The regulatory assets and liabilities recorded in the Consolidated Balance Sheets are summarized in the table below:



	Remaining Recovery Period (years)	December 31,
(dollars in millions)	Remaining Recovery Period (years)	2016		2015
Regulatory Assets
Pension and Other Postretirement Benefits (Note 8)	Various	$	128	$	120
Income Taxes Recoverable through Future Rates ⁽¹⁾	Various	29		26
Final Mine Reclamation and Retiree Health Care Costs ⁽²⁾	21	27		28
Property Tax Deferrals ⁽³⁾	1	23		21
Lost Fixed Cost Recovery	1	23		16
Springerville Unit 1 Leasehold Improvements ⁽⁴⁾	7	17		21
Sundt Coal Handling Facilities ⁽⁵⁾	Plant Life	16		—
Derivatives (Note 11)	3	2		12
Other Regulatory Assets	Various	16		20
Total Regulatory Assets		281		264
Less Current Portion	1	56		52
Total Non-Current Regulatory Assets		$	225	$	212



Regulatory Liabilities
Net Cost of Removal for Interim Retirements ⁽⁶⁾	Various	$	270	$	264
Purchased Power and Fuel Adjustment Clause	1	38		18
Renewable Energy Standard	Various	32		25
Deferred Investment Tax Credits ⁽⁷⁾	Various	23		32
Other Regulatory Liabilities	Various	14		21
Total Regulatory Liabilities		377		360
Less Current Portion	1	76		53
Total Non-Current Regulatory Liabilities		$	301	$	307


⁽¹⁾	Income Taxes Recoverable through Future Rates are amortized over the life of the assets. See Note 1 and Note 12 for additional information regarding income taxes.


⁽²⁾	Final Mine Reclamation and Retiree Health Care Costs represent costs associated with TEP’s jointly-owned facilities at San Juan, Four Corners, and Navajo. TEP recognizes these costs at future value and is permitted to fully recover these costs through the PPFAC when paid. The majority of the final mine reclamation costs are expected to occur through 2037.

⁽³⁾

Property taxes are recorded as a regulatory asset based on historical ratemaking treatment allowing regulated utilities to recover property taxes on a pay-as-you-go or cash basis. TEP records a liability to reflect the accrual for financial reporting purposes and an offsetting regulatory asset to reflect recovery for regulatory purposes. This asset is fully recovered in rates with a recovery period of approximately six months.


⁽⁴⁾	Springerville Unit 1 Leasehold Improvements represent investments TEP made, which were previously recorded in Plant in Service on the Consolidated Balance Sheets, to ensure that the facilities continued to provide safe, reliable service to TEP's customers. TEP received ACC authorization to recover leasehold improvement costs at Springerville Unit 1 over a 10-year amortization period.

⁽⁵⁾

In June 2014, the EPA issued a final rule that required TEP to either: (i) install, by mid-2017, SNCR and dry sorbent injection if Sundt Unit 4 continued to use coal as a fuel source; or (ii) permanently eliminate coal as a fuel source as a better-than-BART alternative by the end of 2017. In March 2016, TEP notified the EPA of its decision to permanently eliminate coal as a fuel source, and transferred the NBV of the Sundt Coal Handling Facilities to a regulatory asset. TEP will apply excess depreciation reserves against the unrecovered NBV as approved in the 2017 Rate Order.


⁽⁶⁾	Net Cost of Removal for Interim Retirements represents an estimate of the cost of future AROs net of salvage value. These are amounts collected through revenue for the net cost of removal of interim retirements for transmission, distribution, generation plant, and general and intangible plant which are not yet expended.


⁽⁷⁾	Accumulated Deferred Investment Tax Credits (ITC) represent federal energy credits generated after 2011 that are amortized over the tax life of the underlying asset.