Income Taxes (Tables)

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Schedule of Provision (Benefit) for Current and Deferred Income Taxes

The provision (benefit) for income taxes is composed of the following:

	Years Ended December 31,
(in millions)	2013			2012			2011
Continuing Operations
Current
Federal	$	—		$	—		$	48
State	—			—			(44		)
Total current	—			—			4
Deferred
Federal	$	(33	)	$	26		$	(389	)
State	(60		)	134			(56		)
Total deferred	(93		)	160			(445		)
Provision (benefit) for income taxes from continuing operations	(93		)	160			(441		)
Discontinued operations	6			(73		)	(411		)
Total	$	(87	)	$	87		$	(852	)

The benefit for income taxes is composed of the following:

	Years Ended December 31,
(in millions)	2013			2012			2011
Current
Federal	$	—		$	—		$	2
State	—			—			12
Total current	—			—			14
Deferred
Federal	$	(14	)	$	(76	)	$	(145	)
State	(3		)	14			(41		)
Total deferred	(17		)	(62		)	(186		)
Benefit for income taxes	$	(17	)	$	(62	)	$	(172	)

Sources of Income (Loss) Before Income Taxes

The components of income (loss) before income taxes applicable to continuing operations and discontinued operations are as follows:

	Years Ended December 31,
(in millions)	2013			2012			2011
Continuing operations	$	(735	)	$	(637	)	$	(888	)
Discontinued operations	7			(185		)	(1,043		)
Total	$	(728	)	$	(822	)	$	(1,931	)

Schedule of Deferred Tax Assets and Liabilities

The components of net accumulated deferred income tax asset (liability) were:

	December 31,
(in millions)	2013			2012
Deferred tax assets
Accrued charges and liabilities	$	232		$	234
Net operating loss carryforwards	1,202			841
Production tax and other credit carryforwards	332			254
Derivative instruments	15			49
Other	5			6
Total	1,786			1,384
Valuation allowance	(752		)	(444		)
Net deferred tax assets	1,034			940
Deferred tax liabilities
Property, plant and equipment - basis differences	$	1,069		$	989
Deferred investment tax credit	4			4
State taxes	19			28
Total	1,092			1,021
Deferred tax liabilities, net	$	(58	)	$	(81	)
Classification of net accumulated deferred income taxes
Included in deferred taxes and tax credits, net	$	58		$	81

The components of net accumulated deferred income tax asset (liability) were:

	December 31,
(in millions)	2013			2012
Deferred tax assets
State taxes	$	3		$	—
Deferred income	2			2
Derivative instruments	6			24
Impairment of loan to affiliate - tax	539			539
Property, plant and equipment - basis differences	107			—
Net operating loss carryforwards	88			—
Accrued charges and liabilities	22			16
Total	767			581
Valuation allowance	(767		)	(533		)
Net deferred tax assets	—			48
Deferred tax liabilities
State taxes	—			3
Property, plant and equipment - basis differences	—			45
Total	—			48
Deferred taxes, net	$	—		$	—

Reconciliation of Income Tax Expense

The table below provides a reconciliation of income tax benefit computed at the federal statutory income tax rate to the income tax benefit:

	Years Ended December 31,
(in millions)	2013			2012			2011
Loss before income taxes	(650		)	$	(1,526	)	$	(442	)
Benefit for income taxes at federal statutory rate of 35%	$	(228	)	$	(534	)	$	(155	)
State tax, net of federal benefit	(26		)	(52		)	(19		)
Change in valuation allowance	234			521			—
Other	3			3			2
Total benefit for income taxes	$	(17	)	$	(62	)	$	(172	)
Effective tax rate	3		%	4		%	39		%

The table below provides a reconciliation of income tax expense (benefit) computed at the federal statutory income tax rate to the income tax provision (benefit):

	Years Ended December 31,
(in millions)	2013			2012			2011
Loss from continuing operations before income taxes	$	(735	)	$	(637	)	$	(888	)
Benefit for income taxes at federal statutory rate of 35%	$	(257	)	$	(223	)	$	(311	)
Increase (decrease) in income tax from
State tax - net of federal benefit	(32		)	11			(56		)
Excess losses over tax allocation losses	(27		)	—			—
Change in valuation allowance	308			438			—
Production tax credits, net	(79		)	(68		)	(66		)
Qualified production deduction	—			—			(6		)
Deferred tax adjustments	1			—			(8		)
Taxes on income allocated to noncontrolling interests	(10		)	(4		)	—
Other	3			6			6
Total provision (benefit) for income taxes from continuing operations	$	(93	)	$	160		$	(441	)
Effective tax rate	13		%	*			50		%

* Not meaningful.

Reconciliation of Unrecognized Tax Benefits

The following table provides a reconciliation of unrecognized tax benefits:

(in millions)	2013		2012			2011
Balance at January 1	$	159	$	171		$	153
Tax positions taken during the current year
Increases	—		—			9
Decreases	—		—			—
Tax positions taken during a prior year
Increases	—		—			9
Decreases	—		(12		)	—
Decreases for settlements during the period	—		—			—
Decreases resulting from a lapse in statute of limitations	—		—			—
Balance at December 31	$	159	$	159		$	171

The following table provides a reconciliation of unrecognized tax benefits:

(in millions)	2013		2012		2011
Balance at January 1	$	44	$	44	$	44
No activity	—		—		—
Balance at December 31	$	44	$	44	$	44