.500% Series O, due 2018	324		324		323
6.500% Series S, due 2018	499		498		498
7.125% Series V, due 2019	500		499		499
6.650% Series N, due 2036	367		357		356
6.750% Series R, due 2037	349		345		345
5.375% Series X, due 2040	250		247		247
5.450% Series Y, due 2041	250		236		235
Variable-rate series (2016-1.890% to 1.928%, 2015-0.672% to 1.055%):
Pollution Control Revenue Bonds Series 2006A, due 2032	38		38		38
Pollution Control Revenue Bonds Series 2006, due 2036	38		37		37
Capital and financial lease obligations - 2.750% to 11.600%, due through 2054	485		485		497
Total Nevada Power	3,100		3,066		3,285

Sierra Pacific:
General and refunding mortgage securities:
6.000% Series M, due 2016	—		—		450
3.375% Series T, due 2023	250		248		248
2.600% Series U, due 2026	400		395		—
6.750% Series P, due 2037	252		255		255
Tax-exempt refunding revenue bond obligations:
Fixed-rate series:
1.250% Pollution Control Series 2016A, due 2029	20		20		—
1.500% Gas Facilities Series 2016A, due 2031	58		58		—
3.000% Gas and Water Series 2016B, due 2036	60		64		—
Variable-rate series (2016-0.788% to 0.800%, 2015-0.733% to 1.054%):
Pollution Control Series 2006A, due 2031	—		—		58
Pollution Control Series 2006B, due 2036	—		—		74
Pollution Control Series 2006C, due 2036	—		—		80
Water Facilities Series 2016C, due 2036	30		29		—
Water Facilities Series 2016D, due 2036	25		25		—
Water Facilities Series 2016E, due 2036	25		25		—
Capital and financial lease obligations - 2.700% to 10.130%, due through 2054	34		34		37
Total Sierra Pacific	1,154		1,153		1,202
Total NV Energy	$	4,569	$	4,582	$	4,860

The issuance of General and Refunding Mortgage Securities by the Nevada Utilities is subject to PUCN approval and is limited by available property and other provisions of the mortgage indentures for each of Nevada Power and Sierra Pacific. As of December 31, 2016, approximately $8.9 billion of Nevada Power's and $3.8 billion of Sierra Pacific's (based on original cost) property was subject to the liens of the mortgages.

Northern Powergrid

Northern Powergrid and its subsidiaries' long-term debt consists of the following, including fair value adjustments and unamortized premiums, discounts and debt issuance costs, as of December 31 (dollars in millions):



	Par Value⁽¹⁾		2016		2015

8.875% Bonds, due 2020	$	123	$	136	$	162
9.25% Bonds, due 2020	247		259		315
3.901% to 4.586% European Investment Bank loans, due 2018 to 2022	333		333		398
7.25% Bonds, due 2022	247		257		306
2.50% Bonds due 2025	185		182		217
2.073% European Investment Bank loan, due 2025	62		62		—
2.564% European Investment Bank loans, due 2027	308		308		368
7.25% Bonds, due 2028	229		234		280
4.375% Bonds, due 2032	185		182		217
5.125% Bonds, due 2035	247		243		291
5.125% Bonds, due 2035	185		183		218
Total Northern Powergrid	$	2,351	$	2,379	$	2,772


(1)	The par values for these debt instruments are denominated in sterling.

BHE Pipeline Group

BHE Pipeline Group' long-term debt consists of the following, including unamortized premiums, discounts and debt issuance costs, as of December 31 (dollars in millions):



	Par Value		2016		2015
Northern Natural Gas:
5.75% Senior Notes, due 2018	$	200	$	199	$	199
4.25% Senior Notes, due 2021	200		199		199
5.8% Senior Bonds, due 2037	150		149		149
4.1% Senior Bonds, due 2042	250		248		248
Total Northern Natural Gas	800		795		795

Kern River:
4.893% Senior Notes, due 2018	195		195		245

Total BHE Pipeline Group	$	995	$	990	$	1,040

Kern River's long-term debt amortizes monthly. Kern River redeemed the remaining amount of its 6.676% Senior Notes due 2016 at a redemption price determined in accordance with the terms of the indenture. Kern River provides a debt service reserve letter of credit to cover the next six months of principal and interest payments due on the loans, which were equal to $35 million and $33 million as of December 31, 2016 and 2015, respectively.

BHE Transmission

BHE Transmission's long-term debt consists of the following, including fair value adjustments and unamortized premiums, discounts and debt issuance costs, as of December 31, (dollars in millions):



	Par Value⁽¹⁾		2016		2015
AltaLink Investments, L.P.:
Series 09-1 Senior Bonds, 5.207%, due 2016	$	—	$	—	$	112
Series 12-1 Senior Bonds, 3.674%, due 2019	149		153		151
Series 13-1 Senior Bonds, 3.265%, due 2020	149		152		149
Series 15-1 Senior Bonds, 2.244%, due 2022	149		148		144
Total AltaLink Investments, L.P.	447		453		556

AltaLink, L.P.:
Series 2008-1 Notes, 5.243%, due 2018	149		148		145
Series 2013-2 Notes, 3.621%, due 2020	93		93		90
Series 2012-2 Notes, 2.978%, due 2022	204		204		198
Series 2013-4 Notes, 3.668%, due 2023	372		371		360
Series 2014-1 Notes, 3.399%, due 2024	260		260		252
Series 2016-1 Notes, 2.747%, due 2026	260		259		—
Series 2006-1 Notes, 5.249%, due 2036	112		111		108
Series 2010-1 Notes, 5.381%, due 2040	93		93		90
Series 2010-2 Notes, 4.872%, due 2040	112		111		108
Series 2011-1 Notes, 4.462%, due 2041	205		204		198
Series 2012-1 Notes, 3.99%, due 2042	391		385		374
Series 2013-3 Notes, 4.922%, due 2043	260		260		252
Series 2014-3 Notes, 4.054%, due 2044	219		218		212
Series 2015-1 Notes, 4.090%, due 2045	260		259		251
Series 2016-2 Notes, 3.717%, due 2046	335		333		—
Series 2013-1 Notes, 4.446%, due 2053	186		186		180
Series 2014-2 Notes, 4.274%, due 2064	97		97		93
Total AltaLink, L.P.	3,608		3,592		2,911

Other:
Construction Loan, 4.950%, due 2021	13		13		—

Total BHE Transmission	$	4,068	$	4,058	$	3,467


(1)	The par values for these debt instruments are denominated in Canadian dollars.

BHE Renewables

BHE Renewables' long-term debt consists of the following, including fair value adjustments and unamortized debt issuance costs, as of December 31 (dollars in millions):



	Par Value		2016		2015
Fixed-rate⁽¹⁾:
CE Generation Bonds, 7.416%, due 2018	$	67	$	67	$	97
Salton Sea Funding Corporation Bonds, 7.475%, due 2018	30		31		51
Cordova Funding Corporation Bonds, 8.48% to 9.07%, due 2019	96		97		113
Bishop Hill Holdings Senior Notes, 5.125%, due 2032	100		99		102
Solar Star Funding Senior Notes, 3.950%, due 2035	316		311		321
Solar Star Funding Senior Notes, 5.375%, due 2035	977		966		988
Grande Prairie Wind Senior Notes, 3.860%, due 2037	419		414		—
Topaz Solar Farms Senior Notes, 5.750%, due 2039	791		780		815
Topaz Solar Farms Senior Notes, 4.875%, due 2039	230		229		239
Other	22		22		25
Variable-rate⁽¹⁾:
Pinyon Pines I and II Term Loans, due 2019⁽²⁾	356		355		378
Wailuku Special Purpose Revenue Bonds, 0.90%, due 2021	7		7		8
TX Jumbo Road Term Loan, due 2025⁽²⁾	212		206		219
Marshall Wind Term Loan, due 2026⁽²⁾	93		90		—
Total BHE Renewables	$	3,716	$	3,674	$	3,356


(1)	Amortizes quarterly or semiannually.

(2)

The term loans have variable interest rates based on LIBOR plus a margin that varies during the terms of the agreements. The Company has entered into interest rate swaps that fix the interest rate on 75% of the Pinyon Pines outstanding debt and 100% of the TX Jumbo Road and Marshall Wind outstanding debt. The variable interest rate as of December 31, 2016 and 2015 was 2.62% and 2.23%, respectively, while the fixed interest rates ranged from 3.21% to 3.63% as of December 31, 2016, and 3.55% to 3.63% as of December 31, 2015.

Annual Repayments of Long-Term Debt

The annual repayments of BHE and subsidiary debt for the years beginning January 1, 2017 and thereafter, excluding fair value adjustments and unamortized premiums, discounts and debt issuance costs, are as follows (in millions):



											2022 and
	2017		2018		2019		2020		2021		Thereafter		Total

BHE senior notes	$	400	$	1,000	$	—	$	350	$	—	$	6,125	$	7,875
BHE junior subordinated debentures	—		—		—		—		—		944		944
PacifiCorp	58		588		352		40		425		5,657		7,120
MidAmerican Funding	251		351		500		2		1		3,552		4,657
NV Energy	18		840		519		336		27		2,829		4,569
Northern Powergrid	—		49		49		418		—		1,835		2,351
BHE Pipeline Group	66		329		—		—		200		400		995
BHE Transmission	—		151		151		245		3		3,518		4,068
BHE Renewables	213		236		528		161		167		2,411		3,716
Totals	$	1,006	$	3,544	$	2,099	$	1,552	$	823	$	27,271	$	36,295

PacifiCorp [Member]

Debt Instrument [Line Items]

Debt and Capital Leases Disclosures [Text Block]

Long-term Debt and Capital Lease Obligations

PacifiCorp's long-term debt and capital lease obligations were as follows as of December 31 (dollars in millions):



	2016						2015
					Average				Average
	Principal		Carrying		Interest		Carrying		Interest
	Amount		Value		Rate		Value		Rate

First mortgage bonds:
3.85% to 8.53%, due through 2021	$	1,272	$	1,269	5.10	%	$	1,271	5.10	%
2.95% to 8.27%, due 2022 to 2026	1,829		1,820		4.10		1,819		4.10
7.70% due 2031	300		298		7.70		298		7.70
5.25% to 6.10%, due 2034 to 2036	850		843		5.80		843		5.80
5.75% to 6.35%, due 2037 to 2039	2,150		2,134		6.00		2,133		6.00
4.10% due 2042	300		297		4.10		297		4.10
Variable-rate series, tax-exempt bond obligations (2016-0.69% to 0.86%; 2015-0.01% to 0.22%):
Due 2017 to 2018	91		91		0.85		91		0.22
Due 2018 to 2025⁽¹⁾	108		108		0.74		107		0.01
Due 2024⁽¹⁾⁽²⁾	143		142		0.70		196		0.02
Due 2024 to 2025 ⁽²⁾	50		50		0.80		59		0.21
Total long-term debt	7,093		7,052				7,114
Capital lease obligations:
8.75% to 14.61%, due through 2035	27		27		11.09		32		11.25
Total long-term debt and capital lease
obligations	$	7,120	$	7,079			$	7,146



Reflected as:
	2016		2015

Current portion of long-term debt and capital lease obligations	$	58	$	68
Long-term debt and capital lease obligations	7,021		7,078
Total long-term debt and capital lease obligations	$	7,079	$	7,146


1)	Supported by $255 million and $310 million of fully available letters of credit issued under committed bank arrangements as of December 31, 2016 and 2015, respectively.


2)	Secured by pledged first mortgage bonds registered to and held by the tax-exempt bond trustee generally with the same interest rates, maturity dates and redemption provisions as the tax-exempt bond obligations.

PacifiCorp's long-term debt generally includes provisions that allow PacifiCorp to redeem the first mortgage bonds in whole or in part at any time through the payment of a make-whole premium. Variable-rate tax-exempt bond obligations are generally redeemable at par value.

PacifiCorp currently has regulatory authority from the OPUC and the IPUC to issue an additional $1.325 billion of long-term debt. PacifiCorp must make a notice filing with the Washington Utilities and Transportation Commission prior to any future issuance. PacifiCorp currently has an effective shelf registration statement filed with the United States Securities and Exchange Commission to issue up to $1.325 billion additional first mortgage bonds through January 2019.

PacifiCorp has entered into long-term agreements that qualify as capital leases and expire at various dates through March 2035 for transportation services, a power purchase agreement and real estate. The transportation services agreements included as capital leases are for the right to use pipeline facilities to provide natural gas to two of PacifiCorp's generating facilities. Net capital lease assets of $27 million and $32 million as of December 31, 2016 and 2015, respectively, were included in property, plant and equipment, net in the Consolidated Balance Sheets.

As of December 31, 2016, the annual principal maturities of long-term debt and total capital lease obligations for 2017 and thereafter are as follows (in millions):



	Long-term			Capital Lease
	Debt			Obligations			Total

2017	$	52		$	9		$	61
2018	586			4			590
2019	350			4			354
2020	38			3			41
2021	420			6			426
Thereafter	5,647			20			5,667
Total	7,093			46			7,139
Unamortized discount and debt issuance costs	(41		)	—			(41		)
Amounts representing interest	—			(19		)	(19		)
Total	$	7,052		$	27		$	7,079

MidAmerican Energy Company [Member]

Debt Instrument [Line Items]

Long-term Debt [Text Block]

Long-Term Debt

MidAmerican Energy's long-term debt consists of the following, including amounts maturing within one year and unamortized premiums, discounts and debt issuance costs, as of December 31 (dollars in millions):



	Par Value		2016		2015

First mortgage bonds:
2.40%, due 2019	$	500	$	499	$	499
3.70%, due 2023	250		248		248
3.50%, due 2024	500		501		502
4.80%, due 2043	350		345		345
4.40%, due 2044	400		394		394
4.25%, due 2046	450		445		444
Notes:
5.95% Series, due 2017	250		250		250
5.3% Series, due 2018	350		350		349
6.75% Series, due 2031	400		396		395
5.75% Series, due 2035	300		298		298
5.8% Series, due 2036	350		347		347
Transmission upgrade obligation, 4.45% and 3.42% due through 2035 and 2036, respectively	10		7		4
Variable-rate tax-exempt bond obligation series: (weighted average interest rate- 2016-0.76%, 2015-0.03%):
Due 2016	—		—		33
Due 2017	—		—		4
Due 2023, issued in 1993	7		7		7
Due 2023, issued in 2008	57		57		57
Due 2024	35		35		35
Due 2025	13		13		13
Due 2036	33		33		—
Due 2038	45		45		45
Due 2046	30		29		—
Capital lease obligations - 4.16%, due through 2020	2		2		2
Total	$	4,332	$	4,301	$	4,271

The annual repayments of MidAmerican Energy's long-term debt for the years beginning January 1, 2017, and thereafter, excluding unamortized premiums, discounts and debt issuance costs, are as follows (in millions):



2017	$	251
2018	351
2019	500
2020	2
2021	1
2022 and thereafter	3,227

Pursuant to MidAmerican Energy's mortgage dated September 9, 2013, MidAmerican Energy's first mortgage bonds, currently and from time to time outstanding, are secured by a first mortgage lien on substantially all of its electric generating, transmission and distribution property within the State of Iowa, subject to certain exceptions and permitted encumbrances. As of December 31, 2016, MidAmerican Energy's eligible property subject to the lien of the mortgage totaled approximately $15 billion based on original cost. Additionally, MidAmerican Energy's senior notes outstanding are equally and ratably secured with the first mortgage bonds as required by the indentures under which the senior notes were issued.

MidAmerican Energy's variable-rate tax-exempt obligations, including the tax-exempt bonds discussed above, bear interest at rates that are periodically established through remarketing of the bonds in the short-term tax-exempt market. MidAmerican Energy, at its option, may change the mode of interest calculation for these bonds by selecting from among several floating or fixed rate alternatives. The interest rates shown in the table above are the weighted average interest rates as of December 31, 2016 and 2015. MidAmerican Energy maintains revolving credit facility agreements to provide liquidity for holders of these issues.

In September 2016, the Iowa Finance Authority issued $33 million of variable-rate tax-exempt Pollution Control Facilities Refunding Revenue Bonds due September 2036, the proceeds of which were loaned to MidAmerican Energy to refinance, in September 2016, variable-rate tax-exempt pollution control refunding revenue bonds totaling $29 million due September 2016 and $4 million due March 2017, which were optionally redeemed in full.

In December 2016, the Iowa Finance Authority issued $30 million of its variable-rate, tax-exempt Solid Waste Facilities Revenue Bonds due December 2046, the proceeds of which were loaned to MidAmerican Energy for purpose of constructing solid waste facilities. The bonds are secured by an equal amount of first mortgage bonds pursuant to MidAmerican Energy's mortgage dated September 9, 2013, as supplemented and amended.

As of December 31, 2016, MidAmerican Energy was in compliance with all of its applicable long-term debt covenants.

In March 1999, MidAmerican Energy committed to the IUB to use commercially reasonable efforts to maintain an investment grade rating on its long-term debt and to maintain its common equity level above 42% of total capitalization unless circumstances beyond its control result in the common equity level decreasing to below 39% of total capitalization. MidAmerican Energy must seek the approval from the IUB of a reasonable utility capital structure if MidAmerican Energy's common equity level decreases below 42% of total capitalization, unless the decrease is beyond the control of MidAmerican Energy. MidAmerican Energy is also required to seek the approval of the IUB if MidAmerican Energy's equity level decreases to below 39%, even if the decrease is due to circumstances beyond the control of MidAmerican Energy. As of December 31, 2016, MidAmerican Energy's common equity ratio was 53% computed on a basis consistent with its commitment. As a result of its regulatory commitment to maintain its common equity level above certain thresholds, MidAmerican Energy could dividend $2.0 billion as of December 31, 2016, without falling below 42%.

MidAmerican Funding, LLC and Subsidiaries [Domain]

Debt Instrument [Line Items]

Long-term Debt [Text Block]

Long-Term Debt

Refer to Note 9 of MidAmerican Energy's Notes to Financial Statements for detail and a discussion of its long-term debt. In addition to MidAmerican Energy's annual repayments of long-term debt, MidAmerican Funding has $325 million of long-term debt due in 2029, with a carrying value of $326 million as of December 31, 2016 and 2015.

MidAmerican Funding parent company long-term debt is secured by a pledge of the common stock of MHC. See Item 15(c) for the Consolidated Financial Statements of MHC Inc. and subsidiaries. The bonds are the direct senior secured obligations of MidAmerican Funding and effectively rank junior to all indebtedness and other liabilities of the direct and indirect subsidiaries of MidAmerican Funding, to the extent of the assets of these subsidiaries. MidAmerican Funding may redeem the bonds in whole or in part at any time at a redemption price equal to the sum of any accrued and unpaid interest to the date of redemption and the greater of (1) 100% of the principal amount of the bonds or (2) the sum of the present values of the remaining scheduled payments of principal and interest on the bonds, discounted to the date of redemption on a semiannual basis at the treasury yield plus 25 basis points.

Subsidiaries of MidAmerican Funding must make payments on their own indebtedness before making distributions to MidAmerican Funding. Refer to Note 9 of MidAmerican Energy's Notes to Financial Statements for a discussion of utility regulatory restrictions affecting distributions from MidAmerican Energy. As a result of the utility regulatory restrictions agreed to by MidAmerican Energy in March 1999, MidAmerican Funding had restricted net assets of $3.1 billion as of December 31, 2016.

As of December 31, 2016, MidAmerican Funding was in compliance with all of its applicable long-term debt covenants.

Each of MidAmerican Funding's direct or indirect subsidiaries is organized as a legal entity separate and apart from MidAmerican Funding and its other subsidiaries. It should not be assumed that any asset of any subsidiary of MidAmerican Funding will be available to satisfy the obligations of MidAmerican Funding or any of its other subsidiaries; provided, however, that unrestricted cash or other assets which are available for distribution may, subject to applicable law and the terms of financing arrangements of such parties, be advanced, loaned, paid as dividends or otherwise distributed or contributed to MidAmerican Funding, one of its subsidiaries or affiliates thereof.

Nevada Power Company [Member]

Debt Instrument [Line Items]

Debt Disclosure [Text Block]

Long-Term Debt and Financial and Capital Lease Obligations

Nevada Power's long-term debt consists of the following, including unamortized premiums, discounts and debt issuance costs, as of December 31 (dollars in millions):



	Par Value		2016		2015
General and refunding mortgage securities:
5.950% Series M, due 2016	—		—		210
6.500% Series O, due 2018	324		324		323
6.500% Series S, due 2018	499		498		498
7.125% Series V, due 2019	500		499		499
6.650% Series N, due 2036	367		357		356
6.750% Series R, due 2037	349		345		345
5.375% Series X, due 2040	250		247		247
5.450% Series Y, due 2041	250		236		235
Variable-rate series (2016-1.890% to 1.928%, 2015-0.672% to 1.055%):
Pollution Control Revenue Bonds Series 2006A, due 2032	38		38		38
Pollution Control Revenue Bonds Series 2006, due 2036	38		37		37
Capital and financial lease obligations - 2.750% to 11.600%, due through 2054	485		485		497
Total long-term debt and financial and capital leases	$	3,100	$	3,066	$	3,285

Reflected as:
Current portion of long-term debt and financial and capital lease obligations			$	17	$	225
Long-term debt and financial and capital lease obligations			3,049		3,060
Total long-term debt and financial and capital leases			$	3,066	$	3,285

In January 2017, Nevada Power (1) issued a notice to the bondholders for the repurchase of the remaining outstanding amounts of its $38 million Pollution Control Revenue Bonds Series 2006 and $38 million Pollution Control Revenue Bonds Series 2006A and (2) redeemed the Pollution Control Revenue Bonds Series 2006A aggregate principal amount outstanding plus accrued interest with the use of cash on hand. In February 2017, Nevada Power redeemed the Pollution Control Revenue Bonds Series 2006 aggregate principal amount outstanding plus accrued interest with the use of cash on hand.

Annual Payment on Long-Term Debt and Financial and Capital Leases

The annual repayments of long-term debt and capital and financial leases for the years beginning January 1, 2017 and thereafter, are as follows (in millions):



	Long-term			Capital and Financial
	Debt			Lease Obligations			Total

2017	$	—		$	75		$	75
2018	823			74			897
2019	500			76			576
2020	—			75			75
2021	—			79			79
Thereafter	1,292			831			2,123
Total	2,615			1,210			3,825
Unamortized premium, discount and debt issuance cost	(34		)	—			(34		)
Executory costs	—			(111		)	(111		)
Amounts representing interest	—			(614		)	(614		)
Total	$	2,581		$	485		$	3,066

The issuance of General and Refunding Mortgage Securities by Nevada Power is subject to PUCN approval and is limited by available property and other provisions of the mortgage indentures. As of December 31, 2016, approximately $8.9 billion (based on original cost) of Nevada Power’s property was subject to the liens of the mortgages.

Financial and Capital Lease Obligations

•

In 1984, Nevada Power entered into a 30-year capital lease for the Pearson Building with five, five-year renewal options beginning in year 2015. In February 2010, Nevada Power amended this capital lease agreement to include the lease of the adjoining parking lot and to exercise three of the five-year renewal options beginning in year 2015. There remain two additional renewal options which could extend the lease an additional ten years. Capital assets of $25 million and $27 million were included in property, plant and equipment, net as of December 31, 2016 and 2015, respectively.

•

In 2007, Nevada Power entered into a 20-year lease, with three 10-year renewal options, to occupy land and building for its Beltway Complex operations center in southern Nevada. Nevada Power accounts for the building portion of the lease as a capital lease and the land portion of the lease as an operating lease. Nevada Power transferred operations to the facilities in June 2009. Capital assets of $7 million were included in property, plant and equipment, net as of December 31, 2016 and 2015.

•

Nevada Power has long-term energy purchase contracts which qualify as capital leases. The leases were entered into between the years 1989 and 1990 and became commercially operable through 1993. The terms of the leases are for 30 years and expire between the years 2022-2023. Capital assets of $38 million and $40 million were included in property, plant and equipment, net as of December 31, 2016 and 2015, respectively.


•	Nevada Power has master leasing agreements of which various pieces of equipment qualify as capital leases. The remaining equipment is treated as operating leases. Lease terms average seven years under the master lease agreement. Capital assets of $1 million were included in property, plant and equipment, net as of December 31, 2016 and 2015.

•

ON Line was placed in-service on December 31, 2013. The Nevada Utilities entered into a long-term transmission use agreement, in which the Nevada Utilities have 25% interest and Great Basin Transmission South, LLC has 75% interest. Refer to Note 4 for additional information. The Nevada Utilities' share of the long-term transmission use agreement and ownership interest is split at 95% for Nevada Power and 5% for Sierra Pacific. The term is for 41 years with the agreement ending December 31, 2054. Payments began on January 31, 2014. ON Line assets of $402 million and $410 million were included in property, plant and equipment, net as of December 31, 2016 and 2015, respectively.

Sierra Pacific Power Company [Member]

Debt Instrument [Line Items]

Debt Disclosure [Text Block]

Long-Term Debt and Financial and Capital Lease Obligations

Sierra Pacific's long-term debt consists of the following, including unamortized premiums, discounts and debt issuance costs, as of December 31 (dollars in millions):



	Par Value		2016		2015
General and refunding mortgage securities:
6.000% Series M, due 2016	$	—	$	—	$	450
3.375% Series T, due 2023	250		248		248
2.600% Series U, due 2026	400		395		—
6.750% Series P, due 2037	252		255		255
Tax-exempt refunding revenue bond obligations:
Fixed-rate series:
1.250% Pollution Control Series 2016A, due 2029⁽¹⁾	20		20		—
1.500% Gas Facilities Series 2016A, due 2031⁽¹⁾	58		58		—
3.000% Gas and Water Series 2016B, due 2036⁽²⁾	60		64		—
Variable-rate series (2016-0.788% to 0.800%, 2015-0.733% to 1.054%):
Pollution Control Series 2006A, due 2031	—		—		58
Pollution Control Series 2006B, due 2036	—		—		74
Pollution Control Series 2006C, due 2036	—		—		80
Water Facilities Series 2016C, due 2036	30		29		—
Water Facilities Series 2016D, due 2036	25		25		—
Water Facilities Series 2016E, due 2036	25		25		—
Capital and financial lease obligations - 2.700% to 10.130%, due through 2054	34		34		37
Total long-term debt and financial and capital leases	$	1,154	$	1,153	$	1,202

Reflected as:
Current portion of long-term debt and financial and capital lease obligations			$	1	$	453
Long-term debt and financial and capital lease obligations			1,152		749
Total long-term debt and financial and capital leases			$	1,153	$	1,202


(1)	Subject to mandatory purchase by Sierra Pacific in June 2019 at which date the interest rate may be adjusted from time to time.


(2)	Subject to mandatory purchase by Sierra Pacific in June 2022 at which date the interest rate may be adjusted from time to time.

Annual Payment on Long-Term Debt and Financial and Capital Leases

The annual repayments of long-term debt and capital and financial leases for the years beginning January 1, 2017 and thereafter, are as follows (in millions):



	Long-term			Capital and Financial
	Debt			Lease Obligations			Total

2017	$	—		$	4		$	4
2018	—			4			4
2019	—			4			4
2020	—			4			4
2021	—			3			3
Thereafter	1,120			50			1,170
Total	1,120			69			1,189
Unamortized premium, discount and debt issuance cost	(1		)	—			(1		)
Amounts representing interest	—			(35		)	(35		)
Total	$	1,119		$	34		$	1,153

The issuance of General and Refunding Mortgage Securities by Sierra Pacific is subject to PUCN approval and is limited by available property and other provisions of the mortgage indentures. As of December 31, 2016, approximately $3.8 billion (based on original cost) of Sierra Pacific’s property was subject to the liens of the mortgages.

Financial and Capital Lease Obligations


•	Sierra Pacific has master leasing agreements of which various pieces of equipment qualify as capital leases. The remaining equipment is treated as operating leases. Lease terms average seven years under the master lease agreement. Capital assets of $3 million were included in property, plant and equipment, net as of December 31, 2016 and 2015.

•

ON Line was placed in-service on December 31, 2013. The Nevada Utilities entered into a long-term transmission use agreement, in which the Nevada Utilities have 25% interest and Great Basin Transmission South, LLC has 75% interest. Refer to Note 4 for additional information. The Nevada Utilities share of the long-term transmission use agreement and ownership interest is split at 5% for Sierra Pacific and 95% for Nevada Power. The term is for 41 years with the agreement ending December 31, 2054. Payments began on January 31, 2014. ON Line assets of $21 million and $22 million were included in property, plant and equipment, net as of December 31, 2016 and 2015, respectively.


•	In 2015, Sierra Pacific entered into a 20-year capital lease for the Fort Churchill Solar Array. Capital assets of $10 million and $12 million were included in property, plant and equipment, net as of December 31, 2016 and 2015, respectively.