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RELATED PARTY TRANSACTIONS
 6 Months Ended
Jun. 30, 2023
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS RELATED PARTY TRANSACTIONS
TEP engages in various transactions with Fortis, UNS Energy, and UNS Energy Affiliates. These transactions include: (i) the sale and purchase of power and transmission services; (ii) common cost allocations; and (iii) the provision of corporate and other labor-related services.
The following table presents the components of related party balances included in Accounts Receivable and Accounts Payable on the Condensed Consolidated Balance Sheets:
(in millions)June 30, 2023December 31, 2022
Receivables from Related Parties
UNS Electric$13 $22 
UNS Gas2 2 
UNS Energy— 2 
Total Due from Related Parties$15 $26 
Payables to Related Parties
UNS Electric$2 $5 
UNS Energy1 1 
UNS Gas— 1 
Total Due to Related Parties$3 $7 
The following table presents the components of related party transactions included in the Condensed Consolidated Statements of Income:
Three Months Ended June 30,Six Months Ended June 30,
(in millions)2023202220232022
Goods and Services Provided by TEP to Affiliates
Wholesale Revenues, UNS Electric (1)
$6 $9 $13 $10 
Common Costs, UNS Energy Affiliates (2)
5 6 11 11 
Transmission Revenues, UNS Electric (1)
2 1 4 3 
Control Area Services, UNS Electric (3)
1 1 1 2 
Goods and Services Provided by Affiliates to TEP
Corporate Services, UNS Energy (4)
$1 $2 $4 $5 
Corporate Services, UNS Energy Affiliates (5)
1 1 1 1 
Purchased Power, UNS Electric (1)
— — 1 — 
Capacity Charges, UNS Gas (6)
— — 1 — 
(1)TEP and UNS Electric sell power and transmission services to each other. Wholesale power is sold at prevailing market prices while transmission services are sold at FERC-approved rates through the applicable OATT.
(2)Common costs (information systems, facilities, etc.) are allocated on a cost-causative basis and recorded as revenue by TEP. The method of allocation is deemed reasonable by management and is reviewed by the ACC as part of the rate case process.
(3)TEP charges UNS Electric for control area services under a FERC-filed Control Area Services Agreement.
(4)Costs for corporate services at UNS Energy are allocated to its subsidiaries using the Massachusetts Formula, an industry-accepted method of allocating common costs to affiliated entities. TEP's allocation is approximately 85% of UNS Energy's allocated costs. Corporate Services, UNS Energy includes legal, audit, and Fortis' management fees. TEP's share of Fortis' management fees was $2 million and $4 million for the three and six months ended June 30, 2023 and 2022, respectively.
(5)Costs for corporate services (e.g., finance, accounting, tax, legal, and information technology) and other labor services for UNS Energy Affiliates are directly assigned to the benefiting entity at a fully burdened cost when possible.
(6)UNS Gas charges TEP for natural gas capacity used to supply one of TEP's generation facilities.