Employee Postretirement Benefits

3 Months Ended

Mar. 31, 2016

Employee Postretirement Benefits

5. Employee Postretirement Benefits

Included in the table below is the periodic expense for pension and other postretirement benefits offered by the company. Amounts disclosed for pension benefits include the amounts related to the qualified pension plan and the non-qualified, non-contributory SERP.

Pension Expense
(millions)	Pension Benefits						Other Postretirement Benefits
Three months ended Mar. 31,	2016			2015			2016			2015
Components of net periodic benefit expense
Service cost	$	4.4		$	4.5		$	0.5		$	0.6
Interest cost		8.1			7.4			2.2			2.0
Expected return on assets		(11.3	)		(10.8	)		(0.3	)		(0.3	)
Amortization of:
Prior service (benefit) cost		0.0			(0.1	)		(0.6	)		(0.6	)
Actuarial loss		3.4			3.4			0.0			0.0
Regulatory asset		0.0			0.0			0.2			0.3
Net pension expense recognized in the    TECO Energy Consolidated Condensed Statements of Income	$	4.6		$	4.4		$	2.0		$	2.0

For the fiscal 2016 plan year, TECO Energy is using an assumed long-term EROA of 7.00% and a discount rate of 4.685% for pension benefits under its qualified pension plan. For the Jan. 1, 2016 measurement of TECO Energy’s other postretirement benefits, TECO Energy assumed a discount rate of 4.667% for the Florida-based plan and 4.687% for the NMGC plan. Additionally, TECO Energy made contributions of $4.7 million and $14.9 million to its pension plan for the three months ended Mar. 31, 2016 and 2015, respectively.

For the three months ended Mar. 31, 2016 and 2015, TECO Energy and its subsidiaries reclassified $0.8 million of pretax unamortized prior service benefit and actuarial losses from AOCI to net income as part of periodic benefit expense. In addition, during the three months ended Mar. 31, 2016 and 2015, the regulated companies reclassified $2.2 million of unamortized prior service benefit and actuarial losses from regulatory assets to net income as part of periodic benefit expense.

Tampa Electric Company [Member]

Employee Postretirement Benefits

5. Employee Postretirement Benefits

TEC is a participant in the comprehensive retirement plans of TECO Energy. Amounts allocable to all participants of the TECO Energy retirement plans are found in Note 5, Employee Postretirement Benefits, in the TECO Energy Notes to Consolidated Condensed Financial Statements. TEC’s portion of the net pension expense for the three months ended Mar. 31, 2016 and 2015, respectively, was $2.9 million and $2.6 million for pension benefits, and $1.5 million and $1.4 million for other postretirement benefits.

For the fiscal 2016 plan year, TECO Energy assumed a long-term EROA of 7.00% and a discount rate of 4.685%.  For the Jan. 1, 2016 measurement of TECO Energy’s other postretirement benefits, TECO Energy used a discount rate of 4.667%. Additionally, TECO Energy made contributions of $4.7 million and $14.9 million to its pension plan in the three months ended Mar. 31, 2016 and 2015, respectively. TEC’s portion of the contributions was $3.9 million and $11.0 million, respectively.

Included in the benefit expenses discussed above, for the three months ended Mar. 31, 2016 and 2015, TEC reclassified $2.0 million and $1.9 million, respectively, of unamortized prior service benefit and actuarial losses from regulatory assets to net income.