4. REGULATORY ASSETS AND LIABILITIES

Recognition of regulatory assets and liabilities and the amortization periods over which they are expected to be recovered or refunded through rate regulation reflect the decisions of the PUCT. Components of the regulatory assets and liabilities are provided in the table below. Amounts not earning a return through rate regulation are noted.


	Remaining Rate Recovery/Amortization Period at	Carrying Amount At
	June 30, 2015	June 30, 2015		December 31, 2014

Regulatory assets:
Generation-related regulatory assets securitized by transition bonds (a)(e)	1 year	$	81	$	148
Employee retirement costs	5 years		47		55
Employee retirement costs to be reviewed (b)(c)	To be determined		267		246
Employee retirement liability (a)(c)(d)	To be determined		828		865
Self-insurance reserve (primarily storm recovery costs) ― net	5 years		111		127
Self-insurance reserve to be reviewed ― net (b)(c)	To be determined		316		242
Securities reacquisition costs (pre-industry restructure)	2 years		19		23
Securities reacquisition costs (post-industry restructure) ― net	Terms of related debt		8		7
Recoverable amounts in lieu of deferred income taxes ― net	Life of related asset or liability		12		14
Deferred conventional meter and metering facilities depreciation	Largely 5 years		112		123
Deferred AMS costs	To be determined		140		113
Energy efficiency performance bonus (a)	1 year		11		22
Under-recovered wholesale transmission service expense ― net (a)	1 year		34		26
Other regulatory assets	Various		9		12
Total regulatory assets			1,995		2,023
Regulatory liabilities:
Estimated net removal costs	Life of utility plant		608		531
Investment tax credit and protected excess deferred taxes	Various		15		18
Over-collection of transition bond revenues (a)(e)	1 year		31		32
Energy efficiency programs (a)	Not applicable		20		13
Total regulatory liabilities			674		594
Net regulatory asset		$	1,321	$	1,429

____________

(a)

Not earning a return in the regulatory rate-setting process.

(b)

Costs incurred since the period covered under the last rate review.

(c)

Recovery is specifically authorized by statute or by the PUCT, subject to reasonableness review.

(d)

Represents unfunded liabilities recorded in accordance with pension and OPEB accounting standards.

(e)

Bondco net regulatory assets of $47 million at June 30, 2015 consisted of $78 million included in generation-related regulatory assets net of the regulatory liability for over-collection of transition bond revenues of $31 million. Bondco net regulatory assets of $108 million at December 31, 2014 consisted of $140 million included in generation-related regulatory assets net of the regulatory liability for over-collection of transition bond revenues of $32 million.