Commission File Number | Registrant, State of Incorporation, Address and Telephone Number | I.R.S. Employer Identification No. | ||
1-9052 | DPL INC. | 31-1163136 | ||
(An Ohio Corporation) | ||||
1065 Woodman Drive Dayton, Ohio 45432 | ||||
937-259-7215 | ||||
1-2385 | THE DAYTON POWER AND LIGHT COMPANY | 31-0258470 | ||
(An Ohio Corporation) | ||||
1065 Woodman Drive Dayton, Ohio 45432 | ||||
937-259-7215 |
DPL Inc. | Yes o | No x |
The Dayton Power and Light Company | Yes o | No x |
DPL Inc. | Yes x | No o |
The Dayton Power and Light Company | Yes x | No o |
Large accelerated filer | Accelerated filer | Non- accelerated filer (Do not check if a smaller reporting company) | Smaller reporting company | Emerging growth company | |
DPL Inc. | o | o | x | o | o |
The Dayton Power and Light Company | o | o | x | o | o |
DPL Inc. | o |
The Dayton Power and Light Company | o |
DPL Inc. | Yes o | No x |
The Dayton Power and Light Company | Yes o | No x |
Registrant | Description | Shares Outstanding | ||
DPL Inc. | Common Stock, no par value | 1 | ||
The Dayton Power and Light Company | Common Stock, $0.01 par value | 41,172,173 |
Page No. | ||
Glossary of Terms | ||
Forward-Looking Statements | ||
Part I Financial Information | ||
Item 1 | Financial Statements – DPL Inc. and The Dayton Power and Light Company (Unaudited) | |
DPL Inc. | ||
The Dayton Power and Light Company | ||
Item 2 | ||
Item 3 | ||
Item 4 | ||
Page No. | ||
Part II Other Information | ||
Item 1 | ||
Item 1A | ||
Item 2 | ||
Item 3 | ||
Item 4 | ||
Item 5 | ||
Item 6 | ||
Other | ||
Term | Definition |
AES | The AES Corporation, a global power company and the ultimate parent company of DPL |
AES Ohio Generation | AES Ohio Generation, LLC, a wholly-owned subsidiary of DPL that owns and operates generation facilities from which it makes wholesale sales |
AOCI | Accumulated Other Comprehensive Income |
ARO | Asset Retirement Obligation |
ASU | Accounting Standards Update |
CAA | U.S. Clean Air Act |
Capacity Market | The purpose of the capacity market is to enable PJM to obtain sufficient resources to reliably meet the needs of electric customers within the PJM footprint. PJM procures capacity, through a multi-auction structure, on behalf of the load serving entities to satisfy the load obligations. There are four auctions held for each Delivery Year (running from June 1 through May 31). The Base Residual Auction is held three years in advance of the Delivery Year and there is one Incremental Auction held in each of the subsequent three years. DP&L’s capacity is located in the “rest of” RTO area of PJM. |
CCR | Coal combustion residuals |
CP | In 2015, PJM adopted changes to the capacity market known as “Capacity Performance”. The CP program offers the potential for higher capacity revenues, combined with substantially increased penalties for non-performance or under-performance during certain periods identified as “capacity performance hours.” The DP&L units operate under the CP construct effective June 1, 2016. |
CPP | Clean Power Plan |
D.C. Circuit Court | United States Court of Appeals for the District of Columbia Circuit |
DPL | DPL Inc. |
DPLER | DPL Energy Resources, Inc., formerly a wholly-owned subsidiary of DPL which sold competitive electric energy and other energy services. DPLER was sold by DPL on January 1, 2016. The DPLER sale agreement was signed on December 28, 2015. |
DP&L | The Dayton Power and Light Company, the principal subsidiary of DPL and a public utility that delivers electricity to residential, commercial, industrial and governmental customers in a 6,000 square mile area of West Central Ohio |
Dths | Decatherms, unit of heat energy equal to 10 therms. One therm is equal to 100,000 British Thermal Units |
EBITDA | Earnings before interest, taxes, depreciation and amortization. EBITDA also excludes the Fixed-asset impairment |
EGU | Electric Generating Unit |
ERISA | The Employee Retirement Income Security Act of 1974 |
ESP | The Electric Security Plan is a plan that a utility must file with the PUCO to establish SSO rates pursuant to Ohio law |
ESP 1 | ESP approved by PUCO order dated June 24, 2009 |
ESP 2 | ESP approved by PUCO order dated September 4, 2013. The Ohio Supreme Court ruled that it was invalid. DP&L withdrew its ESP 2 on July 27, 2016 and filed to reinstate previously authorized rates from ESP 1 |
ESP 3 | ESP filed with the PUCO by DP&L on February 22, 2016 and an amended application filed on October 11, 2016 |
FASB | Financial Accounting Standards Board |
FASC | FASB Accounting Standards Codification |
FERC | Federal Energy Regulatory Commission |
FGD | Flue Gas Desulfurization |
Form 10-K | DPL’s and DP&L’s combined Annual Report on Form 10-K for the fiscal year ended December 31, 2016, which was filed on February 28, 2017 |
GLOSSARY OF TERMS (cont.) | |
Term | Definition |
First and Refunding Mortgage | DP&L’s First and Refunding Mortgage, dated October 1, 1935, as amended, with the Bank of New York Mellon as Trustee |
FTR | Financial Transmission Right |
GAAP | Generally Accepted Accounting Principles in the United States of America |
Generation Separation | The transfer on October 1, 2017 to AES Ohio Generation of the DP&L-owned generating facilities and related liabilities pursuant to an asset contribution agreement with a subsidiary that was then merged into AES Ohio Generation |
GHG | Greenhouse Gas |
kV | Kilovolt, 1,000 volts |
kWh | Kilowatt-hours |
LIBOR | London Inter-Bank Offering Rate |
Master Trust | DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans |
Merger | The merger of DPL and Dolphin Sub, Inc., a wholly-owned subsidiary of AES. On November 28, 2011, DPL became a wholly-owned subsidiary of AES. |
MRO | Market Rate Option, a market-based plan that a utility may file with PUCO to establish SSO rates pursuant to Ohio law |
MTM | Mark to Market |
MVIC | Miami Valley Insurance Company, a wholly-owned insurance subsidiary of DPL that provides insurance services to DPL and its subsidiaries and, in some cases, insurance services to partner companies related to jointly-owned facilities operated by DP&L |
MW | Megawatt |
MWh | Megawatt-hour |
NAV | Net asset value |
NAAQS | National Ambient Air Quality Standards |
NERC | North American Electric Reliability Corporation |
Non-bypassable | Charges that are assessed to all customers regardless of whom the customer selects as their retail electric generation supplier |
NOV | Notice of Violation |
NOx | Nitrogen Oxide |
NPDES | National Pollutant Discharge Elimination System |
NSPS | New Source Performance Standards |
NYMEX | New York Mercantile Exchange |
Ohio EPA | Ohio Environmental Protection Agency |
OTC | Over-The-Counter |
OVEC | Ohio Valley Electric Corporation, an electric generating company in which DP&L holds a 4.9% equity interest |
PJM | PJM Interconnection, LLC, an RTO |
PUCO | Public Utilities Commission of Ohio |
RPM | Reliability Pricing Model. The Reliability Pricing Model was PJM’s capacity construct prior to the implementation of the CP program. |
RTO | Regional Transmission Organization |
SCR | Selective Catalytic Reduction |
SEC | Securities and Exchange Commission |
SEET | Significantly excessive earnings test |
SERP | Supplemental Executive Retirement Plan |
GLOSSARY OF TERMS (cont.) | |
Term | Definition |
Service Company | AES US Services, LLC, the shared services affiliate providing accounting, finance, and other support services to AES’ U.S. SBU businesses |
SO2 | Sulfur Dioxide |
SSO | Standard Service Offer represents the regulated rates, authorized by the PUCO, charged to DP&L retail customers that take retail generation service from DP&L within DP&L’s service territory |
T&D | DP&L’s electric transmission and distribution businesses, which distribute electricity to residential, commercial, industrial and governmental customers |
USEPA | U.S. Environmental Protection Agency |
USD | U.S. dollar |
USF | The Universal Service Fund is a statewide program which provides qualified low-income customers in Ohio with income-based bills and energy efficiency education programs |
U.S. SBU | U. S. Strategic Business Unit, AES’ reporting unit covering the businesses in the United States, including DPL |
• | abnormal or severe weather and catastrophic weather-related damage; |
• | unusual maintenance or repair requirements; |
• | changes in fuel costs and purchased power, coal, environmental emission allowances, natural gas and other commodity prices; |
• | volatility and changes in markets for electricity and other energy-related commodities; |
• | performance of our suppliers; |
• | increased competition and deregulation in the electric utility industry; |
• | availability and price of capacity; |
• | state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, emission levels, rate structures or tax laws; |
• | compliance with, changes in and liabilities under environmental laws and regulations to which DPL and its subsidiaries are subject; |
• | the development and operation of RTOs, including PJM to which DP&L has given control of its transmission functions; |
• | changes in our purchasing processes, pricing, delays, contractor and supplier performance and availability; |
• | significant delays associated with large construction projects; |
• | growth in our service territory and changes in demand and demographic patterns; |
• | changes in accounting rules and the effect of accounting pronouncements issued periodically by accounting standard-setting bodies; |
• | financial market conditions, changes in interest rates and changes in our credit ratings and availability and cost of capital; |
• | changes in tax laws and the effects of our strategies to reduce tax payments; |
• | the outcomes of litigation and regulatory investigations, proceedings or inquiries; |
• | general economic conditions; and |
• | the risks and other factors discussed in this report and other DPL and DP&L filings with the SEC. |
Part I – Financial Information |
Item 1 – Financial Statements |
DPL INC. | ||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenues | $ | 323.9 | $ | 389.3 | $ | 945.9 | $ | 1,081.6 | ||||||||
Cost of revenues: | ||||||||||||||||
Net fuel cost | 57.3 | 78.9 | 165.4 | 206.0 | ||||||||||||
Net purchased power cost | 84.0 | 111.7 | 263.4 | 330.5 | ||||||||||||
Total cost of revenues | 141.3 | 190.6 | 428.8 | 536.5 | ||||||||||||
Gross margin | 182.6 | 198.7 | 517.1 | 545.1 | ||||||||||||
Operating expenses: | ||||||||||||||||
Operation and maintenance | 81.9 | 91.5 | 250.3 | 257.2 | ||||||||||||
Depreciation and amortization | 27.3 | 30.9 | 81.8 | 100.3 | ||||||||||||
General taxes | 20.1 | 21.6 | 68.3 | 64.2 | ||||||||||||
Fixed-asset impairment | — | — | 66.4 | 235.5 | ||||||||||||
Loss / (gain) on asset disposal | (0.3 | ) | — | 15.9 | 0.1 | |||||||||||
Other | (5.2 | ) | (0.7 | ) | (6.1 | ) | (0.7 | ) | ||||||||
Total operating expenses | 123.8 | 143.3 | 476.6 | 656.6 | ||||||||||||
Operating income / (loss) | 58.8 | 55.4 | 40.5 | (111.5 | ) | |||||||||||
Other income / (expense), net | ||||||||||||||||
Investment income | 0.1 | 0.1 | 0.2 | 0.3 | ||||||||||||
Interest expense | (27.2 | ) | (27.0 | ) | (81.5 | ) | (79.3 | ) | ||||||||
Charge for early redemption of debt | (3.0 | ) | (0.5 | ) | (3.3 | ) | (3.1 | ) | ||||||||
Other expense | (0.7 | ) | (0.2 | ) | (2.3 | ) | (0.9 | ) | ||||||||
Total other expense, net | (30.8 | ) | (27.6 | ) | (86.9 | ) | (83.0 | ) | ||||||||
Income / (loss) from continuing operations before income tax | 28.0 | 27.8 | (46.4 | ) | (194.5 | ) | ||||||||||
Income tax expense / (benefit) from continuing operations | 6.1 | 12.7 | (17.1 | ) | (75.0 | ) | ||||||||||
Net income / (loss) from continuing operations | 21.9 | 15.1 | (29.3 | ) | (119.5 | ) | ||||||||||
Discontinued operations (Note 12) | ||||||||||||||||
Loss from discontinued operations | — | — | — | (0.7 | ) | |||||||||||
Gain from disposal of discontinued operations | — | — | — | 49.2 | ||||||||||||
Income tax expense for discontinued operations | — | — | — | 18.9 | ||||||||||||
Net income from discontinued operations | — | — | — | 29.6 | ||||||||||||
Net income / (loss) | $ | 21.9 | $ | 15.1 | $ | (29.3 | ) | $ | (89.9 | ) |
DPL INC. | ||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME / (LOSS) | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Net income / (loss) | $ | 21.9 | $ | 15.1 | $ | (29.3 | ) | $ | (89.9 | ) | ||||||
Available-for-sale securities activity: | ||||||||||||||||
Change in fair value of available-for-sale securities, net of income tax expense of $(0.1), $0.0, $(0.2) and $(0.1) for each respective period | 0.1 | 0.1 | 0.4 | 0.2 | ||||||||||||
Reclassification to earnings, net of income tax expense of $0.0 for each respective period | — | — | (0.1 | ) | — | |||||||||||
Total change in fair value of available-for-sale securities | 0.1 | 0.1 | 0.3 | 0.2 | ||||||||||||
Derivative activity: | ||||||||||||||||
Change in derivative fair value, net of income tax expense of $(0.8), $(5.2), $(6.6) and $(12.3) for each respective period | 1.4 | 9.5 | 12.1 | 22.4 | ||||||||||||
Reclassification to earnings, net of income tax benefit of $1.3, $3.0, $3.3 and $13.8 for each respective period | (2.4 | ) | (5.5 | ) | (6.0 | ) | (24.4 | ) | ||||||||
Total change in fair value of derivatives | (1.0 | ) | 4.0 | 6.1 | (2.0 | ) | ||||||||||
Pension and postretirement activity: | ||||||||||||||||
Prior service cost for the period, net of income tax benefit of $0.0, $0.0, $0.2 and $0.0 for each respective period | — | — | (0.3 | ) | — | |||||||||||
Net loss for period, net of income tax benefit of $0.0, $0.0, $0.7 and $0.0 for each respective period | — | — | (1.2 | ) | — | |||||||||||
Reclassification to earnings, net of income tax expense of $0.0, $0.0, $(0.5) and $(0.1) for each respective period | — | — | 0.9 | 0.1 | ||||||||||||
Total change in unfunded pension obligation | — | — | (0.6 | ) | 0.1 | |||||||||||
Other comprehensive income / (loss) | (0.9 | ) | 4.1 | 5.8 | (1.7 | ) | ||||||||||
Net comprehensive income / (loss) | $ | 21.0 | $ | 19.2 | $ | (23.5 | ) | $ | (91.6 | ) |
DPL INC. | ||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
$ in millions | September 30, 2017 | December 31, 2016 | ||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 23.4 | $ | 54.6 | ||||
Restricted cash | 2.0 | 29.0 | ||||||
Accounts receivable, net (Note 2) | 111.4 | 135.1 | ||||||
Inventories (Note 2) | 28.7 | 77.2 | ||||||
Taxes applicable to subsequent years | 19.6 | 81.0 | ||||||
Regulatory assets, current | 4.5 | 0.1 | ||||||
Other prepayments and current assets | 23.4 | 31.8 | ||||||
Assets held for sale - current (Note 13) | 57.0 | — | ||||||
Total current assets | 270.0 | 408.8 | ||||||
Property, plant & equipment: | ||||||||
Property, plant & equipment | 1,963.5 | 1,985.6 | ||||||
Less: Accumulated depreciation and amortization | (372.6 | ) | (334.8 | ) | ||||
1,590.9 | 1,650.8 | |||||||
Construction work in process | 70.8 | 116.4 | ||||||
Total net property, plant & equipment | 1,661.7 | 1,767.2 | ||||||
Other non-current assets: | ||||||||
Regulatory assets, non-current | 209.4 | 203.9 | ||||||
Intangible assets, net of amortization | 19.7 | 22.7 | ||||||
Other deferred assets | 13.5 | 16.6 | ||||||
Total other non-current assets | 242.6 | 243.2 | ||||||
Total assets | $ | 2,174.3 | $ | 2,419.2 | ||||
LIABILITIES AND SHAREHOLDER'S DEFICIT | ||||||||
Current liabilities: | ||||||||
Current portion of long-term debt (Note 7) | $ | 29.7 | $ | 29.7 | ||||
Short-term debt | 65.0 | — | ||||||
Accounts payable | 61.3 | 113.9 | ||||||
Accrued taxes | 169.9 | 185.1 | ||||||
Accrued interest | 26.8 | 17.7 | ||||||
Security deposits | 16.4 | 15.2 | ||||||
Regulatory liabilities, current | 20.0 | 33.7 | ||||||
Insurance and claims costs | 5.4 | 5.4 | ||||||
Other current liabilities | 31.5 | 50.2 | ||||||
Liabilities held for sale - current (Note 13) | 7.0 | — | ||||||
Total current liabilities | 433.0 | 450.9 | ||||||
Non-current liabilities: | ||||||||
Long-term debt (Note 7) | 1,712.2 | 1,828.7 | ||||||
Deferred taxes | 254.6 | 252.4 | ||||||
Taxes payable | 3.6 | 84.6 | ||||||
Regulatory liabilities, non-current | 134.5 | 130.4 | ||||||
Pension, retiree and other benefits | 100.7 | 101.6 | ||||||
Asset retirement obligations | 132.5 | 138.8 | ||||||
Other deferred credits | 14.0 | 19.4 | ||||||
Total non-current liabilities | 2,352.1 | 2,555.9 | ||||||
Commitments and contingencies (Note 10) | ||||||||
Common shareholder's deficit | ||||||||
Common stock: | ||||||||
1,500 shares authorized; 1 share issued and outstanding at September 30, 2017 and December 31, 2016 | — | — | ||||||
Other paid-in capital | 2,233.3 | 2,233.0 | ||||||
Accumulated other comprehensive income | 6.1 | 0.3 | ||||||
Accumulated deficit | (2,850.2 | ) | (2,820.9 | ) | ||||
Total common shareholder's deficit | (610.8 | ) | (587.6 | ) | ||||
Total liabilities and shareholder's deficit | $ | 2,174.3 | $ | 2,419.2 |
DPL INC. | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
Nine months ended September 30, | ||||||||
$ in millions | 2017 | 2016 | ||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (29.3 | ) | $ | (89.9 | ) | ||
Adjustments to reconcile net loss to net cash from operating activities: | ||||||||
Depreciation and amortization | 81.8 | 100.3 | ||||||
Charge for early redemption of debt | 3.3 | 3.1 | ||||||
Deferred income taxes | (3.5 | ) | (101.4 | ) | ||||
Fixed-asset impairment | 66.4 | 235.5 | ||||||
Gain on sale of business | — | (49.2 | ) | |||||
Loss on asset disposal | 15.9 | 0.1 | ||||||
Changes in certain assets and liabilities: | ||||||||
Accounts receivable | 15.8 | 23.6 | ||||||
Inventories | 9.5 | 29.1 | ||||||
Prepaid taxes | — | 0.2 | ||||||
Taxes applicable to subsequent years | 61.4 | 61.5 | ||||||
Deferred regulatory costs, net | (6.5 | ) | 19.5 | |||||
Accounts payable | (46.4 | ) | (10.2 | ) | ||||
Accrued taxes payable | (93.5 | ) | (34.2 | ) | ||||
Accrued interest payable | 8.8 | 13.9 | ||||||
Security deposits | 1.1 | (0.6 | ) | |||||
Pension, retiree and other benefits | 3.8 | (2.2 | ) | |||||
Other | (6.9 | ) | (0.5 | ) | ||||
Net cash provided by operating activities | 81.7 | 198.6 | ||||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (95.6 | ) | (109.8 | ) | ||||
Proceeds from sale of business | — | 75.5 | ||||||
Insurance proceeds | 12.6 | 5.2 | ||||||
Purchase of renewable energy credits | (0.1 | ) | (0.3 | ) | ||||
Decrease in restricted cash | 27.0 | 5.5 | ||||||
Other investing activities, net | 0.3 | 0.8 | ||||||
Net cash used in investing activities | (55.8 | ) | (23.1 | ) | ||||
Cash flows from financing activities: | ||||||||
Payments of deferred financing costs | — | (8.0 | ) | |||||
Issuance of long-term debt, net of discount | — | 442.8 | ||||||
Retirement of long-term debt | (122.1 | ) | (520.8 | ) | ||||
Borrowings from revolving credit facilities | 80.0 | — | ||||||
Repayment of borrowings from revolving credit facilities | (15.0 | ) | — | |||||
Other financing activities, net | — | (0.1 | ) | |||||
Net cash used in financing activities | (57.1 | ) | (86.1 | ) | ||||
Cash and cash equivalents: | ||||||||
Net change | (31.2 | ) | 89.4 | |||||
Balance at beginning of period | 54.6 | 32.4 | ||||||
Cash and cash equivalents at end of period | $ | 23.4 | $ | 121.8 | ||||
Supplemental cash flow information: | ||||||||
Interest paid, net of amounts capitalized | $ | 69.0 | $ | 61.1 | ||||
Income taxes paid / (refunded), net | $ | — | $ | 0.3 | ||||
Non-cash financing and investing activities: | ||||||||
Accruals for capital expenditures | $ | 9.2 | $ | 15.9 |
Accounting Standard | Description | Date of Adoption | Effect on the financial statements upon adoption |
New Accounting Standards Adopted | |||
2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting | The standard simplifies the following aspects of accounting for share-based payments awards: accounting for income taxes, classification of excess tax benefits on the statement of cash flows, forfeitures, statutory tax withholding requirements, classification of awards as either equity or liabilities and classification of employee taxes paid on statement of cash flows when an employer withholds shares for tax-withholding purposes. Transition method: The recognition of excess tax benefits and tax deficiencies arising from vesting or settlement were applied retrospectively. The elimination of the requirement that excess tax benefits be realized before they are recognized was adopted on a modified retrospective basis. | January 1, 2017. | The primary effect of adoption was the recognition of excess tax benefits in our provision for income taxes in the period when the awards vest or are settled, rather than in paid-in-capital in the period when the excess tax benefits are realized. The adoption of this standard did not have a material impact on the consolidated financial statements. |
Accounting Standard | Description | Date of Adoption | Effect on the financial statements upon adoption |
New Accounting Standards Issued But Not Yet Effective | |||
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities | The standard updates the hedge accounting model in ASC 815 to expand the ability to hedge risk, reduce complexity and ease certain documentation and assessment requirements. It also eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. Transition method: modified retrospective approach and prospective for presentation and disclosures. | January 1, 2019. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements and if we would early adopt it. |
2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities | This standard shortens the period of amortization of the premium on certain callable debt securities to the earliest call date. Transition method: modified retrospective. | January 1, 2019. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements. |
2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost | This standard changes the presentation of non-service cost expense associated with defined benefit plans and updates the guidance so that only the service cost component will be eligible for capitalization. Transition method: Retrospective for presentation of non-service cost expense. Prospective for the change in capitalization. | January 1, 2018. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements. |
2017-05, Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Topic 610-20) | This standard clarifies the scope and application of ASC 610-20 on the sale, transfer, and derecognition of nonfinancial assets and in substance nonfinancial assets to non-customers, including partial sales. It also clarifies that the derecognition of businesses is under scope of ASC 810. Transition method: full or modified retrospective we are in the process of identifying contracts that would not be completed as of January 1, 2018. Based on the assessment of contracts already executed as of the balance sheet date, the contracts that may require any type of assessment under the new standard are limited. | January 1, 2018. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements. We will adopt the standard on January 1, 2018 and plan to use the modified retrospective approach. |
2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business | This standard provides guidance to assist the entities with evaluating when a set of transferred assets and activities is a business. Transition method: prospective. | January 1, 2018. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements. |
2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues Task Force) | This standard requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Transition method: retrospective. | January 1, 2018. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements. |
2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory | This standard requires that an entity recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. Transition method: modified retrospective. | January 1, 2018. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements. |
2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments | This standard updates the impairment model for financial assets measured at amortized cost to an expected loss model rather than an incurred loss model. It also allows for the presentation of credit losses on available-for-sale debt securities as an allowance rather than a write down. Transition method: various. | January 1, 2020. Early adoption is permitted only as of January 1, 2019. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements. |
Accounting Standard | Description | Date of Adoption | Effect on the financial statements upon adoption |
2016-02, Leases (Topic 842) | This standard requires lessees to recognize assets and liabilities for most leases but recognize expenses in a manner similar to today’s accounting. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance also eliminates today’s real estate-specific provisions. Transition method: modified retrospective at the beginning of the earliest comparative period presented in the financial statements (January 1, 2017). We have established a task force focused on the identification of contracts that would be under the scope of the new standard and on the assessment and measurement of the right-of-use asset and related liability. The implementation team is in the process of evaluating changes to our business processes, systems and controls to support recognition and disclosure under the new standard. | January 1, 2019. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our consolidated financial statements. We intend to adopt the standard as of January 1, 2019. |
2014-09, 2015-14, 2016-08, 2016-10, 2016-12, 2016-20, 2017-05, 2017-13 Revenue from Contracts with Customers (Topic 606) | See discussion of the ASUs below. | January 1, 2018. | We will adopt the standard on January 1, 2018; see below for the evaluation of the impact of its adoption on the consolidated financial statements. |
September 30, | December 31, | |||||||
$ in millions | 2017 | 2016 | ||||||
Accounts receivable, net: | ||||||||
Unbilled revenue | $ | 14.4 | $ | 43.0 | ||||
Customer receivables | 74.2 | 73.9 | ||||||
Amounts due from partners in jointly-owned plants | 17.8 | 12.7 | ||||||
Other | 6.1 | 6.7 | ||||||
Provision for uncollectible accounts | (1.1 | ) | (1.2 | ) | ||||
Total accounts receivable, net | $ | 111.4 | $ | 135.1 | ||||
Inventories, at average cost: | ||||||||
Fuel and limestone | $ | 16.8 | $ | 38.9 | ||||
Plant materials and supplies | 10.9 | 36.6 | ||||||
Other | 1.0 | 1.7 | ||||||
Total inventories, at average cost | $ | 28.7 | $ | 77.2 |
Details about Accumulated Other Comprehensive Income / (Loss) components | Affected line item in the Condensed Consolidated Statements of Operations | Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||||
Gains and losses on Available-for-sale securities activity (Note 5): | ||||||||||||||||||
Other income | $ | — | $ | — | $ | (0.1 | ) | $ | — | |||||||||
Gains and losses on cash flow hedges (Note 6): | ||||||||||||||||||
Interest expense | (0.2 | ) | (0.2 | ) | (0.8 | ) | (0.7 | ) | ||||||||||
Revenue | (4.2 | ) | (9.3 | ) | (12.5 | ) | (46.6 | ) | ||||||||||
Purchased power | 0.7 | 1.0 | 4.0 | 9.1 | ||||||||||||||
Total before income taxes | (3.7 | ) | (8.5 | ) | (9.3 | ) | (38.2 | ) | ||||||||||
Tax expense | 1.3 | 3.0 | 3.3 | 13.8 | ||||||||||||||
Net of income taxes | (2.4 | ) | (5.5 | ) | (6.0 | ) | (24.4 | ) | ||||||||||
Amortization of defined benefit pension items (Note 9): | ||||||||||||||||||
Operation and maintenance | — | — | 1.4 | 0.2 | ||||||||||||||
Tax benefit | — | — | (0.5 | ) | (0.1 | ) | ||||||||||||
Net of income taxes | — | — | 0.9 | 0.1 | ||||||||||||||
Total reclassifications for the period, net of income taxes | $ | (2.4 | ) | $ | (5.5 | ) | $ | (5.2 | ) | $ | (24.3 | ) |
$ in millions | Gains / (losses) on available-for-sale securities | Gains / (losses) on cash flow hedges | Change in unfunded pension obligation | Total | ||||||||||||
Balance at January 1, 2017 | $ | 0.6 | $ | 13.1 | $ | (13.4 | ) | $ | 0.3 | |||||||
Other comprehensive income / (loss) before reclassifications | 0.4 | 12.1 | (1.5 | ) | 11.0 | |||||||||||
Amounts reclassified from accumulated other comprehensive income / (loss) | (0.1 | ) | (6.0 | ) | 0.9 | (5.2 | ) | |||||||||
Net current period other comprehensive income / (loss) | 0.3 | 6.1 | (0.6 | ) | 5.8 | |||||||||||
Balance at September 30, 2017 | $ | 0.9 | $ | 19.2 | $ | (14.0 | ) | $ | 6.1 |
• | Bypassable standard offer energy rates for DP&L’s customers based on competitive bid auctions; |
• | The establishment of a three-year non-bypassable Distribution Modernization Rider (DMR) designed to collect $105.0 million in revenue per year to pay debt obligations at DPL and DP&L and position DP&L to modernize and/or maintain its transmission and distribution infrastructure. With PUCO approval, DP&L has the option of extending the duration of the DMR for an additional two years; |
• | The establishment of a non-bypassable Distribution Investment Rider to recover incremental distribution capital investments, the amount of which is to be established in a separate DP&L distribution rate case |
• | A non-bypassable Reconciliation Rider permitting DP&L to defer, recover or credit the net proceeds from selling energy and capacity received as part of DP&L’s investment in OVEC and DP&L's OVEC related costs; |
• | Implementation by DP&L of a Smart Grid Rider, Economic Development Rider, Economic Development Fund, Regulatory Compliance Rider and certain other new, or changes to existing, rates, riders and competitive retail market enhancements, with tariffs consistent with the order to be effective November 1, 2017; |
• | A commitment to commence a sale process to sell our ownership interests in the Zimmer, Miami Fort and Conesville coal-fired generation plants, with all sales proceeds used to pay debt of DPL and DP&L; and |
• | Restrictions on DPL making dividend or tax sharing payments; and |
• | Various other riders and competitive retail market enhancements. |
DP&L Share | DPL Carrying Value | ||||||||||||||||
Ownership (%) | Summer Production Capacity (MW) | Gross Plant In Service ($ in millions) | Accumulated Depreciation ($ in millions) | Construction Work in Process ($ in millions) | |||||||||||||
Jointly-owned production units | |||||||||||||||||
Conesville - Unit 4 | 16.5 | 129 | $ | 0.5 | $ | 0.5 | $ | 2.3 | |||||||||
Killen - Unit 2 | 67.0 | 402 | 8.5 | 4.1 | — | ||||||||||||
Miami Fort - Units 7 and 8 (a) | 36.0 | 368 | 31.3 | 3.3 | 5.1 | ||||||||||||
Stuart - Units 2 through 4 | 35.0 | 606 | 0.7 | 0.7 | — | ||||||||||||
Zimmer - Unit 1 (a) | 28.1 | 371 | 21.3 | 15.3 | 5.2 | ||||||||||||
Transmission (at varying percentages) | 43.2 | 11.5 | — | ||||||||||||||
Total | 1,876 | $ | 105.5 | $ | 35.4 | $ | 12.6 |
(a) | DP&L has entered into an agreement to sell its interest in these units. See Note 13 – Assets and Liabilities Held for Sale for additional information. |
$ in millions | |||
Balance at January 1, 2017 | $ | 138.8 | |
Additions | 0.1 | ||
Revisions to cash flow and timing estimates | (4.8 | ) | |
Accretion expense | 2.9 | ||
Settlements | (0.1 | ) | |
Reclassified to Liabilities held for sale | (4.4 | ) | |
Balance at September 30, 2017 | $ | 132.5 |
September 30, 2017 | December 31, 2016 | |||||||||||||||
$ in millions | Cost | Fair Value | Cost | Fair Value | ||||||||||||
Assets | ||||||||||||||||
Money market funds | $ | 0.4 | $ | 0.4 | $ | 0.4 | $ | 0.4 | ||||||||
Equity securities | 2.6 | 4.1 | 2.4 | 3.4 | ||||||||||||
Debt securities | 4.2 | 4.3 | 4.4 | 4.4 | ||||||||||||
Hedge funds | 0.1 | 0.1 | — | 0.1 | ||||||||||||
Real estate | — | — | 0.3 | 0.3 | ||||||||||||
Tangible assets | 0.1 | 0.1 | 0.1 | 0.1 | ||||||||||||
Total Assets | $ | 7.4 | $ | 9.0 | $ | 7.6 | $ | 8.7 | ||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Liabilities | ||||||||||||||||
Long-term debt (a) | $ | 1,741.6 | $ | 1,843.8 | $ | 1,858.0 | $ | 1,907.7 |
(a) | Amounts exclude immaterial capital lease obligations |
• | Level 1 (quoted prices in active markets for identical assets or liabilities); |
• | Level 2 (observable inputs such as quoted prices for similar assets or liabilities or quoted prices in markets that are not active); or |
• | Level 3 (unobservable inputs) reflecting management’s own assumptions about the inputs used in pricing the asset or liability). |
Assets and Liabilities at Fair Value | ||||||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||||||
$ in millions | Fair value at September 30, 2017 (a) | Based on Quoted Prices in Active Markets | Other Observable Inputs | Unobservable Inputs | ||||||||||||
Assets | ||||||||||||||||
Master Trust assets | ||||||||||||||||
Money market funds | $ | 0.4 | $ | 0.4 | $ | — | $ | — | ||||||||
Equity securities | 4.1 | — | 4.1 | — | ||||||||||||
Debt securities | 4.3 | — | 4.3 | — | ||||||||||||
Hedge funds | 0.1 | — | 0.1 | — | ||||||||||||
Tangible assets | 0.1 | — | 0.1 | — | ||||||||||||
Total Master Trust assets | 9.0 | 0.4 | 8.6 | — | ||||||||||||
Derivative Assets | ||||||||||||||||
Forward power contracts | 10.8 | — | 10.8 | — | ||||||||||||
Interest rate hedges | 0.9 | — | 0.9 | — | ||||||||||||
Natural gas | — | — | — | — | ||||||||||||
Total Derivative assets | 11.7 | — | 11.7 | — | ||||||||||||
Total Assets | $ | 20.7 | $ | 0.4 | $ | 20.3 | $ | — | ||||||||
Liabilities | ||||||||||||||||
Derivative Liabilities | ||||||||||||||||
Interest rate hedges | $ | — | $ | — | $ | — | $ | — | ||||||||
FTRs | 0.5 | — | — | 0.5 | ||||||||||||
Natural gas futures | 0.8 | 0.8 | — | — | ||||||||||||
Forward power contracts | 8.1 | — | 8.1 | — | ||||||||||||
Total Derivative liabilities | 9.4 | 0.8 | 8.1 | 0.5 | ||||||||||||
Long-term debt (b) | 1,843.8 | — | 1,825.9 | 17.9 | ||||||||||||
Total Liabilities | $ | 1,853.2 | $ | 0.8 | $ | 1,834.0 | $ | 18.4 |
(a) | Includes credit valuation adjustment |
(b) | Amounts exclude immaterial capital lease obligations |
Assets and Liabilities at Fair Value | ||||||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||||||
$ in millions | Fair value at December 31, 2016 (a) | Based on Quoted Prices in Active Markets | Other Observable Inputs | Unobservable Inputs | ||||||||||||
Assets | ||||||||||||||||
Master Trust assets | ||||||||||||||||
Money market funds | $ | 0.4 | $ | 0.4 | $ | — | $ | — | ||||||||
Equity securities | 3.4 | — | 3.4 | — | ||||||||||||
Debt securities | 4.4 | — | 4.4 | — | ||||||||||||
Hedge funds | 0.1 | — | 0.1 | — | ||||||||||||
Real estate | 0.3 | — | 0.3 | — | ||||||||||||
Tangible assets | 0.1 | — | 0.1 | — | ||||||||||||
Total Master Trust assets | 8.7 | 0.4 | 8.3 | — | ||||||||||||
Derivative assets | ||||||||||||||||
Forward power contracts | 19.5 | — | 19.5 | — | ||||||||||||
Interest rate hedges | 1.2 | — | 1.2 | — | ||||||||||||
FTRs | 0.1 | — | — | 0.1 | ||||||||||||
Total Derivative assets | 20.8 | — | 20.7 | 0.1 | ||||||||||||
Total Assets | $ | 29.5 | $ | 0.4 | $ | 29.0 | $ | 0.1 | ||||||||
Liabilities | ||||||||||||||||
Derivative liabilities | ||||||||||||||||
Interest rate hedges | $ | 0.7 | $ | — | $ | 0.7 | $ | — | ||||||||
Forward power contracts | 28.5 | — | 26.0 | 2.5 | ||||||||||||
Total Derivative liabilities | 29.2 | — | 26.7 | 2.5 | ||||||||||||
Long-term debt (b) | 1,907.7 | — | 1,889.7 | 18.0 | ||||||||||||
Total Liabilities | $ | 1,936.9 | $ | — | $ | 1,916.4 | $ | 20.5 |
(a) | Includes credit valuation adjustment |
(b) | Amounts exclude immaterial capital lease obligations |
• | Level 1 inputs are used for derivative contracts such as natural gas futures and for money market accounts that are considered cash equivalents. The fair value is determined by reference to quoted market prices and other relevant information generated by market transactions. |
• | Level 2 inputs are used to value derivatives such as forward power contracts (which are traded on the OTC market but which are valued using prices on the NYMEX for similar contracts on the OTC market). Other Level 2 assets include open-ended mutual funds in the Master Trust, which are valued using the end of day NAV per unit. |
• | Level 3 inputs such as FTRs are considered a Level 3 input because the monthly auctions are considered inactive. Other Level 3 inputs include the credit valuation adjustment on some of the forward power contracts and forward power contracts in less active markets. Our Level 3 inputs are immaterial to our derivative balances as a whole and as such no further disclosures are presented. |
Carrying | Fair Value | Gross | ||||||||||||||||||
Amount (b) | Level 1 | Level 2 | Level 3 | Loss | ||||||||||||||||
$ in millions | Nine months ended September 30, 2017 | |||||||||||||||||||
Assets | ||||||||||||||||||||
Long-lived assets (a) | ||||||||||||||||||||
Stuart | $ | 42.4 | $ | — | $ | — | $ | 3.3 | $ | 39.1 | ||||||||||
Killen | $ | 35.2 | $ | — | $ | — | $ | 7.9 | $ | 27.3 | ||||||||||
$ | 66.4 | |||||||||||||||||||
Nine months ended September 30, 2016 | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Long-lived assets (a) | ||||||||||||||||||||
Killen | $ | 315.1 | $ | — | $ | — | $ | 84.3 | $ | 230.8 | ||||||||||
DP&L peaking facilities | $ | 9.9 | $ | — | $ | — | $ | 5.2 | $ | 4.7 | ||||||||||
$ | 235.5 |
$ in millions | Fair value | Valuation technique | Unobservable input | Weighted average | |||||||
Long-lived assets held and used: | |||||||||||
Stuart | $ | 3.3 | Discounted cash flow | Pre-tax operating margin (through remaining life) | 10.0 | % | |||||
Weighted-average cost of capital | 7.0 | % | |||||||||
Killen | $ | 7.9 | Discounted cash flow | Pre-tax operating margin (through remaining life) | 22.0 | % | |||||
Weighted-average cost of capital | 7.0 | % |
$ in millions | Fair value | Valuation technique | Unobservable input | Weighted average | ||||||
Long-lived assets held and used: | ||||||||||
Killen | $ | 84.3 | Discounted cash flow | Annual revenue growth | -11.0% to 13.0% (2.0%) | |||||
Annual pre-tax operating margin | -50.0% to 67.0% (6.0%) | |||||||||
Weighted-average cost of capital | 11.0% | |||||||||
DP&L peaking facilities | $ | 5.2 | Discounted cash flow | Annual revenue growth | -22.0% to 17.0% (-3.0%) | |||||
Annual pre-tax operating margin | -29.0% to 24.0% (-4.0%) | |||||||||
Weighted-average cost of capital | 7.0% |
Commodity | Accounting Treatment (a) | Unit | Purchases (in thousands) | Sales (in thousands) | Net Purchases/ (Sales) (in thousands) | |||||||||||
FTRs | Not designated | MWh | 3.4 | — | 3.4 | |||||||||||
Natural gas futures | Not designated | Dths | 6,625.0 | (390.0 | ) | 6,235.0 | ||||||||||
Forward power contracts | Designated | MWh | 649.0 | (2,478.9 | ) | (1,829.9 | ) | |||||||||
Forward power contracts | Not designated | MWh | 1,082.8 | (1,060.0 | ) | 22.8 | ||||||||||
Interest rate swaps | Designated | USD | $ | 200,000.0 | $ | — | $ | 200,000.0 |
Commodity | Accounting Treatment (a) | Unit | Purchases (in thousands) | Sales (in thousands) | Net Purchases/ (Sales) (in thousands) | |||||||||||
FTRs | Not designated | MWh | 2.3 | — | 2.3 | |||||||||||
Natural gas futures | Not designated | Dths | 1,590.0 | — | 1,590.0 | |||||||||||
Forward power contracts | Designated | MWh | 342.9 | (9,974.5 | ) | (9,631.6 | ) | |||||||||
Forward power contracts | Not designated | MWh | 2,568.3 | (2,020.9 | ) | 547.4 | ||||||||||
Interest rate swaps | Designated | USD | $ | 200,000.0 | $ | — | $ | 200,000.0 |
Three months ended | Three months ended | |||||||||||||||
September 30, 2017 | September 30, 2016 | |||||||||||||||
Interest | Interest | |||||||||||||||
$ in millions (net of tax) | Power | Rate Hedge | Power | Rate Hedge | ||||||||||||
Beginning accumulated derivative gains in AOCI | $ | 3.0 | $ | 17.2 | $ | 3.4 | $ | 17.3 | ||||||||
Net gains associated with current period hedging transactions | 1.3 | 0.1 | 9.5 | — | ||||||||||||
Net gains / (losses) reclassified to earnings | ||||||||||||||||
Interest expense | — | (0.2 | ) | — | (0.1 | ) | ||||||||||
Revenues | (2.7 | ) | — | (6.0 | ) | — | ||||||||||
Purchased power | 0.5 | — | 0.6 | — | ||||||||||||
Ending accumulated derivative gains in AOCI | $ | 2.1 | $ | 17.1 | $ | 7.5 | $ | 17.2 | ||||||||
Nine months ended | Nine months ended | |||||||||||||||
September 30, 2017 | September 30, 2016 | |||||||||||||||
Interest | Interest | |||||||||||||||
$ in millions (net of tax) | Power | Rate Hedge | Power | Rate Hedge | ||||||||||||
Beginning accumulated derivative gains / (losses) in AOCI | $ | (4.3 | ) | $ | 17.4 | $ | 9.2 | $ | 17.5 | |||||||
Net gains associated with current period hedging transactions | 11.9 | 0.2 | 22.4 | — | ||||||||||||
Net gains / (losses) reclassified to earnings | ||||||||||||||||
Interest expense | — | (0.5 | ) | — | (0.3 | ) | ||||||||||
Revenues | (8.1 | ) | — | (30.0 | ) | — | ||||||||||
Purchased power | 2.6 | — | 5.9 | — | ||||||||||||
Ending accumulated derivative gains in AOCI | $ | 2.1 | $ | 17.1 | $ | 7.5 | $ | 17.2 | ||||||||
Portion expected to be reclassified to earnings in the next twelve months (a) | $ | 1.5 | $ | (0.4 | ) | |||||||||||
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months) | 6 | 37 |
For the three months ended September 30, 2017 | ||||||||||||||||
$ in millions | FTRs | Power | Natural Gas | Total | ||||||||||||
Change in unrealized gain / (loss) | $ | 0.2 | $ | (1.4 | ) | $ | — | $ | (1.2 | ) | ||||||
Realized gain / (loss) | 0.2 | 1.9 | (0.2 | ) | 1.9 | |||||||||||
Total | $ | 0.4 | $ | 0.5 | $ | (0.2 | ) | $ | 0.7 | |||||||
Recorded in Income Statement: gain / (loss) | ||||||||||||||||
Revenues | $ | — | $ | 3.3 | $ | — | $ | 3.3 | ||||||||
Purchased power | 0.4 | (2.8 | ) | (0.2 | ) | (2.6 | ) | |||||||||
Total | $ | 0.4 | $ | 0.5 | $ | (0.2 | ) | $ | 0.7 | |||||||
For the three months ended September 30, 2016 | ||||||||||||||||
$ in millions | FTRs | Power | Natural Gas | Total | ||||||||||||
Change in unrealized gain / (loss) | $ | — | $ | 1.2 | $ | (0.3 | ) | $ | 0.9 | |||||||
Realized gain / (loss) | (0.1 | ) | (2.4 | ) | 0.2 | (2.3 | ) | |||||||||
Total | $ | (0.1 | ) | $ | (1.2 | ) | $ | (0.1 | ) | $ | (1.4 | ) | ||||
Recorded in Income Statement: gain / (loss) | ||||||||||||||||
Revenues | $ | — | $ | (10.4 | ) | $ | — | $ | (10.4 | ) | ||||||
Purchased power | (0.1 | ) | 9.2 | (0.1 | ) | 9.0 | ||||||||||
Total | $ | (0.1 | ) | $ | (1.2 | ) | $ | (0.1 | ) | $ | (1.4 | ) | ||||
For the nine months ended September 30, 2017 | ||||||||||||||||
$ in millions | FTRs | Power | Natural Gas | Total | ||||||||||||
Change in unrealized gain / (loss) | $ | (0.5 | ) | $ | 2.3 | $ | (0.8 | ) | $ | 1.0 | ||||||
Realized gain / (loss) | 0.5 | (1.4 | ) | (0.3 | ) | (1.2 | ) | |||||||||
Total | $ | — | $ | 0.9 | $ | (1.1 | ) | $ | (0.2 | ) | ||||||
Recorded in Income Statement: gain / (loss) | ||||||||||||||||
Revenues | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) | ||||||
Purchased power | — | 3.5 | (1.1 | ) | 2.4 | |||||||||||
Total | $ | — | $ | 0.9 | $ | (1.1 | ) | $ | (0.2 | ) | ||||||
For the nine months ended September 30, 2016 | ||||||||||||||||
$ in millions | FTRs | Power | Natural Gas | Total | ||||||||||||
Change in unrealized gain / (loss) | $ | 0.4 | $ | 2.3 | $ | — | $ | 2.7 | ||||||||
Realized gain / (loss) | (0.4 | ) | (5.3 | ) | 0.7 | (5.0 | ) | |||||||||
Total | $ | — | $ | (3.0 | ) | $ | 0.7 | $ | (2.3 | ) | ||||||
Recorded in Income Statement: gain / (loss) | ||||||||||||||||
Revenues | $ | — | $ | (13.1 | ) | $ | — | $ | (13.1 | ) | ||||||
Purchased power | — | 10.1 | 0.7 | 10.8 | ||||||||||||
Total | $ | — | $ | (3.0 | ) | $ | 0.7 | $ | (2.3 | ) | ||||||
Fair Values of Derivative Instruments | ||||||||||||||||||
at September 30, 2017 | ||||||||||||||||||
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets | ||||||||||||||||||
$ in millions | Hedging Designation | Gross Fair Value as presented in the Consolidated Balance Sheets (a) | Financial Instruments with Same Counterparty in Offsetting Position | Cash Collateral | Net Fair Value | |||||||||||||
Assets | ||||||||||||||||||
Short-term derivative positions (presented in Other prepayments and current assets) | ||||||||||||||||||
Forward power contracts | Designated | $ | 7.0 | $ | (4.6 | ) | $ | — | $ | 2.4 | ||||||||
Forward power contracts | Not designated | 3.5 | (2.7 | ) | — | 0.8 | ||||||||||||
Natural gas futures | Not designated | — | — | — | — | |||||||||||||
Long-term derivative positions (presented in Other deferred assets) | ||||||||||||||||||
Interest rate swap | Designated | 0.9 | — | — | 0.9 | |||||||||||||
Natural gas futures | Not designated | — | — | — | — | |||||||||||||
Forward power contracts | Not designated | 0.3 | — | — | 0.3 | |||||||||||||
Total assets | $ | 11.7 | $ | (7.3 | ) | $ | — | $ | 4.4 | |||||||||
Liabilities | ||||||||||||||||||
Short-term derivative positions (presented in Other current liabilities) | ||||||||||||||||||
Forward power contracts | Designated | $ | 4.6 | $ | (4.6 | ) | $ | — | $ | — | ||||||||
Interest rate swap | Designated | — | — | — | — | |||||||||||||
Forward power contracts | Not designated | 3.5 | (2.7 | ) | (0.7 | ) | 0.1 | |||||||||||
Natural gas futures | Not designated | 0.8 | — | (0.8 | ) | — | ||||||||||||
FTRs | Not designated | 0.5 | — | — | 0.5 | |||||||||||||
Long-term derivative positions (presented in Other deferred credits) | ||||||||||||||||||
Natural gas futures | Not designated | — | — | — | — | |||||||||||||
Total liabilities | $ | 9.4 | $ | (7.3 | ) | $ | (1.5 | ) | $ | 0.6 |
Fair Values of Derivative Instruments | ||||||||||||||||||
at December 31, 2016 | ||||||||||||||||||
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets | ||||||||||||||||||
$ in millions | Hedging Designation | Gross Fair Value as presented in the Consolidated Balance Sheets (a) | Financial Instruments with Same Counterparty in Offsetting Position | Cash Collateral | Net Fair Value | |||||||||||||
Assets | ||||||||||||||||||
Short-term derivative positions (presented in Other prepayments and current assets) | ||||||||||||||||||
Forward power contracts | Designated | $ | 11.0 | $ | (10.5 | ) | $ | — | $ | 0.5 | ||||||||
Forward power contracts | Not designated | 6.0 | (4.7 | ) | — | 1.3 | ||||||||||||
FTRs | Not designated | 0.1 | — | — | 0.1 | |||||||||||||
Long-term derivative positions (presented in Other deferred assets) | ||||||||||||||||||
Interest rate swaps | Designated | 1.2 | — | — | 1.2 | |||||||||||||
Forward power contracts | Designated | 0.6 | (0.6 | ) | — | — | ||||||||||||
Forward power contracts | Not designated | 1.9 | (1.0 | ) | — | 0.9 | ||||||||||||
Total assets | $ | 20.8 | $ | (16.8 | ) | $ | — | $ | 4.0 | |||||||||
Liabilities | ||||||||||||||||||
Short-term derivative positions (presented in Other current liabilities) | ||||||||||||||||||
Interest rate swaps | Designated | $ | 0.7 | $ | — | $ | — | $ | 0.7 | |||||||||
Forward power contracts | Designated | 16.4 | (10.5 | ) | (5.5 | ) | 0.4 | |||||||||||
Forward power contracts | Not designated | 7.7 | (4.7 | ) | — | 3.0 | ||||||||||||
Long-term derivative positions (presented in Other deferred credits) | ||||||||||||||||||
Forward power contracts | Designated | 2.4 | (0.6 | ) | (0.8 | ) | 1.0 | |||||||||||
Forward power contracts | Not designated | 2.0 | (1.0 | ) | — | 1.0 | ||||||||||||
Total liabilities | $ | 29.2 | $ | (16.8 | ) | $ | (6.3 | ) | $ | 6.1 |
Interest | September 30, | December 31, | ||||||||||
$ in millions | Rate | Maturity | 2017 | 2016 | ||||||||
Term loan - rates from 4.01% - 4.49% (a) and 4.00% - 4.01% (b) | 2022 | $ | 441.7 | $ | 445.0 | |||||||
Tax-exempt First Mortgage Bonds | 4.8% | 2036 | — | 100.0 | ||||||||
Tax-exempt First Mortgage Bonds - rates from 1.52% - 1.83% (a) and 1.29% - 1.42% (b) | 2020 | 200.0 | 200.0 | |||||||||
U.S. Government note | 4.2% | 2061 | 17.9 | 18.0 | ||||||||
Capital leases | 0.3 | 0.4 | ||||||||||
Unamortized deferred financing costs | (9.9 | ) | (10.7 | ) | ||||||||
Unamortized long-term debt discounts and premiums, net | (2.0 | ) | (5.5 | ) | ||||||||
Total long-term debt at consolidated subsidiary | 648.0 | 747.2 | ||||||||||
Bank term loan - rates from 3.02% - 3.99% (a) and 2.67% - 3.02% (b) | 2020 | 106.3 | 125.0 | |||||||||
Senior unsecured notes | 6.75% | 2019 | 200.0 | 200.0 | ||||||||
Senior unsecured notes | 7.25% | 2021 | 780.0 | 780.0 | ||||||||
Note to DPL Capital Trust II (c) | 8.125% | 2031 | 15.6 | 15.6 | ||||||||
Unamortized deferred financing costs | (7.4 | ) | (8.8 | ) | ||||||||
Unamortized long-term debt discounts and premiums, net | (0.6 | ) | (0.6 | ) | ||||||||
Total long-term debt | 1,741.9 | 1,858.4 | ||||||||||
Less: current portion | (29.7 | ) | (29.7 | ) | ||||||||
Long-term debt, net of current portion | $ | 1,712.2 | $ | 1,828.7 |
(a) | Range of interest rates for the nine months ended September 30, 2017. |
(b) | Range of interest rates for the year ended December 31, 2016. |
(c) | Note payable to related party. |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
2017 | 2016 | 2017 | 2016 | |||||
DPL | 21.8% | 45.7% | 36.9% | 38.6% |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Service cost | $ | 1.5 | $ | 1.4 | $ | 4.3 | $ | 4.2 | ||||||||
Interest cost | 3.5 | 3.7 | 10.6 | 11.1 | ||||||||||||
Expected return on plan assets | (5.7 | ) | (5.7 | ) | (17.1 | ) | (17.1 | ) | ||||||||
Plan curtailment (a) | — | — | 4.1 | — | ||||||||||||
Amortization of unrecognized: | ||||||||||||||||
Prior service cost | 0.2 | 0.4 | 0.8 | 1.4 | ||||||||||||
Actuarial loss | 1.3 | 1.1 | 4.0 | 3.2 | ||||||||||||
Net periodic benefit cost | $ | 0.8 | $ | 0.9 | $ | 6.7 | $ | 2.8 |
(a) | As a result of the decision to retire certain of DP&L's coal-fired plants, we recognized a plan curtailment of $4.1 million in the first quarter of 2017. See Note 14 – Fixed-asset Impairments for more information. |
$ in millions | ||||
Estimated to be paid during | Pension | |||
2017 | $ | 6.3 | ||
2018 | $ | 25.5 | ||
2019 | $ | 26.0 | ||
2020 | $ | 26.4 | ||
2021 | $ | 26.7 | ||
2022 - 2026 | $ | 139.6 |
• | The federal CAA and state laws and regulations (including State Implementation Plans) which require compliance, obtaining permits and reporting as to air emissions; |
• | Litigation with federal and certain state governments and certain special interest groups regarding whether modifications to or maintenance of certain coal-fired generating stations require additional permitting or pollution control technology, or whether emissions from coal-fired generating stations cause or contribute to climate change; |
• | Rules and future rules issued by the USEPA, the Ohio EPA or other authorities that require or will require substantial reductions in SO2, particulates, mercury, acid gases, NOx, and other air emissions. DPL has installed emission control technology and is taking other measures to comply with required and anticipated reductions; |
• | Rules and future rules issued by the USEPA, the Ohio EPA or other authorities that require or will require reporting and reductions of GHGs; |
• | Rules and future rules issued by the USEPA, the Ohio EPA or other authorities associated with the federal Clean Water Act, which prohibits the discharge of pollutants into waters of the United States except pursuant to appropriate permits; and |
• | Solid and hazardous waste laws and regulations, which govern the management and disposal of certain waste. The majority of solid waste created from the combustion of coal and fossil fuels consists of fly ash and other coal combustion by-products. |
$ in millions | T&D | Generation | Other | Adjustments and Eliminations | DPL Consolidated | |||||||||||||||
Three months ended September 30, 2017 | ||||||||||||||||||||
Revenues from external customers | $ | 184.0 | $ | 137.2 | $ | 2.7 | $ | — | $ | 323.9 | ||||||||||
Intersegment revenues | 0.2 | — | 0.9 | (1.1 | ) | — | ||||||||||||||
Total revenues | $ | 184.2 | $ | 137.2 | $ | 3.6 | $ | (1.1 | ) | $ | 323.9 | |||||||||
Depreciation and amortization | $ | 19.6 | $ | 4.7 | $ | 3.0 | $ | — | $ | 27.3 | ||||||||||
Interest expense | $ | 7.7 | $ | — | $ | 19.5 | $ | — | $ | 27.2 | ||||||||||
Income / (loss) from continuing operations before income tax | $ | 20.0 | $ | 29.9 | $ | (21.9 | ) | $ | — | $ | 28.0 | |||||||||
Cash capital expenditures | $ | 20.6 | $ | 7.9 | $ | 0.7 | $ | — | $ | 29.2 |
$ in millions | T&D | Generation | Other | Adjustments and Eliminations | DPL Consolidated | |||||||||||||||
Three months ended September 30, 2016 | ||||||||||||||||||||
Revenues from external customers | $ | 215.5 | $ | 170.4 | $ | 3.4 | $ | — | $ | 389.3 | ||||||||||
Intersegment revenues | 0.3 | — | 2.0 | (2.3 | ) | — | ||||||||||||||
Total revenues | $ | 215.8 | $ | 170.4 | $ | 5.4 | $ | (2.3 | ) | $ | 389.3 | |||||||||
Depreciation and amortization | $ | 17.8 | $ | 7.7 | $ | 5.4 | $ | — | $ | 30.9 | ||||||||||
Interest expense | $ | 6.5 | $ | 0.1 | $ | 20.5 | $ | (0.1 | ) | $ | 27.0 | |||||||||
Income / (loss) from continuing operations before income tax | $ | 36.4 | $ | 14.2 | $ | (22.8 | ) | $ | — | $ | 27.8 | |||||||||
Cash capital expenditures | $ | 19.6 | $ | 10.6 | $ | 0.5 | $ | — | $ | 30.7 |
$ in millions | T&D | Generation | Other | Adjustments and Eliminations | DPL Consolidated | |||||||||||||||
Nine months ended September 30, 2017 | ||||||||||||||||||||
Revenues from external customers | $ | 541.7 | $ | 396.4 | $ | 7.8 | $ | — | $ | 945.9 | ||||||||||
Intersegment revenues | 0.8 | — | 3.6 | (4.4 | ) | — | ||||||||||||||
Total revenues | $ | 542.5 | $ | 396.4 | $ | 11.4 | $ | (4.4 | ) | $ | 945.9 | |||||||||
Depreciation and amortization | $ | 56.3 | $ | 16.6 | $ | 8.9 | $ | — | $ | 81.8 | ||||||||||
Fixed-asset Impairments (Note 14) | $ | — | $ | 66.3 | $ | 0.1 | $ | — | $ | 66.4 | ||||||||||
Interest expense | $ | 22.9 | $ | 0.2 | $ | 58.4 | $ | — | $ | 81.5 | ||||||||||
Income / (loss) from continuing operations before income tax | $ | 60.1 | $ | (43.7 | ) | $ | (62.8 | ) | $ | — | $ | (46.4 | ) | |||||||
Cash capital expenditures | $ | 66.3 | $ | 27.1 | $ | 2.2 | $ | — | $ | 95.6 | ||||||||||
At September 30, 2017 | ||||||||||||||||||||
Total assets | $ | 1,655.3 | $ | 333.0 | $ | 694.4 | $ | (508.4 | ) | $ | 2,174.3 |
$ in millions | T&D | Generation | Other | Adjustments and Eliminations | DPL Consolidated | |||||||||||||||
Nine months ended September 30, 2016 | ||||||||||||||||||||
Revenues from external customers | $ | 604.4 | $ | 470.0 | $ | 7.2 | $ | — | $ | 1,081.6 | ||||||||||
Intersegment revenues | 1.0 | — | 4.2 | (5.2 | ) | — | ||||||||||||||
Total revenues | $ | 605.4 | $ | 470.0 | $ | 11.4 | $ | (5.2 | ) | $ | 1,081.6 | |||||||||
Depreciation and amortization | $ | 55.1 | $ | 44.6 | $ | 0.6 | $ | — | $ | 100.3 | ||||||||||
Fixed-asset Impairments (Note 14) | $ | — | $ | 857.1 | $ | (621.6 | ) | $ | — | $ | 235.5 | |||||||||
Interest expense | $ | 17.5 | $ | 0.3 | $ | 61.7 | $ | (0.2 | ) | $ | 79.3 | |||||||||
Income / (loss) from continuing operations before income tax | $ | 97.9 | $ | (857.2 | ) | $ | 564.8 | $ | — | $ | (194.5 | ) | ||||||||
Cash capital expenditures | $ | 61.8 | $ | 46.9 | $ | 1.1 | $ | — | $ | 109.8 | ||||||||||
At December 31, 2016 | ||||||||||||||||||||
Total assets | $ | 1,710.5 | $ | 472.3 | $ | 673.6 | $ | (437.2 | ) | $ | 2,419.2 |
$ in millions | Nine months ended September 30, 2016 | |||
Operating expenses | $ | (0.7 | ) | |
Loss from discontinued operations before income taxes | (0.7 | ) | ||
Gain from disposal of discontinued operations | 49.2 | |||
Income tax expense | 18.9 | |||
Income on discontinued operations | $ | 29.6 |
$ in millions | September 30, 2017 | |||
Assets | ||||
Accounts receivable, net (a) | $ | (11.2 | ) | |
Inventories | 22.7 | |||
Property, plant & equipment, net | 44.8 | |||
Other prepayments and current assets | 0.7 | |||
Total assets of the disposal group classified as held for sale in the balance sheet | $ | 57.0 | ||
Liabilities | ||||
Accounts payable | $ | 0.7 | ||
Accrued taxes | 2.6 | |||
Asset retirement obligations | 4.4 | |||
Other liabilities (b) | (0.7 | ) | ||
Total liabilities of the disposal group classified as held for sale in the balance sheet | $ | 7.0 |
(a) | Represents credit balances netted in Accounts Receivable, due to the right of offset with partners |
(b) | Represents amounts due to (from) partners for pension benefits associated with partner-operated plants |
THE DAYTON POWER AND LIGHT COMPANY | ||||||||||||||||
CONDENSED STATEMENTS OF OPERATIONS | ||||||||||||||||
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenues | $ | 305.6 | $ | 368.4 | $ | 900.8 | $ | 1,031.3 | ||||||||
Cost of revenues: | ||||||||||||||||
Net fuel cost | 52.8 | 71.0 | 152.8 | 189.5 | ||||||||||||
Net purchased power cost | 83.5 | 110.0 | 260.7 | 328.0 | ||||||||||||
Total cost of revenues | 136.3 | 181.0 | 413.5 | 517.5 | ||||||||||||
Gross margin | 169.3 | 187.4 | 487.3 | 513.8 | ||||||||||||
Operating expenses: | ||||||||||||||||
Operation and maintenance | 81.7 | 85.5 | 245.2 | 248.0 | ||||||||||||
Depreciation and amortization | 22.7 | 24.1 | 68.2 | 95.2 | ||||||||||||
General taxes | 19.6 | 21.2 | 66.8 | 62.8 | ||||||||||||
Gain on termination of contract | — | — | — | (27.7 | ) | |||||||||||
Fixed-asset impairment | — | — | 66.3 | 857.1 | ||||||||||||
Loss / (gain) on asset disposal | (0.3 | ) | — | 15.9 | 0.2 | |||||||||||
Other | (4.4 | ) | — | (4.4 | ) | — | ||||||||||
Total operating expenses | 119.3 | 130.8 | 458.0 | 1,235.6 | ||||||||||||
Operating income / (loss) | 50.0 | 56.6 | 29.3 | (721.8 | ) | |||||||||||
Other expense, net | ||||||||||||||||
Investment income | 0.1 | 0.1 | 0.2 | 0.3 | ||||||||||||
Interest expense | (7.7 | ) | (6.5 | ) | (23.1 | ) | (17.2 | ) | ||||||||
Charge for early redemption of debt | (1.0 | ) | (0.5 | ) | (1.1 | ) | (0.5 | ) | ||||||||
Other expense | (0.2 | ) | 0.1 | (1.5 | ) | (0.2 | ) | |||||||||
Total other expense, net | (8.8 | ) | (6.8 | ) | (25.5 | ) | (17.6 | ) | ||||||||
Income / (loss) from operations before income tax | 41.2 | 49.8 | 3.8 | (739.4 | ) | |||||||||||
Income tax expense / (benefit) | 11.9 | 19.7 | 0.2 | (271.6 | ) | |||||||||||
Net income / (loss) | 29.3 | 30.1 | 3.6 | (467.8 | ) | |||||||||||
Dividends on preferred stock | — | 0.3 | — | 0.7 | ||||||||||||
Income / (loss) attributable to common stock | $ | 29.3 | $ | 29.8 | $ | 3.6 | $ | (468.5 | ) |
THE DAYTON POWER AND LIGHT COMPANY | ||||||||||||||||
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME / (LOSS) | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Net income / (loss) | $ | 29.3 | $ | 30.1 | $ | 3.6 | $ | (467.8 | ) | |||||||
Available-for-sale securities activity: | ||||||||||||||||
Change in fair value of available-for-sale securities, net of income tax expense of $(0.1), $0.0, $(0.2) and $(0.1) for each respective period | 0.1 | 0.1 | 0.4 | 0.2 | ||||||||||||
Reclassification to earnings, net of income tax expense of $0.0, $0.0, $0.0 and $0.0 for each respective period | — | — | (0.1 | ) | — | |||||||||||
Total change in fair value of available-for-sale securities | 0.1 | 0.1 | 0.3 | 0.2 | ||||||||||||
Derivative activity: | ||||||||||||||||
Change in derivative fair value, net of income tax (expense) / benefit of $(0.8), $5.2, $(6.6) and $(12.2) for each respective period | 1.4 | 9.5 | 12.1 | 22.5 | ||||||||||||
Reclassification to earnings, net of income tax benefit of $1.4, $3.0, $3.3 and $13.5 for each respective period | (2.4 | ) | (5.6 | ) | (6.0 | ) | (24.8 | ) | ||||||||
Total change in fair value of derivatives | (1.0 | ) | 3.9 | 6.1 | (2.3 | ) | ||||||||||
Pension and postretirement activity: | ||||||||||||||||
Prior service costs for the period, net of income tax benefit of $0.0, $0.0, $0.6 and $0.0 for each respective period | — | — | (1.1 | ) | — | |||||||||||
Net loss for period, net of income tax benefit of $0.0, $0.0, $0.2 and $0.0 for each respective period | — | — | (0.5 | ) | — | |||||||||||
Reclassification to earnings, net of income tax expense of $(0.4), $(0.4), $(2.1) and $(1.6) for each respective period | 0.7 | 0.7 | 3.8 | 1.7 | ||||||||||||
Total change in unfunded pension obligation | 0.7 | 0.7 | 2.2 | 1.7 | ||||||||||||
Other comprehensive income / (loss) | (0.2 | ) | 4.7 | 8.6 | (0.4 | ) | ||||||||||
Net comprehensive income / (loss) | $ | 29.1 | $ | 34.8 | $ | 12.2 | $ | (468.2 | ) |
THE DAYTON POWER AND LIGHT COMPANY | ||||||||
CONDENSED BALANCE SHEETS | ||||||||
$ in millions | September 30, 2017 | December 31, 2016 | ||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 15.3 | $ | 1.6 | ||||
Restricted cash | 2.0 | 29.0 | ||||||
Accounts receivable, net (Note 2) | 107.9 | 134.6 | ||||||
Inventories (Note 2) | 26.9 | 75.8 | ||||||
Taxes applicable to subsequent years | 19.2 | 79.2 | ||||||
Regulatory assets, current | 4.5 | 0.1 | ||||||
Other prepayments and current assets | 21.8 | 32.4 | ||||||
Assets held for sale - current (Note 13) | 57.0 | — | ||||||
Total current assets | 254.6 | 352.7 | ||||||
Property, plant & equipment: | ||||||||
Property, plant & equipment | 2,345.4 | 2,398.6 | ||||||
Less: Accumulated depreciation and amortization | (1,060.6 | ) | (1,047.9 | ) | ||||
1,284.8 | 1,350.7 | |||||||
Construction work in process | 52.3 | 89.9 | ||||||
Total net property, plant & equipment | 1,337.1 | 1,440.6 | ||||||
Other non-current assets: | ||||||||
Regulatory assets, non-current | 209.4 | 203.9 | ||||||
Intangible assets, net of amortization | 19.9 | 23.0 | ||||||
Other deferred assets | 12.3 | 14.9 | ||||||
Total other non-current assets | 241.6 | 241.8 | ||||||
Total assets | $ | 1,833.3 | $ | 2,035.1 | ||||
LIABILITIES AND SHAREHOLDER'S EQUITY | ||||||||
Current liabilities: | ||||||||
Current portion of long-term debt (Note 7) | $ | 4.7 | $ | 4.7 | ||||
Short-term debt (Note 7) | 15.0 | 5.0 | ||||||
Accounts payable | 56.6 | 110.5 | ||||||
Accrued taxes | 59.2 | 75.7 | ||||||
Accrued interest | 0.8 | 2.1 | ||||||
Security deposits | 16.4 | 15.2 | ||||||
Regulatory liabilities, current | 20.0 | 33.7 | ||||||
Other current liabilities | 31.0 | 48.3 | ||||||
Liabilities held for sale - current (Note 13) | 6.0 | — | ||||||
Total current liabilities | 209.7 | 295.2 | ||||||
Non-current liabilities: | ||||||||
Long-term debt (Note 7) | 643.3 | 744.7 | ||||||
Deferred taxes | 155.1 | 146.3 | ||||||
Taxes payable | 4.8 | 84.1 | ||||||
Regulatory liabilities, non-current | 134.5 | 130.4 | ||||||
Pension, retiree and other benefits | 100.7 | 101.6 | ||||||
Unamortized investment tax credit | 16.1 | 17.7 | ||||||
Asset retirement obligations | 131.0 | 135.2 | ||||||
Other deferred credits | 12.4 | 17.6 | ||||||
Total non-current liabilities | 1,197.9 | 1,377.6 | ||||||
Commitments and contingencies (Note 11) | ||||||||
Common shareholder's equity: | ||||||||
Common stock, at par value of $0.01 per share | 0.4 | 0.4 | ||||||
250,000,000 shares authorized, 41,172,173 shares issued and outstanding | ||||||||
Other paid-in capital | 791.9 | 810.7 | ||||||
Accumulated other comprehensive loss | (33.9 | ) | (42.5 | ) | ||||
Accumulated deficit | (332.7 | ) | (406.3 | ) | ||||
Total common shareholder's equity | 425.7 | 362.3 | ||||||
Total liabilities and shareholder's equity | $ | 1,833.3 | $ | 2,035.1 |
THE DAYTON POWER AND LIGHT COMPANY | ||||||||
CONDENSED STATEMENTS OF CASH FLOWS | ||||||||
Nine months ended September 30, | ||||||||
$ in millions | 2017 | 2016 | ||||||
Cash flows from operating activities: | ||||||||
Net income / (loss) | $ | 3.6 | $ | (467.8 | ) | |||
Adjustments to reconcile net income / (loss) to net cash from operating activities: | ||||||||
Depreciation and amortization | 68.2 | 95.2 | ||||||
Charge for early redemption of debt | 1.1 | 0.5 | ||||||
Deferred income taxes | 1.6 | (314.2 | ) | |||||
Fixed-asset impairment | 66.3 | 857.1 | ||||||
Loss on asset disposal | 15.9 | 0.2 | ||||||
Changes in certain assets and liabilities: | ||||||||
Accounts receivable | 20.5 | (11.0 | ) | |||||
Inventories | 10.0 | 29.4 | ||||||
Prepaid taxes | — | 2.7 | ||||||
Taxes applicable to subsequent years | 60.0 | 59.9 | ||||||
Deferred regulatory costs, net | (6.5 | ) | 19.5 | |||||
Accounts payable | (58.4 | ) | (13.5 | ) | ||||
Accrued taxes payable | (83.9 | ) | (43.2 | ) | ||||
Accrued interest payable | (1.5 | ) | (3.3 | ) | ||||
Security deposits | 1.1 | (0.6 | ) | |||||
Pension, retiree and other benefits | 3.8 | (2.2 | ) | |||||
Other | (3.1 | ) | 11.7 | |||||
Net cash provided by operating activities | 98.7 | 220.4 | ||||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (82.4 | ) | (98.3 | ) | ||||
Purchase of renewable energy credits | (0.1 | ) | (0.3 | ) | ||||
Decrease in restricted cash | 27.0 | 5.5 | ||||||
Insurance proceeds | 12.5 | 5.6 | ||||||
Other investing activities, net | 0.3 | 0.9 | ||||||
Net cash used in investing activities | (42.7 | ) | (86.6 | ) | ||||
Cash flows from financing activities: | ||||||||
Dividends and returns of capital paid to parent | (19.0 | ) | — | |||||
Borrowings from revolving credit facilities | 30.0 | — | ||||||
Repayment of borrowings from revolving credit facilities | (15.0 | ) | — | |||||
Capital contributions from parent | 70.0 | — | ||||||
Issuance of long-term debt, net of discount | — | 442.8 | ||||||
Retirement of long-term debt | (103.3 | ) | (445.3 | ) | ||||
Payments of deferred financing costs | — | (8.0 | ) | |||||
Issuance of short-term debt - related party | 30.0 | 5.0 | ||||||
Repayment of short-term debt - related party | (35.0 | ) | (40.0 | ) | ||||
Other financing activities, net | — | (0.8 | ) | |||||
Net cash used in financing activities | (42.3 | ) | (46.3 | ) | ||||
Cash and cash equivalents: | ||||||||
Net change | 13.7 | 87.5 | ||||||
Balance at beginning of period | 1.6 | 5.4 | ||||||
Cash and cash equivalents at end of period | $ | 15.3 | $ | 92.9 | ||||
Supplemental cash flow information: | ||||||||
Interest paid, net of amounts capitalized | $ | 22.3 | $ | 16.3 | ||||
Income taxes paid, net | $ | 22.2 | $ | 0.3 | ||||
Non-cash financing and investing activities: | ||||||||
Accruals for capital expenditures | $ | 7.7 | $ | 10.1 | ||||
Equity contribution to settle liability | $ | — | $ | 7.5 |
Accounting Standard | Description | Date of Adoption | Effect on the financial statements upon adoption |
New Accounting Standards Adopted | |||
2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting | The standard simplifies the following aspects of accounting for share-based payments awards: accounting for income taxes, classification of excess tax benefits on the statement of cash flows, forfeitures, statutory tax withholding requirements, classification of awards as either equity or liabilities and classification of employee taxes paid on statement of cash flows when an employer withholds shares for tax-withholding purposes. Transition method: The recognition of excess tax benefits and tax deficiencies arising from vesting or settlement were applied retrospectively. The elimination of the requirement that excess tax benefits be realized before they are recognized was adopted on a modified retrospective basis. | January 1, 2017. | The primary effect of adoption was the recognition of excess tax benefits in our provision for income taxes in the period when the awards vest or are settled, rather than in paid-in-capital in the period when the excess tax benefits are realized. The adoption of this standard did not have a material impact on the financial statements. |
Accounting Standard | Description | Date of Adoption | Effect on the financial statements upon adoption |
New Accounting Standards Issued But Not Yet Effective | |||
2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to Accounting for Hedging Activities | The standard updates the hedge accounting model in ASC 815 to expand the ability to hedge risk, reduce complexity and ease certain documentation and assessment requirements. It also eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. Transition method: modified retrospective approach and prospective for presentation and disclosures. | January 1, 2019. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our financial statements and if we would early adopt it. |
2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities | This standard shortens the period of amortization of the premium on certain callable debt securities to the earliest call date. Transition method: modified retrospective. | January 1, 2019. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our financial statements. |
2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost | This standard changes the presentation of non-service cost expense associated with defined benefit plans and updates the guidance so that only the service cost component will be eligible for capitalization. Transition method: Retrospective for presentation of non-service cost expense. Prospective for the change in capitalization. | January 1, 2018. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our financial statements. |
2017-05, Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Topic 610-20) | This standard clarifies the scope and application of ASC 610-20 on the sale, transfer, and derecognition of nonfinancial assets and in substance nonfinancial assets to non-customers, including partial sales. It also clarifies that the derecognition of businesses is under scope of ASC 810. Transition method: full or modified retrospective we are in the process of identifying contracts that would not be completed as of January 1, 2018. Based on the assessment of contracts already executed as of the balance sheet date, the contracts that may require any type of assessment under the new standard are limited. | January 1, 2018. | We will adopt the standard on January 1, 2018; see below for the evaluation of the impact of its adoption on the financial statements. We will adopt the standard on January 1, 2018 and plan to use the modified retrospective approach. |
2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business | This standard provides guidance to assist the entities with evaluating when a set of transferred assets and activities is a business. Transition method: prospective. | January 1, 2018. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our financial statements. |
2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues Task Force) | This standard requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Transition method: retrospective. | January 1, 2018. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our financial statements. |
2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory | This standard requires that an entity recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. Transition method: modified retrospective. | January 1, 2018. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our financial statements. |
Accounting Standard | Description | Date of Adoption | Effect on the financial statements upon adoption |
2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments | This standard updates the impairment model for financial assets measured at amortized cost to an expected loss model rather than an incurred loss model. It also allows for the presentation of credit losses on available-for-sale debt securities as an allowance rather than a write down. Transition method: various. | January 1, 2020. Early adoption is permitted only as of January 1, 2019. | We are currently evaluating the impact of adopting the standard on our financial statements. |
2016-02, Leases (Topic 842) | This standard requires lessees to recognize assets and liabilities for most leases but recognize expenses in a manner similar to today’s accounting. For lessors, the guidance modifies the lease classification criteria and the accounting for sales-type and direct financing leases. The guidance also eliminates today’s real estate-specific provisions. Transition method: modified retrospective at the beginning of the earliest comparative period presented in the financial statements (January 1, 2017). We have established a task force focused on the identification of contracts that would be under the scope of the new standard and on the assessment and measurement of the right-of-use asset and related liability. The implementation team is in the process of evaluating changes to our business processes, systems and controls to support recognition and disclosure under the new standard. | January 1, 2019. Early adoption is permitted. | We are currently evaluating the impact of adopting the standard on our financial statements. We intend to adopt the standard as of January 1, 2019. |
2014-09, 2015-14, 2016-08, 2016-10, 2016-12, 2016-20, 2017-05, 2017-13 Revenue from Contracts with Customers (Topic 606) | See discussion of the ASUs below. | January 1, 2018. | We will adopt the standard on January 1, 2018; see below for the evaluation of the impact of its adoption on the financial statements. |
September 30, | December 31, | |||||||
$ in millions | 2017 | 2016 | ||||||
Accounts receivable, net: | ||||||||
Unbilled revenue | $ | 14.4 | $ | 43.0 | ||||
Customer receivables | 68.7 | 71.2 | ||||||
Amounts due from affiliates | 2.3 | 2.9 | ||||||
Amounts due from partners in jointly-owned plants | 17.8 | 12.7 | ||||||
Other | 5.8 | 6.0 | ||||||
Provision for uncollectible accounts | (1.1 | ) | (1.2 | ) | ||||
Total accounts receivable, net | $ | 107.9 | $ | 134.6 | ||||
Inventories, at average cost: | ||||||||
Fuel and limestone | $ | 16.8 | $ | 38.8 | ||||
Plant materials and supplies | 9.1 | 35.3 | ||||||
Other | 1.0 | 1.7 | ||||||
Total inventories, at average cost | $ | 26.9 | $ | 75.8 |
Details about Accumulated Other Comprehensive Income / (Loss) components | Affected line item in the Condensed Consolidated Statements of Operations | Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||||
Gains and losses on Available-for-sale securities activity (Note 5): | ||||||||||||||||||
Other income | $ | — | $ | — | $ | (0.1 | ) | $ | — | |||||||||
Gains and losses on cash flow hedges (Note 6): | ||||||||||||||||||
Interest expense | (0.3 | ) | (0.3 | ) | (0.8 | ) | (0.9 | ) | ||||||||||
Revenue | (4.2 | ) | (9.3 | ) | (12.5 | ) | (46.5 | ) | ||||||||||
Purchased power | 0.7 | 1.0 | 4.0 | 9.1 | ||||||||||||||
Total before income taxes | (3.8 | ) | (8.6 | ) | (9.3 | ) | (38.3 | ) | ||||||||||
Tax expense | 1.4 | 3.0 | 3.3 | 13.5 | ||||||||||||||
Net of income taxes | (2.4 | ) | (5.6 | ) | (6.0 | ) | (24.8 | ) | ||||||||||
Amortization of defined benefit pension items (Note 9): | ||||||||||||||||||
Operation and maintenance | 1.1 | 1.1 | 5.9 | 3.3 | ||||||||||||||
Tax benefit | (0.4 | ) | (0.4 | ) | (2.1 | ) | (1.6 | ) | ||||||||||
Net of income taxes | 0.7 | 0.7 | 3.8 | 1.7 | ||||||||||||||
Total reclassifications for the period, net of income taxes | $ | (1.7 | ) | $ | (4.9 | ) | $ | (2.3 | ) | $ | (23.1 | ) |
$ in millions | Gains / (losses) on available-for-sale securities | Gains / (losses) on cash flow hedges | Change in unfunded pension obligation | Total | ||||||||||||
Balance at January 1, 2017 | $ | 0.7 | $ | (2.7 | ) | $ | (40.5 | ) | $ | (42.5 | ) | |||||
Other comprehensive income / (loss) before reclassifications | 0.4 | 12.1 | (1.6 | ) | 10.9 | |||||||||||
Amounts reclassified from accumulated other comprehensive income / (loss) | (0.1 | ) | (6.0 | ) | 3.8 | (2.3 | ) | |||||||||
Net current period other comprehensive income | 0.3 | 6.1 | 2.2 | 8.6 | ||||||||||||
Balance at September 30, 2017 | $ | 1.0 | $ | 3.4 | $ | (38.3 | ) | $ | (33.9 | ) |
• | Bypassable standard offer energy rates for DP&L’s customers based on competitive bid auctions; |
• | The establishment of a three-year non-bypassable Distribution Modernization Rider (DMR) designed to collect $105.0 million in revenue per year to pay debt obligations at DPL and DP&L and position DP&L to modernize and/or maintain its transmission and distribution infrastructure. With PUCO approval, DP&L has the option of extending the duration of the DMR for an additional two years; |
• | The establishment of a non-bypassable Distribution Investment Rider to recover incremental distribution capital investments, the amount of which is to be established in a separate DP&L distribution rate case |
• | A non-bypassable Reconciliation Rider permitting DP&L to defer, recover or credit the net proceeds from selling energy and capacity received as part of DP&L’s investment in OVEC and DP&L's OVEC related costs; |
• | Implementation by DP&L of a Smart Grid Rider, Economic Development Rider, Economic Development Fund, Regulatory Compliance Rider and certain other new, or changes to existing, rates, riders and competitive retail market enhancements, with tariffs consistent with the order to be effective November 1, 2017; |
• | A commitment to commence a sale process to sell our ownership interests in the Zimmer, Miami Fort and Conesville coal-fired generation plants, with all sales proceeds used to pay debt of DPL and DP&L; and |
• | Restrictions on DPL making dividend or tax sharing payments; and |
• | Various other riders and competitive retail market enhancements. |
DP&L Share | DP&L Carrying Value | ||||||||||||||||
Ownership (%) | Summer Production Capacity (MW) | Gross Plant In Service ($ in millions) | Accumulated Depreciation ($ in millions) | Construction Work in Process ($ in millions) | |||||||||||||
Jointly-owned production units | |||||||||||||||||
Conesville - Unit 4 | 16.5 | 129 | $ | 0.5 | $ | 0.5 | $ | 2.3 | |||||||||
Killen - Unit 2 | 67.0 | 402 | 8.5 | 4.1 | — | ||||||||||||
Miami Fort - Units 7 and 8 (a) | 36.0 | 368 | 31.3 | 3.3 | 5.1 | ||||||||||||
Stuart - Units 2 through 4 | 35.0 | 606 | 0.7 | 0.7 | — | ||||||||||||
Zimmer - Unit 1 (a) | 28.1 | 371 | 21.3 | 15.3 | 5.2 | ||||||||||||
Transmission (at varying percentages) | 98.6 | 66.9 | — | ||||||||||||||
Total | 1,876 | $ | 160.9 | $ | 90.8 | $ | 12.6 |
(a) | DP&L has entered into an agreement to sell its interest in these units. See Note 13 – Assets and Liabilities Held for Sale for additional information. |
$ in millions | |||
Balance at January 1, 2017 | $ | 135.2 | |
Additions | 0.1 | ||
Revisions to cash flow and timing estimates | (4.8 | ) | |
Accretion expense | 4.0 | ||
Settlements | (0.1 | ) | |
Reclassified to Liabilities held for sale | (3.4 | ) | |
Balance at September 30, 2017 | $ | 131.0 |
September 30, 2017 | December 31, 2016 | |||||||||||||||
$ in millions | Cost | Fair Value | Cost | Fair Value | ||||||||||||
Assets | ||||||||||||||||
Money market funds | $ | 0.4 | $ | 0.4 | $ | 0.4 | $ | 0.4 | ||||||||
Equity securities | 2.6 | 4.1 | 2.4 | 3.4 | ||||||||||||
Debt securities | 4.2 | 4.3 | 4.4 | 4.4 | ||||||||||||
Hedge funds | 0.1 | 0.1 | — | 0.1 | ||||||||||||
Real estate | — | — | 0.3 | 0.3 | ||||||||||||
Tangible assets | 0.1 | 0.1 | 0.1 | 0.1 | ||||||||||||
Total assets | $ | 7.4 | $ | 9.0 | $ | 7.6 | $ | 8.7 | ||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Liabilities | ||||||||||||||||
Long-term debt (a) | $ | 647.7 | $ | 659.5 | $ | 749.0 | $ | 763.5 |
(a) | Amounts exclude immaterial capital lease obligations |
• | Level 1 (quoted prices in active markets for identical assets or liabilities); |
• | Level 2 (observable inputs such as quoted prices for similar assets or liabilities or quoted prices in markets that are not active); or |
• | Level 3 (unobservable inputs) reflecting management’s own assumptions about the inputs used in pricing the asset or liability). |
Assets and Liabilities at Fair Value | ||||||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||||||
$ in millions | Fair value at September 30, 2017 (a) | Based on Quoted Prices in Active Markets | Other Observable Inputs | Unobservable Inputs | ||||||||||||
Assets | ||||||||||||||||
Master Trust assets | ||||||||||||||||
Money market funds | $ | 0.4 | $ | 0.4 | $ | — | $ | — | ||||||||
Equity securities | 4.1 | — | 4.1 | — | ||||||||||||
Debt securities | 4.3 | — | 4.3 | — | ||||||||||||
Hedge funds | 0.1 | — | 0.1 | — | ||||||||||||
Tangible assets | 0.1 | — | 0.1 | — | ||||||||||||
Total Master Trust assets | 9.0 | 0.4 | 8.6 | — | ||||||||||||
Derivative assets | ||||||||||||||||
Natural gas futures | 0.9 | 0.9 | — | — | ||||||||||||
Interest rate hedges | — | — | — | — | ||||||||||||
Forward power contracts | 10.8 | — | 10.8 | — | ||||||||||||
Total derivative assets | 11.7 | 0.9 | 10.8 | — | ||||||||||||
Total assets | $ | 20.7 | $ | 1.3 | $ | 19.4 | $ | — | ||||||||
Liabilities | ||||||||||||||||
Derivative liabilities | ||||||||||||||||
FTRs | $ | 0.5 | $ | — | $ | — | $ | 0.5 | ||||||||
Interest rate hedges | — | — | — | — | ||||||||||||
Natural gas futures | 0.8 | 0.8 | — | — | ||||||||||||
Forward power contracts | 8.1 | — | 8.1 | — | ||||||||||||
Total derivative liabilities | 9.4 | 0.8 | 8.1 | 0.5 | ||||||||||||
Long-term debt (b) | 659.5 | — | 641.6 | 17.9 | ||||||||||||
Total liabilities | $ | 668.9 | $ | 0.8 | $ | 649.7 | $ | 18.4 |
(a) | Includes credit valuation adjustment |
(b) | Amounts exclude immaterial capital lease obligations |
Assets and Liabilities at Fair Value | ||||||||||||||||
Level 1 | Level 2 | Level 3 | ||||||||||||||
$ in millions | Fair value at December 31, 2016 (a) | Based on Quoted Prices in Active Markets | Other Observable Inputs | Unobservable Inputs | ||||||||||||
Assets | ||||||||||||||||
Master Trust assets | ||||||||||||||||
Money market funds | $ | 0.4 | $ | 0.4 | $ | — | $ | — | ||||||||
Equity securities | 3.4 | — | 3.4 | — | ||||||||||||
Debt securities | 4.4 | — | 4.4 | — | ||||||||||||
Hedge funds | 0.1 | — | 0.1 | — | ||||||||||||
Real estate | 0.3 | — | 0.3 | — | ||||||||||||
Tangible assets | 0.1 | — | 0.1 | — | ||||||||||||
Total Master Trust assets | 8.7 | 0.4 | 8.3 | — | ||||||||||||
Derivative assets | ||||||||||||||||
FTRs | 0.1 | — | — | 0.1 | ||||||||||||
Interest rate hedges | 1.2 | — | 1.2 | — | ||||||||||||
Forward power contracts | 19.5 | — | 19.5 | — | ||||||||||||
Total Derivative assets | 20.8 | — | 20.7 | 0.1 | ||||||||||||
Total assets | $ | 29.5 | $ | 0.4 | $ | 29.0 | $ | 0.1 | ||||||||
Liabilities | ||||||||||||||||
Derivative liabilities | ||||||||||||||||
Interest rate hedges | $ | 0.7 | $ | — | $ | 0.7 | $ | — | ||||||||
Forward power contracts | 28.5 | — | 26.0 | 2.5 | ||||||||||||
Total Derivative liabilities | 29.2 | — | 26.7 | 2.5 | ||||||||||||
Long-term debt (b) | 763.5 | — | 745.5 | 18.0 | ||||||||||||
Total liabilities | $ | 792.7 | $ | — | $ | 772.2 | $ | 20.5 |
(a) | Includes credit valuation adjustment |
(b) | Amounts exclude immaterial capital lease obligations |
• | Level 1 inputs are used for derivative contracts such as natural gas futures and for money market accounts that are considered cash equivalents. The fair value is determined by reference to quoted market prices and other relevant information generated by market transactions. |
• | Level 2 inputs are used to value derivatives such as forward power contracts (which are traded on the OTC market but which are valued using prices on the NYMEX for similar contracts on the OTC market). Other Level 2 assets include open-ended mutual funds in the Master Trust, which are valued using the end of day NAV per unit. |
• | Level 3 inputs such as FTRs are considered a Level 3 input because the monthly auctions are considered inactive. Other Level 3 inputs include the credit valuation adjustment on some of the forward power contracts and forward power contracts in less active markets. Our Level 3 inputs are immaterial to our derivative balances as a whole and as such no further disclosures are presented. |
Carrying | Fair Value | Gross | ||||||||||||||||||
Amount (b) | Level 1 | Level 2 | Level 3 | Loss | ||||||||||||||||
$ in millions | Nine months ended September 30, 2017 | |||||||||||||||||||
Assets | ||||||||||||||||||||
Long-lived assets (a) | ||||||||||||||||||||
Stuart | $ | 42.3 | $ | — | $ | — | $ | 3.3 | $ | 39.0 | ||||||||||
Killen | $ | 35.2 | $ | — | $ | — | $ | 7.9 | $ | 27.3 | ||||||||||
$ | 66.3 | |||||||||||||||||||
Nine months ended September 30, 2016 | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Long-lived assets (a) | ||||||||||||||||||||
Stuart | $ | 456.4 | $ | — | $ | — | $ | 164.4 | $ | 292.0 | ||||||||||
Killen | $ | 330.5 | $ | — | $ | — | $ | 84.3 | $ | 246.2 | ||||||||||
Zimmer | $ | 429.9 | $ | — | $ | — | $ | 111.0 | $ | 318.9 | ||||||||||
$ | 857.1 |
$ in millions | Fair value | Valuation technique | Unobservable input | Weighted average | |||||||
Long-lived assets held and used: | |||||||||||
Stuart | $ | 3.3 | Discounted cash flow | Pre-tax operating margin (through remaining life) | 10.0 | % | |||||
Weighted-average cost of capital | 7.0 | % | |||||||||
Killen | $ | 7.9 | Discounted cash flow | Pre-tax operating margin (through remaining life) | 22.0 | % | |||||
Weighted-average cost of capital | 7.0 | % |
$ in millions | Fair value | Valuation technique | Unobservable input | Weighted average | ||||||
Long-lived assets held and used: | ||||||||||
Stuart | $ | 164.4 | Discounted cash flow | Annual revenue growth | -9.0% to 10.0% (2.0%) | |||||
Annual pre-tax operating margin | -29.0% to 52.0% (5.0%) | |||||||||
Weighted-average cost of capital | 9.0% | |||||||||
Killen | $ | 84.3 | Discounted cash flow | Annual revenue growth | -11.0% to 13.0% (2.0%) | |||||
Annual pre-tax operating margin | -50.0% to 67.0% (6.0%) | |||||||||
Weighted-average cost of capital | 11.0% | |||||||||
Zimmer | $ | 111.0 | Discounted cash flow | Annual revenue growth | -14.0% to 13.0% (1.0%) | |||||
Annual pre-tax operating margin | -46.0% to 80.0% (4.0%) | |||||||||
Weighted-average cost of capital | 9.0% |
Commodity | Accounting Treatment (a) | Unit | Purchases (in thousands) | Sales (in thousands) | Net Purchases/ (Sales) (in thousands) | |||||||||||
FTRs | Not designated | MWh | 3.4 | — | 3.4 | |||||||||||
Natural gas futures | Not designated | Dths | 6,625.0 | (390.0 | ) | 6,235.0 | ||||||||||
Forward power contracts | Designated | MWh | 649.0 | (2,478.9 | ) | (1,829.9 | ) | |||||||||
Forward power contracts | Not designated | MWh | 1,082.8 | (1,060.0 | ) | 22.8 | ||||||||||
Interest rate swaps | Designated | USD | $ | 200,000.0 | $ | — | $ | 200,000.0 |
Commodity | Accounting Treatment (a) | Unit | Purchases (in thousands) | Sales (in thousands) | Net Purchases/ (Sales) (in thousands) | |||||||||||
FTRs | Not designated | MWh | 2.3 | — | 2.3 | |||||||||||
Natural gas futures | Not designated | Dths | 1,590.0 | — | 1,590.0 | |||||||||||
Forward power contracts | Designated | MWh | 342.9 | (9,974.5 | ) | (9,631.6 | ) | |||||||||
Forward power contracts | Not designated | MWh | 2,568.3 | (2,037.5 | ) | 530.8 | ||||||||||
Interest rate swaps | Designated | USD | $ | 200,000.0 | $ | — | $ | 200,000.0 |
Three months ended | Three months ended | |||||||||||||||
September 30, 2017 | September 30, 2016 | |||||||||||||||
Interest | Interest | |||||||||||||||
$ in millions (net of tax) | Power | Rate Hedge | Power | Rate Hedge | ||||||||||||
Beginning accumulated derivative gains in AOCI | $ | 3.0 | $ | 1.4 | $ | 3.4 | $ | 1.6 | ||||||||
Net gains associated with current period hedging transactions | 1.3 | 0.1 | 9.5 | — | ||||||||||||
Net gains / (losses) reclassified to earnings | ||||||||||||||||
Interest expense | — | (0.2 | ) | — | (0.2 | ) | ||||||||||
Revenues | (2.7 | ) | — | (6.0 | ) | — | ||||||||||
Purchased power | 0.5 | — | 0.6 | — | ||||||||||||
Ending accumulated derivative gains in AOCI | $ | 2.1 | $ | 1.3 | $ | 7.5 | $ | 1.4 | ||||||||
Nine months ended | Nine months ended | |||||||||||||||
September 30, 2017 | September 30, 2016 | |||||||||||||||
Interest | Interest | |||||||||||||||
$ in millions (net of tax) | Power | Rate Hedge | Power | Rate Hedge | ||||||||||||
Beginning accumulated derivative gains / (losses) in AOCI | $ | (4.3 | ) | $ | 1.6 | $ | 9.2 | $ | 2.0 | |||||||
Net gains associated with current period hedging transactions | 11.9 | 0.2 | 22.5 | — | ||||||||||||
Net gains / (losses) reclassified to earnings | ||||||||||||||||
Interest expense | — | (0.5 | ) | — | (0.6 | ) | ||||||||||
Revenues | (8.1 | ) | — | (30.1 | ) | — | ||||||||||
Purchased power | 2.6 | — | 5.9 | — | ||||||||||||
Ending accumulated derivative gains in AOCI | $ | 2.1 | $ | 1.3 | $ | 7.5 | $ | 1.4 | ||||||||
Portion expected to be reclassified to earnings in the next twelve months (a) | $ | 1.5 | $ | (0.4 | ) | |||||||||||
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months) | 6 | 37 |
(a) | The actual amounts that we reclassify from AOCI to earnings related to power can differ from the estimate above due to market price changes. |
For the three months ended September 30, 2017 | ||||||||||||||||
$ in millions | FTRs | Power | Natural Gas | Total | ||||||||||||
Change in unrealized gain / (loss) | $ | 0.2 | $ | (1.4 | ) | $ | — | $ | (1.2 | ) | ||||||
Realized gain / (loss) | 0.2 | 1.9 | (0.2 | ) | 1.9 | |||||||||||
Total | $ | 0.4 | $ | 0.5 | $ | (0.2 | ) | $ | 0.7 | |||||||
Recorded in Income Statement: gain / (loss) | ||||||||||||||||
Revenues | $ | — | $ | 3.3 | $ | — | $ | 3.3 | ||||||||
Purchased power | 0.4 | (2.8 | ) | (0.2 | ) | (2.6 | ) | |||||||||
Total | $ | 0.4 | $ | 0.5 | $ | (0.2 | ) | $ | 0.7 | |||||||
For the three months ended September 30, 2016 | ||||||||||||||||
$ in millions | FTRs | Power | Natural Gas | Total | ||||||||||||
Change in unrealized gain / (loss) | $ | — | $ | 1.2 | $ | (0.3 | ) | $ | 0.9 | |||||||
Realized gain / (loss) | (0.1 | ) | (2.4 | ) | 0.2 | (2.3 | ) | |||||||||
Total | $ | (0.1 | ) | $ | (1.2 | ) | $ | (0.1 | ) | $ | (1.4 | ) | ||||
Recorded in Income Statement: gain / (loss) | ||||||||||||||||
Revenues | $ | — | $ | (10.4 | ) | $ | — | $ | (10.4 | ) | ||||||
Purchased power | (0.1 | ) | 9.2 | (0.1 | ) | 9.0 | ||||||||||
Total | $ | (0.1 | ) | $ | (1.2 | ) | $ | (0.1 | ) | $ | (1.4 | ) | ||||
For the nine months ended September 30, 2017 | ||||||||||||||||
$ in millions | FTRs | Power | Natural Gas | Total | ||||||||||||
Change in unrealized gain / (loss) | $ | (0.5 | ) | $ | 2.2 | $ | (0.8 | ) | $ | 0.9 | ||||||
Realized gain / (loss) | 0.5 | (1.5 | ) | (0.3 | ) | (1.3 | ) | |||||||||
Total | $ | — | $ | 0.7 | $ | (1.1 | ) | $ | (0.4 | ) | ||||||
Recorded in Income Statement: gain / (loss) | ||||||||||||||||
Revenues | $ | — | $ | (2.7 | ) | $ | — | $ | (2.7 | ) | ||||||
Purchased power | — | 3.4 | (1.1 | ) | 2.3 | |||||||||||
Total | $ | — | $ | 0.7 | $ | (1.1 | ) | $ | (0.4 | ) | ||||||
For the nine months ended September 30, 2016 | ||||||||||||||||
$ in millions | FTRs | Power | Natural Gas | Total | ||||||||||||
Change in unrealized gain / (loss) | $ | 0.4 | $ | 2.3 | $ | — | $ | 2.7 | ||||||||
Realized gain / (loss) | (0.4 | ) | (5.3 | ) | 0.7 | (5.0 | ) | |||||||||
Total | $ | — | $ | (3.0 | ) | $ | 0.7 | $ | (2.3 | ) | ||||||
Recorded in Income Statement: gain / (loss) | ||||||||||||||||
Revenues | $ | — | $ | (13.1 | ) | $ | — | $ | (13.1 | ) | ||||||
Purchased power | — | 10.1 | 0.7 | 10.8 | ||||||||||||
Total | $ | — | $ | (3.0 | ) | $ | 0.7 | $ | (2.3 | ) |
Fair Values of Derivative Instruments | ||||||||||||||||||
at September 30, 2017 | ||||||||||||||||||
Gross Amounts Not Offset in the Condensed Balance Sheets | ||||||||||||||||||
$ in millions | Hedging Designation | Gross Fair Value as presented in the Balance Sheets (a) | Financial Instruments with Same Counterparty in Offsetting Position | Cash Collateral | Net Fair Value | |||||||||||||
Assets | ||||||||||||||||||
Short-term derivative positions (presented in Other prepayments and current assets) | ||||||||||||||||||
Forward power contracts | Designated | $ | 7.0 | $ | (4.6 | ) | $ | — | $ | 2.4 | ||||||||
Forward power contracts | Not designated | 3.5 | (2.7 | ) | — | 0.8 | ||||||||||||
Natural gas futures | Not designated | — | — | — | — | |||||||||||||
Long-term derivative positions (presented in Other deferred assets) | ||||||||||||||||||
Interest rate swap | Designated | 0.9 | — | — | 0.9 | |||||||||||||
Natural gas futures | Not designated | — | — | — | — | |||||||||||||
Forward power contracts | Not designated | 0.3 | — | — | 0.3 | |||||||||||||
Total assets | $ | 11.7 | $ | (7.3 | ) | $ | — | $ | 4.4 | |||||||||
Liabilities | ||||||||||||||||||
Short-term derivative positions (presented in Other current liabilities) | ||||||||||||||||||
Forward power contracts | Designated | $ | 4.6 | $ | (4.6 | ) | $ | — | $ | — | ||||||||
Interest rate swaps | Designated | — | — | — | — | |||||||||||||
Forward power contracts | Not designated | 3.5 | (2.7 | ) | (0.7 | ) | 0.1 | |||||||||||
Natural gas futures | Not designated | 0.8 | — | (0.8 | ) | — | ||||||||||||
FTRs | Not designated | 0.5 | — | — | 0.5 | |||||||||||||
Long-term derivative positions (presented in Other deferred credits) | ||||||||||||||||||
Natural gas futures | Not designated | — | — | — | — | |||||||||||||
Total liabilities | $ | 9.4 | $ | (7.3 | ) | $ | (1.5 | ) | $ | 0.6 |
Fair Values of Derivative Instruments | ||||||||||||||||||
at December 31, 2016 | ||||||||||||||||||
Gross Amounts Not Offset in the Condensed Balance Sheets | ||||||||||||||||||
$ in millions | Hedging Designation | Gross Fair Value as presented in the Balance Sheets (a) | Financial Instruments with Same Counterparty in Offsetting Position | Cash Collateral | Net Fair Value | |||||||||||||
Assets | ||||||||||||||||||
Short-term derivative positions (presented in Other prepayments and current assets) | ||||||||||||||||||
Forward power contracts | Designated | $ | 11.0 | $ | (10.5 | ) | $ | — | $ | 0.5 | ||||||||
Forward power contracts | Not designated | 6.0 | (4.7 | ) | — | 1.3 | ||||||||||||
FTRs | Not designated | 0.1 | — | — | 0.1 | |||||||||||||
Long-term derivative positions (presented in Other deferred assets) | ||||||||||||||||||
Interest rate swaps | Designated | 1.2 | — | — | 1.2 | |||||||||||||
Forward power contracts | Designated | 0.6 | (0.6 | ) | — | — | ||||||||||||
Forward power contracts | Not designated | 1.9 | (1.0 | ) | — | 0.9 | ||||||||||||
Total assets | $ | 20.8 | $ | (16.8 | ) | $ | — | $ | 4.0 | |||||||||
Liabilities | ||||||||||||||||||
Short-term derivative positions (presented in Other current liabilities) | ||||||||||||||||||
Forward power contracts | Designated | $ | 16.4 | $ | (10.5 | ) | $ | (5.5 | ) | $ | 0.4 | |||||||
Interest rate swaps | Designated | 0.7 | — | — | 0.7 | |||||||||||||
Forward power contracts | Not designated | 7.7 | (4.7 | ) | — | 3.0 | ||||||||||||
Long-term derivative positions (presented in Other deferred credits) | ||||||||||||||||||
Forward power contracts | Designated | 2.4 | (0.6 | ) | (0.8 | ) | 1.0 | |||||||||||
Forward power contracts | Not designated | 2.0 | (1.0 | ) | — | 1.0 | ||||||||||||
Total liabilities | $ | 29.2 | $ | (16.8 | ) | $ | (6.3 | ) | $ | 6.1 |
Interest | September 30, | December 31, | ||||||||||
$ in millions | Rate | Maturity | 2017 | 2016 | ||||||||
Term loan - rates from 4.01% - 4.49% (a) and 4.00% - 4.01% (b) | 2022 | $ | 441.7 | $ | 445.0 | |||||||
Tax-exempt First Mortgage Bonds | 4.8% | 2036 | — | 100.0 | ||||||||
Tax-exempt First Mortgage Bonds - rates from 1.52% - 1.83% (a) and 1.29% - 1.42% (b) | 2020 | 200.0 | 200.0 | |||||||||
U.S. Government note | 4.2% | 2061 | 17.9 | 18.0 | ||||||||
Capital leases | 0.3 | 0.4 | ||||||||||
Unamortized deferred financing costs | (9.9 | ) | (11.8 | ) | ||||||||
Unamortized long-term debt discounts | (2.0 | ) | (2.2 | ) | ||||||||
Total long-term debt | 648.0 | 749.4 | ||||||||||
Less: current portion | (4.7 | ) | (4.7 | ) | ||||||||
Long-term debt, net of current portion | $ | 643.3 | $ | 744.7 |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
2017 | 2016 | 2017 | 2016 | |||||
DP&L | 28.9% | 39.6% | 5.3% | 36.7% |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Service cost | $ | 1.5 | $ | 1.4 | $ | 4.3 | $ | 4.2 | ||||||||
Interest cost | 3.5 | 3.7 | 10.6 | 11.1 | ||||||||||||
Expected return on plan assets | (5.7 | ) | (5.7 | ) | (17.1 | ) | (17.1 | ) | ||||||||
Plan curtailment (a) | — | — | 5.6 | — | ||||||||||||
Amortization of unrecognized: | ||||||||||||||||
Prior service cost | 0.3 | 0.8 | 1.1 | 2.3 | ||||||||||||
Actuarial loss | 2.1 | 1.8 | 6.6 | 5.4 | ||||||||||||
Net periodic benefit cost | $ | 1.7 | $ | 2.0 | $ | 11.1 | $ | 5.9 |
(a) | As a result of the decision to retire certain of DP&L's coal-fired plants, we recognized a plan curtailment of $5.6 million in the first quarter of 2017. See Note 14 – Fixed-asset Impairments for more information. |
$ in millions | ||||
Estimated to be paid during | Pension | |||
2017 | $ | 6.3 | ||
2018 | $ | 25.5 | ||
2019 | $ | 26.0 | ||
2020 | $ | 26.4 | ||
2021 | $ | 26.7 | ||
2022 - 2026 | $ | 139.6 |
• | The federal CAA and state laws and regulations (including State Implementation Plans) which require compliance, obtaining permits and reporting as to air emissions; |
• | Litigation with federal and certain state governments and certain special interest groups regarding whether modifications to or maintenance of certain coal-fired generating stations require additional permitting or pollution control technology, or whether emissions from coal-fired generating stations cause or contribute to climate change; |
• | Rules and future rules issued by the USEPA, the Ohio EPA or other authorities that require or will require substantial reductions in SO2, particulates, mercury, acid gases, NOx, and other air emissions. DP&L has installed emission control technology and is taking other measures to comply with required and anticipated reductions; |
• | Rules and future rules issued by the USEPA, the Ohio EPA or other authorities that require or will require reporting and reductions of GHGs; |
• | Rules and future rules issued by the USEPA, the Ohio EPA or other authorities associated with the federal Clean Water Act, which prohibits the discharge of pollutants into waters of the United States except pursuant to appropriate permits; and |
• | Solid and hazardous waste laws and regulations, which govern the management and disposal of certain waste. The majority of solid waste created from the combustion of coal and fossil fuels consists of fly ash and other coal combustion by-products. |
$ in millions | T&D | Generation | Adjustments and Eliminations | DP&L Total | ||||||||||||
Three months ended September 30, 2017 | ||||||||||||||||
Revenues from external customers | $ | 184.2 | $ | 121.4 | $ | — | $ | 305.6 | ||||||||
Intersegment revenues | — | — | — | — | ||||||||||||
Total revenues | $ | 184.2 | $ | 121.4 | $ | — | $ | 305.6 | ||||||||
Depreciation and amortization | $ | 19.6 | $ | 3.1 | $ | — | $ | 22.7 | ||||||||
Interest expense | $ | 7.7 | $ | — | $ | — | $ | 7.7 | ||||||||
Income from operations before income tax | $ | 20.0 | $ | 21.2 | $ | — | $ | 41.2 | ||||||||
Cash capital expenditures | $ | 20.6 | $ | 4.2 | $ | — | $ | 24.8 |
$ in millions | T&D | Generation | Adjustments and Eliminations | DP&L Total | ||||||||||||
Three months ended September 30, 2016 | ||||||||||||||||
Revenues from external customers | $ | 215.8 | $ | 152.6 | $ | — | $ | 368.4 | ||||||||
Intersegment revenues | — | — | — | — | ||||||||||||
Total revenues | $ | 215.8 | $ | 152.6 | $ | — | $ | 368.4 | ||||||||
Depreciation and amortization | $ | 17.8 | $ | 6.3 | $ | — | $ | 24.1 | ||||||||
Interest expense | $ | 6.4 | $ | 0.1 | $ | — | $ | 6.5 | ||||||||
Income from operations before income tax | $ | 36.5 | $ | 13.3 | $ | — | $ | 49.8 | ||||||||
Cash capital expenditures | $ | 19.6 | $ | 6.9 | $ | — | $ | 26.5 |
$ in millions | T&D | Generation | Adjustments and Eliminations | DP&L Total | ||||||||||||
Nine months ended September 30, 2017 | ||||||||||||||||
Revenues from external customers | $ | 542.5 | $ | 358.3 | $ | — | $ | 900.8 | ||||||||
Intersegment revenues | — | — | — | — | ||||||||||||
Total revenues | $ | 542.5 | $ | 358.3 | $ | — | $ | 900.8 | ||||||||
Depreciation and amortization | $ | 56.3 | $ | 11.9 | $ | — | $ | 68.2 | ||||||||
Fixed-asset Impairments (Note 14) | $ | — | $ | 66.3 | $ | — | $ | 66.3 | ||||||||
Interest expense | $ | 22.9 | $ | 0.2 | $ | — | $ | 23.1 | ||||||||
Income / (loss) from operations before income tax | $ | 60.1 | $ | (56.3 | ) | $ | — | $ | 3.8 | |||||||
Cash capital expenditures | $ | 66.3 | $ | 16.1 | $ | — | $ | 82.4 | ||||||||
At September 30, 2017 | ||||||||||||||||
Total assets | $ | 1,655.3 | $ | 178.0 | $ | — | $ | 1,833.3 |
$ in millions | T&D | Generation | Adjustments and Eliminations | DP&L Total | ||||||||||||
Nine months ended September 30, 2016 | ||||||||||||||||
Revenues from external customers | $ | 605.4 | $ | 425.9 | $ | — | $ | 1,031.3 | ||||||||
Intersegment revenues | — | — | — | — | ||||||||||||
Total revenues | $ | 605.4 | $ | 425.9 | $ | — | $ | 1,031.3 | ||||||||
Depreciation and amortization | $ | 55.1 | $ | 40.1 | $ | — | $ | 95.2 | ||||||||
Fixed-asset Impairments (Note 14) | $ | — | $ | 857.1 | $ | — | $ | 857.1 | ||||||||
Interest expense | $ | 16.9 | $ | 0.3 | $ | — | $ | 17.2 | ||||||||
Income / (loss) from operations before income tax | $ | 98.5 | $ | (837.9 | ) | $ | — | $ | (739.4 | ) | ||||||
Cash capital expenditures | $ | 61.8 | $ | 36.5 | $ | — | $ | 98.3 | ||||||||
At December 31, 2016 | ||||||||||||||||
Total assets | $ | 1,710.5 | $ | 324.6 | $ | — | $ | 2,035.1 |
$ in millions | September 30, 2017 | |||
Assets | ||||
Accounts receivable, net (a) | $ | (11.2 | ) | |
Inventories | 22.7 | |||
Property, plant & equipment, net | 44.8 | |||
Other prepayments and current assets | 0.7 | |||
Total assets of the disposal group classified as held for sale in the balance sheet | $ | 57.0 | ||
Liabilities | ||||
Accounts payable | $ | 0.7 | ||
Accrued taxes | 2.6 | |||
Asset retirement obligations | 3.4 | |||
Other liabilities (b) | (0.7 | ) | ||
Total liabilities of the disposal group classified as held for sale in the balance sheet | $ | 6.0 |
(a) | Represents credit balances netted in Accounts Receivable, due to the right of offset with partners |
(b) | Represents amounts due to (from) partners for pension benefits associated with partner-operated plants |
• | Review of Results of Operations |
◦ | DPL |
▪ | DPL - T&D Segment |
▪ | DPL - Generation Segment |
◦ | DP&L |
▪ | DP&L - T&D Segment |
▪ | DP&L - Generation Segment |
• | Key Trends and Uncertainties |
• | Capital Resources and Liquidity |
• | Market Risk |
• | Critical Accounting Estimates |
• | water intake regulations finalized by the USEPA on May 19, 2014; |
• | the appeal of the NPDES permit governing the discharge of water from the Stuart station; and |
• | revised technology-based regulations governing water discharges from steam electric generating facilities, finalized by the USEPA on November 3, 2015. |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenues: | ||||||||||||||||
Retail | $ | 163.8 | $ | 197.4 | $ | 487.1 | $ | 553.1 | ||||||||
Wholesale | 102.2 | 138.3 | 299.8 | 368.0 | ||||||||||||
RTO revenues | 15.3 | 16.8 | 43.7 | 47.2 | ||||||||||||
RTO capacity revenues | 39.8 | 32.9 | 106.6 | 104.6 | ||||||||||||
Other revenues | 2.8 | 3.9 | 8.7 | 8.7 | ||||||||||||
Total revenues | 323.9 | 389.3 | 945.9 | 1,081.6 | ||||||||||||
Cost of revenues: | ||||||||||||||||
Fuel cost: | ||||||||||||||||
Fuel | 57.6 | 80.4 | 166.3 | 210.9 | ||||||||||||
Gains from the sale of coal | (0.3 | ) | (1.9 | ) | (0.9 | ) | (4.9 | ) | ||||||||
Mark-to-market losses | — | 0.4 | — | — | ||||||||||||
Net fuel cost | 57.3 | 78.9 | 165.4 | 206.0 | ||||||||||||
Purchased power: | ||||||||||||||||
Purchased power | 63.2 | 86.1 | 200.4 | 254.5 | ||||||||||||
RTO charges | 15.8 | 23.2 | 53.3 | 60.2 | ||||||||||||
RTO capacity charges | 3.8 | 3.6 | 10.7 | 18.5 | ||||||||||||
Mark-to-market losses / (gains) | 1.2 | (1.2 | ) | (1.0 | ) | (2.7 | ) | |||||||||
Net purchased power cost | 84.0 | 111.7 | 263.4 | 330.5 | ||||||||||||
Total cost of revenues | 141.3 | 190.6 | 428.8 | 536.5 | ||||||||||||
Gross margin | 182.6 | 198.7 | 517.1 | 545.1 | ||||||||||||
Operating expenses: | ||||||||||||||||
Operation and maintenance | 81.9 | 91.5 | 250.3 | 257.2 | ||||||||||||
Depreciation and amortization | 27.3 | 30.9 | 81.8 | 100.3 | ||||||||||||
General taxes | 20.1 | 21.6 | 68.3 | 64.2 | ||||||||||||
Fixed-asset impairment | — | — | 66.4 | 235.5 | ||||||||||||
Loss / (gain) on asset disposal | (0.3 | ) | — | 15.9 | 0.1 | |||||||||||
Other | (5.2 | ) | (0.7 | ) | (6.1 | ) | (0.7 | ) | ||||||||
Total operating expenses | 123.8 | 143.3 | 476.6 | 656.6 | ||||||||||||
Operating income / (loss) | 58.8 | 55.4 | 40.5 | (111.5 | ) | |||||||||||
Other income / (expense), net: | ||||||||||||||||
Investment income | 0.1 | 0.1 | 0.2 | 0.3 | ||||||||||||
Interest expense | (27.2 | ) | (27.0 | ) | (81.5 | ) | (79.3 | ) | ||||||||
Charge for early redemption of debt | (3.0 | ) | (0.5 | ) | (3.3 | ) | (3.1 | ) | ||||||||
Other expense | (0.7 | ) | (0.2 | ) | (2.3 | ) | (0.9 | ) | ||||||||
Total other expense, net | (30.8 | ) | (27.6 | ) | (86.9 | ) | (83.0 | ) | ||||||||
Income / (loss) from continuing operations before income tax (a) | $ | 28.0 | $ | 27.8 | $ | (46.4 | ) | $ | (194.5 | ) |
(a) | For purposes of discussing operating results, we present and discuss Income / (loss) from continuing operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance. |
Three months ended September 30, | Nine months ended September 30, | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Heating degree days (a) | 78 | 31 | 2,763 | 3,212 | ||||||||
Cooling degree days (a) | 584 | 874 | 862 | 1,175 |
(a) | Heating and cooling degree days are a measure of the relative heating or cooling required for a home or business. The heating degrees in a day are calculated as the degrees that the average actual daily temperature is below 65 degrees Fahrenheit. For example, if the average temperature on March 20th was 40 degrees Fahrenheit, the heating degrees for that day would be the 25 degree difference between 65 degrees and 40 degrees. In a similar manner, cooling degrees in a day are calculated as the degrees that the average actual daily temperature is above 65 degrees Fahrenheit. |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
$ in millions | 2017 vs. 2016 | 2017 vs. 2016 | ||||||
Retail | ||||||||
Rate | $ | (17.0 | ) | $ | (35.2 | ) | ||
Volume | (15.5 | ) | (34.1 | ) | ||||
Other miscellaneous | (1.1 | ) | 3.3 | |||||
Total retail change | (33.6 | ) | (66.0 | ) | ||||
Wholesale | ||||||||
Rate | (8.8 | ) | (25.2 | ) | ||||
Volume | (27.3 | ) | (43.0 | ) | ||||
Total wholesale change | (36.1 | ) | (68.2 | ) | ||||
RTO revenues and RTO capacity revenues | ||||||||
RTO revenues and RTO capacity revenues | 5.4 | (1.5 | ) | |||||
Other | ||||||||
Other revenues | (1.1 | ) | — | |||||
Total revenues change | $ | (65.4 | ) | $ | (135.7 | ) |
• | Retail revenues decreased $33.6 million primarily due to lower average DP&L retail rates and lower DP&L retail volumes. The decrease in average retail rates was primarily driven by reverting to ESP 1 rates in September of 2016, lower rates associated with the competitive bid rider, and a decrease in the USF revenue rate rider, partially offset by increased revenue associated with energy efficiency programs |
• | Wholesale revenues decreased $36.1 million primarily as a result of an unfavorable $27.3 million wholesale volume variance and an unfavorable $8.8 million wholesale price variance. The unfavorable price variance was due to lower PJM market prices in the third quarter of 2017 and lower realized gains on derivatives. The decrease in wholesale volumes of $27.3 million was primarily driven by a decrease in the load served of other parties through their competitive bid process, as well as a 20% decrease in internal generation at DPL's plants in 2017. |
• | RTO capacity and other revenues, consisting primarily of compensation for use of DP&L’s transmission assets, regulation services, reactive supply and operating reserves, and PJM capacity payments, increased $5.4 million compared to the same period in the prior year. This increase was the result of a $6.9 million increase in revenue realized from the PJM capacity auction in 2017 due to higher prices in the CP auction. The capacity price that became effective in June of 2017 was $152/MW-day, compared to $59/MW-day under the base RPM auction and $134/MW-day for the transitional CP auction in June of 2016. This increase was partially offset by a $1.5 million decrease in RTO revenues due to lower rates and availability related to compensation for DPL's reactive supply and operating reserves. |
• | Retail revenues decreased $66.0 million primarily due to lower average DP&L retail rates and lower DP&L retail volumes. The decrease in average retail rates was primarily driven by reverting to ESP 1 rates in September of 2016, collections on the remaining 2015 deferred fuel balance in the first quarter of 2016, and a decrease in the USF revenue rate rider, partially offset by increased revenue associated with energy efficiency programs recorded in 2017. The decrease in retail volume was primarily driven by more mild weather in 2017, as heating degree days decreased by 449 degree days and cooling degree days decreased by 313 degree days. The aforementioned impacts resulted in an unfavorable $35.2 million retail price variance and an unfavorable $34.1 million retail volume variance. These variances were partially offset by a favorable other miscellaneous variance of $3.3 million. |
• | Wholesale revenues decreased $68.2 million primarily as a result of an unfavorable $43.0 million wholesale volume variance and an unfavorable $25.2 million wholesale price variance. Despite increases in PJM market prices, the unfavorable price variance was due to lower realized gains on derivatives in 2017. The decrease in wholesale volumes of $43.0 million was primarily driven by a decrease in the load served of other parties through their competitive bid process and a 10% decrease in internal generation at DPL's plants in 2017. |
• | RTO capacity and other revenues, consisting primarily of compensation for use of DP&L’s transmission assets, regulation services, reactive supply and operating reserves, and PJM capacity payments, decreased $1.5 million compared to the same period in the prior year. This decrease was the result of a $3.5 million decrease in RTO revenues due to lower rates and availability related to compensation for DPL's reactive supply and operating reserves. This decrease was partially offset by a $2.0 million increase in revenue realized from the PJM capacity auction in 2017 primarily due to higher average prices in the CP auction. The capacity price that became effective in June of 2017 was $152/MW-day, compared to $59/MW-day under the base RPM auction and $134/MW-day for the transitional CP auction in June of 2016, and $136/MW-day in June of 2015. |
• | Net fuel costs, which include coal, gas, oil and emission allowance costs, decreased $21.6 million compared to the same period in the prior year primarily due to a 10% decrease in average fuel cost per MWh and a 20% decrease in internal generation. |
• | Net purchased power decreased $27.7 million compared to the same period in the prior year. This change was driven by the following factors: |
◦ | Purchased power decreased $22.9 million primarily due to a $11.3 million volume decrease and an $11.6 million price decrease compared to the same period in the prior year. The volume decrease was primarily driven by a lower load served through the competitive bid process of other parties compared to 2016, as well as the decrease in DP&L retail demand in 2017. The price decrease was primarily driven by lower rates in the competitive bid process in 2017 than 2016 and lower PJM market rates. |
◦ | RTO charges decreased $7.4 million compared to the same period in the prior year primarily due to lower transmission and congestion charges. RTO charges are incurred by DP&L as a member of PJM and primarily include transmission charges within our network, which are incurred and charged to customers in the transmission rider, transmission and congestion losses incurred on DP&L's wholesale revenues, and costs associated with load obligations for retail customers. |
◦ | RTO capacity charges increased $0.2 million compared to the same period in the prior year primarily due to increases in RTO capacity prices. As noted above, RTO capacity prices are set by an annual auction. The increase in RTO capacity prices was partially offset by a lower retail load served in 2017. Retail load served relates to the load of other parties through their competitive bid process. |
◦ | Mark-to-market losses increased $2.4 million due to changes in power prices in 2017 and 2016. |
• | Net fuel costs, which include coal, gas, oil and emission allowance costs, decreased $40.6 million compared to the same period in the prior year primarily due to a 13% decrease in average fuel cost per MWh and a 10% decrease in internal generation. There were fuel costs deferred in 2015, which were expensed in 2016 because they were collected in 2016, which contributed to the price decrease. There were no fuel costs deferred or collected in the first nine months of 2017. |
• | Net purchased power decreased $67.1 million compared to the same period in the prior year. This decrease was driven by the following factors: |
◦ | Purchased power decreased $54.1 million primarily due to a $35.8 million volume decrease and an $18.3 million price decrease compared to the same period in the prior year. The volume decrease was primarily driven by a lower load served through the competitive bid process of other parties compared to 2016, as well as the decrease in DP&L retail demand in 2017. The price decrease was primarily driven by lower rates in the competitive bid process in 2017 than 2016. |
◦ | RTO charges decreased $6.9 million compared to the same period in the prior year primarily due to lower transmission and congestion charges. RTO charges are incurred by DP&L as a member of PJM and primarily include transmission charges within our network, which are incurred and charged to customers in the transmission rider, transmission and congestion losses incurred on DP&L's wholesale revenues, and costs associated with load obligations for retail customers. |
◦ | RTO capacity charges decreased $7.8 million compared to the same period in the prior year primarily due to a lower retail load served in 2017, as well as a $1.7 million PJM penalty incurred in March 2016 associated with low plant availability. Retail load served relates to the load of other parties through their competitive bid process. As noted above, RTO capacity prices are set by an annual auction. |
◦ | Mark-to-market gains decreased $1.7 million due to changes in power prices in 2017 and 2016. |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
$ in millions | 2017 vs. 2016 | 2017 vs. 2016 | ||||||
Decrease in uncollectible expenses for the low-income payment program, which is funded by the USF revenue rate rider (a) | $ | (6.3 | ) | $ | (18.4 | ) | ||
Decrease in generating facilities operating and maintenance expenses | (6.6 | ) | (3.5 | ) | ||||
Increase in group insurance expense associated with participation in the AES self-insurance plan | — | 7.3 | ||||||
Increase in retirement benefits costs, primarily due to pension curtailment charges associated with announced plant closures in the first quarter of 2017 | 0.8 | 6.2 | ||||||
Increase in legal and other consulting costs | 1.1 | 2.8 | ||||||
Other, net | 1.4 | (1.3 | ) | |||||
Net change in operation and maintenance expense | $ | (9.6 | ) | $ | (6.9 | ) |
(a) | There is a corresponding offset in Revenues associated with these programs. |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
T&D | $ | 20.0 | $ | 36.4 | $ | 60.1 | $ | 97.9 | ||||||||
Generation | 29.9 | 14.2 | (43.7 | ) | (857.2 | ) | ||||||||||
Other | (21.9 | ) | (22.8 | ) | (62.8 | ) | 564.8 | |||||||||
Income / (loss) from continuing operations before income tax (a) | $ | 28.0 | $ | 27.8 | $ | (46.4 | ) | $ | (194.5 | ) |
(a) | For purposes of discussing operating results, we present and discuss Income / (loss) from continuing operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance. |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenues: | ||||||||||||||||
Retail | $ | 164.0 | $ | 197.6 | $ | 487.8 | $ | 553.9 | ||||||||
Wholesale | 5.9 | 5.3 | 14.5 | 12.3 | ||||||||||||
RTO revenues | 12.5 | 11.5 | 35.5 | 34.2 | ||||||||||||
RTO capacity revenues | 1.8 | 1.4 | 4.7 | 5.0 | ||||||||||||
Total revenues | 184.2 | 215.8 | 542.5 | 605.4 | ||||||||||||
Cost of revenues: | ||||||||||||||||
Net fuel cost | — | — | — | 5.3 | ||||||||||||
Purchased power: | ||||||||||||||||
Purchased power | 58.2 | 73.9 | 178.2 | 199.9 | ||||||||||||
RTO charges | 15.7 | 15.7 | 43.2 | 44.3 | ||||||||||||
RTO capacity charges | 0.5 | 0.2 | 0.6 | (0.2 | ) | |||||||||||
Net purchased power cost | 74.4 | 89.8 | 222.0 | 244.0 | ||||||||||||
Total cost of revenues | 74.4 | 89.8 | 222.0 | 249.3 | ||||||||||||
Gross margin | 109.8 | 126.0 | 320.5 | 356.1 | ||||||||||||
Operating expenses: | ||||||||||||||||
Operation and maintenance | 42.4 | 47.3 | 121.4 | 134.9 | ||||||||||||
Depreciation and amortization | 19.6 | 17.8 | 56.3 | 55.1 | ||||||||||||
General taxes | 19.3 | 17.7 | 57.8 | 50.7 | ||||||||||||
Gain on asset disposal | (0.3 | ) | — | (0.3 | ) | (0.4 | ) | |||||||||
Total operating expenses | 81.0 | 82.8 | 235.2 | 240.3 | ||||||||||||
Operating income | 28.8 | 43.2 | 85.3 | 115.8 | ||||||||||||
Other expense, net | ||||||||||||||||
Investment income | 0.1 | 0.1 | 0.2 | 0.3 | ||||||||||||
Interest expense | (7.7 | ) | (6.5 | ) | (22.9 | ) | (17.5 | ) | ||||||||
Charge for early redemption of debt | (1.0 | ) | (0.5 | ) | (1.1 | ) | (0.5 | ) | ||||||||
Other expense | (0.2 | ) | 0.1 | (1.4 | ) | (0.2 | ) | |||||||||
Total other expense, net | (8.8 | ) | (6.8 | ) | (25.2 | ) | (17.9 | ) | ||||||||
Income from continuing operations before income tax (a) | $ | 20.0 | $ | 36.4 | $ | 60.1 | $ | 97.9 |
(a) | For purposes of discussing operating results, we present and discuss Income from continuing operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance. |
• | Retail revenues decreased $33.6 million primarily due to lower average DP&L retail rates and lower DP&L retail volumes. The decrease in average retail rates was primarily driven by reverting to ESP 1 rates in September of 2016, lower rates associated with the competitive bid rider, and a decrease in the USF revenue rate rider, partially offset by increased revenue associated with energy efficiency programs |
• | Wholesale revenues increased $0.6 million. These revenues, included in the T&D segment, consist of our 4.9% share of the generation output of OVEC, which is sold into PJM at market prices. |
• | RTO capacity and other revenues increased $1.4 million compared to the same period in the prior year. |
• | Retail revenues decreased $66.1 million primarily due to lower average DP&L retail rates and lower DP&L retail volumes. The decrease in average retail rates was primarily driven by reverting to ESP 1 rates in September of 2016, collections on the remaining 2015 deferred fuel balance in the first quarter of 2016, and a decrease in the USF revenue rate rider, partially offset by increased revenue associated with energy efficiency programs recorded in 2017. The decrease in retail volume was primarily driven by more mild weather in 2017, as heating degree days decreased by 449 degree days and cooling degree days decreased by 313 degree days. The aforementioned impacts resulted in an unfavorable $35.2 million retail price variance and an unfavorable $34.1 million retail volume variance. These variances were partially offset by a favorable other miscellaneous variance of $3.2 million. |
• | Wholesale revenues increased $2.2 million. These revenues, included in the T&D segment, consist of our 4.9% share of the generation output of OVEC, which is sold into PJM at market prices. As such, the increase in wholesale revenue is due to increased OVEC revenue. |
• | RTO capacity and other revenues increased $1.0 million compared to the same period in the prior year. |
• | Net purchased power decreased $15.4 million compared to the prior year. This was driven by the following factors: |
◦ | Purchased power decreased $15.7 million compared to the same period in the prior year primarily due to a favorable price variance of $7.4 million driven by lower rates in the competitive bid process in 2017, and lower volumes of $8.3 million due to the decrease in DP&L retail demand in 2017. |
◦ | RTO capacity and other charges increased $0.3 million compared to the same period in the prior year. |
• | Net fuel costs, which include expense recognition or deferral coinciding with the collection of fuel costs through the regulatory fuel deferral, decreased $5.3 million compared to the prior year primarily due to fuel costs deferred in 2015, being collected in 2016. There were no fuel costs deferred or collected in 2017. |
• | Net purchased power decreased $22.0 million compared to the prior year. This was driven by the following factors: |
◦ | Purchased power decreased $21.7 million compared to the same period in the prior year primarily due to a favorable price variance of $8.5 million driven by lower rates in the competitive bid process in 2017, and lower volumes of $13.2 million due to the decrease in DP&L retail demand in 2017. |
◦ | RTO capacity and other charges decreased $0.3 million compared to the same period in the prior year. |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
$ in millions | 2017 vs. 2016 | 2017 vs. 2016 | ||||||
Decrease in uncollectible expenses for the low-income payment program, which is funded by the USF revenue rate rider (a) | $ | (6.3 | ) | $ | (18.4 | ) | ||
Increase in General taxes (b) | 1.6 | 7.1 | ||||||
Increase / (decrease) in group insurance expense associated with participation in the AES self-insurance plan | (0.1 | ) | 3.4 | |||||
Increase in legal and other consulting costs | 0.5 | 2.5 | ||||||
Increase in Depreciation and amortization expense primarily due to additional investments in T&D fixed assets | 1.8 | 1.2 | ||||||
Other, net | 0.7 | (0.9 | ) | |||||
Net change in operating expenses | $ | (1.8 | ) | $ | (5.1 | ) |
(a) | There is a corresponding offset in Revenues associated with these programs, resulting in no impact to Income from continuing operations before income tax. |
(b) | During the three months ended September 30, 2017, General taxes increased $1.6 million compared to the same period in the prior year. The increase was primarily the result of higher Ohio property tax expense driven by higher tax rates and property values. During the nine months ended September 30, 2017, General taxes increased $7.1 million compared to the same period in the prior year. The increase was primarily the result of higher Ohio property tax expense driven by higher tax rates, higher property values, lower expense in 2016 due to a $1.6 million favorable true-up of the 2015 Ohio property tax accrual to reflect actual payments made in 2016, and a 2017 unfavorable true-up of $1.2 million for the 2016 Ohio property tax accrual to reflect actual payments made in 2017. |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenues: | ||||||||||||||||
Retail | $ | 0.1 | $ | 0.1 | $ | 0.2 | $ | 0.2 | ||||||||
Wholesale | 96.3 | 133.6 | 286.1 | 357.3 | ||||||||||||
RTO revenues | 2.8 | 5.3 | 8.2 | 13.0 | ||||||||||||
RTO capacity revenues | 38.0 | 31.5 | 101.9 | 99.6 | ||||||||||||
Other mark-to-market losses | — | (0.1 | ) | — | (0.1 | ) | ||||||||||
Total revenues | 137.2 | 170.4 | 396.4 | 470.0 | ||||||||||||
Cost of revenues: | ||||||||||||||||
Fuel cost: | ||||||||||||||||
Fuel | 57.6 | 80.4 | 166.3 | 205.3 | ||||||||||||
Losses from the sale of coal | (0.3 | ) | (1.9 | ) | (0.9 | ) | (4.6 | ) | ||||||||
Mark-to-market losses | — | 0.4 | — | — | ||||||||||||
Net fuel cost | 57.3 | 78.9 | 165.4 | 200.7 | ||||||||||||
Purchased power: | ||||||||||||||||
Purchased power | 4.6 | 11.2 | 21.8 | 54.6 | ||||||||||||
RTO charges | 0.1 | 7.5 | 10.1 | 15.9 | ||||||||||||
RTO capacity charges | 3.3 | 3.4 | 10.1 | 18.7 | ||||||||||||
Mark-to-market losses / (gains) | 1.2 | (1.2 | ) | (1.0 | ) | (2.7 | ) | |||||||||
Net purchased power cost | 9.2 | 20.9 | 41.0 | 86.5 | ||||||||||||
Total cost of revenues | 66.5 | 99.8 | 206.4 | 287.2 | ||||||||||||
Gross margin | 70.7 | 70.6 | 190.0 | 182.8 | ||||||||||||
Operating expenses: | ||||||||||||||||
Operation and maintenance | 40.3 | 45.5 | 130.0 | 124.8 | ||||||||||||
Depreciation and amortization | 4.7 | 7.7 | 16.6 | 44.6 | ||||||||||||
General taxes | 0.9 | 3.8 | 10.4 | 13.4 | ||||||||||||
Fixed-asset impairment | — | — | 66.3 | 857.1 | ||||||||||||
Loss / (gain) on asset disposal | — | (0.7 | ) | 16.2 | (0.2 | ) | ||||||||||
Other | (5.2 | ) | — | (6.1 | ) | — | ||||||||||
Total operating expenses | 40.7 | 56.3 | 233.4 | 1,039.7 | ||||||||||||
Operating income / (loss) | 30.0 | 14.3 | (43.4 | ) | (856.9 | ) | ||||||||||
Other expense, net | ||||||||||||||||
Interest expense | — | (0.1 | ) | (0.2 | ) | (0.3 | ) | |||||||||
Other expense | (0.1 | ) | — | (0.1 | ) | — | ||||||||||
Total other expense, net | (0.1 | ) | (0.1 | ) | (0.3 | ) | (0.3 | ) | ||||||||
Income / (loss) from continuing operations before income tax (a) | $ | 29.9 | $ | 14.2 | $ | (43.7 | ) | $ | (857.2 | ) |
(a) | For purposes of discussing operating results, we present and discuss Income / (loss) from continuing operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance. |
• | Wholesale revenues decreased $37.3 million primarily as a result of an unfavorable wholesale volume variance of $33.2 million and an unfavorable wholesale price variance of $4.1 million. The unfavorable price variance was due to lower PJM market prices in the third quarter of 2017 and lower realized gains on derivatives. The decrease in wholesale volumes was primarily driven by a decrease in the load served of other parties through their competitive bid process, as well as a 20% decrease in internal generation at DPL's plants in 2017. |
• | RTO capacity and other revenues, consisting primarily of PJM capacity revenues, regulation services, reactive supply and operating reserves, increased $4.0 million compared to the same period in the prior year. This increase was the result of a $6.5 million increase in revenue realized from the PJM capacity auction in 2017 due to higher prices in the CP auction. The capacity price that became effective in June of 2017 was $152/MW-day, compared to $59/MW-day under the base RPM auction and $134/MW-day for the transitional CP auction in June of 2016. This increase was partially offset by a $2.5 million decrease in RTO revenues due to lower rates and availability related to compensation for DPL's reactive supply and operating reserves. |
• | Wholesale revenues decreased $71.2 million primarily as a result of an unfavorable wholesale volume variance of $48.7 million and an unfavorable wholesale price variance of $22.5 million. Despite increases in PJM market prices, the unfavorable price variance was due to lower realized gains on derivatives in 2017. The decrease in wholesale volumes was primarily driven by a decrease in the load served of other parties through their competitive bid process and a 10% decrease in internal generation at DPL's plants in 2017. |
• | RTO capacity and other revenues, consisting primarily of PJM capacity revenues, regulation services, reactive supply and operating reserves, decreased $2.5 million compared to the same period in the prior year primarily due to a $4.8 million decrease in RTO revenues due to lower rates and availability related to compensation for DPL's reactive supply and operating reserves. This decrease was partially offset by a $2.3 million increase in revenue realized from the PJM capacity auction in 2017 primarily due to higher average prices in the CP auction. The capacity price that became effective in June of 2017 was $152/MW-day, compared to $59/MW-day under the base RPM auction and $134/MW-day for the transitional CP auction in June of 2016, and $136/MW-day in June of 2015. |
• | Net fuel costs, which include coal, gas, oil and emission allowance costs, decreased $21.6 million compared to the same period in the prior year primarily due to a 10% decrease in average fuel cost per MWh and a 20% decrease in internal generation. |
• | Net purchased power decreased $11.7 million compared to the prior year. This decrease was driven by the following factors: |
◦ | Purchased power decreased $6.6 million primarily due to a favorable volume variance of $3.5 million and a favorable price variance of $3.1 million. The volume decrease was primarily driven by a lower load served through the competitive bid process of other parties compared to 2016. The price decrease was primarily driven by lower PJM market rates in the third quarter of 2017. The generation segment purchases power to source retail load in other service territories and to meet contracted Wholesale requirements when generating facilities are not available due to planned and unplanned outages or when market prices are below the marginal costs associated with our generating facilities. |
◦ | RTO charges decreased $7.4 million compared to the same period in the prior year primarily due to lower transmission and congestion charges. |
◦ | RTO capacity charges decreased $0.1 million compared to the same period in the prior year primarily due to a lower retail load served in 2017, partially offset by higher RTO capacity prices. Retail load served relates to the load of other parties through their competitive bid process. |
◦ | Mark-to-market losses increased $2.4 million due to changes in power prices in 2017 and 2016. |
• | Net fuel costs, which include coal, gas, oil and emission allowance costs, decreased $35.3 million compared to the same period in the prior year primarily due to a 13% decrease in average fuel cost per MWh and a 10% decrease in internal generation. |
• | Net purchased power decreased $45.5 million compared to the prior year. This decrease was driven by the following factors: |
◦ | Purchased power decreased $32.8 million primarily due to a favorable volume variance of $29.9 million and a favorable price variance of $2.9 million. The decrease in volume was driven by a lower load served of other parties through their competitive bid process in 2017. The price decrease was primarily driven by lower PJM market rates. The generation segment purchases power to source retail load in other service territories and to meet contracted Wholesale requirements when generating facilities are not available due to planned and unplanned outages or when market prices are below the marginal costs associated with our generating facilities. |
◦ | RTO charges decreased $5.8 million compared to the same period in the prior year primarily due to lower transmission and congestion charges. |
◦ | RTO capacity charges decreased $8.6 million compared to the same period in the prior year primarily due to a lower retail load served in 2017, as well as a $1.7 million PJM penalty incurred in March 2016 associated with low plant availability. Retail load served relates to the load of other parties through their competitive bid process. As noted above, RTO capacity prices are set by an annual auction. |
◦ | Mark-to-market gains decreased $1.7 million due to changes in power prices in 2017 and 2016. |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
$ in millions | 2017 vs. 2016 | 2017 vs. 2016 | ||||||
Change in Fixed-asset impairment from 2016 to 2017 (a) | $ | — | $ | (790.8 | ) | |||
Decrease in Depreciation and amortization expense as a result of the fixed-asset impairments in the second and fourth quarters of 2016 and the first quarter of 2017, which reduced depreciation expense due to the lower asset values | (3.0 | ) | (28.0 | ) | ||||
Higher insurance recoveries in 2017 | (5.2 | ) | (6.1 | ) | ||||
Decrease in General taxes due to a true-up of the year to date 2017 Ohio property tax accrual for generation to reflect final assessments for 2017 taxes recorded in the third quarter of 2017 | (2.9 | ) | (3.0 | ) | ||||
Decrease in generating facilities operating and maintenance expenses | (5.6 | ) | (2.4 | ) | ||||
Loss on asset disposal (b) | 0.7 | 16.4 | ||||||
Increase / (decrease) in retirement benefit costs, primarily due to pension curtailment charges associated with announced plant closures in the first quarter | (0.1 | ) | 5.6 | |||||
Increase in group insurance expenses associated with participation in the AES self-insurance plan | 0.1 | 3.9 | ||||||
Other, net | 0.4 | (1.9 | ) | |||||
Net change in operating expenses | $ | (15.6 | ) | $ | (806.3 | ) |
(a) | During the nine months ended September 30, 2017, the Generation segment recorded a fixed-asset impairment of $66.3 million. The Generation segment recognized asset impairment expense of $39.1 million and $27.3 million for Stuart Station and Killen Station, respectively. During the nine months ended September 30, 2016, the Generation segment recorded a fixed-asset impairment of $857.1 million. The Generation segment recognized asset impairment expense of $230.8 million and $4.7 million for Killen Station and certain DP&L peaking generating facilities, respectively. For more information, see Note 14 – Fixed-asset Impairments of Notes to DPL's Condensed Consolidated Financial Statements. |
(b) | During the nine months ended September 30, 2017, the Generation segment recorded a loss on asset disposal of $15.9 million primarily related to the write-off of plant materials and supplies inventory at the Stuart and Killen plants. |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenues: | ||||||||||||||||
Retail | $ | 164.1 | $ | 197.7 | $ | 488.0 | $ | 554.1 | ||||||||
Wholesale | 95.0 | 127.9 | 283.9 | 347.2 | ||||||||||||
RTO revenues | 14.5 | 15.2 | 41.0 | 43.9 | ||||||||||||
RTO capacity revenues | 32.0 | 27.6 | 87.9 | 86.2 | ||||||||||||
Other mark-to-market losses | — | — | — | (0.1 | ) | |||||||||||
Total revenues | 305.6 | 368.4 | 900.8 | 1,031.3 | ||||||||||||
Cost of revenues: | ||||||||||||||||
Fuel cost: | ||||||||||||||||
Fuel | 53.1 | 72.5 | 153.7 | 194.4 | ||||||||||||
Gains from the sale of coal | (0.3 | ) | (1.9 | ) | (0.9 | ) | (4.9 | ) | ||||||||
Mark-to-market losses | — | 0.4 | — | — | ||||||||||||
Net fuel cost | 52.8 | 71.0 | 152.8 | 189.5 | ||||||||||||
Purchased power: | ||||||||||||||||
Purchased power | 62.9 | 85.3 | 199.3 | 254.2 | ||||||||||||
RTO charges | 16.0 | 22.7 | 52.9 | 59.1 | ||||||||||||
RTO capacity charges | 3.4 | 3.3 | 9.5 | 17.4 | ||||||||||||
Mark-to-market losses / (gains) | 1.2 | (1.3 | ) | (1.0 | ) | (2.7 | ) | |||||||||
Net purchased power cost | 83.5 | 110.0 | 260.7 | 328.0 | ||||||||||||
Total cost of revenues | 136.3 | 181.0 | 413.5 | 517.5 | ||||||||||||
Gross margin | 169.3 | 187.4 | 487.3 | 513.8 | ||||||||||||
Operating expenses: | ||||||||||||||||
Operation and maintenance | 81.7 | 85.5 | 245.2 | 248.0 | ||||||||||||
Depreciation and amortization | 22.7 | 24.1 | 68.2 | 95.2 | ||||||||||||
General taxes | 19.6 | 21.2 | 66.8 | 62.8 | ||||||||||||
Gain on termination of contract | — | — | — | (27.7 | ) | |||||||||||
Fixed-asset impairment | — | — | 66.3 | 857.1 | ||||||||||||
Loss / (gain) on asset disposal | (0.3 | ) | — | 15.9 | 0.2 | |||||||||||
Other | (4.4 | ) | — | (4.4 | ) | — | ||||||||||
Total operating expenses | 119.3 | 130.8 | 458.0 | 1,235.6 | ||||||||||||
Operating income / (loss) | 50.0 | 56.6 | 29.3 | (721.8 | ) | |||||||||||
Other expense, net | ||||||||||||||||
Investment income | 0.1 | 0.1 | 0.2 | 0.3 | ||||||||||||
Interest expense | (7.7 | ) | (6.5 | ) | (23.1 | ) | (17.2 | ) | ||||||||
Charge for early redemption of debt | (1.0 | ) | (0.5 | ) | (1.1 | ) | (0.5 | ) | ||||||||
Other expense | (0.2 | ) | 0.1 | (1.5 | ) | (0.2 | ) | |||||||||
Total other expense, net | (8.8 | ) | (6.8 | ) | (25.5 | ) | (17.6 | ) | ||||||||
Income / (loss) from operations before income tax (a) | $ | 41.2 | $ | 49.8 | $ | 3.8 | $ | (739.4 | ) |
(a) | For purposes of discussing operating results, we present and discuss Income / (loss) from operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information used by management to make decisions regarding our financial performance. |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
$ in millions | 2017 vs. 2016 | 2017 vs. 2016 | ||||||
Retail | ||||||||
Rate | $ | (17.0 | ) | $ | (35.3 | ) | ||
Volume | (15.5 | ) | (34.2 | ) | ||||
Other miscellaneous | (1.1 | ) | 3.4 | |||||
Total retail change | (33.6 | ) | (66.1 | ) | ||||
Wholesale | ||||||||
Rate | (9.4 | ) | (27.4 | ) | ||||
Volume | (23.5 | ) | (35.9 | ) | ||||
Total wholesale change | (32.9 | ) | (63.3 | ) | ||||
RTO revenues and RTO capacity revenues | ||||||||
RTO revenues and RTO capacity revenues | 3.7 | (1.2 | ) | |||||
Other | ||||||||
Unrealized MTM | — | 0.1 | ||||||
Total revenues change | $ | (62.8 | ) | $ | (130.5 | ) |
• | Retail revenues decreased $33.6 million primarily due to lower average DP&L retail rates and lower DP&L retail volumes. The decrease in average retail rates was primarily driven by reverting to ESP 1 rates in September of 2016, lower rates associated with the competitive bid rider, and a decrease in the USF revenue rate rider, partially offset by increased revenue associated with energy efficiency programs recorded in 2017. The decrease in retail volume was primarily driven by more mild weather in 2017, as cooling degree days decreased by 290 degree days. The aforementioned impacts resulted in an unfavorable $17.0 million retail price variance and an unfavorable $15.5 million retail volume variance. In addition, there was an unfavorable other miscellaneous variance of $1.1 million. |
• | Wholesale revenues decreased $32.9 million primarily as a result of an unfavorable $23.5 million wholesale volume variance and an unfavorable $9.4 million wholesale price variance. The unfavorable price variance was due to lower PJM market prices in the third quarter of 2017 and lower realized gains on derivatives. The decrease in wholesale volumes of $23.5 million was primarily driven by a decrease in the load served of other parties through their competitive bid process, as well as a 19% decrease in internal generation at DP&L's plants in 2017. |
• | RTO capacity and other revenues, consisting primarily of compensation for use of DP&L’s transmission assets, regulation services, reactive supply and operating reserves, and PJM capacity payments, increased $3.7 million compared to the same period in the prior year. This increase was the result of a $4.4 million increase in revenue realized from the PJM capacity auction in 2017 due to higher prices in the CP auction. The capacity price that became effective in June of 2017 was $152/MW-day, compared to $59/MW-day under the base RPM auction and $134/MW-day for the transitional CP auction in June of 2016. This increase was partially offset by a $0.7 million decrease in RTO revenues due to lower rates and availability related to compensation for DPL's reactive supply and operating reserves. |
• | Retail revenues decreased $66.1 million primarily due to lower average DP&L retail rates and lower DP&L retail volumes. The decrease in average retail rates was primarily driven by reverting to ESP 1 rates in September of 2016, collections on the remaining 2015 deferred fuel balance in the first quarter of 2016, and a decrease in the USF revenue rate rider, partially offset by increased revenue associated with energy efficiency programs recorded in 2017. The decrease in retail volume was primarily driven by more mild weather in 2017, as heating degree days decreased by 449 degree days and cooling degree days decreased by 313 degree days. The aforementioned impacts resulted in an unfavorable $35.3 million retail price variance and an unfavorable $34.2 million retail volume variance. These variances were partially offset by a favorable other miscellaneous variance of $3.4 million. |
• | Wholesale revenues decreased $63.3 million primarily as a result of an unfavorable $35.9 million wholesale volume variance and an unfavorable $27.4 million wholesale price variance. Despite increases in PJM market prices, the unfavorable price variance was due to lower realized gains on derivatives in 2017. The decrease in wholesale volumes of $35.9 million was primarily driven by a decrease in the load served of other parties through their competitive bid process and an 8% decrease in internal generation at DP&L's plants in 2017. |
• | RTO capacity and other revenues, consisting primarily of compensation for use of DP&L’s transmission assets, regulation services, reactive supply and operating reserves, and PJM capacity payments, decreased $1.2 million compared to the same period in the prior year. This decrease was the result of a $2.9 million decrease in RTO revenues due to lower rates and availability related to compensation for DP&L's reactive supply and operating reserves. This decrease was partially offset by a $1.7 million increase in revenue realized from the PJM capacity auction in 2017 primarily due to higher average prices in the CP auction. The capacity price that became effective in June of 2017 was $152/MW-day, compared to $59/MW-day under the base RPM auction and $134/MW-day for the transitional CP auction in June of 2016, and $136/MW-day in June of 2015. |
• | Net fuel costs, which include coal, gas, oil and emission allowance costs, decreased $18.2 million, compared to the same period in the prior year primarily due to a 10% decrease in average fuel cost per MWh and a 19% decrease in internal generation at DP&L's plants in 2017. |
• | Net purchased power decreased $26.5 million compared to the prior year. This decrease was driven by the following factors: |
◦ | Purchased power decreased $22.4 million primarily due to a $12.2 million volume decrease and a $10.2 million price decrease compared to the same period in the prior year. The volume decrease was primarily driven by a lower load served through the competitive bid process of other parties compared to 2016, as well as the decrease in DP&L retail demand in 2017. The price decrease was primarily driven by lower rates in the competitive bid process in 2017 than 2016 and lower PJM market rates. |
◦ | RTO charges decreased $6.7 million compared to the same period in the prior year due to lower transmission and congestion charges. RTO charges are incurred by DP&L as a member of PJM and primarily include transmission charges within our network, which are incurred and charged to customers in the transmission rider, transmission and congestion losses incurred on DP&L's wholesale revenues, and costs associated with load obligations for retail customers. |
◦ | RTO capacity charges increased $0.1 million compared to the same period in the prior year primarily due to increases in RTO capacity prices. As noted above, RTO capacity prices are set by an annual auction. The increase in RTO capacity prices was partially offset by a lower retail load served in 2017. Retail load served relates to the load of other parties through their competitive bid process. |
◦ | Mark-to-market losses increased $2.5 million compared to the same period in the prior year due to changes in power prices in 2017 and 2016. |
• | Net fuel costs, which include coal, gas, oil and emission allowance costs, decreased $36.7 million, compared to the same period in the prior year primarily due to a 14% decrease in average fuel cost per MWh and an 8% decrease in internal generation. There were fuel costs deferred in 2015, which were expensed in 2016 because they were collected in 2016, which contributed to the price decrease. There were no fuel costs deferred or collected in 2017. |
• | Net purchased power decreased $67.3 million compared to the prior year. This decrease was driven by the following factors: |
◦ | Purchased power decreased $54.9 million primarily due to a $35.0 million volume decrease and a $19.9 million price decrease compared to the same period in the prior year. The volume decrease was primarily driven by a lower load served through the competitive bid process of other parties compared to 2016, as well as the decrease in DP&L retail demand in 2017. The price decrease was primarily driven by lower rates in the competitive bid process in 2017 than 2016. |
◦ | RTO charges decreased $6.2 million compared to the same period in the prior year due to lower transmission and congestion charges. RTO charges are incurred by DP&L as a member of PJM and primarily include transmission charges within our network, which are incurred and charged to customers in the transmission rider, transmission and congestion losses incurred on DP&L's wholesale revenues, and costs associated with load obligations for retail customers. |
◦ | RTO capacity charges decreased $7.9 million compared to the same period in the prior year primarily due to a lower retail load served in 2017, as well as a $1.7 million PJM penalty incurred in March 2016 associated with low plant availability. Retail load served relates to the load of other parties through their competitive bid process. As noted above, RTO capacity prices are set by an annual auction. |
◦ | Mark-to-market gains decreased $1.7 million compared to the same period in the prior year due to changes in power prices in 2017 and 2016. |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
$ in millions | 2017 vs. 2016 | 2017 vs. 2016 | ||||||
Decrease in uncollectible expenses for the low-income payment program, which is funded by the USF revenue rate rider (a) | $ | (6.3 | ) | $ | (18.4 | ) | ||
Decrease in generating facilities operating and maintenance expenses | (3.6 | ) | (2.3 | ) | ||||
Increase in retirement benefits costs, primarily due to pension curtailment charges associated with announced plant closures in the first quarter of 2017 | 0.7 | 7.6 | ||||||
Increase in group insurance expense associated with participation in the AES self-insurance plan | — | 7.2 | ||||||
Insurance recoveries from MVIC in 2016 | 2.9 | 2.9 | ||||||
Increase in legal and other consulting costs | 1.2 | 2.8 | ||||||
Other, net | 1.3 | (2.6 | ) | |||||
Net change in operation and maintenance expense | $ | (3.8 | ) | $ | (2.8 | ) |
(a) | There is a corresponding offset in Revenues associated with these programs. |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
T&D | $ | 20.0 | $ | 36.5 | $ | 60.1 | $ | 98.5 | ||||||||
Generation | 21.2 | 13.3 | (56.3 | ) | (837.9 | ) | ||||||||||
Income / (loss) from operations before income tax (a) | $ | 41.2 | $ | 49.8 | $ | 3.8 | $ | (739.4 | ) |
(a) | For purposes of discussing operating results, we present and discuss Income / (loss) from operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance. |
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
$ in millions | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenues: | ||||||||||||||||
Retail | $ | 0.1 | $ | 0.1 | $ | 0.2 | $ | 0.2 | ||||||||
Wholesale | 89.1 | 122.6 | 269.4 | 334.9 | ||||||||||||
RTO revenues | 2.0 | 3.7 | 5.5 | 9.7 | ||||||||||||
RTO capacity revenues | 30.2 | 26.2 | 83.2 | 81.2 | ||||||||||||
Other mark-to-market losses | — | — | — | (0.1 | ) | |||||||||||
Total revenues | 121.4 | 152.6 | 358.3 | 425.9 | ||||||||||||
Cost of revenues: | ||||||||||||||||
Cost of fuel: | ||||||||||||||||
Fuel | 53.1 | 72.5 | 153.7 | 188.8 | ||||||||||||
Gains from the sale of coal | (0.3 | ) | (1.9 | ) | (0.9 | ) | (4.6 | ) | ||||||||
Mark-to-market losses | — | 0.4 | — | — | ||||||||||||
Net fuel cost | 52.8 | 71.0 | 152.8 | 184.2 | ||||||||||||
Purchased power: | ||||||||||||||||
Purchased power | 4.7 | 11.4 | 21.1 | 54.3 | ||||||||||||
RTO charges | 0.3 | 7.0 | 9.7 | 14.8 | ||||||||||||
RTO capacity charges | 2.9 | 3.1 | 8.9 | 17.6 | ||||||||||||
Mark-to-market losses / (gains) | 1.2 | (1.3 | ) | (1.0 | ) | (2.7 | ) | |||||||||
Net purchased power cost | 9.1 | 20.2 | 38.7 | 84.0 | ||||||||||||
Total cost of revenues | 61.9 | 91.2 | 191.5 | 268.2 | ||||||||||||
Gross margin | 59.5 | 61.4 | 166.8 | 157.7 | ||||||||||||
Operating expenses: | ||||||||||||||||
Operation and maintenance | 39.3 | 38.2 | 123.8 | 113.1 | ||||||||||||
Depreciation and amortization | 3.1 | 6.3 | 11.9 | 40.1 | ||||||||||||
General taxes | 0.3 | 3.5 | 9.0 | 12.1 | ||||||||||||
Gain on termination of contract | — | — | — | (27.7 | ) | |||||||||||
Fixed-asset impairment | — | — | 66.3 | 857.1 | ||||||||||||
Loss on asset disposal | — | — | 16.2 | 0.6 | ||||||||||||
Other | (4.4 | ) | — | (4.4 | ) | — | ||||||||||
Total operating expenses | 38.3 | 48.0 | 222.8 | 995.3 | ||||||||||||
Other income / (expense), net | 21.2 | 13.4 | (56.0 | ) | (837.6 | ) | ||||||||||
Other expense, net | ||||||||||||||||
Interest expense | — | (0.1 | ) | (0.2 | ) | (0.3 | ) | |||||||||
Other expense | — | — | (0.1 | ) | — | |||||||||||
Total other expense, net | — | (0.1 | ) | (0.3 | ) | (0.3 | ) | |||||||||
Income / (loss) from operations before income tax (a) | $ | 21.2 | $ | 13.3 | $ | (56.3 | ) | $ | (837.9 | ) |
(a) | For purposes of discussing operating results, we present and discuss Income / (loss) from operations before income tax. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance. |
• | Wholesale revenues decreased $33.5 million primarily as a result of an unfavorable wholesale volume variance of $29.2 million and an unfavorable wholesale price variance of $4.3 million. The unfavorable price variance was due to lower PJM market prices in the third quarter of 2017 and lower realized gains on derivatives. The decrease in wholesale volumes was primarily driven by a decrease in the load served of other parties through their competitive bid process, as well as a 19% decrease in internal generation at DP&L's plants in 2017. |
• | RTO capacity and other revenues increased $2.3 million compared to the same period in the prior year. This increase was the result of a $4.0 million increase in revenue realized from the PJM capacity auction in 2017 due to higher prices in the CP auction. The capacity price that became effective in June of 2017 was $152/MW-day, compared to $59/MW-day under the base RPM auction and $134/MW-day for the transitional CP auction in June of 2016. This increase was partially offset by a $1.7 million decrease in RTO revenues due to lower rates and availability related to compensation for DP&L's reactive supply and operating reserves. |
• | Wholesale revenues decreased $65.5 million primarily as a result of an unfavorable wholesale volume variance of $41.6 million and an unfavorable wholesale price variance of $23.9 million. Despite increases in PJM market prices, the unfavorable price variance was due to lower realized gains on derivatives in 2017. The decrease in wholesale volumes was primarily driven by a decrease in the load served of other parties through their competitive bid process and an 8% decrease in internal generation at DP&L's plants in 2017. |
• | RTO capacity and other revenues, consisting primarily of PJM capacity payments, decreased $2.2 million compared to the same period in the prior year primarily due to a $4.2 million decrease in RTO revenues due to lower rates and availability related to compensation for DP&L's reactive supply and operating reserves. This decrease was partially offset by a $2.0 million increase in revenue realized from the PJM capacity auction in 2017 primarily due to higher average prices in the CP auction. The capacity price that became effective in June of 2017 was $152/MW-day, compared to $59/MW-day under the base RPM auction and $134/MW-day for the transitional CP auction in June of 2016, and $136/MW-day in June of 2015. |
• | Net fuel costs, which include coal, gas, oil and emission allowance costs, decreased $18.2 million compared to the same period in the prior year primarily due to a 10% decrease in average fuel cost per MWh and a 19% decrease in internal generation at DP&L's plants in 2017. |
• | Net purchased power decreased $11.1 million compared to the prior year. This decrease was driven by the following factors: |
◦ | Purchased power decreased $6.7 million primarily due to a favorable volume variance of $4.5 million and a favorable price variance of $2.2 million. The decrease in volume was driven by a lower load served of other parties through their competitive bid process in 2017. The price decrease was primarily driven by lower PJM market rates in the third quarter of 2017. The generation segment purchases power to source retail load in other service territories and to meet contracted Wholesale requirements when generating facilities are not available due to planned and unplanned outages or when market prices are below the marginal costs associated with our generating facilities. |
◦ | RTO charges decreased $6.7 million compared to the same period in the prior year primarily due to lower transmission and congestion charges. |
◦ | RTO capacity charges decreased $0.2 million compared to the same period in the prior year primarily due to a lower retail load served in 2017, partially offset by higher RTO capacity prices. Retail load served relates to the load of other parties through their competitive bid process. |
◦ | Mark-to-market losses increased $2.5 million due to changes in power prices in 2017 and 2016. |
• | Net fuel costs, which include coal, gas, oil and emission allowance costs, decreased $31.4 million compared to the same period in the prior year primarily due to a 14% decrease in average fuel cost per MWh and an 8% decrease in internal generation at DP&L's plants in 2017. |
• | Net purchased power decreased $45.3 million compared to the prior year. This decrease was driven by the following factors: |
◦ | Purchased power decreased $33.2 million primarily due to a favorable volume variance of $29.9 million and a favorable price variance of $3.3 million. The decrease in volume was driven by a lower load served of other parties through their competitive bid process in 2017. The generation segment purchases power to source retail load in other service territories and to meet contracted Wholesale requirements when generating facilities are not available due to planned and unplanned outages or when market prices are below the marginal costs associated with our generating facilities. |
◦ | RTO charges decreased $5.1 million compared to the same period in the prior year primarily due to lower transmission and congestion charges. |
◦ | RTO capacity charges decreased $8.7 million compared to the same period in the prior year primarily due to a lower retail load served in 2017, as well as a $1.7 million PJM penalty incurred in March 2016 associated with low plant availability. Retail load served relates to the load of other parties through their competitive bid process. As noted above, RTO capacity prices are set by an annual auction. |
◦ | Mark-to-market gains decreased $1.7 million due to changes in power prices in 2017 and 2016. |
Three months ended | Nine months ended | |||||||
September 30, | September 30, | |||||||
$ in millions | 2017 vs. 2016 | 2017 vs. 2016 | ||||||
Change in Fixed-asset impairment from 2016 to 2017 (a) | $ | — | $ | (790.8 | ) | |||
Decrease in Depreciation and amortization expense as a result of the fixed-asset impairments in the second and fourth quarters of 2016 and the first quarter of 2017, which reduced depreciation expense due to the lower asset values | (3.2 | ) | (28.2 | ) | ||||
Higher insurance recoveries in 2017 | (4.4 | ) | (4.4 | ) | ||||
Decrease in General taxes due to a true-up of the year to date 2017 Ohio property tax accrual for generation to reflect final assessments for 2017 taxes recorded in the third quarter of 2017 | (3.2 | ) | (3.1 | ) | ||||
Decrease in generating facilities operating and maintenance expenses | (2.6 | ) | (1.0 | ) | ||||
Gain on termination of contract in 2016 | — | 27.7 | ||||||
Loss on asset disposal (b) | — | 15.6 | ||||||
Increase / (decrease) in retirement benefits costs, primarily due to pension curtailment charges associated with announced plant closures in the first quarter | (0.1 | ) | 5.7 | |||||
Increase in group insurance expense associated with participation in the AES self-insurance plan | — | 3.8 | ||||||
Other, net | 3.8 | 2.2 | ||||||
Net change in operating expenses | $ | (9.7 | ) | $ | (772.5 | ) |
(a) | During the nine months ended September 30, 2017, the Generation segment recorded a fixed-asset impairment of $66.3 million. The Generation segment recognized an asset impairment expense of $39.0 million and $27.3 million for Stuart Station and Killen Station, respectively. During the nine months ended September 30, 2016, the Generation segment recorded a fixed-asset impairment of $857.1 million. The Generation segment recognized an asset impairment expense of $292.0 million, $246.2 million and $318.9 million for Stuart Station, Killen Station and Zimmer station, respectively. For more information, see Note 14 – Fixed-asset Impairments of Notes to DP&L's Condensed Financial Statements. |
(b) | During the nine months ended September 30, 2017, the Generation segment recorded a loss on asset disposal of $16.2 million primarily related to the write-off of plant materials and supplies inventory at the Stuart and Killen plants. |
• | PJM capacity prices; |
• | Effect of implementing DP&L's ESP 3 order approved on October 20, 2017 with rates to be effective November 1, 2017; |
• | Outcome of DP&L's pending distribution rate case; |
• | Operational performance of generation facilities; |
• | Recovery in the power market, particularly as it relates to an expansion in dark spreads; |
• | Sale or transfer of generation assets now owned by AES Ohio Generation; and |
• | DPL's ability to reduce its cost structure. |
• | Bypassable standard offer energy rates for DP&L’s customers based on competitive bid auctions; |
• | The establishment of a three-year non-bypassable Distribution Modernization Rider (DMR) designed to collect $105.0 million in revenue per year to pay debt obligations at DPL and DP&L and position DP&L to modernize and/or maintain its transmission and distribution infrastructure. With PUCO approval, DP&L has the option of extending the duration of the DMR for an additional two years; |
• | The establishment of a non-bypassable Distribution Investment Rider to recover incremental distribution capital investments, the amount of which is to be established in a separate DP&L distribution rate case |
• | A non-bypassable Reconciliation Rider permitting DP&L to defer, recover or credit the net proceeds from selling energy and capacity received as part of DP&L’s investment in OVEC and DP&L's OVEC related costs; |
• | Implementation by DP&L of a Smart Grid Rider, Economic Development Rider, Economic Development Fund, Regulatory Compliance Rider and certain other new, or changes to existing, rates, riders and |
• | A commitment to commence a sale process to sell our ownership interests in the Zimmer, Miami Fort and Conesville coal-fired generation plants, with all sales proceeds used to pay debt of DPL and DP&L; and |
• | Restrictions on DPL making dividend or tax sharing payments; and |
• | Various other riders and competitive retail market enhancements. |
DPL | Nine months ended September 30, | |||||||
$ in millions | 2017 | 2016 | ||||||
Net cash provided by operating activities | $ | 81.7 | $ | 198.6 | ||||
Net cash used in investing activities | (55.8 | ) | (23.1 | ) | ||||
Net cash used in financing activities | (57.1 | ) | (86.1 | ) | ||||
Net change | (31.2 | ) | 89.4 | |||||
Balance at beginning of period | 54.6 | 32.4 | ||||||
Cash and cash equivalents at end of period | $ | 23.4 | $ | 121.8 |
Nine months ended September 30, | $ change | |||||||||||
$ in millions | 2017 | 2016 | 2017 vs. 2016 | |||||||||
Net income / (loss) | $ | (29.3 | ) | $ | (89.9 | ) | $ | 60.6 | ||||
Depreciation and amortization | 81.8 | 100.3 | (18.5 | ) | ||||||||
Impairment expenses | 66.4 | 235.5 | (169.1 | ) | ||||||||
Gain on sale of business | — | (49.2 | ) | 49.2 | ||||||||
Deferred income taxes | (3.5 | ) | (101.4 | ) | 97.9 | |||||||
Other adjustments to Net income / (loss) | 19.2 | 3.2 | 16.0 | |||||||||
Net income / (loss), adjusted for non-cash items | 134.6 | 98.5 | 36.1 | |||||||||
Net change in operating assets and liabilities | (52.9 | ) | 100.1 | (153.0 | ) | |||||||
Net cash provided by operating activities | $ | 81.7 | $ | 198.6 | $ | (116.9 | ) |
$ in millions | $ Change | |||
Decrease from accrued taxes payable primarily due to an income tax benefit from the current year loss | $ | (59.3 | ) | |
Decrease from accounts receivable due to lower collections | (7.8 | ) | ||
Decrease from accounts payable due to timing of payments | (36.2 | ) | ||
Decrease from deferred regulatory costs, net, due to lower collections on regulatory assets and liabilities | (26.0 | ) | ||
Decrease from inventory primarily due to lower coal purchases in 2016 | (19.6 | ) | ||
Other | (4.1 | ) | ||
Total decrease in cash from changes in operating assets and liabilities | $ | (153.0 | ) |
DP&L | Nine months ended September 30, | |||||||
$ in millions | 2017 | 2016 | ||||||
Net cash provided by operating activities | $ | 98.7 | $ | 220.4 | ||||
Net cash used in investing activities | (42.7 | ) | (86.6 | ) | ||||
Net cash used in financing activities | (42.3 | ) | (46.3 | ) | ||||
Net change | 13.7 | 87.5 | ||||||
Balance at beginning of period | 1.6 | 5.4 | ||||||
Cash and cash equivalents at end of period | $ | 15.3 | $ | 92.9 |
Nine months ended September 30, | $ change | |||||||||||
$ in millions | 2017 | 2016 | 2017 vs. 2016 | |||||||||
Net income / (loss) | $ | 3.6 | $ | (467.8 | ) | $ | 471.4 | |||||
Depreciation and amortization | 68.2 | 95.2 | (27.0 | ) | ||||||||
Impairment expenses | 66.3 | 857.1 | (790.8 | ) | ||||||||
Deferred income taxes | 1.6 | (314.2 | ) | 315.8 | ||||||||
Other adjustments to Net income / (loss) | 17.0 | 0.7 | 16.3 | |||||||||
Net income / (loss), adjusted for non-cash items | 156.7 | 171.0 | (14.3 | ) | ||||||||
Net change in operating assets and liabilities | (58.0 | ) | 49.4 | (107.4 | ) | |||||||
Net cash provided by operating activities | $ | 98.7 | $ | 220.4 | $ | (121.7 | ) |
$ in millions | $ Change | |||
Decrease from accrued taxes payable, due to income tax benefit incurred on current year loss | $ | (40.7 | ) | |
Decrease from accounts payable due to timing of payments | (44.9 | ) | ||
Decrease from deferred regulatory costs, net, due to lower collections on regulatory assets and liabilities | (26.0 | ) | ||
Decrease from inventory primarily due to lower coal purchases in 2016 | (19.4 | ) | ||
Increase from accounts receivable due to higher collections | 31.5 | |||
Other | (7.9 | ) | ||
Total decrease in cash from changes in operating assets and liabilities | $ | (107.4 | ) |
$ in millions | Type | Maturity | Commitment | Amounts available as of September 30, 2017 | ||||||||
DP&L | Revolving | July 2020 | $ | 175.0 | $ | 158.6 | ||||||
DPL | Revolving | July 2020 | 205.0 | 142.1 | ||||||||
$ | 380.0 | $ | 300.7 |
DPL | DP&L | Outlook | Effective or Affirmed | |||||
Fitch Ratings | BBB-(a) / BB+(b) | BBB+ (c) | Positive | October 2017 | ||||
Moody's Investors Service, Inc. | Ba3 (b) | Baa2 (c) | Positive | October 2017 | ||||
Standard & Poor's Financial Services LLC | BB- (b) | BBB- (c) | Stable | October 2017 |
(a) | Rating relates to DPL’s Senior secured debt. |
(b) | Rating relates to DPL's Senior unsecured debt. |
(c) | Rating relates to DP&L’s Senior secured debt. |
DPL | DP&L | Outlook | Effective or Affirmed | |||||
Fitch Ratings | BB | BBB- | Positive | October 2017 | ||||
Moody's Investors Service, Inc. | Ba3 | Baa3 | Positive | October 2017 | ||||
Standard & Poor's Financial Services LLC | BB- | BB- | Stable | October 2017 |
DPL | Nine months ended | |||||
September 30, | ||||||
2017 | 2016 | |||||
Percent of electric revenues from wholesale market | 32 | % | 34 | % | ||
DP&L | Nine months ended | |||||
September 30, | ||||||
2017 | 2016 | |||||
Percent of electric revenues from wholesale market | 32 | % | 34 | % |
$ in millions | DPL | DP&L | ||||||
Effect of 10% change in price per MWh | $ | 26.6 | $ | 25.4 |
PJM Delivery Year | ||||||||||||||||||||
($/MW-day) | 2016/17 | 2017/18 | 2018/19 | 2019/20 | 2020/21 | |||||||||||||||
Capacity clearing price | $ | 134 | $ | 152 | $ | 165 | $ | 100 | $ | 77 |
Calendar Year | ||||||||||||||||||||
($/MW-day) | 2016 | 2017 | 2018 | 2019 | 2020 | |||||||||||||||
Computed average capacity price | $ | 135 | $ | 145 | $ | 159 | $ | 127 | $ | 87 |
$ in millions | DPL | DP&L | ||||||
Effect of $10/MW-day change in capacity auction pricing | $ | 5.7 | $ | 4.8 |
$ in millions | DPL | DP&L | ||||||
Effect of 10% change in fuel and purchased power | $ | 18.9 | $ | 17.5 |
DPL | ||||||||||||||||||||||||||||||||
Principal payments due | At September 30, 2017 | |||||||||||||||||||||||||||||||
during the twelve months ending | ||||||||||||||||||||||||||||||||
September 30, | Principal | Fair | ||||||||||||||||||||||||||||||
$ in millions | 2018 | 2019 | 2020 | 2021 | 2022 | Thereafter | Amount | Value | ||||||||||||||||||||||||
Long-term debt (a) | ||||||||||||||||||||||||||||||||
Variable-rate debt | $ | 29.5 | $ | 29.5 | $ | 60.8 | $ | 4.5 | $ | 423.7 | $ | — | $ | 548.0 | $ | 548.0 | ||||||||||||||||
Average interest rate (b) | 4.1% | 4.1% | 4.0% | 4.5% | 4.5% | —% | ||||||||||||||||||||||||||
Fixed-rate debt (c) | $ | 0.1 | $ | 0.2 | $ | 400.2 | $ | 0.2 | $ | 780.2 | $ | 32.6 | 1,213.5 | 1,295.8 | ||||||||||||||||||
Average interest rate | 4.2% | 4.2% | 4.3% | 4.2% | 7.2% | 6.1% | ||||||||||||||||||||||||||
Total | $ | 1,761.5 | $ | 1,843.8 |
(a) | Amounts exclude immaterial capital lease obligations |
(b) | Based on rates in effect at September 30, 2017 |
(c) | Fixed-rate debt includes $200.0 million DP&L Tax-exempt First Mortgage Bonds, which are variable rate, that have been hedged, per discussion above. See Note 6 – Derivative Instruments and Hedging Activities of Notes to DPL's Condensed Consolidated Financial Statements |
DP&L | ||||||||||||||||||||||||||||||||
Principal payments due | At September 30, 2017 | |||||||||||||||||||||||||||||||
during the twelve months ending | ||||||||||||||||||||||||||||||||
September 30, | Principal | Fair | ||||||||||||||||||||||||||||||
$ in millions | 2018 | 2019 | 2020 | 2021 | 2022 | Thereafter | Amount | Value | ||||||||||||||||||||||||
Long-term debt (a) | ||||||||||||||||||||||||||||||||
Variable-rate debt | $ | 4.5 | $ | 4.5 | $ | 4.5 | $ | 4.5 | $ | 423.7 | $ | — | $ | 441.7 | $ | 441.7 | ||||||||||||||||
Average interest rate (b) | 4.5% | 4.5% | 4.5% | 4.5% | 4.5% | —% | ||||||||||||||||||||||||||
Fixed-rate debt (c) | $ | 0.1 | $ | 0.2 | $ | 200.2 | $ | 0.2 | $ | 0.2 | $ | 17.0 | 217.9 | 217.8 | ||||||||||||||||||
Average interest rate | 4.2% | 4.2% | 1.8% | 4.2% | 4.2% | 4.2% | ||||||||||||||||||||||||||
Total | $ | 659.6 | $ | 659.5 |
(a) | Amounts exclude immaterial capital lease obligations |
(b) | Based on rates in effect at September 30, 2017 |
(c) | Fixed-rate debt includes $200.0 million DP&L Tax-exempt First Mortgage Bonds, which are variable rate, that have been hedged, per discussion above. See Note 6 – Derivative Instruments and Hedging Activities of Notes to DP&L's Condensed Financial Statements |
DPL | At September 30, 2017 | One percent | ||||||||||
Principal | Fair | interest rate | ||||||||||
$ in millions | Amount | Value | risk | |||||||||
Long-term debt (a) | ||||||||||||
Variable-rate debt | $ | 548.0 | $ | 548.0 | $ | 5.5 | ||||||
Fixed-rate debt (b) | 1,213.5 | 1,295.8 | 12.1 | |||||||||
Total | $ | 1,761.5 | $ | 1,843.8 | $ | 17.6 |
(a) | Amounts exclude immaterial capital lease obligations |
(b) | Fixed-rate debt includes $200.0 million DP&L Tax-exempt First Mortgage Bonds, which are variable rate, that have been hedged, per discussion above. See Note 6 – Derivative Instruments and Hedging Activities of Notes to DPL's Condensed Consolidated Financial Statements |
DP&L | At September 30, 2017 | One percent | ||||||||||
Principal | Fair | interest rate | ||||||||||
$ in millions | Amount | Value | risk | |||||||||
Long-term debt (a) | ||||||||||||
Variable-rate debt | $ | 441.7 | $ | 441.7 | $ | 4.4 | ||||||
Fixed-rate debt (b) | 217.9 | 217.8 | 2.2 | |||||||||
Total | $ | 659.6 | $ | 659.5 | $ | 6.6 |
(a) | Amounts exclude immaterial capital lease obligations |
(b) | Fixed-rate debt includes $200.0 million DP&L Tax-exempt First Mortgage Bonds, which are variable rate, that have been hedged, per discussion above. See Note 6 – Derivative Instruments and Hedging Activities of Notes to DP&L's Condensed Financial Statements |
ELECTRIC SALES AND CUSTOMERS (a) | |||||||||
DPL | DP&L | ||||||||
Three months ended | Three months ended | ||||||||
September 30, | September 30, | ||||||||
2017 | 2016 | 2017 | 2016 | ||||||
Electric Sales (millions of kWh) | 3,975 | 4,810 | 3,836 | 4,586 | |||||
Billed electric customers (end of period) | 520,211 | 517,607 | 520,211 | 517,607 | |||||
Nine months ended | Nine months ended | ||||||||
September 30, | September 30, | ||||||||
2017 | 2016 | 2017 | 2016 | ||||||
Electric Sales (millions of kWh) | 11,396 | 12,753 | 11,061 | 12,242 | |||||
Billed electric customers (end of period) | 520,211 | 517,607 | 520,211 | 517,607 |
(a) | This table contains wholesale sales in the PJM market and to other utilities. |
DPL Inc. | DP&L | Exhibit Number | Exhibit | Location |
X | X | 2.1 | Asset Contribution Agreement, dated as of September 28, 2017, by and between The Dayton Power and Light Company and AES Ohio Merger Sub, LLC | |
X | X | 2.2 | Agreement and Plan of Merger, dated as of September 28, 2017, by and between AES Ohio Merger Sub, LLC and AES Ohio Generation, LLC | |
X | X | 4.1 | Fifty-First Supplemental Indenture dated as of September 29, 2017 between The Bank of New York Mellon, Trustee and The Dayton Power and Light Company | |
X | 31(a) | Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
X | 31(b) | Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
X | 31(c) | Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
X | 31(d) | Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
X | 32(a) | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
X | 32(b) | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
X | 32(c) | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
X | 32(d) | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
X | X | 101.INS | XBRL Instance | Filed herewith as Exhibit 101.INS |
X | X | 101.SCH | XBRL Taxonomy Extension Schema | Filed herewith as Exhibit 101.SCH |
X | X | 101.CAL | XBRL Taxonomy Extension Calculation Linkbase | Filed herewith as Exhibit 101.CAL |
X | X | 101.DEF | XBRL Taxonomy Extension Definition Linkbase | Filed herewith as Exhibit 101.DEF |
X | X | 101.LAB | XBRL Taxonomy Extension Label Linkbase | Filed herewith as Exhibit 101.LAB |
X | X | 101.PRE | XBRL Taxonomy Extension Presentation Linkbase | Filed herewith as Exhibit 101.PRE |
DPL Inc. | ||
(Registrant) | ||
Date: | November 1, 2017 | /s/ Kenneth J. Zagzebski |
Kenneth J. Zagzebski | ||
President and Chief Executive Officer | ||
(principal executive officer) | ||
November 1, 2017 | /s/ Craig L. Jackson | |
Craig L. Jackson | ||
Chief Financial Officer | ||
(principal financial officer) | ||
November 1, 2017 | /s/ Kurt A. Tornquist | |
Kurt A. Tornquist | ||
Controller | ||
(principal accounting officer) |
The Dayton Power and Light Company | ||
(Registrant) | ||
Date: | November 1, 2017 | /s/ Thomas A. Raga |
Thomas A. Raga | ||
President and Chief Executive Officer | ||
(principal executive officer) | ||
November 1, 2017 | /s/ Craig L. Jackson | |
Craig L. Jackson | ||
Chief Financial Officer | ||
(principal financial officer) | ||
November 1, 2017 | /s/ Kurt A. Tornquist | |
Kurt A. Tornquist | ||
Controller | ||
(principal accounting officer) |
1. | I have reviewed this quarterly report on Form 10-Q of DPL Inc. ; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Kenneth J. Zagzebski |
Kenneth J. Zagzebski |
President and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of DPL Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Craig L. Jackson |
Craig L. Jackson |
Chief Financial Officer |
1. | I have reviewed this quarterly report on Form 10-Q of The Dayton Power and Light Company; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Thomas A. Raga |
Thomas A. Raga |
President and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of The Dayton Power and Light Company; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Craig L. Jackson |
Craig L. Jackson |
Chief Financial Officer |
/s/ Kenneth J. Zagzebski |
Kenneth J. Zagzebski |
President and Chief Executive Officer |
/s/ Craig L. Jackson |
Craig L. Jackson |
Chief Financial Officer |
/s/ Thomas A. Raga |
Thomas A. Raga |
President and Chief Executive Officer |
/s/ Craig L. Jackson |
Craig L. Jackson |
Chief Financial Officer |
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 30, 2017 |
Nov. 01, 2017 |
|
Entity Registrant Name | DPL INC | |
Entity Central Index Key | 0000787250 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 1 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q3 | |
Entity Voluntary Filers | Yes | |
Entity Well-known Seasoned Issuer | No | |
THE DAYTON POWER AND LIGHT COMPANY [Member] | ||
Entity Registrant Name | DAYTON POWER & LIGHT CO | |
Entity Central Index Key | 0000027430 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 41,172,173 | |
Entity Voluntary Filers | Yes | |
Entity Well-known Seasoned Issuer | No |
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Common stock, shares authorized | 1,500 | 1,500 |
Common stock, shares issued | 1 | 1 |
Common stock, shares outstanding | 1 | 1 |
THE DAYTON POWER AND LIGHT COMPANY [Member] | ||
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares outstanding | 41,172,173 | 41,172,173 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Overview and Summary of Significant Accounting Policies |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Overview and Summary of Significant Accounting Policies | Overview and Summary of Significant Accounting Policies Description of Business DPL is a diversified regional energy company organized in 1985 under the laws of Ohio. DPL has two reportable segments: the Transmission and Distribution segment and the Generation segment. See Note 11 – Business Segments for more information relating to these reportable segments. The terms “we,” “us,” “our” and “ours” are used to refer to DPL and its subsidiaries. DPL is an indirectly wholly-owned subsidiary of AES. DP&L is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 520,000 customers located in West Central Ohio. Additionally, DP&L procures retail SSO electric service on behalf of residential, commercial, industrial and governmental customers in a 6,000 square mile area of West Central Ohio. As of September 30, 2017, DP&L owned undivided interests in multiple coal-fired and peaking electric generating facilities as well as numerous transmission facilities. As of October 1, 2017, the DP&L-owned generating facilities were transferred to AES Ohio Generation, an affiliate of DP&L and wholly-owned subsidiary of DPL, through an asset contribution agreement to a subsidiary that was merged into AES Ohio Generation. Also, Stuart Station Unit 1 was retired on October 1, 2017. DP&L sources 100% of the generation for its SSO customers through a competitive bid process. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. DP&L's distribution sales reflect the general economic conditions, seasonal weather patterns, the proliferation of energy efficiency and distributed renewable resources and the market price of electricity. From January 1, 2016 through September 30, 2017, DP&L sold all of its energy and capacity into the wholesale market. DPL’s other significant subsidiaries include AES Ohio Generation and MVIC, our captive insurance company that provides insurance services to DPL and our subsidiaries. AES Ohio Generation, as of September 30, 2017, owned and operated certain peaking generating facilities, and, as of October 1, 2017, owns those facilities plus additional coal-fired and peaking facilities previously owned by DP&L. AES Ohio Generation sells all of its energy and capacity into the wholesale market. DPL owns all of the common stock of its subsidiaries. DPL also has a wholly-owned business trust, DPL Capital Trust II, formed for the purpose of issuing trust capital securities to investors. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. DPL and its subsidiaries employed 1,074 people as of September 30, 2017, of which 1,065 were employed by DP&L. As part of Generation Separation on October 1, 2017, DP&L generation employees became employees of AES Ohio Generation. Approximately 61% of all DP&L and AES Ohio Generation employees are under a collective bargaining agreement that was set to expire on October 31, 2017. The Company and the union representing these employees have agreed to extend the current agreement through January 31, 2018, while continuing to negotiate a new agreement. We are unable to determine what impact a new agreement may have on our operations. Financial Statement Presentation DPL’s Condensed Consolidated Financial Statements include the accounts of DPL and its wholly-owned subsidiaries except for DPL Capital Trust II, which is not consolidated, consistent with the provisions of GAAP. As of September 30, 2017, DP&L had undivided ownership interests in five coal-fired generating facilities, various peaking generating facilities and numerous transmission facilities, all of which are included in the financial statements at the lower of depreciated historical cost or fair value, if impaired. Operating revenues and expenses of these facilities are included on a pro rata basis in the corresponding lines in the Condensed Consolidated Statements of Operations. Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation. All material intercompany accounts and transactions are eliminated in consolidation. These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2016. In the opinion of our management, the Condensed Consolidated Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2017; our results of operations for the three and nine months ended September 30, 2017 and 2016 and our cash flows for the nine months ended September 30, 2017 and 2016. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, including, but not limited to, seasonal weather variations, the timing of outages of EGUs, changes in economic conditions involving commodity prices and competition, and other factors, interim results for the three and nine months ended September 30, 2017 may not be indicative of our results that will be realized for the full year ending December 31, 2017. The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: the carrying value of property, plant and equipment; unbilled revenues; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits. Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2017 and 2016 were $13.0 million and $14.4 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2017 and 2016 were $36.9 million and $38.9 million, respectively. New Accounting Pronouncements The following table provides a brief description of recent accounting pronouncements that could have a material impact on our consolidated financial statements:
ASU 2014-09 and its subsequent corresponding updates provide the principles an entity must apply to measure and recognize revenue. The core principle is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Amendments to the standard were issued that provide further clarification of the principle and to provide certain transition expedients. The standard will replace most existing revenue recognition guidance in GAAP. In 2016, we established a cross-functional implementation team and are in the process of evaluating changes to our business processes, systems and controls to support recognition and disclosure under the new standard. At this time, we do not expect any significant impact on our financial systems or a material change to controls as a result of the implementation of the new revenue recognition standard. Given the complexity and diversity of our non-regulated arrangements, we are assessing the standard on a contract-by-contract basis and are in the process of completing the contract assessments by applying interpretations reached during 2017 on key issues. These issues include the application of the practical expedient for measuring progress towards satisfaction of a performance obligation, when variable quantities would be considered variable consideration versus an option to acquire additional goods and services and how to allocate variable consideration to one or more, but not all, distinct goods or services promised in a series of distinct goods or services that forms part of a single performance obligation. We will continue our work to complete the assessment of the full population of contracts and determine the overall impact to the consolidated financial statements. The standard requires retrospective application and allows either a full retrospective adoption in which all periods are presented under the new standard or a modified retrospective approach in which the cumulative effect of initially applying the guidance is recognized at the date of initial application. Although we had previously been working toward adopting the standard using the full retrospective method, given the limited situations where revenue recognized under ASC 606 differs from that recognized under ASC 605, we now expect to use the modified retrospective approach. However, we will continue to assess this conclusion which is dependent on the final impact to the financial statements. We are continuing to work with various non-authoritative industry groups, and monitoring the FASB and Transition Resource Group activity, as we finalize our accounting policy on these and other industry specific interpretative issues which is expected in 2017. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Overview and Summary of Significant Accounting Policies | Overview and Summary of Significant Accounting Policies Description of Business DP&L is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 520,000 customers located in West Central Ohio. Additionally, DP&L procures retail SSO electric service on behalf of residential, commercial, industrial and governmental customers in a 6,000 square mile area of West Central Ohio. As of September 30, 2017, DP&L owned undivided interests in multiple coal-fired and peaking electric generating facilities as well as numerous transmission facilities. As of October 1, 2017, the DP&L-owned generating facilities were transferred to AES Ohio Generation, an affiliate of DP&L and wholly-owned subsidiary of DPL, through an asset contribution agreement to a subsidiary that was merged into AES Ohio Generation. With the October 1, 2017 transfer of DP&L's generation assets to a separate DPL subsidiary, DP&L has discontinued its generation business operations. Also, Stuart Station Unit 1 was retired on October 1, 2017. DP&L sources 100% of the generation for its SSO customers through a competitive bid process. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. DP&L's distribution sales reflect the general economic conditions, seasonal weather patterns, the proliferation of energy efficiency and distributed renewable resources and the market price of electricity. From January 1, 2016 through September 30, 2017, DP&L sold all of its energy and capacity into the wholesale market. DP&L is a subsidiary of DPL. Through September 30, 2017, DP&L had two reportable segments: the Transmission and Distribution (T&D) segment and the Generation segment. See Note 12 – Business Segments for more information relating to these reportable segments. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. DP&L employed 1,065 people as of September 30, 2017. As part of Generation Separation on October 1, 2017, DP&L generation employees became employees of AES Ohio Generation, an affiliate of DP&L and wholly-owned subsidiary of DPL. Approximately 61% of DP&L and AES Ohio Generation employees are under a collective bargaining agreement that was set to expire on October 31, 2017. The Company and the union representing these employees have agreed to extend the current agreement through January 31, 2018, while continuing to negotiate a new agreement. We are unable to determine what impact a new agreement may have on our operations. Financial Statement Presentation DP&L does not have any subsidiaries. As of September 30, 2017, DP&L had undivided ownership interests in five coal-fired generating facilities, various peaking generating facilities and numerous transmission facilities, all of which are included in the financial statements at the lower of depreciated historical cost or fair value, if impaired. Operating revenues and expenses of these facilities are included on a pro rata basis in the corresponding lines in the Condensed Statements of Operations. Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation. In the current period, we have reclassified the presentation of the December 2016 dividend payment which was originally recorded as a charge to Accumulated deficit and is now presented as a charge to Other paid-in capital. This reclassification was to prospectively correct an immaterial error. These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2016. In the opinion of our management, the Condensed Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2017; our results of operations for the three and nine months ended September 30, 2017 and 2016 and our cash flows for the nine months ended September 30, 2017 and 2016. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, including, but not limited to, seasonal weather variations, the timing of outages of EGUs, changes in economic conditions involving commodity prices and competition, and other factors, interim results for the three and nine months ended September 30, 2017 may not be indicative of our results that will be realized for the full year ending December 31, 2017. The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: the carrying value of property, plant and equipment; unbilled revenues; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits. Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2017 and 2016 were $13.0 million and $14.4 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2017 and 2016 were $36.9 million and $38.9 million, respectively. New Accounting Pronouncements The following table provides a brief description of recent accounting pronouncements that could have a material impact on our financial statements:
ASU 2014-09 and its subsequent corresponding updates provide the principles an entity must apply to measure and recognize revenue. The core principle is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Amendments to the standard were issued that provide further clarification of the principle and to provide certain transition expedients. The standard will replace most existing revenue recognition guidance in GAAP. In 2016, we established a cross-functional implementation team and are in the process of evaluating changes to our business processes, systems and controls to support recognition and disclosure under the new standard. At this time, we do not expect any significant impact on our financial systems or a material change to controls as a result of the implementation of the new revenue recognition standard. Given the complexity and diversity of our non-regulated arrangements, we are assessing the standard on a contract-by-contract basis and are in the process of completing the contract assessments by applying interpretations reached during 2017 on key issues. These issues include the application of the practical expedient for measuring progress towards satisfaction of a performance obligation, when variable quantities would be considered variable consideration versus an option to acquire additional goods and services and how to allocate variable consideration to one or more, but not all, distinct goods or services promised in a series of distinct goods or services that forms part of a single performance obligation. We will continue our work to complete the assessment of the full population of contracts and determine the overall impact to the consolidated financial statements. The standard requires retrospective application and allows either a full retrospective adoption in which all periods are presented under the new standard or a modified retrospective approach in which the cumulative effect of initially applying the guidance is recognized at the date of initial application. Although we had previously been working toward adopting the standard using the full retrospective method, given the limited situations where revenue recognized under ASC 606 differs from that recognized under ASC 605, we now expect to use the modified retrospective approach. However, we will continue to assess this conclusion which is dependent on the final impact to the financial statements. We are continuing to work with various non-authoritative industry groups, and monitoring the FASB and Transition Resource Group activity, as we finalize our accounting policy on these and other industry specific interpretative issues which is expected in 2017. |
Supplemental Financial Information |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Information | Supplemental Financial Information Accounts receivable and Inventories are as follows at September 30, 2017 and December 31, 2016:
Accumulated Other Comprehensive Income / (Loss) The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2017 and 2016 are as follows:
The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2017 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Information | Supplemental Financial Information Accounts receivable and Inventories are as follows at September 30, 2017 and December 31, 2016:
Accumulated Other Comprehensive Income / (Loss) The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2017 and 2016 are as follows:
The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2017 are as follows:
|
Regulatory Matters (Notes) |
9 Months Ended | ||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||
Schedule of Regulatory Assets and Liabilities [Text Block] | Regulatory Matters In January 2017, DP&L filed a settlement in its ESP 3 case and filed an amended stipulation on March 13, 2017, which was subject to approval by the PUCO. A final decision was issued by the PUCO on October 20, 2017, modifying and adopting the amended stipulation and recommendation. The ESP establishes DP&L's framework for providing retail service on a going forward basis including rate structures, non-bypassable charges and other specific rate recovery true-up mechanisms. The signatory parties agreed to a six-year settlement that provides a framework for energy rates and defines components which include, but are not limited to, the following:
In connection with any sale or closure of our generation plants as contemplated by the ESP 3 settlement or otherwise, DPL and DP&L would expect to incur certain cash and non-cash charges, some or all of which could be material to the business and financial condition of DPL and DP&L. DP&L’s ESP 2 had been approved by the PUCO for the years 2014 - 2016, and permitted DP&L to collect a non-bypassable service stability rider equal to $110.0 million per year for each of those years and required DP&L to conduct competitive bid auctions to procure generation supply for SSO service. The Ohio Supreme Court in a June 2016 opinion stated that the PUCO’s approval of the ESP was reversed. In view of that reversal, DP&L filed a motion to withdraw its ESP 2 and implement rates consistent with those in effect prior to 2014. The PUCO approved DP&L’s withdrawal of ESP 2 and implementation plans. Those rates were in effect until rates approved as a result of DP&L’s pending ESP 3 are effective, November 1, 2017. In February 2017, several parties appealed the PUCO orders that approved both the withdrawal and the implementation plans to the Ohio Supreme Court. Those appeals are pending, and the outcome and potential financial impact of those appeals cannot be determined at this time. In July 2017, the Office of the Ohio Consumers Counsel filed a motion with the Ohio Supreme Court seeking to stay collection of the reinstated prior rates while the appeals are pending. That stay was denied by the Ohio Supreme Court in September 2017. DP&L is subject to a SEET threshold and is required to apply general rules for calculating earnings and comparing them to a comparable group to determine whether there were significantly excessive earnings during a given calendar year. The ESP 3 maintains DP&L’s return on equity SEET threshold at 12% and provides that DMR amounts are excluded from the SEET calculation. A stipulation was reached with the PUCO staff agreeing that DP&L did not exceed the SEET threshold for 2015, which was approved by the PUCO on September 6, 2017. On May 15, 2017, DP&L filed its application to demonstrate that it did not have significantly excessive earnings for calendar year 2016. That case is still pending. In future years, the SEET could have a material effect on results of operations, financial condition and cash flows. |
||||||||||||||||||||||||||||||||
Subsidiaries [Member] | |||||||||||||||||||||||||||||||||
Schedule of Regulatory Assets and Liabilities [Text Block] | Regulatory Matters In January 2017, DP&L filed a settlement in its ESP 3 case and filed an amended stipulation on March 13, 2017, which was subject to approval by the PUCO. A final decision was issued by the PUCO on October 20, 2017, modifying and adopting the amended stipulation and recommendation. The ESP establishes DP&L's framework for providing retail service on a going forward basis including rate structures, non-bypassable charges and other specific rate recovery true-up mechanisms. The signatory parties agreed to a six-year settlement that provides a framework for energy rates and defines components which include, but are not limited to, the following:
In connection with any sale or closure of our generation plants as contemplated by the ESP 3 settlement or otherwise, DPL and DP&L would expect to incur certain cash and non-cash charges, some or all of which could be material to the business and financial condition of DPL and DP&L. DP&L’s ESP 2 had been approved by the PUCO for the years 2014 - 2016, and permitted DP&L to collect a non-bypassable service stability rider equal to $110.0 million per year for each of those years and required DP&L to conduct competitive bid auctions to procure generation supply for SSO service. The Ohio Supreme Court in a June 2016 opinion stated that the PUCO’s approval of the ESP was reversed. In view of that reversal, DP&L filed a motion to withdraw its ESP 2 and implement rates consistent with those in effect prior to 2014. The PUCO approved DP&L’s withdrawal of ESP 2 and implementation plans. Those rates were in effect until rates approved as a result of DP&L’s pending ESP 3 are effective, November 1, 2017. In February 2017, several parties appealed the PUCO orders that approved both the withdrawal and the implementation plans to the Ohio Supreme Court. Those appeals are pending, and the outcome and potential financial impact of those appeals cannot be determined at this time. In July 2017, the Office of the Ohio Consumers Counsel filed a motion with the Ohio Supreme Court seeking to stay collection of the reinstated prior rates while the appeals are pending. That stay was denied by the Ohio Supreme Court in September 2017. DP&L is subject to a SEET threshold and is required to apply general rules for calculating earnings and comparing them to a comparable group to determine whether there were significantly excessive earnings during a given calendar year. The ESP 3 maintains DP&L’s return on equity SEET threshold at 12% and provides that DMR amounts are excluded from the SEET calculation. A stipulation was reached with the PUCO staff agreeing that DP&L did not exceed the SEET threshold for 2015, which was approved by the PUCO on September 6, 2017. On May 15, 2017, DP&L filed its application to demonstrate that it did not have significantly excessive earnings for calendar year 2016. That case is still pending. In future years, the SEET could have a material effect on results of operations, financial condition and cash flows. |
Property, Plant and Equipment (Notes) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment Disclosure [Text Block] | Property, Plant and Equipment Coal-fired facilities As of September 30, 2017, DP&L and certain other Ohio utilities had undivided ownership interests in five coal-fired electric generating facilities and numerous transmission facilities. Certain expenses, primarily fuel costs for the generating units, are allocated to the owners based on their energy usage. The remaining expenses, investments in fuel inventory, plant materials and operating supplies, and capital additions are allocated to the owners in accordance with their respective ownership interests. DP&L’s share of the operations of such facilities is included within the corresponding line in the Condensed Consolidated Statements of Operations, and DP&L’s share of the investment in the facilities is included within Total net property, plant and equipment in the Condensed Consolidated Balance Sheets, except for amounts related to Miami Fort and Zimmer, which are classified as Held for Sale, as described below. Each co-owner provides their own financing for their share of the operations and capital expenditures of the jointly-owned station. DP&L’s undivided ownership interest in such facilities at September 30, 2017, was as follows:
Each of the above generating units has SCR and FGD equipment installed. On January 10, 2017, a high-pressure feedwater heater shell failed on Unit 1 at the J.M. Stuart station. As a result, $6.4 million of net book value was written off, resulting in a $3.2 million loss on disposal, net of accrued insurance recoveries, which was recorded during the first quarter of 2017. This loss was reversed during the second quarter of 2017 due to additional accrued insurance recoveries. This unit was retired on October 1, 2017. Accordingly, the 202 MWs of capacity associated with Stuart Unit 1 have been removed from the table above. On March 17, 2017, the Board of Directors of DP&L approved the retirement of the DP&L operated and co-owned Stuart Station coal-fired and diesel-fired generating units and the DP&L operated and co-owned Killen Station coal-fired generating unit and combustion turbine on or before June 1, 2018, and the co-owners of these facilities agreed with DP&L to proceed with this plan of retirement. On April 21, 2017, DP&L and AES Ohio Generation entered into an agreement for the sale of DP&L’s undivided interests in Zimmer and Miami Fort for $50.0 million in cash and the assumption of certain liabilities, including environmental liabilities. The purchase price is subject to adjustment at closing based on the amount of certain inventories, pre-paid amounts, employment benefits, insurance premiums, property taxes and other costs. The sale is subject to approval by the FERC and is expected to close in the fourth quarter of 2017. See Note 13 – Assets and Liabilities Held for Sale for additional information. On October 1, 2017, Generation Separation was completed and the coal-fired electric generating facilities described above were transferred to AES Ohio Generation. The portion of the co-owned transmission facilities owned by DP&L remains owned by DP&L. AROs We recognize AROs in accordance with GAAP which requires legal obligations associated with the retirement of long-lived assets to be recognized at their fair value at the time those obligations are incurred. Upon initial recognition of a legal liability, costs are capitalized as part of the related long-lived asset and depreciated over the useful life of the related asset. Our legal obligations are associated with the retirement of our long-lived assets, consisting primarily of river intake and discharge structures, coal unloading facilities, loading docks, ice breakers and ash disposal facilities. Estimating the amount and timing of future expenditures of this type requires significant judgment. Management routinely updates these estimates as additional information becomes available. Changes in the Liability for Generation AROs
See Note 5 – Fair Value for further discussion on changes to our AROs. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiaries [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment Disclosure [Text Block] | Property, Plant and Equipment Coal-fired facilities As of September 30, 2017, DP&L and certain other Ohio utilities had undivided ownership interests in five coal-fired electric generating facilities and numerous transmission facilities. Certain expenses, primarily fuel costs for the generating units, are allocated to the owners based on their energy usage. The remaining expenses, investments in fuel inventory, plant materials and operating supplies, and capital additions are allocated to the owners in accordance with their respective ownership interests. DP&L’s share of the operations of such facilities is included within the corresponding line in the Condensed Statements of Operations, and DP&L’s share of the investment in the facilities is included within Total net property, plant and equipment in the Condensed Balance Sheets, except for amounts related to Miami Fort and Zimmer, which are classified as Held for Sale, as described below. Each co-owner provides their own financing for their share of the operations and capital expenditures of the jointly-owned station. DP&L’s undivided ownership interest in such facilities at September 30, 2017, was as follows:
Each of the above generating units has SCR and FGD equipment installed. On January 10, 2017, a high-pressure feedwater heater shell failed on Unit 1 at the J.M. Stuart station. As a result, $6.4 million of net book value was written off, resulting in a $3.2 million loss on disposal, net of accrued insurance recoveries, which was recorded during the first quarter of 2017. This loss was reversed during the second quarter of 2017 due to additional accrued insurance recoveries. This unit was retired on October 1, 2017. Accordingly, the 202 MWs of capacity associated with Stuart Unit 1 have been removed from the table above. On March 17, 2017, the Board of Directors of DP&L approved the retirement of the DP&L operated and co-owned Stuart Station coal-fired and diesel-fired generating units and the DP&L operated and co-owned Killen Station coal-fired generating unit and combustion turbine on or before June 1, 2018, and the co-owners of these facilities agreed with DP&L to proceed with this plan of retirement. On April 21, 2017, DP&L and AES Ohio Generation entered into an agreement for the sale of DP&L’s undivided interests in Zimmer and Miami Fort for $50.0 million in cash and the assumption of certain liabilities, including environmental liabilities. The purchase price is subject to adjustment at closing based on the amount of certain inventories, pre-paid amounts, employment benefits, insurance premiums, property taxes and other costs. The sale is subject to approval by the FERC and is expected to close in the fourth quarter of 2017. On October 1, 2017, Generation Separation was completed and the coal-fired electric generating facilities described above were transferred to AES Ohio Generation. The portion of the co-owned transmission facilities owned by DP&L remains owned by DP&L. AROs We recognize AROs in accordance with GAAP which requires legal obligations associated with the retirement of long-lived assets to be recognized at their fair value at the time those obligations are incurred. Upon initial recognition of a legal liability, costs are capitalized as part of the related long-lived asset and depreciated over the useful life of the related asset. Our legal obligations are associated with the retirement of our long-lived assets, consisting primarily of river intake and discharge structures, coal unloading facilities, loading docks, ice breakers and ash disposal facilities. Estimating the amount and timing of future expenditures of this type requires significant judgment. Management routinely updates these estimates as additional information becomes available. Changes in the Liability for Generation AROs
See Note 5 – Fair Value for further discussion on changes to our AROs. |
Fair Value |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value | Fair Value The fair values of our financial instruments are based on published sources for pricing when possible. We rely on valuation models only when no other methods exist. The value of our financial instruments represents our best estimates of the fair value, which may not be the value realized in the future. The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2017 and December 31, 2016. Information about the fair value of our derivative instruments can be found in Note 6 – Derivative Instruments and Hedging Activities.
These financial instruments are not subject to master netting agreements or collateral requirements and as such are presented in the Condensed Consolidated Balance Sheet at their gross fair value, except for Long-term debt, which is presented at amortized carrying value. Fair Value Hierarchy Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. These inputs are then categorized as:
Valuations of assets and liabilities reflect the value of the instrument including the values associated with counterparty risk. We include our own credit risk and our counterparty’s credit risk in our calculation of fair value using global average default rates based on an annual study conducted by a large rating agency. We did not have any transfers of the fair values of our financial instruments between Level 1, Level 2 or Level 3 of the fair value hierarchy during the nine months ended September 30, 2017 or 2016. Master Trust Assets DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans and these assets are not used for general operating purposes. These assets are primarily comprised of open-ended mutual funds, which are valued using the net asset value per unit. These investments are recorded at fair value within Other deferred assets on the balance sheets and classified as available-for-sale. Any unrealized gains or losses are recorded in AOCI until the securities are sold. DPL had $1.5 million ($0.9 million after tax) of unrealized gains and immaterial unrealized losses on the Master Trust assets in AOCI at September 30, 2017 and $1.0 million ($0.6 million after tax) of unrealized gains and immaterial unrealized losses on the Master Trust assets in AOCI at December 31, 2016. During the nine months ended September 30, 2017, $0.8 million ($0.6 million after tax) of various investments were sold to facilitate the distribution of benefits and the unrealized gains were reversed into earnings. An immaterial amount of unrealized gains are expected to be reversed to earnings as investments are sold over the next twelve months to facilitate the distribution of benefits. Long-term debt The fair value of debt is based on current public market prices for disclosure purposes only. Unrealized gains or losses are not recognized in the financial statements as long-term debt is presented at cost, net of unamortized premium or discount and unamortized deferred financing costs in the financial statements. The long-term debt amounts include the current portion payable in the next twelve months and have maturities that range from 2019 to 2061. The fair value of assets and liabilities at September 30, 2017 and December 31, 2016 and the respective category within the fair value hierarchy for DPL was determined as follows:
Our financial instruments are valued using the market approach in the following categories:
Approximately 86% of the inputs to the fair value of our derivative instruments are from quoted market prices. Our long-term debt is fair valued for disclosure purposes only and most of the fair values are determined using quoted market prices in inactive markets. These fair value inputs are considered Level 2 in the fair value hierarchy. As the Wright-Patterson Air Force Base note is not publicly traded, fair value is assumed to equal carrying value. These fair value inputs are considered Level 3 in the fair value hierarchy as there are no observable inputs. Additional Level 3 disclosures are not presented since our long-term debt is not recorded at fair value. Non-recurring Fair Value Measurements We use the cost approach to determine the fair value of our AROs, which is estimated by discounting expected cash outflows to their present value at the initial recording of the liability. Cash outflows are based on the approximate future disposal cost as determined by market information, historical information or other management estimates. These inputs to the fair value of the AROs would be considered Level 3 inputs under the fair value hierarchy. As a result of changes in our estimates of costs to be incurred for our AROs, we decreased our AROs by $4.8 million in the first nine months of 2017. AROs for ash ponds, asbestos, ash landfills, river structures and underground storage tanks decreased by a net amount of $1.9 million and increased by a net amount of $3.0 million during the nine months ended September 30, 2017 and 2016, respectively. In addition, there was a $4.4 million decrease in the ARO liability during the nine months ended September 30, 2017 related to AROs at Miami Fort and Zimmer being reclassified to Liabilities held for sale - current. On March 17, 2017, the Board of Directors of DP&L approved the retirement of the DP&L operated and co-owned Stuart Station coal-fired and diesel-fired generating units and the Killen Station coal-fired generating unit and combustion turbine (collectively, the “Facilities”) on or before June 1, 2018, and the co-owners of the Facilities agreed with DP&L to proceed with this plan of retirement. As a result, we performed a long-lived asset impairment analysis during the first quarter of 2017 and determined that the carrying amounts of the Facilities were not recoverable. See Note 14 – Fixed-asset Impairments. A ruling by the Supreme Court of Ohio on June 20, 2016, lower expectation of future capacity revenue resulting from the most recent PJM capacity auction and a higher anticipated level of environmental compliance costs resulting from third party studies were collectively determined to be an impairment indicator for Killen and certain DP&L peaking generating facilities. As a result, we performed a long-lived asset impairment analysis during the second quarter of 2016 and determined that the carrying amount of these assets were not recoverable. See Note 14 – Fixed-asset Impairments. When evaluating impairment of long-lived assets, we measure fair value using the applicable fair value measurement guidance. Impairment expense is measured by comparing the fair value at the evaluation date to the carrying amount. The following table summarizes Long-lived assets measured at fair value on a non-recurring basis during the periods and their level within the fair value hierarchy:
(a)See Note 14 – Fixed-asset Impairments for further information (b)Carrying amount at date of valuation The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the nine months ended September 30, 2017:
The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the nine months ended September 30, 2016:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value | Fair Value The fair values of our financial instruments are based on published sources for pricing when possible. We rely on valuation models only when no other methods exist. The value of our financial instruments represents our best estimates of the fair value, which may not be the value realized in the future. The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2017 and December 31, 2016. Information about the fair value of our derivative instruments can be found in Note 6 – Derivative Instruments and Hedging Activities.
These financial instruments are not subject to master netting agreements or collateral requirements and as such are presented in the Condensed Balance Sheet at their gross fair value, except for Long-term debt, which is presented at amortized carrying value. Fair Value Hierarchy Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. These inputs are then categorized as:
Valuations of assets and liabilities reflect the value of the instrument including the values associated with counterparty risk. We include our own credit risk and our counterparty’s credit risk in our calculation of fair value using global average default rates based on an annual study conducted by a large rating agency. We did not have any transfers of the fair values of our financial instruments between Level 1, Level 2 or Level 3 of the fair value hierarchy during the nine months ended September 30, 2017 or 2016. Master Trust Assets DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans and these assets are not used for general operating purposes. These assets are primarily comprised of open-ended mutual funds, which are valued using the net asset value per unit. These investments are recorded at fair value within Other deferred assets on the balance sheets and classified as available-for-sale. Any unrealized gains or losses are recorded in AOCI until the securities are sold. DP&L had $1.5 million ($1.0 million after tax) of unrealized gains and immaterial unrealized losses on the Master Trust assets in AOCI at September 30, 2017 and $1.1 million ($0.7 million after tax) of unrealized gains and immaterial unrealized losses on the Master Trust assets in AOCI at December 31, 2016. During the nine months ended September 30, 2017, $0.8 million ($0.6 million after tax) of various investments were sold to facilitate the distribution of benefits and the unrealized gains were reversed into earnings. An immaterial amount of unrealized gains are expected to be reversed to earnings as investments are sold over the next twelve months to facilitate the distribution of benefits. Long-term debt The fair value of debt is based on current public market prices for disclosure purposes only. Unrealized gains or losses are not recognized in the financial statements as long-term debt is presented at cost, net of unamortized premium or discount and unamortized deferred financing costs in the financial statements. The long-term debt amounts include the current portion payable in the next twelve months and have maturities that range from 2020 to 2061. The fair value of assets and liabilities at September 30, 2017 and December 31, 2016 and the respective category within the fair value hierarchy for DP&L was determined as follows:
Our financial instruments are valued using the market approach in the following categories:
Approximately 86% of the inputs to the fair value of our derivative instruments are from quoted market prices. Our long-term debt is fair valued for disclosure purposes only and most of the fair values are determined using quoted market prices in inactive markets. These fair value inputs are considered Level 2 in the fair value hierarchy. As the Wright-Patterson Air Force Base note is not publicly traded, fair value is assumed to equal carrying value. These fair value inputs are considered Level 3 in the fair value hierarchy as there are no observable inputs. Additional Level 3 disclosures are not presented since our long-term debt is not recorded at fair value. Non-recurring Fair Value Measurements We use the cost approach to determine the fair value of our AROs, which is estimated by discounting expected cash outflows to their present value at the initial recording of the liability. Cash outflows are based on the approximate future disposal cost as determined by market information, historical information or other management estimates. These inputs to the fair value of the AROs would be considered Level 3 inputs under the fair value hierarchy. As a result of changes in our estimates of costs to be incurred for our AROs, we decreased our AROs by $4.8 million in the first nine months of 2017. AROs for ash ponds, asbestos, ash landfills, river structures and underground storage tanks decreased by a net amount of $0.8 million and increased by a net amount of $3.0 million during the nine months ended September 30, 2017 and 2016, respectively. In addition, there was a $3.4 million decrease in the ARO liability during the nine months ended September 30, 2017 related to AROs at Miami Fort and Zimmer being reclassified to Liabilities held for sale - current. On March 17, 2017, the Board of Directors of DP&L approved the retirement of the DP&L operated and co-owned Stuart Station coal-fired and diesel-fired generating units and the Killen Station coal-fired generating unit and combustion turbine (collectively, the “Facilities”) on or before June 1, 2018, and the co-owners of the Facilities agreed with DP&L to proceed with this plan of retirement. As a result, we performed a long-lived asset impairment analysis during the first quarter of 2017 and determined that the carrying amounts of the Facilities were not recoverable. See Note 14 – Fixed-asset Impairments. A ruling by the Supreme Court of Ohio on June 20, 2016, lower expectation of future capacity revenue resulting from the most recent PJM capacity auction and a higher anticipated level of environmental compliance costs resulting from third party studies were collectively determined to be an impairment indicator for the Stuart, Killen and Zimmer EGUs. As a result, we performed a long-lived asset impairment analysis during the second quarter of 2016 and determined that the carrying amount of these assets were not recoverable. See Note 14 – Fixed-asset Impairments. When evaluating impairment of long-lived assets, we measure fair value using the applicable fair value measurement guidance. Impairment expense is measured by comparing the fair value at the evaluation date to the carrying amount. The following table summarizes Long-lived assets measured at fair value on a non-recurring basis during the periods and their level within the fair value hierarchy:
(a)See Note 14 – Fixed-asset Impairments for further information (b)Carrying amount at date of valuation The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the nine months ended September 30, 2017:
The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the nine months ended September 30, 2016:
|
Derivative Instruments and Hedging Activities |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities In the normal course of business, DPL enters into various financial instruments, including derivative financial instruments. We use derivatives principally to manage the risk of changes in market prices for commodities and interest rate risk associated with our long-term debt. The derivatives that we use to economically hedge these risks are governed by our risk management policies for forward and futures contracts. Our net positions are continually assessed within our structured hedging programs to determine whether new or offsetting transactions are required. The objective of the hedging program is to mitigate financial risks while ensuring that we have adequate resources to meet our requirements. We monitor and value derivative positions monthly as part of our risk management processes. We use published sources for pricing, when possible, to mark positions to market. All of our derivative instruments are used for risk management purposes and are designated as cash flow hedges if they qualify under FASC 815 for accounting purposes. At September 30, 2017, DPL's derivative instruments were as follows:
(a) Refers to whether the derivative instruments have been designated as a cash flow hedge. At December 31, 2016, DPL's derivative instruments were as follows:
(a) Refers to whether the derivative instruments have been designated as a cash flow hedge. Cash Flow Hedges As part of our risk management processes, we identify the relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. The fair values of cash flow hedges determined by current public market prices will continue to fluctuate with changes in market prices up to contract expiration. The effective portion of the hedging transaction is recognized in AOCI and transferred to earnings using specific identification of each contract when the forecasted hedged transaction takes place or when the forecasted hedged transaction is probable of not occurring. The ineffective portion of the cash flow hedge is recognized in earnings in the current period. All risk components were taken into account to determine the hedge effectiveness of the cash flow hedges. We enter into forward power contracts to manage commodity price risk exposure related to our generation of electricity. We do not hedge all commodity price risk. We reclassify gains and losses on forward power contracts from AOCI into earnings in those periods in which the contracts settle. We have two interest rate swaps to hedge the variable interest on our $200.0 million variable interest rate tax-exempt First Mortgage Bonds. The interest rate swaps have a combined notional amount of $200.0 million and will settle monthly based on a one month LIBOR. We use the income approach to value the swaps, which consists of forecasting future cash flows based on contractual notional amounts and applicable and available market data as of the valuation date. The most common market data inputs used in the income approach include volatilities, spot and forward benchmark interest rates (LIBOR). Forward rates with the same tenor as the derivative instrument being valued are generally obtained from published sources, with these forward rates being assessed quarterly at a portfolio-level for reasonableness versus comparable published rates. We reclassify gains and losses on the swaps out of AOCI and into earnings in those periods in which hedged interest payments occur. We had previously entered into interest rate derivative contracts to manage interest rate exposure related to anticipated borrowings of fixed-rate debt. These interest rate derivative contracts were settled in the third quarter of 2013 and we continue to amortize amounts out of AOCI into interest expense. The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2017 and 2016:
(a)The actual amounts that we reclassify from AOCI to earnings related to power can differ from the estimate above due to market price changes. Net gains or losses associated with the ineffective portion of the hedging transactions were immaterial in the periods presented. Derivatives not designated as hedges Certain derivative contracts are entered into on a regular basis as part of our risk management program but do not qualify for hedge accounting or the normal purchase and normal sales scope exceptions under FASC 815. Accordingly, such contracts are recorded at fair value with changes in the fair value charged or credited to the Condensed Consolidated Statements of Operations in the period in which the change occurred. This is commonly referred to as “MTM accounting.” Contracts we enter into as part of our risk management program may be settled financially, by physical delivery, or net settled with the counterparty. FTRs, natural gas futures, and certain forward power contracts are currently marked to market. Certain qualifying derivative instruments have been designated as normal purchase or normal sale contracts, as provided under GAAP. Derivative contracts that have been designated as normal purchases or normal sales under GAAP are not subject to MTM accounting and are recognized in the Condensed Consolidated Statements of Operations on an accrual basis. Financial Statement Effect The following tables present the amount and classification within the Condensed Consolidated Statements of Operations of the gains and losses on DPL’s derivatives not designated as hedging instruments for the three and nine months ended September 30, 2017 and 2016:
DPL has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. The following tables summarize the derivative positions presented in the balance sheet where a right of offset exists under these arrangements and related cash collateral received or pledged, as well as the fair value, balance sheet classification and hedging designation of DPL’s derivative instruments:
(a) includes credit valuation adjustment
(a) includes credit valuation adjustment Credit risk-related contingent features Certain of our OTC commodity derivative contracts are under master netting agreements that contain provisions that require us to post collateral if our credit ratings drop below certain thresholds. We have crossed this threshold and our counterparties could request that we post collateral for our net liability position with them. As of the date of the filing of this report, we have not had to post collateral with any of these counterparties. The aggregate fair value of DPL’s commodity derivative instruments that were in a MTM loss position at September 30, 2017 was $9.4 million. $1.5 million of collateral was posted directly with third parties and in a broker margin account which offsets our loss positions on the forward contracts. This liability position is further offset by the asset position of counterparties with master netting agreements of $7.3 million. Since our long-term debt is below investment grade, we could have to post collateral for the remaining $0.6 million. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities In the normal course of business, DP&L enters into various financial instruments, including derivative financial instruments. We use derivatives principally to manage the risk of changes in market prices for commodities and interest rate risk associated with our long-term debt. The derivatives that we use to economically hedge these risks are governed by our risk management policies for forward and futures contracts. Our net positions are continually assessed within our structured hedging programs to determine whether new or offsetting transactions are required. The objective of the hedging program is to mitigate financial risks while ensuring that we have adequate resources to meet our requirements. We monitor and value derivative positions monthly as part of our risk management processes. We use published sources for pricing, when possible, to mark positions to market. All of our derivative instruments are used for risk management purposes and are designated as cash flow hedges if they qualify under FASC 815 for accounting purposes. At September 30, 2017, DP&L's derivative instruments were as follows:
(a) Refers to whether the derivative instruments have been designated as a cash flow hedge. At December 31, 2016, DP&L's derivative instruments were as follows:
(a) Refers to whether the derivative instruments have been designated as a cash flow hedge. Cash Flow Hedges As part of our risk management processes, we identify the relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. The fair values of cash flow hedges determined by current public market prices will continue to fluctuate with changes in market prices up to contract expiration. The effective portion of the hedging transaction is recognized in AOCI and transferred to earnings using specific identification of each contract when the forecasted hedged transaction takes place or when the forecasted hedged transaction is probable of not occurring. The ineffective portion of the cash flow hedge is recognized in earnings in the current period. All risk components were taken into account to determine the hedge effectiveness of the cash flow hedges. We enter into forward power contracts to manage commodity price risk exposure related to our generation of electricity. We do not hedge all commodity price risk. We reclassify gains and losses on forward power contracts from AOCI into earnings in those periods in which the contracts settle. We have two interest rate swaps to hedge the variable interest on our $200.0 million variable interest rate tax-exempt First Mortgage Bonds. The interest rate swaps have a combined notional amount of $200.0 million and will settle monthly based on a one month LIBOR. We use the income approach to value the swaps, which consists of forecasting future cash flows based on contractual notional amounts and applicable and available market data as of the valuation date. The most common market data inputs used in the income approach include volatilities, spot and forward benchmark interest rates (LIBOR). Forward rates with the same tenor as the derivative instrument being valued are generally obtained from published sources, with these forward rates being assessed quarterly at a portfolio-level for reasonableness versus comparable published rates. We reclassify gains and losses on the swaps out of AOCI and into earnings in those periods in which hedged interest payments occur. The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2017 and 2016:
Net gains or losses associated with the ineffective portion of the hedging transactions were immaterial in the periods presented. Derivatives not designated as hedges Certain derivative contracts are entered into on a regular basis as part of our risk management program but do not qualify for hedge accounting or the normal purchase and normal sales scope exceptions under FASC 815. Accordingly, such contracts are recorded at fair value with changes in the fair value charged or credited to the Condensed Statements of Operations in the period in which the change occurred. This is commonly referred to as “MTM accounting.” Contracts we enter into as part of our risk management program may be settled financially, by physical delivery, or net settled with the counterparty. FTRs, natural gas futures, and certain forward power contracts are currently marked to market. Certain qualifying derivative instruments have been designated as normal purchase or normal sale contracts, as provided under GAAP. Derivative contracts that have been designated as normal purchases or normal sales under GAAP are not subject to MTM accounting and are recognized in the Condensed Statements of Operations on an accrual basis. Financial Statement Effect The following tables present the amount and classification within the Condensed Statements of Operations of the gains and losses on DP&L's derivatives not designated as hedging instruments for the three and nine months ended September 30, 2017 and 2016:
DP&L has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. The following tables summarize the derivative positions presented in the balance sheet where a right of offset exists under these arrangements and related cash collateral received or pledged, as well as the fair value, balance sheet classification and hedging designation of DP&L’s derivative instruments:
(a) includes credit valuation adjustment
(a) includes credit valuation adjustment Credit risk-related contingent features Certain of our OTC commodity derivative contracts are under master netting agreements that contain provisions that require us to post collateral if our credit ratings drop below certain thresholds. We have crossed this threshold and our counterparties could request that we post collateral for our net liability position with them. As of the date of the filing of this report, we have not had to post collateral with any of these counterparties. The aggregate fair value of DP&L’s commodity derivative instruments that were in a MTM loss position at September 30, 2017 was $9.4 million. $1.5 million of collateral was posted directly with third parties and in a broker margin account which offsets our loss positions on the forward contracts. This liability position is further offset by the asset position of counterparties with master netting agreements of $7.3 million. If DP&L's long-term debt were to fall below investment grade, DP&L could be required to post collateral for the remaining $0.6 million. |
Debt Obligations |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Obligations | Long-term Debt The following table summarizes DPL's outstanding long-term debt.
Deferred financing costs are amortized over the remaining life of the debt using the effective interest method. Premiums or discounts on long-term debt are amortized over the remaining life of the debt using the effective interest method. Line of credit At September 30, 2017, DPL had $50.0 million in outstanding borrowings on its line of credit. In addition, DP&L had $15.0 million in outstanding borrowings on its line of credit. Significant transactions On May 26, 2017, DP&L commenced a tender offer to purchase any and all of the outstanding 4.8% tax-exempt First Mortgage Bonds at par value (plus accrued and unpaid interest). By June 23, 2017, or the expiration date of the tender, $8.1 million of the outstanding bonds were tendered. On June 26, 2017, DP&L accepted all of the tendered bonds, redeemed and retired them. On July 7, 2017, DP&L notified the Ohio Air Quality Development Authority and the Trustee of the same First Mortgage Bonds that DP&L was going to call at par value (plus accrued and unpaid interest) $21.9 million of these bonds. This call was completed on August 7, 2017. On September 28, 2017, DP&L issued an irrevocable call notice to purchase all of the remaining outstanding 4.8% tax-exempt First Mortgage Bonds at par value (plus accrued and unpaid interest). As of September 30, 2017, all of the bonds were either redeemed or defeased. This was done to facilitate Generation Separation and the release of the DP&L generation assets from the lien of DP&L's First and Refunding Mortgage. The redemption of the $70.0 million principal amount of defeased bonds was completed on October 30, 2017. Long-term debt covenants and restrictions DP&L’s unsecured revolving credit agreement and Bond Purchase and Covenants Agreement have two financial covenants. The first measures Total Debt to Total Capitalization and is calculated at the end of each fiscal quarter by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. The second financial covenant ratio compares EBITDA to Interest Expense and is calculated at the end of each fiscal quarter by dividing EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period. On February 21, 2017, DP&L and its lenders amended DP&L’s revolving credit agreement and Bond Purchase and Covenant Agreement. These amendments modified the definition of Consolidated Net Worth (which is used for measuring the Total Debt to Total Capitalization ratio under each of the agreements), to exclude, through March 31, 2018, non-cash charges related directly to impairments of coal generation assets in DP&L's fiscal quarter ending December 31, 2016 and thereafter. With this amendment, DP&L’s Total Debt to Total Capitalization ratio for the period ending September 30, 2017 is 0.46 to 1.00. The amendment also changed, for each agreement, the dates after generation separation during which compliance with the Total Capitalization ratio detailed above shall be suspended if DP&L's long-term indebtedness, as required by the PUCO, is less than or equal to $750.0 million. This time period was originally January 1, 2017 to December 31, 2017, but is now the twelve months immediately subsequent to the separation of the generation assets from DP&L. The cost of borrowing under DP&L's unsecured revolving credit agreement and Bond Purchase and Covenants Agreement adjust under certain credit rating scenarios. DPL’s revolving credit agreement and term loan have two financial covenants. The first financial covenant, a Total Debt to EBITDA ratio, is calculated at the end of each fiscal quarter by dividing total debt at the end of the current quarter by consolidated EBITDA for the four prior fiscal quarters. The second financial covenant, an EBITDA to Interest Expense ratio, is calculated, at the end of each fiscal quarter, by dividing EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period. The cost of borrowing under DPL's revolving credit agreement and term loan adjust under certain credit rating scenarios. DPL’s revolving credit agreement, term loan, and senior unsecured notes due 2019 restrict dividend payments from DPL to AES. As of September 30, 2017, DP&L and DPL were in compliance with all debt covenants, including the financial covenants described above. Substantially all property, plant & equipment of DP&L is subject to the lien of the mortgage securing DP&L’s First and Refunding Mortgage. In July 2017, assets related to the Miami Fort station and the Zimmer station were released from the lien of DP&L's First and Refunding Mortgage in connection with the pending sale. On October 1, 2017, all the other DP&L generation assets transferred to AES Ohio Generation as part of Generation Separation were released from the lien of DP&L’s First and Refunding Mortgage. See Note 13 – Assets and Liabilities Held for Sale for additional information. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Obligations | Long-term Debt The following table summarizes DP&L's outstanding long-term debt.
(a)Range of interest rates for the nine months ended September 30, 2017. (b)Range of interest rates for the year ended December 31, 2016. Deferred financing costs are amortized over the remaining life of the debt using the effective interest method. Premiums or discounts on long-term debt are amortized over the remaining life of the debt using the effective interest method. Line of credit At September 30, 2017, DP&L had $15.0 million in outstanding borrowings on its line of credit. Significant transactions On May 26, 2017, DP&L commenced a tender offer to purchase any and all of the outstanding 4.8% tax-exempt First Mortgage Bonds at par value (plus accrued and unpaid interest). By June 23, 2017, or the expiration date of the tender, $8.1 million of the outstanding bonds were tendered. On June 26, 2017, DP&L accepted all of the tendered bonds, redeemed and retired them. On July 7, 2017, DP&L notified the Ohio Air Quality Development Authority and the Trustee of the same First Mortgage Bonds that DP&L was going to call at par value (plus accrued and unpaid interest) $21.9 million of these bonds. This call was completed on August 7, 2017. On September 28, 2017, DP&L issued an irrevocable call notice to purchase all of the remaining outstanding 4.8% tax-exempt First Mortgage Bonds at par value (plus accrued and unpaid interest). As of September 30, 2017, all of the bonds were either redeemed or defeased. This was done to facilitate Generation Separation and the release of the DP&L generation assets from the lien of DP&L's First and Refunding Mortgage. The redemption of the $70.0 million principal amount of defeased bonds was completed on October 30, 2017. Long-term debt covenants and restrictions DP&L’s unsecured revolving credit agreement and Bond Purchase and Covenants Agreement have two financial covenants. The first measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. The second financial covenant ratio compares EBITDA to Interest Expense and is calculated at the end of each fiscal quarter by dividing EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period. On February 21, 2017, DP&L and its lenders amended DP&L’s revolving credit agreement and Bond Purchase and Covenant Agreement. These amendments modified the definition of Consolidated Net Worth (which is used for measuring the Total Debt to Total Capitalization ratio under each of the agreements), to exclude, through March 31, 2018, non-cash charges related directly to impairments of coal generation assets in DP&L's fiscal quarter ending December 31, 2016 and thereafter. With this amendment, DP&L’s Total Debt to Total Capitalization ratio for the period ending September 30, 2017 is 0.46 to 1.00. The amendment also changed, for each agreement, the dates after generation separation during which compliance with the Total Capitalization ratio detailed above shall be suspended if DP&L's long-term indebtedness, as required by the PUCO, is less than or equal to $750.0 million. This time period was originally January 1, 2017 to December 31, 2017, but is now the twelve months immediately subsequent to the separation of the generation assets from DP&L. As of September 30, 2017, DP&L was in compliance with all debt covenants, including the financial covenants described above. The cost of borrowing under DP&L's unsecured revolving credit agreement and Bond Purchase and Covenants Agreement adjusts under certain credit rating scenarios. Substantially all property, plant & equipment of DP&L is subject to the lien of the mortgage securing DP&L’s First and Refunding Mortgage. In July 2017, assets related to the Miami Fort station and the Zimmer station were released from the lien of DP&L's First and Refunding Mortgage in connection with the pending sale. On October 1, 2017, all the other DP&L generation assets transferred to AES Ohio Generation as part of Generation Separation were released from the lien of DP&L’s First and Refunding Mortgage. See Note 13 – Assets and Liabilities Held for Sale for additional information. |
Income Taxes |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The following table details the effective tax rates for the three and nine months ended September 30, 2017 and 2016.
Income tax expense for the nine months ended September 30, 2017 and 2016 was calculated using the estimated annual effective income tax rates for 2017 and 2016 of 36.0% and 38.6%, respectively. Management estimates the annual effective tax rate based on its forecast of annual pre-tax income. To the extent that actual pre-tax results for the year differ from the forecasts applied to the most recent interim period, the estimated rates could be materially different from the actual effective tax rates. The effective tax rate for the three months ended September 30, 2017 includes the impact of an adjustment relating to flow-through depreciation. The impact of this adjustment decreased the effective tax rate by 10.8% for the three months ended September 30, 2017. There is no impact on the effective tax rate for the nine months ended September 30, 2017. The decrease in the annual effective rate compared to the same period in 2016 is primarily due to the forecasted tax expense relating to flow-through depreciation and the projected manufacturer's production deduction. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The following table details the effective tax rates for the three and nine months ended September 30, 2017 and 2016.
Income tax expense for the nine months ended September 30, 2017 and 2016 was calculated using the estimated annual effective income tax rates for 2017 and 2016 of 19.0% and 36.7%, respectively. Management estimates the annual effective tax rate based on its forecast of annual pre-tax income. To the extent that actual pre-tax results for the year differ from the forecasts applied to the most recent interim period, the estimated rates could be materially different from the actual effective tax rates. The effective tax rate for the three months ended September 30, 2017 includes the impact of an adjustment relating to flow-through depreciation. The impact of this adjustment increased the effective tax rate by 8.2% for the three months ended September 30, 2017. There is no impact on the effective tax rate for the nine months ended September 30, 2017. The decrease in the annual effective rate compared to the same period in 2016 is primarily due to the forecasted tax expense relating to flow-through depreciation and the projected manufacturer's production deduction. Income taxes paid, net, were $22.2 million and $0.3 million for the nine months ended September 30, 2017 and 2016, respectively. For the nine months ended September 30, 2017, the $22.2 million represented payments made to DPL. |
Benefit Plans |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension and Postretirement Benefits | Benefit Plans DP&L sponsors a defined benefit pension plan for the vast majority of its employees. We generally fund pension plan benefits as accrued in accordance with the minimum funding requirements of ERISA and, in addition, make voluntary contributions from time to time. There were $5.0 million in employer contributions during each of the nine months ended September 30, 2017 and 2016. The amounts presented in the following tables for pension include the collective bargaining plan formula, the traditional management plan formula, the cash balance plan formula and the SERP, in the aggregate. The pension costs below have not been adjusted for amounts billed to the Service Company for former DP&L employees who are now employed by the Service Company but are still participants in the DP&L plan. The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2017 and 2016 was:
In addition, DP&L provides postretirement health care and life insurance benefits to certain retired employees, their spouses and eligible dependents. We have funded a portion of the union-eligible benefits using a Voluntary Employee Beneficiary Association Trust. These postretirement health care benefits and the related unfunded obligation of $15.6 million at September 30, 2017 and $15.8 million at December 31, 2016 were not material to the financial statements in the periods covered by this report. Benefit payments, which reflect future service, are estimated to be paid as follows:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension and Postretirement Benefits | Benefit Plans DP&L sponsors a defined benefit pension plan for the vast majority of its employees. We generally fund pension plan benefits as accrued in accordance with the minimum funding requirements of ERISA and, in addition, make voluntary contributions from time to time. There were $5.0 million in employer contributions during each of the nine months ended September 30, 2017 and 2016. The amounts presented in the following tables for pension include the collective bargaining plan formula, the traditional management plan formula, the cash balance plan formula and the SERP, in the aggregate. The pension costs below have not been adjusted for amounts billed to the Service Company for former DP&L employees who are now employed by the Service Company but are still participants in the DP&L plan. The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2017 and 2016 was:
In addition, DP&L provides postretirement health care and life insurance benefits to certain retired employees, their spouses and eligible dependents. We have funded a portion of the union-eligible benefits using a Voluntary Employee Beneficiary Association Trust. These postretirement health care benefits and the related unfunded obligation of $15.6 million at September 30, 2017 and $15.8 million at December 31, 2016 were not material to the financial statements in the periods covered by this report. Benefit payments, which reflect future service, are estimated to be paid as follows:
|
Shareholder's Equity |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
THE DAYTON POWER AND LIGHT COMPANY [Member] | |
Class of Stock [Line Items] | |
Shareholder's Equity | Shareholder’s Equity DP&L has 250,000,000 authorized shares of common stock, $0.01 par value, of which 41,172,173 are outstanding at September 30, 2017. All common shares are held by DP&L’s parent, DPL. As part of the PUCO’s approval of the Merger, DP&L agreed to maintain a capital structure that includes an equity ratio, calculated as total equity divided by total capitalization, of at least 50 percent and to not have a negative retained earnings balance. After the fixed-asset impairments recorded in 2017 and 2016 and as of September 30, 2017, DP&L's equity ratio was 39% and retained earnings balance was negative. It is unknown what impact, if any, this will have on DP&L. In the generation separation order dated September 17, 2014, the PUCO permitted DP&L to temporarily maintain long-term debt of $750.0 million or 75% of its rate base, whichever is greater, until January 1, 2018. After considering the payments and defeasance noted in Note 7 – Long-term Debt, DP&L's long-term debt is $659.9 million. During the nine months ended September 30, 2017, DP&L paid $19.0 million in cash to DPL, which was treated as a return of capital reducing Other paid-in capital. In addition, DPL made a $70.0 million capital contribution to DP&L during the third quarter of 2017. |
Contractual Obligations, Commercial Commitments and Contingencies |
9 Months Ended | ||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||
Entity Information [Line Items] | |||||||||||||||||||||||||
Contractual Obligations, Commercial Commitments and Contingencies | Contractual Obligations, Commercial Commitments and Contingencies Guarantees In the normal course of business, DPL enters into various agreements with its wholly-owned subsidiary, AES Ohio Generation, providing financial or performance assurance to third parties. These agreements are entered into primarily to support or enhance the creditworthiness otherwise attributed to this subsidiary on a stand-alone basis, thereby facilitating the extension of sufficient credit to accomplish this subsidiary's intended commercial purposes. At September 30, 2017, DPL had $38.6 million of guarantees on behalf of AES Ohio Generation to third parties for future financial or performance assurance under such agreements. The guarantee arrangements entered into by DPL with these third parties cover select present and future obligations of AES Ohio Generation to such beneficiaries and are terminable by DPL upon written notice to the beneficiaries within a certain time. The carrying amount of obligations for commercial transactions covered by these guarantees recorded in our Condensed Consolidated Balance Sheets was $1.2 million and $2.3 million at September 30, 2017 and December 31, 2016, respectively. To date, DPL has not incurred any losses related to the guarantees of AES Ohio Generation’s obligations and we believe it is remote that DPL would be required to perform or incur any losses in the future associated with any of the above guarantees. Equity Ownership Interest DP&L has a 4.9% equity ownership interest in OVEC, which is recorded using the cost method of accounting under GAAP. At September 30, 2017, DP&L could be responsible for the repayment of 4.9%, or $71.3 million, of a $1,455.5 million debt obligation comprised of both fixed and variable rate securities with maturities from 2019 to 2040. OVEC could also seek additional contributions from us to avoid a default in the event that other OVEC members defaulted on their respective OVEC obligations. As of September 30, 2017, we have no knowledge of such a default. Commercial Commitments and Contractual Obligations There have been no material changes, outside the ordinary course of business, to our commercial commitments and to the information disclosed in the contractual obligations table in our Form 10-K for the fiscal year ended December 31, 2016. Contingencies In the normal course of business, we are subject to various lawsuits, actions, proceedings, claims and other matters asserted under various laws and regulations. We believe the amounts provided in our Condensed Consolidated Financial Statements, as prescribed by GAAP, are adequate in light of the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Consolidated Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of September 30, 2017, cannot be reasonably determined. Environmental Matters DPL’s and DP&L’s facilities and operations are subject to a wide range of federal, state and local environmental regulations and laws. The environmental issues that may affect us include:
In addition to imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at our facilities to comply, or to determine compliance, with such regulations. We record liabilities for loss contingencies related to environmental matters when a loss is probable of occurring and can be reasonably estimated in accordance with the provisions of GAAP. Accordingly, we have immaterial accruals for loss contingencies for environmental matters. We also have a number of environmental matters for which we have not accrued loss contingencies because the risk of loss is not probable or a loss cannot be reasonably estimated. We evaluate the potential liability related to environmental matters quarterly and may revise our estimates. Such revisions in the estimates of the potential liabilities could have a material adverse effect on our results of operations, financial condition or cash flows. We have several pending environmental matters associated with our coal-fired generation units. Some of these matters could have material adverse impacts on the operation of the power stations. |
||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||
Entity Information [Line Items] | |||||||||||||||||||||||||
Contractual Obligations, Commercial Commitments and Contingencies | Contractual Obligations, Commercial Commitments and Contingencies Equity Ownership Interest DP&L has a 4.9% equity ownership interest in OVEC, which is recorded using the cost method of accounting under GAAP. At September 30, 2017, DP&L could be responsible for the repayment of 4.9%, or $71.3 million, of a $1,455.5 million debt obligation comprised of both fixed and variable rate securities with maturities from 2019 to 2040. OVEC could also seek additional contributions from us to avoid a default in the event that other OVEC members defaulted on their respective OVEC obligations. As of September 30, 2017, we have no knowledge of such a default. Commercial Commitments and Contractual Obligations There have been no material changes, outside the ordinary course of business, to our commercial commitments and to the information disclosed in the contractual obligations table in our Form 10-K for the fiscal year ended December 31, 2016. Contingencies In the normal course of business, we are subject to various lawsuits, actions, proceedings, claims and other matters asserted under various laws and regulations. We believe the amounts provided in our Condensed Financial Statements, as prescribed by GAAP, are adequate in light of the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of September 30, 2017, cannot be reasonably determined. Environmental Matters DP&L’s facilities and operations are subject to a wide range of federal, state and local environmental regulations and laws. The environmental issues that may affect us include:
In addition to imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at our facilities to comply, or to determine compliance, with such regulations. We record liabilities for loss contingencies related to environmental matters when a loss is probable of occurring and can be reasonably estimated in accordance with the provisions of GAAP. Accordingly, we have immaterial accruals for loss contingencies for environmental matters. We also have a number of environmental matters for which we have not accrued loss contingencies because the risk of loss is not probable or a loss cannot be reasonably estimated. We evaluate the potential liability related to environmental matters quarterly and may revise our estimates. Such revisions in the estimates of the potential liabilities could have a material adverse effect on our results of operations, financial condition or cash flows. We have several pending environmental matters associated with our coal-fired generation units. Some of these matters could have material adverse impacts on the operation of the power stations. |
Business Segments |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segments | Business Segments DPL currently manages the business through two reportable operating segments, the T&D segment and the Generation segment. The primary segment performance measure is income / (loss) from continuing operations before income tax as management has concluded that this measure best reflects the underlying business performance of DPL and is the most relevant measure considered in DPL’s internal evaluation of the financial performance of its segments. The segments are discussed further below: Transmission and Distribution Segment The T&D segment is comprised primarily of DP&L’s electric transmission and distribution businesses, which distribute electricity to residential, commercial, industrial and governmental customers. DP&L distributes electricity to more than 520,000 retail customers located in a 6,000 square mile area of West Central Ohio. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses recording regulatory assets when incurred costs are expected to be recovered in future customer rates and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. The T&D segment includes revenues and costs associated with our investment in OVEC and the historical results of DP&L’s Beckjord, Hutchings Coal, and East Bend generating facilities, which were either closed or sold in prior periods. As these assets did not transfer to AES Ohio Generation on October 1, 2017 when DP&L’s generation separation occurred, they are grouped with the T&D assets for segment reporting purposes. In addition, regulatory deferrals and collections, which include fuel deferrals in historical periods, are included in the T&D segment. Generation Segment The Generation segment is comprised of AES Ohio Generation and DP&L’s electric generation business. Beginning in 2001, Ohio law gave consumers the right to choose the electric generation supplier from whom they purchase retail generation services. Through September 30, 2017, AES Ohio Generation owned and operated peaking generating facilities, and DP&L owned multiple coal-fired and peaking electric generating facilities. As a result of Generation Separation, the DP&L-owned generating facilities were transferred to AES Ohio Generation on October 1, 2017. Both AES Ohio Generation and DP&L primarily sell their generated energy and capacity into the PJM wholesale market as DP&L sources all of the generation for its SSO customers through a competitive bid process. Included within the “Other” column are other businesses that do not meet the GAAP requirements for disclosure as reportable segments as well as certain corporate costs, which include interest expense on DPL’s long-term debt and adjustments related to purchase accounting from the Merger. The accounting policies of the reportable segments are the same as those described in Note 1 – Overview and Summary of Significant Accounting Policies. Intersegment sales, costs of sales and expenses are eliminated in consolidation. Certain shared and corporate costs are allocated among reporting segments. The following tables present financial information for each of DPL’s reportable business segments prior to the October 1, 2017 transfer to AES Ohio Generation:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiaries [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segments | Business Segments Through September 30, 2017, DP&L managed the business through two reportable operating segments, the T&D segment and the Generation segment. After Generation Separation, DP&L will have only one reportable operating segment, the T&D segment, beginning on October 1, 2017. The primary segment performance measure is income / (loss) from operations before income tax as management has concluded that this measure best reflects the underlying business performance of DP&L and is the most relevant measure considered in DP&L’s internal evaluation of the financial performance of its segments. The segments are discussed further below: Transmission and Distribution Segment The T&D segment is comprised primarily of DP&L’s electric transmission and distribution businesses, which distribute electricity to residential, commercial, industrial and governmental customers. DP&L distributes electricity to more than 520,000 retail customers located in a 6,000 square mile area of West Central Ohio. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses recording regulatory assets when incurred costs are expected to be recovered in future customer rates and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. The T&D segment includes revenues and costs associated with our investment in OVEC and the historical results of DP&L’s Beckjord, Hutchings Coal, and East Bend generating facilities, which were either closed or sold in prior periods. As these assets did not transfer to AES Ohio Generation on October 1, 2017 when DP&L’s generation separation occurred, they are grouped with the T&D assets for segment reporting purposes. In addition, regulatory deferrals and collections, which include fuel deferrals in historical periods, are included in the T&D segment. Generation Segment The Generation segment is comprised of DP&L’s electric generation business. Beginning in 2001, Ohio law gave consumers the right to choose the electric generation supplier from whom they purchase retail generation services. DP&L's Generation segment sells its generated energy and capacity into the wholesale market as DP&L sources all of the generation for its SSO customers through a competitive bid process. Through September 30, 2017, DP&L owned multiple coal-fired and peaking electric generating facilities. As a result of Generation Separation, the DP&L-owned generating facilities were transferred to AES Ohio Generation on October 1, 2017, and DP&L will no longer have a Generation segment. The accounting policies of the reportable segments are the same as those described in Note 1 – Overview and Summary of Significant Accounting Policies. Intersegment sales, costs of sales and expenses are eliminated in consolidation. Certain shared and corporate costs are allocated among reporting segments. The following tables present financial information for each of DP&L’s reportable business segments:
|
Discontinued Operations |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations | Discontinued Operations On January 1, 2016, DPL closed on the sale of DPLER, its competitive retail business. The sale agreement was signed on December 28, 2015, and DPL recorded a gain on this transaction of $49.2 million in the first quarter of 2016. The gain includes the impact of DPLER’s liability to DP&L that transferred with the sale on January 1, 2016 but was eliminated in consolidation as of December 31, 2015. Operating activities related to DPLER have been reclassified to "Discontinued operations" in the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2016. The following table summarizes the revenues, cost of revenues, operating expenses and income tax of discontinued operations for the periods indicated:
Cash flows related to discontinued operations are included in our Condensed Consolidated Statements of Cash Flows. Cash flows from operating activities for discontinued operations were $(0.7) million for the nine months ended September 30, 2016. Cash flows from investing activities for discontinued operations were $75.5 million for the nine months ended September 30, 2016. All cash generated from discontinued operations was paid to DPL through dividends for all periods presented. Assets and Liabilities Held for Sale On April 21, 2017, DP&L and AES Ohio Generation entered into an Asset Purchase Agreement with subsidiaries of Dynegy Inc., for the sale of DP&L's undivided interests in the Zimmer Station and the Miami Fort Station for cash and the assumption of certain liabilities, including environmental liabilities. The cash purchase price is subject to adjustment at closing based on the amount of certain inventories, pre-paid amounts, employment benefits, insurance premiums, property taxes and other costs prior to closing. The sale is subject to approval by the FERC and is expected to close in the fourth quarter of 2017. Accordingly, the assets and liabilities of Zimmer Station and Miami Fort Station were classified as held for sale as of September 30, 2017, but the plants did not meet the criteria to be reported as discontinued operations. The following table summarizes the major classes of assets and liabilities classified as held for sale as of September 30, 2017:
Zimmer Station and Miami Fort Station's results are reflected within continuing operations in the Condensed Consolidated Statements of Operations. The combined income / (loss) from continuing operations before income tax for Zimmer Station and Miami Fort Station was $11.0 million and $1.4 million for the three months ended September 30, 2017 and 2016, respectively, and $18.9 million and $(9.8) million for the nine months ended September 30, 2017 and 2016, respectively. Zimmer Station and Miami Fort Station are included in the Generation segment. |
Held for Sale (Notes) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long Lived Assets Held-for-sale [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations | Discontinued Operations On January 1, 2016, DPL closed on the sale of DPLER, its competitive retail business. The sale agreement was signed on December 28, 2015, and DPL recorded a gain on this transaction of $49.2 million in the first quarter of 2016. The gain includes the impact of DPLER’s liability to DP&L that transferred with the sale on January 1, 2016 but was eliminated in consolidation as of December 31, 2015. Operating activities related to DPLER have been reclassified to "Discontinued operations" in the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2016. The following table summarizes the revenues, cost of revenues, operating expenses and income tax of discontinued operations for the periods indicated:
Cash flows related to discontinued operations are included in our Condensed Consolidated Statements of Cash Flows. Cash flows from operating activities for discontinued operations were $(0.7) million for the nine months ended September 30, 2016. Cash flows from investing activities for discontinued operations were $75.5 million for the nine months ended September 30, 2016. All cash generated from discontinued operations was paid to DPL through dividends for all periods presented. Assets and Liabilities Held for Sale On April 21, 2017, DP&L and AES Ohio Generation entered into an Asset Purchase Agreement with subsidiaries of Dynegy Inc., for the sale of DP&L's undivided interests in the Zimmer Station and the Miami Fort Station for cash and the assumption of certain liabilities, including environmental liabilities. The cash purchase price is subject to adjustment at closing based on the amount of certain inventories, pre-paid amounts, employment benefits, insurance premiums, property taxes and other costs prior to closing. The sale is subject to approval by the FERC and is expected to close in the fourth quarter of 2017. Accordingly, the assets and liabilities of Zimmer Station and Miami Fort Station were classified as held for sale as of September 30, 2017, but the plants did not meet the criteria to be reported as discontinued operations. The following table summarizes the major classes of assets and liabilities classified as held for sale as of September 30, 2017:
Zimmer Station and Miami Fort Station's results are reflected within continuing operations in the Condensed Consolidated Statements of Operations. The combined income / (loss) from continuing operations before income tax for Zimmer Station and Miami Fort Station was $11.0 million and $1.4 million for the three months ended September 30, 2017 and 2016, respectively, and $18.9 million and $(9.8) million for the nine months ended September 30, 2017 and 2016, respectively. Zimmer Station and Miami Fort Station are included in the Generation segment. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiaries [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long Lived Assets Held-for-sale [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations | Assets and Liabilities Held for Sale On April 21, 2017, DP&L and AES Ohio Generation entered into an Asset Purchase Agreement with subsidiaries of Dynegy Inc., for the sale of DP&L's undivided interests in the Zimmer Station and the Miami Fort Station for cash and the assumption of certain liabilities, including environmental liabilities. The cash purchase price is subject to adjustment at closing based on the amount of certain inventories, pre-paid amounts, employment benefits, insurance premiums, property taxes and other costs prior to closing. The sale is subject to approval by the FERC and is expected to close in the fourth quarter of 2017. Accordingly, the assets and liabilities of Zimmer Station and Miami Fort Station were classified as held for sale as of September 30, 2017, but the plants did not meet the criteria to be reported as discontinued operations. The following table summarizes the major classes of assets and liabilities classified as held for sale as of September 30, 2017:
Zimmer Station and Miami Fort Station's results are reflected within continuing operations in the Condensed Statements of Operations. The combined income / (loss) from continuing operations before income tax for Zimmer Station and Miami Fort Station was $11.0 million and $1.9 million for the three months ended September 30, 2017 and 2016, respectively, and $18.9 million and $(333.5) million for the nine months ended September 30, 2017 and 2016, respectively. Zimmer Station and Miami Fort Station are included in the Generation segment. |
Fixed-asset Impairment (Notes) |
9 Months Ended |
---|---|
Sep. 30, 2017 | |
Finite-Lived Intangible Assets [Line Items] | |
Asset Impairment Charges [Text Block] | Fixed-asset Impairments On March 17, 2017, the Board of Directors of DP&L approved the retirement of the two DP&L operated and co-owned electric generating stations; the Stuart Station coal-fired and diesel-fired generating units and the Killen Station coal-fired generating unit and combustion turbine (collectively, the “Facilities”) on or before June 1, 2018. The co-owners of these facilities agreed with DP&L to proceed with this plan of retirement. We performed a long-lived asset impairment analysis and determined that the carrying amounts of the Facilities were not recoverable. The asset groups of Stuart Station and Killen Station were determined to have fair values of $3.3 million and $7.9 million, respectively, using the discounted cash flows under the income approach. As a result, we recognized asset impairment expense of $39.1 million and $27.3 million for Stuart Station and Killen Station, respectively. Additionally, as a result of the decision to retire the Facilities by June 1, 2018, we concluded that inventory at these Facilities is considered obsolete. As a result, we recognized a loss on disposal of $9.8 million and $6.4 million for Stuart Station and Killen Station inventories, respectively, during the first quarter of 2017, which is recorded in Loss on asset disposal in the Condensed Consolidated Statements of Operations. During the second quarter of 2016, we tested the recoverability of our long-lived assets at certain of our generation facilities at DP&L. A ruling by the Supreme Court of Ohio on June 20, 2016, lower expectation of future capacity revenue resulting from the most recent PJM capacity auction and a higher anticipated level of environmental compliance costs resulting from third party studies were collectively determined to be an impairment indicator for these assets. We performed a long-lived asset impairment analysis and determined that the carrying amount of Killen and certain DP&L peaking generating facilities were not recoverable. The asset groups of Killen and these DP&L peaking generating facilities were determined to have fair values of $84.3 million and $5.2 million, respectively, using the discounted cash flows under the income approach. As a result, we recognized asset impairment expense of $230.8 million and $4.7 million for Killen and these DP&L peaking generating facilities, respectively. |
THE DAYTON POWER AND LIGHT COMPANY [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Asset Impairment Charges [Text Block] | Fixed-asset Impairments On March 17, 2017, the Board of Directors of DP&L approved the retirement of the two DP&L operated and co-owned electric generating stations; the Stuart Station coal-fired and diesel-fired generating units and the Killen Station coal-fired generating unit and combustion turbine (collectively, the “Facilities”) on or before June 1, 2018. The co-owners of these facilities agreed with DP&L to proceed with this plan of retirement. We performed a long-lived asset impairment analysis and determined that the carrying amounts of the Facilities were not recoverable. The asset groups of Stuart Station and Killen Station were determined to have fair values of $3.3 million and $7.9 million, respectively, using the discounted cash flows under the income approach. As a result, we recognized asset impairment expense of $39.0 million and $27.3 million for Stuart Station and Killen Station, respectively. Additionally, as a result of the decision to retire the Facilities by June 1, 2018, we concluded that inventory at these Facilities is considered obsolete. As a result, we recognized a loss on disposal of $9.8 million and $6.4 million for Stuart Station and Killen Station inventories, respectively, during the first quarter of 2017, which is recorded in Loss on asset disposal in the Condensed Statements of Operations. During the second quarter of 2016, we tested the recoverability of our long-lived assets at certain of our generation facilities at DP&L. A ruling by the Supreme Court of Ohio on June 20, 2016, lower expectation of future capacity revenue resulting from the most recent PJM capacity auction and a higher anticipated level of environmental compliance costs resulting from third party studies were collectively determined to be an impairment indicator for these assets. We performed a long-lived asset impairment analysis and determined that the carrying amount of the asset groups of Stuart, Killen and Zimmer were not recoverable. The asset groups of Stuart, Killen and Zimmer were determined to have fair values of $164.4 million, $84.3 million and $111.0 million, respectively, using the discounted cash flows under the income approach. As a result, we recognized asset impairment expense of $292.0 million, $246.2 million and $318.9 million for Stuart, Killen and Zimmer, respectively. |
Summary of Significant Accounting Policies (Policy) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Description of Business | Description of Business DPL is a diversified regional energy company organized in 1985 under the laws of Ohio. DPL has two reportable segments: the Transmission and Distribution segment and the Generation segment. See Note 11 – Business Segments for more information relating to these reportable segments. The terms “we,” “us,” “our” and “ours” are used to refer to DPL and its subsidiaries. DPL is an indirectly wholly-owned subsidiary of AES. DP&L is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 520,000 customers located in West Central Ohio. Additionally, DP&L procures retail SSO electric service on behalf of residential, commercial, industrial and governmental customers in a 6,000 square mile area of West Central Ohio. As of September 30, 2017, DP&L owned undivided interests in multiple coal-fired and peaking electric generating facilities as well as numerous transmission facilities. As of October 1, 2017, the DP&L-owned generating facilities were transferred to AES Ohio Generation, an affiliate of DP&L and wholly-owned subsidiary of DPL, through an asset contribution agreement to a subsidiary that was merged into AES Ohio Generation. Also, Stuart Station Unit 1 was retired on October 1, 2017. DP&L sources 100% of the generation for its SSO customers through a competitive bid process. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. DP&L's distribution sales reflect the general economic conditions, seasonal weather patterns, the proliferation of energy efficiency and distributed renewable resources and the market price of electricity. From January 1, 2016 through September 30, 2017, DP&L sold all of its energy and capacity into the wholesale market. DPL’s other significant subsidiaries include AES Ohio Generation and MVIC, our captive insurance company that provides insurance services to DPL and our subsidiaries. AES Ohio Generation, as of September 30, 2017, owned and operated certain peaking generating facilities, and, as of October 1, 2017, owns those facilities plus additional coal-fired and peaking facilities previously owned by DP&L. AES Ohio Generation sells all of its energy and capacity into the wholesale market. DPL owns all of the common stock of its subsidiaries. DPL also has a wholly-owned business trust, DPL Capital Trust II, formed for the purpose of issuing trust capital securities to investors. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. DPL and its subsidiaries employed 1,074 people as of September 30, 2017, of which 1,065 were employed by DP&L. As part of Generation Separation on October 1, 2017, DP&L generation employees became employees of AES Ohio Generation. Approximately 61% of all DP&L and AES Ohio Generation employees are under a collective bargaining agreement that was set to expire on October 31, 2017. The Company and the union representing these employees have agreed to extend the current agreement through January 31, 2018, while continuing to negotiate a new agreement. We are unable to determine what impact a new agreement may have on our operations. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Statement Presentation | Financial Statement Presentation DPL’s Condensed Consolidated Financial Statements include the accounts of DPL and its wholly-owned subsidiaries except for DPL Capital Trust II, which is not consolidated, consistent with the provisions of GAAP. As of September 30, 2017, DP&L had undivided ownership interests in five coal-fired generating facilities, various peaking generating facilities and numerous transmission facilities, all of which are included in the financial statements at the lower of depreciated historical cost or fair value, if impaired. Operating revenues and expenses of these facilities are included on a pro rata basis in the corresponding lines in the Condensed Consolidated Statements of Operations. Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation. All material intercompany accounts and transactions are eliminated in consolidation. These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2016. In the opinion of our management, the Condensed Consolidated Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2017; our results of operations for the three and nine months ended September 30, 2017 and 2016 and our cash flows for the nine months ended September 30, 2017 and 2016. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, including, but not limited to, seasonal weather variations, the timing of outages of EGUs, changes in economic conditions involving commodity prices and competition, and other factors, interim results for the three and nine months ended September 30, 2017 may not be indicative of our results that will be realized for the full year ending December 31, 2017. The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: the carrying value of property, plant and equipment; unbilled revenues; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits. Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities | Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2017 and 2016 were $13.0 million and $14.4 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2017 and 2016 were $36.9 million and $38.9 million, respectively. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Recently Issued Accounting Standards | New Accounting Pronouncements The following table provides a brief description of recent accounting pronouncements that could have a material impact on our consolidated financial statements:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Description of Business | Description of Business DP&L is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, retail transmission and distribution services are still regulated. DP&L has the exclusive right to provide such transmission and distribution services to approximately 520,000 customers located in West Central Ohio. Additionally, DP&L procures retail SSO electric service on behalf of residential, commercial, industrial and governmental customers in a 6,000 square mile area of West Central Ohio. As of September 30, 2017, DP&L owned undivided interests in multiple coal-fired and peaking electric generating facilities as well as numerous transmission facilities. As of October 1, 2017, the DP&L-owned generating facilities were transferred to AES Ohio Generation, an affiliate of DP&L and wholly-owned subsidiary of DPL, through an asset contribution agreement to a subsidiary that was merged into AES Ohio Generation. With the October 1, 2017 transfer of DP&L's generation assets to a separate DPL subsidiary, DP&L has discontinued its generation business operations. Also, Stuart Station Unit 1 was retired on October 1, 2017. DP&L sources 100% of the generation for its SSO customers through a competitive bid process. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, health care, data management, manufacturing and defense. DP&L's distribution sales reflect the general economic conditions, seasonal weather patterns, the proliferation of energy efficiency and distributed renewable resources and the market price of electricity. From January 1, 2016 through September 30, 2017, DP&L sold all of its energy and capacity into the wholesale market. DP&L is a subsidiary of DPL. Through September 30, 2017, DP&L had two reportable segments: the Transmission and Distribution (T&D) segment and the Generation segment. See Note 12 – Business Segments for more information relating to these reportable segments. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. DP&L employed 1,065 people as of September 30, 2017. As part of Generation Separation on October 1, 2017, DP&L generation employees became employees of AES Ohio Generation, an affiliate of DP&L and wholly-owned subsidiary of DPL. Approximately 61% of DP&L and AES Ohio Generation employees are under a collective bargaining agreement that was set to expire on October 31, 2017. The Company and the union representing these employees have agreed to extend the current agreement through January 31, 2018, while continuing to negotiate a new agreement. We are unable to determine what impact a new agreement may have on our operations. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Statement Presentation | Financial Statement Presentation DP&L does not have any subsidiaries. As of September 30, 2017, DP&L had undivided ownership interests in five coal-fired generating facilities, various peaking generating facilities and numerous transmission facilities, all of which are included in the financial statements at the lower of depreciated historical cost or fair value, if impaired. Operating revenues and expenses of these facilities are included on a pro rata basis in the corresponding lines in the Condensed Statements of Operations. Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation. In the current period, we have reclassified the presentation of the December 2016 dividend payment which was originally recorded as a charge to Accumulated deficit and is now presented as a charge to Other paid-in capital. This reclassification was to prospectively correct an immaterial error. These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2016. In the opinion of our management, the Condensed Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of September 30, 2017; our results of operations for the three and nine months ended September 30, 2017 and 2016 and our cash flows for the nine months ended September 30, 2017 and 2016. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, including, but not limited to, seasonal weather variations, the timing of outages of EGUs, changes in economic conditions involving commodity prices and competition, and other factors, interim results for the three and nine months ended September 30, 2017 may not be indicative of our results that will be realized for the full year ending December 31, 2017. The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: the carrying value of property, plant and equipment; unbilled revenues; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities | Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended September 30, 2017 and 2016 were $13.0 million and $14.4 million, respectively. The amounts of such taxes collected for the nine months ended September 30, 2017 and 2016 were $36.9 million and $38.9 million, respectively. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Recently Issued Accounting Standards | New Accounting Pronouncements The following table provides a brief description of recent accounting pronouncements that could have a material impact on our financial statements:
ASU 2014-09 and its subsequent corresponding updates provide the principles an entity must apply to measure and recognize revenue. The core principle is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Amendments to the standard were issued that provide further clarification of the principle and to provide certain transition expedients. The standard will replace most existing revenue recognition guidance in GAAP. In 2016, we established a cross-functional implementation team and are in the process of evaluating changes to our business processes, systems and controls to support recognition and disclosure under the new standard. At this time, we do not expect any significant impact on our financial systems or a material change to controls as a result of the implementation of the new revenue recognition standard. Given the complexity and diversity of our non-regulated arrangements, we are assessing the standard on a contract-by-contract basis and are in the process of completing the contract assessments by applying interpretations reached during 2017 on key issues. These issues include the application of the practical expedient for measuring progress towards satisfaction of a performance obligation, when variable quantities would be considered variable consideration versus an option to acquire additional goods and services and how to allocate variable consideration to one or more, but not all, distinct goods or services promised in a series of distinct goods or services that forms part of a single performance obligation. We will continue our work to complete the assessment of the full population of contracts and determine the overall impact to the consolidated financial statements. The standard requires retrospective application and allows either a full retrospective adoption in which all periods are presented under the new standard or a modified retrospective approach in which the cumulative effect of initially applying the guidance is recognized at the date of initial application. Although we had previously been working toward adopting the standard using the full retrospective method, given the limited situations where revenue recognized under ASC 606 differs from that recognized under ASC 605, we now expect to use the modified retrospective approach. However, we will continue to assess this conclusion which is dependent on the final impact to the financial statements. We are continuing to work with various non-authoritative industry groups, and monitoring the FASB and Transition Resource Group activity, as we finalize our accounting policy on these and other industry specific interpretative issues which is expected in 2017. |
Summary of Significant Accounting Policies (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of New Accounting Pronouncements | The following table provides a brief description of recent accounting pronouncements that could have a material impact on our consolidated financial statements:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of New Accounting Pronouncements | The following table provides a brief description of recent accounting pronouncements that could have a material impact on our financial statements:
|
Supplemental Financial Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Supplemental Financial Information | September 30, 2017 and December 31, 2016:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reclassification out of Accumulated Other Comprehensive Income | The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2017 and 2016 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2017 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Supplemental Financial Information | September 30, 2017 and December 31, 2016:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reclassification out of Accumulated Other Comprehensive Income | The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and nine months ended September 30, 2017 and 2016 are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the nine months ended September 30, 2017 are as follows:
|
Property, Plant and Equipment (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Jointly Owned Utility Plants [Table Text Block] | DP&L’s undivided ownership interest in such facilities at September 30, 2017, was as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Change in Asset Retirement Obligation [Table Text Block] | Changes in the Liability for Generation AROs
See Note 5 – Fair Value for further discussion on changes to our AROs. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiaries [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Jointly Owned Utility Plants [Table Text Block] | DP&L’s undivided ownership interest in such facilities at September 30, 2017, was as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Change in Asset Retirement Obligation [Table Text Block] | Changes in the Liability for Generation AROs
|
Fair Value (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value and Cost Of Non-Derivative Instruments | The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2017 and December 31, 2016. Information about the fair value of our derivative instruments can be found in Note 6 – Derivative Instruments and Hedging Activities.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Assets and Liabilities Measured on Recurring Basis | The fair value of assets and liabilities at September 30, 2017 and December 31, 2016 and the respective category within the fair value hierarchy for DPL was determined as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements, Nonrecurring [Table Text Block] | When evaluating impairment of long-lived assets, we measure fair value using the applicable fair value measurement guidance. Impairment expense is measured by comparing the fair value at the evaluation date to the carrying amount. The following table summarizes Long-lived assets measured at fair value on a non-recurring basis during the periods and their level within the fair value hierarchy:
(a)See Note 14 – Fixed-asset Impairments for further information (b)Carrying amount at date of valuation |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Inputs, Assets, Quantitative Information [Table Text Block] | The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the nine months ended September 30, 2017:
The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the nine months ended September 30, 2016:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value and Cost Of Non-Derivative Instruments | The following table presents the fair value, carrying value and cost of our non-derivative instruments at September 30, 2017 and December 31, 2016. Information about the fair value of our derivative instruments can be found in Note 6 – Derivative Instruments and Hedging Activities.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Assets and Liabilities Measured on Recurring Basis | The fair value of assets and liabilities at September 30, 2017 and December 31, 2016 and the respective category within the fair value hierarchy for DP&L was determined as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements, Nonrecurring [Table Text Block] | When evaluating impairment of long-lived assets, we measure fair value using the applicable fair value measurement guidance. Impairment expense is measured by comparing the fair value at the evaluation date to the carrying amount. The following table summarizes Long-lived assets measured at fair value on a non-recurring basis during the periods and their level within the fair value hierarchy:
(a)See Note 14 – Fixed-asset Impairments for further information (b)Carrying amount at date of valuation |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Inputs, Assets, Quantitative Information [Table Text Block] | The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the nine months ended September 30, 2017:
The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the nine months ended September 30, 2016:
|
Derivative Instruments and Hedging Activities (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions | At September 30, 2017, DPL's derivative instruments were as follows:
(a) Refers to whether the derivative instruments have been designated as a cash flow hedge. At December 31, 2016, DPL's derivative instruments were as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gains or Losses Recognized in AOCI for the Cash Flow Hedges | The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2017 and 2016:
(a)The actual amounts that we reclassify from AOCI to earnings related to power can differ from the estimate above due to market price changes. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location | The following tables present the amount and classification within the Condensed Consolidated Statements of Operations of the gains and losses on DPL’s derivatives not designated as hedging instruments for the three and nine months ended September 30, 2017 and 2016:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following tables summarize the derivative positions presented in the balance sheet where a right of offset exists under these arrangements and related cash collateral received or pledged, as well as the fair value, balance sheet classification and hedging designation of DPL’s derivative instruments:
(a) includes credit valuation adjustment
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions | At September 30, 2017, DP&L's derivative instruments were as follows:
(a) Refers to whether the derivative instruments have been designated as a cash flow hedge. At December 31, 2016, DP&L's derivative instruments were as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gains or Losses Recognized in AOCI for the Cash Flow Hedges | The following tables provide information concerning gains or losses recognized in AOCI for the cash flow hedges for the three and nine months ended September 30, 2017 and 2016:
Net gains or losses associated with the ineffective portion of the hedging transactions were immaterial in the periods presented. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location | The following tables present the amount and classification within the Condensed Statements of Operations of the gains and losses on DP&L's derivatives not designated as hedging instruments for the three and nine months ended September 30, 2017 and 2016:
DP&L has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following tables summarize the derivative positions presented in the balance sheet where a right of offset exists under these arrangements and related cash collateral received or pledged, as well as the fair value, balance sheet classification and hedging designation of DP&L’s derivative instruments:
(a) includes credit valuation adjustment
|
Debt (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term Debt |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term Debt | The following table summarizes DP&L's outstanding long-term debt.
|
Income Taxes (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Effective Income Tax Rates | The following table details the effective tax rates for the three and nine months ended September 30, 2017 and 2016.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Effective Income Tax Rates | The following table details the effective tax rates for the three and nine months ended September 30, 2017 and 2016.
|
Benefit Plans (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Periodic Benefit Cost / (Income) | The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2017 and 2016 was:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Future Benefit Payments and Medicare Part D Reimbursements | Benefit payments, which reflect future service, are estimated to be paid as follows:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
THE DAYTON POWER AND LIGHT COMPANY [Member] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Periodic Benefit Cost / (Income) | The net periodic benefit cost of the pension benefit plans for the three and nine months ended September 30, 2017 and 2016 was:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Future Benefit Payments and Medicare Part D Reimbursements | Benefit payments, which reflect future service, are estimated to be paid as follows:
|
Business Segments (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Reporting for Reportable Business Segments | The following tables present financial information for each of DPL’s reportable business segments prior to the October 1, 2017 transfer to AES Ohio Generation:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiaries [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Reporting for Reportable Business Segments | The following tables present financial information for each of DP&L’s reportable business segments:
|
Discontinued Operations (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disposal Groups, Including Discontinued Operations [Table Text Block] | The following table summarizes the revenues, cost of revenues, operating expenses and income tax of discontinued operations for the periods indicated:
Accordingly, the assets and liabilities of Zimmer Station and Miami Fort Station were classified as held for sale as of September 30, 2017, but the plants did not meet the criteria to be reported as discontinued operations. The following table summarizes the major classes of assets and liabilities classified as held for sale as of September 30, 2017:
|
Held for Sale (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disposal Groups, Including Discontinued Operations [Table Text Block] | The following table summarizes the revenues, cost of revenues, operating expenses and income tax of discontinued operations for the periods indicated:
Accordingly, the assets and liabilities of Zimmer Station and Miami Fort Station were classified as held for sale as of September 30, 2017, but the plants did not meet the criteria to be reported as discontinued operations. The following table summarizes the major classes of assets and liabilities classified as held for sale as of September 30, 2017:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiaries [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disposal Groups, Including Discontinued Operations [Table Text Block] | Accordingly, the assets and liabilities of Zimmer Station and Miami Fort Station were classified as held for sale as of September 30, 2017, but the plants did not meet the criteria to be reported as discontinued operations. The following table summarizes the major classes of assets and liabilities classified as held for sale as of September 30, 2017:
|
Regulatory Matters (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Mar. 13, 2017 |
Dec. 31, 2016 |
Sep. 30, 2017 |
|
Non-bypassable DMR | $ 105.0 | ||
Service stability rider per year | $ 110.0 | ||
Return on Equity SEET Threshold | 12.00% | ||
Subsidiaries [Member] | |||
Non-bypassable DMR | $ 105.0 | ||
Service stability rider per year | $ 110.0 | ||
Return on Equity SEET Threshold | 12.00% |
Income Taxes (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Entity Information [Line Items] | ||||
Effective income tax rates | 21.80% | 45.70% | 36.90% | 38.60% |
Estimated annual effective income tax rate | 36.00% | 38.60% | ||
Change in effective tax rate after adjustment for flow-through depreciation | 10.80% | |||
THE DAYTON POWER AND LIGHT COMPANY [Member] | ||||
Entity Information [Line Items] | ||||
Effective income tax rates | 28.90% | 39.60% | 5.30% | 36.70% |
Estimated annual effective income tax rate | 19.00% | 36.70% | ||
Income Taxes Paid, Net | $ 22.2 | $ 0.3 | ||
Change in effective tax rate after adjustment for flow-through depreciation | 8.15% |
Benefit Plans (Estimated Future Benefit Payments and Medicare Part D Reimbursements) (Details) - Pension [Member] $ in Millions |
Sep. 30, 2017
USD ($)
|
---|---|
2016 | $ 6.3 |
2017 | 25.5 |
2018 | 26.0 |
2019 | 26.4 |
2020 | 26.7 |
2021 - 2025 | 139.6 |
THE DAYTON POWER AND LIGHT COMPANY [Member] | |
2016 | 6.3 |
2017 | 25.5 |
2018 | 26.0 |
2019 | 26.4 |
2020 | 26.7 |
2021 - 2025 | $ 139.6 |
Shareholder's Equity (Details) - USD ($) |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Class of Stock [Line Items] | |||
Common stock, shares authorized | 1,500 | 1,500 | |
Common stock, shares outstanding | 1 | 1 | |
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||
Class of Stock [Line Items] | |||
Common stock, shares authorized | 250,000,000 | 250,000,000 | |
Par value common shares (in USD per share) | $ 0.01 | $ 0.01 | |
Common stock, shares outstanding | 41,172,173 | 41,172,173 | |
PUCO merger equity ratio approval (at least) | 50.00% | ||
PUCO Equity Ratio | 39.00% | ||
PUCO merger, maximum long-term debt allowed | $ 750,000,000.0 | ||
PUCO merger, maximum long-term debt as percent of rate base (percent) | 75.00% | ||
Long-term Debt, Gross | $ 659,900,000 | ||
Adjustments to Additional Paid in Capital, Dividends in Excess of Retained Earnings | (19,000,000) | ||
Proceeds from Contributions from Parent | $ 70,000,000 | $ 0 |
Contractual Obligations, Commercial Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
|
Public Utility, Property, Plant and Equipment [Line Items] | |||
Due to third parties, current | $ 1.2 | $ 2.3 | |
THE DAYTON POWER AND LIGHT COMPANY [Member] | |||
Public Utility, Property, Plant and Equipment [Line Items] | |||
Debt maturity, earliest | 2019 | ||
Debt maturity, latest | 2040 | ||
DPLE [Member] | |||
Public Utility, Property, Plant and Equipment [Line Items] | |||
Third party guarantees | $ 38.6 | ||
Debt Obligation on 4.9% Equity Ownership [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | |||
Public Utility, Property, Plant and Equipment [Line Items] | |||
Equity ownership interest | 4.90% | ||
Equity ownership interest aggregate cost | $ 71.3 | ||
Electric Generation Company [Member] | THE DAYTON POWER AND LIGHT COMPANY [Member] | |||
Public Utility, Property, Plant and Equipment [Line Items] | |||
Debt obligation | $ 1,455.5 |
Business Segments (Narrative) (Details) - THE DAYTON POWER AND LIGHT COMPANY [Member] |
9 Months Ended |
---|---|
Sep. 30, 2017
mi²
segment
customer
| |
Segment Reporting Information [Line Items] | |
Number of Operating Segments | segment | 2 |
Approximate number of retail customers | customer | 520,000 |
Service area, square miles | mi² | 6,000 |
Discontinued Operations (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Operating expenses | $ (0.7) | |||
Loss from discontinued operations before income taxes | $ 0.0 | $ 0.0 | $ 0.0 | (0.7) |
Gain from disposal of discontinued operations | 0.0 | 0.0 | 0.0 | 49.2 |
Income tax expense for discontinued operations | 0.0 | 0.0 | 0.0 | 18.9 |
Net income from discontinued operations | $ 0.0 | $ 0.0 | $ 0.0 | 29.6 |
Cash flows from operating activities for discontinued operations | (0.7) | |||
Cash flows from investing activities for discontinued operations | $ 75.5 |
"!6%=B7#
MQ=^@^HM6?X,Z/?-SG>0Q*H+]EE$Q[+=C=0TCXZIO4/9%R[XAHMYF?*D.C6#B
M(.4CF"2Q7I0EP6(?AW(^P^7?H/Z+UG]#Y!@T.V<4)&$%H232,E$2:M9E2:&5
MQE, DX)62JAWN-B:#'LGT;V3G5T\?>=< !44TL<7"@74P_(,P&(&(#H#L*C
M,YO 8NTQ&6+Z3$;J2B$W*!F69,'8N.A;%'W1HM\S@T;KO=6B3,]@GA:,@O5<
M X7=I-$I LM8\
MU<7?^:$[;?W4]P[FF+T5W;?Z\JN9$HI\;\K^=_-NBEX^..GGV-=%._[W]F]M
M5Y=3E-Y*F?V\?N;5^'F9XG\,PP-H&D"W :07!ZAI@+(&!%=G8ZI?LB[;;9KZ
MXC77U3IGPTTA'U1?S/UP<:S=^%V?;=M??=_%2;0)WH= D^;QJJ&9)IYKGI F
MN6F"WL/-"$$C- 90LP I#J!@ 4":"N3JR8<-=6H4:$05BI<1.I.-+,20BLA
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M8#;<)2 8I#L0+B*,,,((( [,@7FD)*&2R&D+$Y'6-'0$
M6(&PO=V]R:W-H965TF@Q9O*F.U\&C:FKG.
M@B@C22O&-YM;IH5L:9Y&W\GFJ>F]DBV<+'&]UL+^.X(R0T:W].IXE'7C@X/E
M:2=J^ W^3W>R:+%9I90:6B=-2RQ4&;W?'HZ[@(^ OQ(&MSB34,G9F.=@_"@S
MN@D)@8+"!P6!VP4>0*D@A&F\3)IT#AF(R_-5_5NL'6LY"P1CW)TC<9O:.D
MA$KTRC^:X3M,]7RA9"K^)UQ (3QD@C$*HUQ<2=$[;_2D@JEH\3KNLHW[,-[L
MK[1U I\(?";<10(; \7,OPHO\M2:@=BQ]YT(3[P]<.Q-$9RQ%?$.DW?HO>1)
MLDW9)0A-F..(X0O,&X*A^AR"KX4X\D]TODY/5C-,(GV_I.^2=8'=JL N"B3O
M2N0?2ES#? S"%CW58.LX38X4IF_C)"^\\\#>\_@F;_!QVG\)6\O6D;/Q^+*Q
M_Y4Q'C"5S0V.4(,?;#845#X<]WBVXYB-AC?=](/8_(WS_U!+ P04 " #)
MEF%+,BE_.=$! "Y! &0 'AL+W=OR\BJ00"R/P[.QMHFA'6
M/HFTSR$N"HN+\N?WJ\+BHO@BFO?K )WKU\M(.B 7^O5LH&E&6.L4USH5NCK%
M<4;UA4,JA35%S5DL*[YP%
8A91N6$%RS7_YRXR*C22W%V9"$8/9J@
M+'6(ZP9.1I/
5?[V?/XB[)V>Z!KWBZ\X?ZXOOL\[*2UE^ZPY^
MW]S/XRXCG_MUTW61M1\?_LGG>==3F\>_0Z?S<\RNX>7WS]Y_[QQ2&"*=,-0I\2$B)HB(<0W&((QCNF#*6( NDK".!4G5
M13HL921B?AU &7M8J8+7+,"%*T3
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MTP1$BO6#>: #Q)F\:DP#]04'BA:ZL /%?%^, \4X$'"7/05YH%"/"#SC9:Z
MCL(=)Q1Q?C /%.!!PEQ/%>:!FL(#14L=^$$BQH_&/-" !PG7!>:!1CP(YYNF
MI:ZC8 /Y!$5<,I@'&O& 61]HS ,]A0<:\8#X02+.#W/_ ?& NX.!>: 1#\+Y
MIM&E/^2!IML9!K4:TT C&C"K XUIH*?00*,+/W'C)KO!+-"(!
!(5D038CU$-8GKU.6:I"J9!L(NTD9<
MI%U>$54ETT#80UKP$.M%$SSV6ZI)7*?2>D94^2T;1$L&X?JLOF"9O@];1 L6
M8:H)'O^M'_^P\/9%QW Q-SP4MI EZ/57DX6""5V-I":*BI8'0S6'QQ6 ^6KP5#YJ@YS>2&5
MS_2P.P"ELQE99"BL"0II E%9A35!)6B"PIJ@(C3A3H7K?AA2A2'U**0_'*PL
M"BD+NR]8652"LBBL+"I"6>XZT&A2@Y J#*E'(?WA8&U22)O(FD-C;=()VJ2Q
M-FFD3<.D:E\H\N$2:@% A1F2O(H)58="]0>&=4G[NN0R
(
M^AF/F!XCZFD.I9/?B][/7IX>/K'9RV/8/3I52J<>B0S7#^;8HWUPRA<2&6YR
M,<<>(&J8#8K'B/H99]L>(^JGG&WWHN$2^T"6V)$E'HK&P3"?Q*&/XL@2 Y%A
M=A<>4^S1@RI98B RC%5[3+$'%'//U %3'&90'##%80K% 7Q092=+1+SGD2AZ/-5I
M>W?="!7X#C3=@3[M0 TZ)#K:#V?&GIC7