Pension And OPEB Plans

9 Months Ended

Sep. 30, 2022

Pension And OPEB Plans [Abstract]

PENSION AND OPEB PLANS

8. PENSION AND OPEB PLANS

Pension Plans

We sponsor the Oncor Retirement Plan and also have liabilities related to the Vistra Retirement Plan, both of which are qualified pension plans under Section 401(a) of the Internal Revenue Code of 1986, as amended, and are subject to the provisions of ERISA. Employees do not contribute to either plan. We also have a supplemental

retirement plan for certain employees whose retirement benefits cannot be fully earned under the qualified retirement plans. See Note 9 to Financial Statements in our 2021 Form 10-K for additional information regarding pension plans.

OPEB Plans

We currently sponsor two OPEB plans. One plan covers our eligible current and future retirees whose services are 100% attributed to the regulated business. The second plan covers retirees and eligible current and future retirees whose employment services were assigned to both Oncor (or a predecessor regulated utility business) and the non-regulated business of certain formerly affiliated companies, including Vistra. Vistra is solely responsible for its portion of the liability for retiree benefits related to those retirees. See Note 9 to Financial Statements in our 2021 Form 10-K for additional information.

Pension and OPEB Costs

Our net costs related to pension plans and the OPEB Plans for the three and nine months ended September 30, 2022 and 2021, were comprised of the following:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Components of net allocated pension costs:
Service cost	$	7	$	8	$	23	$	25
Interest cost (a)		23		21		68		63
Expected return on assets (a)		(26)		(25)		(79)		(75)
Amortization of net loss (a)		8		13		24		39
Net pension costs		12		17		36		52
Net adjustments (b)		(1)		(6)		(3)		(18)
Net pension costs recognized as operation and maintenance expense or other deductions	$	11	$	11	$	33	$	34
Components of net OPEB costs:
Service cost	$	1	$	1	$	3	$	3
Interest cost (a)		6		7		18		20
Expected return on assets (a)		(2)		(2)		(6)		(5)
Amortization of prior service cost (a)		-		(4)		-		(12)
Amortization of net loss (a)		-		4		-		13
Net OPEB costs		5		6		15		19
Net adjustments (b)		3		2		8		4
Net OPEB costs recognized as operation and maintenance expense or other deductions	$	8	$	8	$	23	$	23

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(a)The components of net costs other than service cost component are recorded in “Other deductions and (income) – net” in Condensed Statements of Consolidated Income.

(b)Net adjustments include amounts principally deferred as property, regulatory asset or regulatory liability.

The discount rates reflected in net pension and OPEB costs in 2022 are 2.91%, 2.94% and 2.47% for the Oncor Retirement Plan, the Vistra Retirement Plan and the OPEB Plans, respectively. The expected return on pension and OPEB plan assets reflected in the 2022 cost amounts are 4.87%, 4.66% and 5.61% for the Oncor Retirement Plan, the Vistra Retirement Plan and the OPEB Plans, respectively.

Pension Plans and OPEB Plans Cash Contributions

We made cash contributions to the pension plans and OPEB Plans of $3 million and $26 million, respectively, during the nine months ended September 30, 2022. We expect to make additional cash contributions to the pension plans and OPEB Plans of $2 million and $9 million, respectively, during the remainder of 2022. Our pension plans and OPEB Plans funding is expected to total approximately $273 million and $141 million, respectively, in the five-year period from 2022 to 2026 based on the latest actuarial projections.