10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 10-Q
[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 for the quarterly period ended September 30, 2016
OR
[   ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 for the transition period from _________ to ___________

Commission File Number	Registrant; State of Incorporation; Address and Telephone Number	IRS Employer Identification No.
1-11459	PPL Corporation (Exact name of Registrant as specified in its charter) (Pennsylvania) Two North Ninth Street Allentown, PA 18101-1179 (610) 774-5151	23-2758192
1-905	PPL Electric Utilities Corporation (Exact name of Registrant as specified in its charter) (Pennsylvania) Two North Ninth Street Allentown, PA 18101-1179 (610) 774-5151	23-0959590
333-173665	LG&E and KU Energy LLC (Exact name of Registrant as specified in its charter) (Kentucky) 220 West Main Street Louisville, KY 40202-1377 (502) 627-2000	20-0523163
1-2893	Louisville Gas and Electric Company (Exact name of Registrant as specified in its charter) (Kentucky) 220 West Main Street Louisville, KY 40202-1377 (502) 627-2000	61-0264150
1-3464	Kentucky Utilities Company (Exact name of Registrant as specified in its charter) (Kentucky and Virginia) One Quality Street Lexington, KY 40507-1462 (502) 627-2000	61-0247570

Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. 

PPL Corporation	Yes  X	No
PPL Electric Utilities Corporation	Yes  X	No
LG&E and KU Energy LLC	Yes  X	No
Louisville Gas and Electric Company	Yes  X	No
Kentucky Utilities Company	Yes  X	No

Indicate by check mark whether the registrants have submitted electronically and posted on their corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrants were required to submit and post such files). 

PPL Corporation	Yes  X	No
PPL Electric Utilities Corporation	Yes  X	No
LG&E and KU Energy LLC	Yes  X	No
Louisville Gas and Electric Company	Yes  X	No
Kentucky Utilities Company	Yes  X	No

Indicate by check mark whether the registrants are large accelerated filers, accelerated filers, non-accelerated filers, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

	Large accelerated filer	Accelerated filer	Non-accelerated filer	Smaller reporting company
PPL Corporation	[ X ]	[     ]	[     ]	[     ]
PPL Electric Utilities Corporation	[     ]	[     ]	[ X ]	[     ]
LG&E and KU Energy LLC	[     ]	[     ]	[ X ]	[     ]
Louisville Gas and Electric Company	[     ]	[     ]	[ X ]	[     ]
Kentucky Utilities Company	[     ]	[     ]	[ X ]	[     ]

Indicate by check mark whether the registrants are shell companies (as defined in Rule 12b-2 of the Exchange Act).

PPL Corporation	Yes	No  X
PPL Electric Utilities Corporation	Yes	No  X
LG&E and KU Energy LLC	Yes	No  X
Louisville Gas and Electric Company	Yes	No  X
Kentucky Utilities Company	Yes	No  X

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

PPL Corporation	Common stock, $0.01 par value, 679,627,323 shares outstanding at October 26, 2016.
PPL Electric Utilities Corporation	Common stock, no par value, 66,368,056 shares outstanding and all held by PPL Corporation at October 26, 2016.
LG&E and KU Energy LLC	PPL Corporation directly holds all of the membership interests in LG&E and KU Energy LLC.
Louisville Gas and Electric Company	Common stock, no par value, 21,294,223 shares outstanding and all held by LG&E and KU Energy LLC at October 26, 2016.
Kentucky Utilities Company	Common stock, no par value, 37,817,878 shares outstanding and all held by LG&E and KU Energy LLC at October 26, 2016.

This document is available free of charge at the Investors section of PPL Corporation's website at www.pplweb.com. However, information on this website does not constitute a part of this Form 10-Q.

PPL CORPORATION

PPL ELECTRIC UTILITIES CORPORATION

LG&E AND KU ENERGY LLC

LOUISVILLE GAS AND ELECTRIC COMPANY

KENTUCKY UTILITIES COMPANY

FORM 10-Q

FOR THE QUARTER ENDED September 30, 2016

Table of Contents

This combined Form 10-Q is separately filed by the following Registrants in their individual capacity: PPL Corporation, PPL Electric Utilities Corporation, LG&E and KU Energy LLC, Louisville Gas and Electric Company and Kentucky Utilities Company. Information contained herein relating to any individual Registrant is filed by such Registrant solely on its own behalf, and no Registrant makes any representation as to information relating to any other Registrant, except that information under "Forward-Looking Information" relating to subsidiaries of PPL Corporation is also attributed to PPL Corporation and information relating to the subsidiaries of LG&E and KU Energy LLC is also attributed to LG&E and KU Energy LLC.

Unless otherwise specified, references in this Report, individually, to PPL Corporation, PPL Electric Utilities Corporation, LG&E and KU Energy LLC, Louisville Gas and Electric Company and Kentucky Utilities Company are references to such entities directly or to one or more of their subsidiaries, as the case may be, the financial results of which subsidiaries are consolidated into such Registrants in accordance with GAAP. This presentation has been applied where identification of particular subsidiaries is not material to the matter being disclosed, and to conform narrative disclosures to the presentation of financial information on a consolidated basis.

				Page
GLOSSARY OF TERMS AND ABBREVIATIONS				i
FORWARD-LOOKING INFORMATION				1
PART I.  FINANCIAL INFORMATION
	Item 1.  Financial Statements
		PPL Corporation and Subsidiaries
			Condensed Consolidated Statements of Income	3
			Condensed Consolidated Statements of Comprehensive Income (Loss)	4
			Condensed Consolidated Statements of Cash Flows	5
			Condensed Consolidated Balance Sheets	6
			Condensed Consolidated Statements of Equity	8
		PPL Electric Utilities Corporation and Subsidiaries
			Condensed Consolidated Statements of Income	10
			Condensed Consolidated Statements of Cash Flows	11
			Condensed Consolidated Balance Sheets	12
			Condensed Consolidated Statements of Equity	14
		LG&E and KU Energy LLC and Subsidiaries
			Condensed Consolidated Statements of Income	15
			Condensed Consolidated Statements of Comprehensive Income	16
			Condensed Consolidated Statements of Cash Flows	17
			Condensed Consolidated Balance Sheets	18
			Condensed Consolidated Statements of Equity	20
		Louisville Gas and Electric Company
			Condensed Statements of Income	22
			Condensed Statements of Cash Flows	23
			Condensed Balance Sheets	24
			Condensed Statements of Equity	26
		Kentucky Utilities Company
			Condensed Statements of Income	28
			Condensed Statements of Cash Flows	29
			Condensed Balance Sheets	30
			Condensed Statements of Equity	32

	Combined Notes to Condensed Financial Statements (Unaudited)
		1.   Interim Financial Statements		33
		2.   Summary of Significant Accounting Policies		33
		3.   Segment and Related Information		35
		4.   Earnings Per Share		35
		5.   Income Taxes		37
		6.   Utility Rate Regulation		38
		7.   Financing Activities		42
		8.   Acquisitions, Development and Divestitures		44
		9.   Defined Benefits		47
		10. Commitments and Contingencies		49
		11. Related Party Transactions		58
		12. Other Income (Expense) - net		58
		13. Fair Value Measurements		59
		14. Derivative Instruments and Hedging Activities		61
		15. Goodwill and Other Intangible Assets		69
		16. Asset Retirement Obligations		69
		17. Accumulated Other Comprehensive Income (Loss)		70
		18. New Accounting Guidance Pending Adoption		72
	Item 2.  Combined Management's Discussion and Analysis of Financial Condition and Results of Operations
		Overview		74
			Introduction	74
			Business Strategy	76
			Financial and Operational Developments	77
		Results of Operations		79
			PPL Corporation and Subsidiaries - Statement of Income Analysis, Segment Earnings and Margins	80
			PPL Electric Utilities Corporation and Subsidiaries - Statement of Income Analysis, Earnings and Margins	93
			LG&E and KU Energy LLC and Subsidiaries - Statement of Income Analysis, Earnings and Margins	96
			Louisville Gas and Electric Company - Statement of Income Analysis, Earnings and Margins	99
			Kentucky Utilities Company - Statement of Income Analysis, Earnings and Margins	102
		Financial Condition		104
			Liquidity and Capital Resources	104
			Risk Management	111
			Foreign Currency Translation	113
			Related Party Transactions	113
			Acquisitions, Development and Divestitures	114
			Environmental Matters	114
		New Accounting Guidance		114
		Application of Critical Accounting Policies		114
	Item 3.  Quantitative and Qualitative Disclosures About Market Risk			116
	Item 4.  Controls and Procedures			116
PART II.  OTHER INFORMATION
	Item 1. Legal Proceedings			116
	Item 1A. Risk Factors			116
	Item 4. Mine Safety Disclosures			117
	Item 6. Exhibits			117
SIGNATURES				119
COMPUTATIONS OF RATIO OF EARNINGS TO FIXED CHARGES
CERTIFICATES OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
CERTIFICATES OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

GLOSSARY OF TERMS AND ABBREVIATIONS

PPL Corporation and its subsidiaries

KU - Kentucky Utilities Company, a public utility subsidiary of LKE engaged in the regulated generation, transmission, distribution and sale of electricity, primarily in Kentucky.

LG&E - Louisville Gas and Electric Company, a public utility subsidiary of LKE engaged in the regulated generation, transmission, distribution and sale of electricity and the distribution and sale of natural gas in Kentucky.

LKE - LG&E and KU Energy LLC, a subsidiary of PPL and the parent of LG&E, KU and other subsidiaries.

LKS - LG&E and KU Services Company, a subsidiary of LKE that provides services to LKE and its subsidiaries.

PPL - PPL Corporation, the parent holding company of PPL Electric, PPL Energy Funding, PPL Capital Funding, LKE and other subsidiaries.

PPL Capital Funding - PPL Capital Funding, Inc., a financing subsidiary of PPL that provides financing for the operations of PPL and certain subsidiaries. Debt issued by PPL Capital Funding is guaranteed as to payment by PPL.

PPL Electric - PPL Electric Utilities Corporation, a public utility subsidiary of PPL engaged in the regulated transmission and distribution of electricity in its Pennsylvania service area and that provides electricity supply to its retail customers in this area as a PLR.

PPL Energy Funding - PPL Energy Funding Corporation, a subsidiary of PPL and the parent holding company of PPL Global and other subsidiaries.

PPL EU Services - PPL EU Services Corporation, a subsidiary of PPL that provides support services and corporate functions such as financial, supply chain, human resources and facilities management services primarily to PPL Electric and its affiliates.

PPL Global - PPL Global, LLC, a subsidiary of PPL Energy Funding that, primarily through its subsidiaries, owns and operates WPD, PPL's regulated electricity distribution businesses in the U.K.

PPL Services - PPL Services Corporation, a subsidiary of PPL that provides administrative, management and support services to PPL and its subsidiaries.

PPL WPD Limited - an indirect U.K. subsidiary of PPL Global and parent to WPD plc.

WPD - refers to PPL WPD Limited and its subsidiaries.

WPD (East Midlands) - Western Power Distribution (East Midlands) plc, a British regional electricity distribution utility company.

WPD plc - Western Power Distribution plc, a direct U.K. subsidiary of PPL WPD Limited. Its principal indirectly owned subsidiaries are WPD (East Midlands), WPD (South Wales), WPD (South West) and WPD (West Midlands).

WPD Midlands - refers to WPD (East Midlands) and WPD (West Midlands), collectively.

WPD (South Wales) - Western Power Distribution (South Wales) plc, a British regional electricity distribution utility company.

WPD (South West) - Western Power Distribution (South West) plc, a British regional electricity distribution utility company.

WPD (West Midlands) - Western Power Distribution (West Midlands) plc, a British regional electricity distribution utility company.

WKE - Western Kentucky Energy Corp., a subsidiary of LKE that leased certain non-utility generating plants in western Kentucky until July 2009.

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Other terms and abbreviations

£ - British pound sterling.

2015 Form 10-K - Annual Report to the SEC on Form 10-K for the year ended December 31, 2015.

2001 Mortgage Indenture - PPL Electric's Indenture, dated as of August 1, 2001, to the Bank of New York Mellon (as successor to JPMorgan Chase Bank), as trustee, as supplemented.

Act 11 - Act 11 of 2012 that became effective on April 16, 2012. The Pennsylvania legislation authorizes the PUC to approve two specific ratemaking mechanisms: the use of a fully projected future test year in base rate proceedings and, subject to certain conditions, a DSIC.

Act 129 - Act 129 of 2008 that became effective in October 2008. The law amends the Pennsylvania Public Utility Code and creates an energy efficiency and conservation program and smart metering technology requirements, adopts new PLR electricity supply procurement rules, provides remedies for market misconduct and changes to the Alternative Energy Portfolio Standard (AEPS).

Advanced Metering System - meters and meter reading systems that provide two-way communication capabilities, which communicate usage and other relevant data to LG&E and KU at regular intervals, but also are able to receive information from LG&E and KU, such as software upgrades and requests to provide meter readings in real time.

AOCI - accumulated other comprehensive income or loss.

Article 50 of the Lisbon Treaty - The Treaty of Lisbon is an international agreement which amends the two treaties which form the constitutional basis of the European Union, and came into force on December 1, 2009. Under Article 50 of this treaty, any member state of the European Union may decide to withdraw from the Union in accordance with its own constitutional requirements.

ARO - asset retirement obligation.

ATM Program - At-the-Market stock offering program.

BSER - Best System of Emission Reduction. The degree of emission reduction that EPA determines has been adequately demonstrated when taking into account the cost of achieving such reduction and any non-air quality health and environmental impact and energy requirements. 

CCR(s) - Coal Combustion Residual(s). CCRs include fly ash, bottom ash and sulfur dioxide scrubber wastes.

Clean Air Act - federal legislation enacted to address certain environmental issues related to air emissions, including acid rain, ozone and toxic air emissions.

Clean Water Act - federal legislation enacted to address certain environmental issues relating to water quality including effluent discharges, cooling water intake, and dredge and fill activities.

CPCN - Certificate of Public Convenience and Necessity. Authority granted by the KPSC pursuant to Kentucky Revised Statute 278.020 to provide utility service to or for the public or the construction of certain plant, equipment, property or facility for furnishing of utility service to the public.

Customer Choice Act - the Pennsylvania Electricity Generation Customer Choice and Competition Act, legislation enacted to restructure the state's electric utility industry to create retail access to a competitive market for generation of electricity.

Distribution Automation - advanced grid intelligence enabling LG&E and KU to perform remote monitoring and control, circuit segmentation and self-healing of select distribution system circuits, improving grid reliability and efficiency.

DNO - Distribution Network Operator in the U.K.

DPCR4 - Distribution Price Control Review 4, the U.K. five-year rate review period applicable to WPD that commenced April 1, 2005.

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DPCR5 - Distribution Price Control Review 5, the U.K. five-year rate review period applicable to WPD that commenced April 1, 2010.

DRIP - PPL Amended and Restated Dividend Reinvestment and Direct Stock Purchase Plan.

DSIC - the Distribution System Improvement Charge authorized under Act 11, which is an alternative ratemaking mechanism providing more-timely cost recovery of qualifying distribution system capital expenditures.

DSM- Demand Side Management. Pursuant to Kentucky Revised Statute 278.285, the KPSC may determine the reasonableness of DSM plans proposed by any utility under its jurisdiction. Proposed DSM mechanisms may seek full recovery of costs and revenues lost by implementing DSM programs and/or incentives designed to provide financial rewards to the utility for implementing cost-effective DSM programs. The cost of such programs shall be assigned only to the class or classes of customers which benefit from the programs.

Earnings from Ongoing Operations - A non-GAAP financial measure of earnings adjusted for the impact of special items and used in "Item 2. Combined Management's Discussion and Analysis of Financial Condition and Results of Operations" (MD&A).

ECR - Environmental Cost Recovery. Pursuant to Kentucky Revised Statute 278.183, Kentucky electric utilities are entitled to the current recovery of costs of complying with the Clean Air Act, as amended, and those federal, state or local environmental requirements that apply to coal combustion wastes and by-products from the production of energy from coal.

ELG(s)- Effluent Limitation Guidelines, regulations promulgated by the EPA.

EPA - Environmental Protection Agency, a U.S. government agency.

FERC - Federal Energy Regulatory Commission, the U.S. federal agency that regulates, among other things, interstate transmission and wholesale sales of electricity, hydroelectric power projects and related matters.

GAAP - Generally Accepted Accounting Principles in the U.S.

GBP -British pound sterling.

GLT - Gas Line Tracker. The KPSC approved mechanism for LG&E's recovery of costs associated with gas service lines, gas risers, leak mitigation, and gas main replacements.

IRS - Internal Revenue Service, a U.S. government agency.

KPSC - Kentucky Public Service Commission, the state agency that has jurisdiction over the regulation of rates and service of utilities in Kentucky.

LCIDA - Lehigh County Industrial Development Authority.

LIBOR - London Interbank Offered Rate.

Margins - A non-GAAP financial measure of performance used in "Item 2. Combined Management's Discussion and Analysis of Financial Condition and Results of Operations" (MD&A).

MATS- Mercury and Air Toxics Standards, regulations promulgated by the EPA.

Moody's - Moody's Investors Service, Inc., a credit rating agency.

MW - megawatt, one thousand kilowatts.

NAAQS - National Ambient Air Quality Standards periodically adopted pursuant to the Clean Air Act.

NERC - North American Electric Reliability Corporation.

NGCC - Natural gas-fired combined-cycle generating plant.

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NPNS - the normal purchases and normal sales exception as permitted by derivative accounting rules. Derivatives that qualify for this exception may receive accrual accounting treatment.

NSR - The new source review provisions of the Clean Air Act that impose stringent emission control requirements on new and modified sources of air emissions that result in emission increases beyond thresholds allowed by the Clean Air Act.

OCI - other comprehensive income or loss.

Ofgem - Office of Gas and Electricity Markets, the British agency that regulates transmission, distribution and wholesale sales of electricity and related matters.

OVEC - Ohio Valley Electric Corporation, located in Piketon, Ohio, an entity in which LKE indirectly owns an 8.13% interest (consists of LG&E's 5.63% and KU's 2.50% interests), which is accounted for as a cost-method investment. OVEC owns and operates two coal-fired power plants, the Kyger Creek plant in Ohio and the Clifty Creek plant in Indiana, with combined summer rating capacities of 2,120 MW.

PLR - Provider of Last Resort, the role of PPL Electric in providing default electricity supply within its delivery area to retail customers who have not chosen to select an alternative electricity supplier under the Customer Choice Act.

PP&E - property, plant and equipment.

PPL EnergyPlus - prior to the June 1, 2015 spinoff of PPL Energy Supply, PPL EnergyPlus, LLC, a subsidiary of PPL Energy Supply that marketed and traded wholesale and retail electricity and gas, and supplied energy and energy services in competitive markets.

PPL Energy Supply - prior to the June 1, 2015 spinoff, PPL Energy Supply, LLC, a subsidiary of PPL Energy Funding and the parent company of PPL EnergyPlus and other subsidiaries.

PUC - Pennsylvania Public Utility Commission, the state agency that regulates certain ratemaking, services, accounting and operations of Pennsylvania utilities.

RAV - regulatory asset value. This term, used within the U.K. regulatory environment, is also commonly known as RAB or regulatory asset base. RAV is based on historical investment costs at time of privatization, plus subsequent allowed additions less annual regulatory depreciation, and represents the value on which DNOs earn a return in accordance with the regulatory cost of capital. RAV is indexed to Retail Price Index (RPI) in order to allow for the effects of inflation. Since the beginning of DPCR5 in April 2010, RAV additions have been based on a percentage of annual total expenditures, which have continued from April 2015 under RIIO-ED1. RAV is intended to represent expenditures that have a long-term benefit to WPD (similar to capital projects for the U.S. regulated businesses that are generally included in rate base).

RCRA - Resource Conservation and Recovery Act of 1976.

Registrant(s) - refers to the Registrants named on the cover of this Report (each a "Registrant" and collectively, the "Registrants").

Regulation S-X - SEC regulation governing the form and content of and requirements for financial statements required to be filed pursuant to the federal securities laws.

RFC - ReliabilityFirst Corporation, one of eight regional entities with delegated authority from NERC that work to safeguard the reliability of the bulk power systems throughout North America.

RIIO-ED1 - RIIO represents "Revenues = Incentive + Innovation + Outputs." RIIO-ED1 refers to the initial eight-year rate review period applicable to WPD which commenced April 1, 2015.

Riverstone - Riverstone Holdings LLC, a Delaware limited liability company and ultimate parent company of the entities that own the competitive power generation business contributed to Talen Energy other than the competitive power generation business contributed by virtue of the spinoff of a newly formed parent of PPL Energy Supply.

RPI - Retail Price Index, is a measure of inflation in the United Kingdom published monthly by the Office for National Statistics.

iv

SCRs - selective catalytic reduction, a pollution control process for the removal of nitrogen oxide from exhaust gas.

S&P - Standard & Poor's Ratings Services, a credit rating agency.

Sarbanes-Oxley- Sarbanes-Oxley Act of 2002, which sets requirements for management's assessment of internal controls for financial reporting. It also requires an independent auditor to make its own assessment.

Scrubber - an air pollution control device that can remove particulates and/or gases (primarily sulfur dioxide) from exhaust gases.

SEC - the U.S. Securities and Exchange Commission, a U.S. government agency primarily responsible to protect investors and maintain the integrity of the securities markets.

SERC - SERC Reliability Corporation, one of eight regional entities with delegated authority from NERC that work to safeguard the reliability of the bulk power systems throughout North America.

Smart meter - an electric meter that utilizes smart metering technology.

Smart metering technology - technology that can measure, among other things, time of electricity consumption to permit offering rate incentives for usage during lower cost or demand intervals. The use of this technology also has the potential to strengthen network reliability.

Superfund - federal environmental statute that addresses remediation of contaminated sites; states also have similar statutes.

Talen Energy - Talen Energy Corporation, the Delaware corporation formed to be the publicly traded company and owner of the competitive generation assets of PPL Energy Supply and certain affiliates of Riverstone.

Talen Energy Marketing - Talen Energy Marketing, LLC, the new name of PPL EnergyPlus subsequent to the spinoff of PPL Energy Supply.

Treasury Stock Method - A method applied to calculate diluted EPS that assumes any proceeds that could be obtained upon exercise of options and warrants (and their equivalents) would be used to purchase common stock at the average market price during the relevant period.

VSCC - Virginia State Corporation Commission, the state agency that has jurisdiction over the regulation of Virginia corporations, including utilities.

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Forward-looking Information

Statements contained in this Form 10-Q concerning expectations, beliefs, plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are other than statements of historical fact are "forward-looking statements" within the meaning of the federal securities laws. Although the Registrants believe that the expectations and assumptions reflected in these statements are reasonable, there can be no assurance that these expectations will prove to be correct. Forward-looking statements are subject to many risks and uncertainties, and actual results may differ materially from the results discussed in forward-looking statements. In addition to the specific factors discussed in each Registrant's 2015 Form 10-K and in "Item 2. Combined Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Form 10-Q, the following are among the important factors that could cause actual results to differ materially from the forward-looking statements.

• challenges by intervenors to the return on equity granted in existing rate structures;

• fuel supply and cost;

• continuing ability to recover fuel costs and environmental expenditures in a timely manner at LG&E and KU, and natural gas supply costs at LG&E;

• weather conditions affecting transmission and distribution operations, and customer energy use;

• availability and operating costs of existing generation facilities;

• the duration of and cost associated with outages at our generating facilities;

• generation, transmission and distribution system conditions, and operating costs;

• expansion of alternative and distributed sources of electricity generation and storage;

• collective labor bargaining negotiations;

• laws or regulations to reduce emissions of "greenhouse" gases or physical effects of climate change;

• the outcome of litigation against the Registrants and their subsidiaries;

• potential effects of threatened or actual terrorism, war or other hostilities, cyber-based intrusions or natural disasters;

• the commitments and liabilities of the Registrants and their subsidiaries;

• the effect of changes in RPI on WPD's revenues and index linked debt;

• the effectiveness of our risk management programs, including foreign currency and interest rate hedging;

• the effect of the June 23, 2016 referendum in the U.K. to withdraw from the European Union;

• our ability to attract and retain qualified employees;

• volatility in demand for electricity;

• market prices of commodity inputs for ongoing capital expenditures or key operational needs;

• capital market conditions, including the availability of capital or credit, changes in interest rates and certain economic indices, and decisions regarding capital structure;

• stock price performance of PPL;

• defaults by counterparties or suppliers for energy, capacity, coal, natural gas or key commodities, goods or services;

• volatility in the fair value of debt and equity securities and its impact on the value of assets in defined benefit plans, and the potential cash funding requirements if fair value declines;

• interest rates and their effect on pension and retiree medical liabilities and interest payable on certain debt securities;

• volatility in or the impact of other changes in financial markets and economic conditions;

• new accounting requirements or new interpretations or applications of existing requirements;

• changes in securities and credit ratings;

• changes in foreign currency exchange rates for British pound sterling;

• current and future environmental conditions, regulations and other requirements and the related costs of compliance, including environmental capital expenditures, emission allowance costs and other expenses;

• changes in political, regulatory or economic conditions in states, regions or countries where the Registrants or their subsidiaries conduct business;

• receipt of necessary governmental permits, approvals and rate relief;

• new state, federal or foreign legislation or regulatory developments;

• the outcome of any rate cases or other cost recovery or revenue filings by PPL Electric, LG&E, KU or WPD;

• the achievement of performance targets set by Ofgem;

• the impact of any state, federal or foreign investigations applicable to the Registrants and their subsidiaries and the energy industry;

• the effect of any business or industry restructuring;

• development of new projects, markets and technologies;

• performance of new ventures; and

• business dispositions or acquisitions and our ability to realize expected benefits from such business transactions.

1

Any such forward-looking statements should be considered in light of such important factors and in conjunction with other documents of the Registrants on file with the SEC.

New factors that could cause actual results to differ materially from those described in forward-looking statements emerge from time to time, and it is not possible for the Registrants to predict all such factors, or the extent to which any such factor or combination of factors may cause actual results to differ from those contained in any forward-looking statement. Any forward-looking statement speaks only as of the date on which such statement is made, and the Registrants undertake no obligation to update the information contained in such statement to reflect subsequent developments or information.

2

PART I.  FINANCIAL INFORMATION

ITEM 1. Financial Statements

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

PPL Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars, except share data)

	Three Months Ended September 30,					Nine Months Ended September 30,
	2016		2015			2016		2015
Operating Revenues	$	1,889	$	1,878		$	5,685	$	5,889
Operating Expenses
Operation
Fuel	227		228			607		695
Energy purchases	151		177			531		676
Other operation and maintenance	417		482			1,292		1,405
Depreciation	232		226			692		658
Taxes, other than income	76		79			229		241
Total Operating Expenses	1,103		1,192			3,351		3,675
Operating Income	786		686			2,334		2,214
Other Income (Expense) - net	49		75			284		61
Interest Expense	223		221			671		645
Income from Continuing Operations Before Income Taxes	612		540			1,947		1,630
Income Taxes	139		144			510		432
Income from Continuing Operations After Income Taxes	473		396			1,437		1,198
Income (Loss) from Discontinued Operations (net of income taxes) (Note 8)	—		(3		)	—		(915		)
Net Income	$	473	$	393		$	1,437	$	283
Earnings Per Share of Common Stock:
Income from Continuing Operations After Income Taxes:
Basic	$	0.70	$	0.59		$	2.12	$	1.78
Diluted	$	0.69	$	0.59		$	2.11	$	1.78
Net Income:
Basic	$	0.70	$	0.58		$	2.12	$	0.42
Diluted	$	0.69	$	0.58		$	2.11	$	0.42
Dividends Declared Per Share of Common Stock	$	0.38	$	0.3775		$	1.14	$	1.1225
Weighted-Average Shares of Common Stock Outstanding (in thousands)
Basic	678,114		670,763			676,905		668,731
Diluted	680,348		673,702			679,969		671,254

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

3

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

PPL Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Net income	$	473		$	393		$	1,437		$	283
Other comprehensive income (loss):
Amounts arising during the period - gains (losses), net of tax (expense) benefit:
Foreign currency translation adjustments, net of tax of ($2), ($3), ($4), ($2)	(641		)	52			(837		)	(97		)
Available-for-sale securities, net of tax of $0, $0, $0, ($9)	—			—			—			7
Qualifying derivatives, net of tax of ($16), $11, ($9), $4	62			(19		)	57			8
Defined benefit plans:
Prior service costs, net of tax of $0, $0, $0, $4	—			—			—			(6		)
Net actuarial gain (loss), net of tax of $4, $0, $3, ($36)	(6		)	—			(4		)	52
Reclassifications from AOCI - (gains) losses, net of tax expense (benefit):
Available-for-sale securities, net of tax of $0, $0, $0, $2	—			—			—			(2		)
Qualifying derivatives, net of tax of $17, ($3), $15, ($23)	(69		)	10			(62		)	20
Equity investees' other comprehensive (income) loss, net of tax of $0, $0, $0, $1	—			—			(1		)	(1		)
Defined benefit plans:
Prior service costs, net of tax of ($1), $0, ($1), $0	—			—			1			—
Net actuarial loss, net of tax of ($10), ($10), ($27), ($35)	31			35			94			111
Total other comprehensive income (loss)	(623		)	78			(752		)	92
Comprehensive income (loss)	$	(150	)	$	471		$	685		$	375

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

PPL Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Nine Months Ended September 30,
	2016			2015
Cash Flows from Operating Activities
Net income	$	1,437		$	283
(Income) Loss from discontinued operations (net of income taxes)	—			915
Income from continuing operations (net of income taxes)	1,437			1,198
Adjustments to reconcile Income from continuing operations (net of taxes) to net cash provided by operating activities - continuing operations
Depreciation	692			658
Amortization	54			46
Defined benefit plans - expense (income)	(29		)	44
Deferred income taxes and investment tax credits	436			359
Unrealized (gains) losses on derivatives, and other hedging activities	107			(17		)
Stock-based compensation expense	23			26
Other	(12		)	9
Change in current assets and current liabilities
Accounts receivable	(29		)	(5		)
Accounts payable	(40		)	(180		)
Unbilled revenues	32			91
Fuel, materials and supplies	8			60
Prepayments	(34		)	(43		)
Taxes payable	40			(142		)
Regulatory assets and liabilities, net	(32		)	46
Other	(21		)	(5		)
Other operating activities
Defined benefit plans - funding	(345		)	(396		)
Settlement of interest rate swaps	—			(88		)
Other assets	18			(42		)
Other liabilities	(75		)	69
Net cash provided by operating activities - continuing operations	2,230			1,688
Net cash provided by operating activities - discontinued operations	—			343
Net cash provided by operating activities	2,230			2,031
Cash Flows from Investing Activities
Expenditures for property, plant and equipment	(2,073		)	(2,560		)
Expenditures for intangible assets	(23		)	(32		)
Proceeds from the sale of other investments	2			136
Other investing activities	28			(7		)
Net cash provided by (used in) investing activities - continuing operations	(2,066		)	(2,463		)
Net cash provided by (used in) investing activities - discontinued operations	—			(149		)
Net cash provided by (used in) investing activities	(2,066		)	(2,612		)
Cash Flows from Financing Activities
Issuance of long-term debt	1,241			1,137
Retirement of long-term debt	(905		)	—
Settlement of cross-currency swaps	46			—
Issuance of common stock	133			145
Payment of common stock dividends	(772		)	(750		)
Net increase (decrease) in short-term debt	(268		)	(271		)
Other financing activities	(33		)	(30		)
Net cash provided by (used in) financing activities - continuing operations	(558		)	231
Net cash provided by (used in) financing activities - discontinued operations	—			(546		)
Net cash distributions to parent from discontinued operations	—			132
Net cash provided by (used in) financing activities	(558		)	(183		)
Effect of Exchange Rates on Cash and Cash Equivalents	(26		)	(6		)
Net (Increase) Decrease in Cash and Cash Equivalents included in Discontinued Operations	—			352
Net Increase (Decrease) in Cash and Cash Equivalents	(420		)	(418		)
Cash and Cash Equivalents at Beginning of Period	836			1,399
Cash and Cash Equivalents at End of Period	$	416		$	981

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

5

CONDENSED CONSOLIDATED BALANCE SHEETS

PPL Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars, shares in thousands)

	September 30, 2016		December 31, 2015
Assets
Current Assets
Cash and cash equivalents	$	416	$	836
Accounts receivable (less reserve: 2016, $48; 2015, $41)
Customer	687		673
Other	45		59
Unbilled revenues	393		453
Fuel, materials and supplies	346		357
Prepayments	97		66
Price risk management assets	78		139
Other current assets	37		63
Total Current Assets	2,099		2,646
Property, Plant and Equipment
Regulated utility plant	34,427		34,399
Less:  accumulated depreciation - regulated utility plant	5,938		5,683
Regulated utility plant, net	28,489		28,716
Non-regulated property, plant and equipment	451		516
Less:  accumulated depreciation - non-regulated property, plant and equipment	155		165
Non-regulated property, plant and equipment, net	296		351
Construction work in progress	1,184		1,315
Property, Plant and Equipment, net	29,969		30,382
Other Noncurrent Assets
Regulatory assets	1,765		1,733
Goodwill	3,175		3,550
Other intangibles	693		679
Price risk management assets	185		156
Other noncurrent assets	152		155
Total Other Noncurrent Assets	5,970		6,273
Total Assets	$	38,038	$	39,301

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

6

CONDENSED CONSOLIDATED BALANCE SHEETS

PPL Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars, shares in thousands)

	September 30, 2016			December 31, 2015
Liabilities and Equity
Current Liabilities
Short-term debt	$	636		$	916
Long-term debt due within one year	443			485
Accounts payable	741			812
Taxes	117			85
Interest	315			303
Dividends	259			255
Customer deposits	302			326
Regulatory liabilities	120			145
Other current liabilities	479			549
Total Current Liabilities	3,412			3,876
Long-term Debt	18,069			18,563
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes	3,810			3,440
Investment tax credits	133			128
Accrued pension obligations	878			1,405
Asset retirement obligations	413			536
Regulatory liabilities	911			945
Other deferred credits and noncurrent liabilities	437			489
Total Deferred Credits and Other Noncurrent Liabilities	6,582			6,943
Commitments and Contingent Liabilities (Notes 6 and 10)
Equity
Common stock - $0.01 par value (a)	7			7
Additional paid-in capital	9,824			9,687
Earnings reinvested	3,624			2,953
Accumulated other comprehensive loss	(3,480		)	(2,728		)
Total Equity	9,975			9,919
Total Liabilities and Equity	$	38,038		$	39,301

(a) 1,560,000 shares authorized; 679,268 shares issued and outstanding at September 30, 2016; 780,000 shares authorized; 673,857 shares issued and outstanding at December 31, 2015.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

7

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

PPL Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars)  

	Common stock shares outstanding (a)	Common stock		Additional paid-in capital			Earnings reinvested			Accumulated other comprehensive loss			Total
December 31, 2015	673,857	$	7	$	9,687		$	2,953		$	(2,728	)	$	9,919
Common stock issued	5,411			168									168
Stock-based compensation				(31		)							(31		)
Net income							1,437						1,437
Dividends and dividend equivalents							(773		)				(773		)
Other comprehensive income (loss)										(752		)	(752		)
Adoption of stock-based compensation guidance cumulative effect adjustment (Note 2)							7						7
September 30, 2016	679,268	$	7	$	9,824		$	3,624		$	(3,480	)	$	9,975
December 31, 2014	665,849	$	7	$	9,433		$	6,462		$	(2,274	)	$	13,628
Common stock issued	5,943			183									183
Stock-based compensation				14									14
Net income							283						283
Dividends and dividend equivalents							(754		)				(754		)
Distribution of PPL Energy Supply (Note 8)							(3,200		)	(24		)	(3,224		)
Other comprehensive income (loss)										92			92
September 30, 2015	671,792	$	7	$	9,630		$	2,791		$	(2,206	)	$	10,222

(a) Shares in thousands. Each share entitles the holder to one vote on any question presented at any shareowners' meeting.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

8

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9

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

PPL Electric Utilities Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Operating Revenues	$	539	$	519	$	1,619	$	1,625
Operating Expenses
Operation
Energy purchases	129		154		414		519
Energy purchases from affiliate	—		—		—		14
Other operation and maintenance	144		162		431		435
Depreciation	64		55		185		158
Taxes, other than income	26		27		79		87
Total Operating Expenses	363		398		1,109		1,213
Operating Income	176		121		510		412
Other Income (Expense) - net	4		1		12		5
Interest Expense	32		32		97		96
Income Before Income Taxes	148		90		425		321
Income Taxes	58		35		162		130
Net Income (a)	$	90	$	55	$	263	$	191

(a) Net income equals comprehensive income.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

10

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

PPL Electric Utilities Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Nine Months Ended September 30,
	2016			2015
Cash Flows from Operating Activities
Net income	$	263		$	191
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation	185			158
Amortization	19			19
Defined benefit plans - expense	9			13
Deferred income taxes and investment tax credits	151			127
Other	(14		)	(9		)
Change in current assets and current liabilities
Accounts receivable	(6		)	18
Accounts payable	(1		)	(140		)
Unbilled revenue	10			28
Prepayments	29			(17		)
Regulatory assets and liabilities	(41		)	46
Taxes payable	(6		)	(50		)
Other	(13		)	13
Other operating activities
Defined benefit plans - funding	—			(33		)
Other assets	15			(6		)
Other liabilities	(5		)	15
Net cash provided by operating activities	595			373
Cash Flows from Investing Activities
Expenditures for property, plant and equipment	(739		)	(758		)
Expenditures for intangible assets	—			(9		)
Other investing activities	(1		)	3
Net cash provided by (used in) investing activities	(740		)	(764		)
Cash Flows from Financing Activities
Issuance of long-term debt	224			—
Retirement of long-term debt	(224		)	—
Contributions from parent	200			275
Payment of common stock dividends to parent	(193		)	(140		)
Net increase (decrease) in short-term debt	130			68
Other financing activities	(3		)	—
Net cash provided by (used in) financing activities	134			203
Net Increase (Decrease) in Cash and Cash Equivalents	(11		)	(188		)
Cash and Cash Equivalents at Beginning of Period	47			214
Cash and Cash Equivalents at End of Period	$	36		$	26

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

11

CONDENSED CONSOLIDATED BALANCE SHEETS

PPL Electric Utilities Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars, shares in thousands)

	September 30, 2016		December 31, 2015
Assets
Current Assets
Cash and cash equivalents	$	36	$	47
Accounts receivable (less reserve: 2016, $22; 2015, $16)
Customer	290		286
Other	12		10
Unbilled revenues	81		91
Materials and supplies	28		34
Prepayments	37		66
Other current assets	15		21
Total Current Assets	499		555
Property, Plant and Equipment
Regulated utility plant	9,360		8,734
Less: accumulated depreciation - regulated utility plant	2,698		2,573
Regulated utility plant, net	6,662		6,161
Construction work in progress	657		530
Property, Plant and Equipment, net	7,319		6,691
Other Noncurrent Assets
Regulatory assets	991		1,006
Intangibles	247		244
Other noncurrent assets	14		15
Total Other Noncurrent Assets	1,252		1,265
Total Assets	$	9,070	$	8,511

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

12

CONDENSED CONSOLIDATED BALANCE SHEETS

PPL Electric Utilities Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars, shares in thousands)

	September 30, 2016		December 31, 2015
Liabilities and Equity
Current Liabilities
Short-term debt	$	130	$	—
Long-term debt due within one year	224		—
Accounts payable	357		288
Accounts payable to affiliates	33		35
Taxes	18		24
Interest	31		37
Regulatory liabilities	94		113
Customer deposits	22		31
Other current liabilities	69		77
Total Current Liabilities	978		605
Long-term Debt	2,607		2,828
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes	1,823		1,663
Accrued pension obligations	185		183
Regulatory liabilities	—		22
Other deferred credits and noncurrent liabilities	88		91
Total Deferred Credits and Other Noncurrent Liabilities	2,096		1,959
Commitments and Contingent Liabilities (Notes 6 and 10)
Equity
Common stock - no par value (a)	364		364
Additional paid-in capital	2,134		1,934
Earnings reinvested	891		821
Total Equity	3,389		3,119
Total Liabilities and Equity	$	9,070	$	8,511

(a) 170,000 shares authorized; 66,368 shares issued and outstanding at September 30, 2016 and December 31, 2015.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

13

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

PPL Electric Utilities Corporation and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Common stock shares outstanding (a)	Common stock		Additional paid-in capital		Earnings reinvested			Total
December 31, 2015	66,368	$	364	$	1,934	$	821		$	3,119
Net income						263			263
Capital contributions from PPL				200					200
Dividends declared on common stock						(193		)	(193		)
September 30, 2016	66,368	$	364	$	2,134	$	891		$	3,389
December 31, 2014	66,368	$	364	$	1,603	$	750		$	2,717
Net income						191			191
Capital contributions from PPL (b)				322					322
Dividends declared on common stock						(140		)	(140		)
September 30, 2015	66,368	$	364	$	1,925	$	801		$	3,090

(a) Shares in thousands. All common shares of PPL Electric stock are owned by PPL.

(b) Includes non-cash contributions of $47 million.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

14

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

LG&E and KU Energy LLC and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Operating Revenues	$	835		$	801		$	2,382		$	2,414
Operating Expenses
Operation
Fuel	227			228			607			695
Energy purchases	24			23			118			143
Other operation and maintenance	197			202			603			625
Depreciation	102			97			301			286
Taxes, other than income	16			14			46			43
Total Operating Expenses	566			564			1,675			1,792
Operating Income	269			237			707			622
Other Income (Expense) - net	(3		)	(1		)	(9		)	(3		)
Interest Expense	50			43			147			127
Interest Expense with Affiliate	4			—			12			1
Income Before Income Taxes	212			193			539			491
Income Taxes	79			73			202			194
Net Income	$	133		$	120		$	337		$	297

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

15

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

LG&E and KU Energy LLC and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016			2015
Net income	$	133	$	120	$	337		$	297
Other comprehensive income (loss):
Amounts arising during the period - gains (losses), net of tax (expense) benefit:
Defined benefit plans:
Net actuarial gain (loss), net of tax of $0, $0, ($1), $5	—		—		1			(8		)
Reclassifications from AOCI - (gains) losses, net of tax expense (benefit):
Equity investees' other comprehensive (income) loss, net of tax of $0, $0, $0, $1	—		—		(1		)	(1		)
Defined benefit plans:
Prior service costs, net of tax of ($1), $0, ($1), $0	—		—		1			1
Net actuarial loss, net of tax of $0, $0, ($1), ($1)	1		1		3			2
Total other comprehensive income (loss)	1		1		4			(6		)
Comprehensive income (loss)	$	134	$	121	$	341		$	291

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

16

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

LG&E and KU Energy LLC and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Nine Months Ended September 30,
	2016			2015
Cash Flows from Operating Activities
Net income	$	337		$	297
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation	301			286
Amortization	21			18
Defined benefit plans - expense	20			29
Deferred income taxes and investment tax credits	212			199
Other	—			29
Change in current assets and current liabilities
Accounts receivable	(43		)	(1		)
Accounts payable	7			(34		)
Accounts payable to affiliates	4			(7		)
Unbilled revenues	6			19
Fuel, materials and supplies	7			43
Income tax receivable	—			132
Accrued interest	42			37
Other	(4		)	(2		)
Other operating activities
Defined benefit plans - funding	(82		)	(66		)
Expenditures for asset retirement obligations	(15		)	(5		)
Settlement of interest rate swaps	—			(88		)
Other assets	1			(4		)
Other liabilities	2			13
Net cash provided by operating activities	816			895
Cash Flows from Investing Activities
Expenditures for property, plant and equipment	(600		)	(928		)
Other investing activities	1			7
Net cash provided by (used in) investing activities	(599		)	(921		)
Cash Flows from Financing Activities
Net increase (decrease) in notes payable with affiliate	84			21
Issuance of long-term debt	221			1,050
Retirement of long-term debt	(221		)	—
Net increase (decrease) in short-term debt	(130		)	(500		)
Debt issuance and credit facility costs	(3		)	(9		)
Distributions to member	(224		)	(157		)
Contributions from member	37			55
Net cash provided by (used in) financing activities	(236		)	460
Net Increase (Decrease) in Cash and Cash Equivalents	(19		)	434
Cash and Cash Equivalents at Beginning of Period	30			21
Cash and Cash Equivalents at End of Period	$	11		$	455

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

17

CONDENSED CONSOLIDATED BALANCE SHEETS

LG&E and KU Energy LLC and Subsidiaries

(Unaudited)

(Millions of Dollars)

	September 30, 2016		December 31, 2015
Assets
Current Assets
Cash and cash equivalents	$	11	$	30
Accounts receivable (less reserve: 2016, $24; 2015, $23)
Customer	250		209
Other	13		17
Unbilled revenues	141		147
Fuel, materials and supplies	292		298
Prepayments	31		23
Regulatory assets	18		35
Other current assets	1		6
Total Current Assets	757		765
Property, Plant and Equipment
Regulated utility plant	12,510		11,906
Less: accumulated depreciation - regulated utility plant	1,382		1,163
Regulated utility plant, net	11,128		10,743
Construction work in progress	349		660
Property, Plant and Equipment, net	11,477		11,403
Other Noncurrent Assets
Regulatory assets	774		727
Goodwill	996		996
Other intangibles	103		123
Other noncurrent assets	80		76
Total Other Noncurrent Assets	1,953		1,922
Total Assets	$	14,187	$	14,090

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

18

CONDENSED CONSOLIDATED BALANCE SHEETS

LG&E and KU Energy LLC and Subsidiaries

(Unaudited)

(Millions of Dollars)

	September 30, 2016		December 31, 2015
Liabilities and Equity
Current Liabilities
Short-term debt	$	135	$	265
Long-term debt due within one year	219		25
Notes payable with affiliate	138		54
Accounts payable	216		266
Accounts payable to affiliates	9		5
Customer deposits	55		52
Taxes	49		46
Price risk management liabilities	6		5
Regulatory liabilities	26		32
Interest	74		32
Asset retirement obligations	54		50
Other current liabilities	111		135
Total Current Liabilities	1,092		967
Long-term Debt
Long-term debt	4,470		4,663
Long-term debt to affiliate	400		400
Total Long-term Debt	4,870		5,063
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes	1,673		1,463
Investment tax credits	132		128
Accrued pension obligations	242		296
Asset retirement obligations	368		485
Regulatory liabilities	911		923
Price risk management liabilities	48		42
Other deferred credits and noncurrent liabilities	180		206
Total Deferred Credits and Other Noncurrent Liabilities	3,554		3,543
Commitments and Contingent Liabilities (Notes 6 and 10)
Member's equity	4,671		4,517
Total Liabilities and Equity	$	14,187	$	14,090

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

19

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

LG&E and KU Energy LLC and Subsidiaries

(Unaudited)

(Millions of Dollars)

	Member's Equity
December 31, 2015	$	4,517
Net income	337
Contributions from member	37
Distributions to member	(224		)
Other comprehensive income (loss)	4
September 30, 2016	$	4,671
December 31, 2014	$	4,248
Net income	297
Contributions from member	55
Distributions to member	(157		)
Other comprehensive income (loss)	(6		)
September 30, 2015	$	4,437

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

20

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21

CONDENSED STATEMENTS OF INCOME

Louisville Gas and Electric Company

(Unaudited)

(Millions of Dollars)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Operating Revenues
Retail and wholesale	$	366		$	349		$	1,058		$	1,089
Electric revenue from affiliate	2			2			19			32
Total Operating Revenues	368			351			1,077			1,121
Operating Expenses
Operation
Fuel	86			82			233			267
Energy purchases	19			18			104			129
Energy purchases from affiliate	5			9			10			17
Other operation and maintenance	85			87			264			286
Depreciation	43			40			126			122
Taxes, other than income	9			7			24			21
Total Operating Expenses	247			243			761			842
Operating Income	121			108			316			279
Other Income (Expense) - net	(1		)	(1		)	(6		)	(3		)
Interest Expense	18			13			53			39
Income Before Income Taxes	102			94			257			237
Income Taxes	39			36			98			91
Net Income (a)	$	63		$	58		$	159		$	146

(a) Net income equals comprehensive income.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

22

CONDENSED STATEMENTS OF CASH FLOWS

Louisville Gas and Electric Company

(Unaudited)

(Millions of Dollars)

	Nine Months Ended September 30,
	2016			2015
Cash Flows from Operating Activities
Net income	$	159		$	146
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation	126			122
Amortization	10			9
Defined benefit plans - expense	6			10
Deferred income taxes and investment tax credits	117			93
Other	—			25
Change in current assets and current liabilities
Accounts receivable	(19		)	10
Accounts receivable from affiliates	(11		)	4
Accounts payable	24			(14		)
Accounts payable to affiliates	(6		)	(1		)
Unbilled revenues	10			13
Fuel, materials and supplies	11			21
Income tax receivable	2			74
Accrued interest	13			9
Other	1			8
Other operating activities
Defined benefit plans - funding	(45		)	(25		)
Expenditures for asset retirement obligations	(11		)	(4		)
Settlement of interest rate swaps	—			(44		)
Other assets	(3		)	10
Other liabilities	(1		)	3
Net cash provided by operating activities	383			469
Cash Flows from Investing Activities
Expenditures for property, plant and equipment	(343		)	(519		)
Net cash provided by (used in) investing activities	(343		)	(519		)
Cash Flows from Financing Activities
Issuance of long-term debt	125			550
Retirement of long-term debt	(125		)	—
Net increase (decrease) in short-term debt	(14		)	(264		)
Debt issuance and credit facility costs	(1		)	(5		)
Payment of common stock dividends to parent	(87		)	(81		)
Contributions from parent	47			20
Net cash provided by (used in) financing activities	(55		)	220
Net Increase (Decrease) in Cash and Cash Equivalents	(15		)	170
Cash and Cash Equivalents at Beginning of Period	19			10
Cash and Cash Equivalents at End of Period	$	4		$	180

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

23

CONDENSED BALANCE SHEETS

Louisville Gas and Electric Company

(Unaudited)

(Millions of Dollars, shares in thousands)

	September 30, 2016		December 31, 2015
Assets
Current Assets
Cash and cash equivalents	$	4	$	19
Accounts receivable (less reserve: 2016, $1; 2015, $1)
Customer	109		92
Other	11		11
Accounts receivable from affiliates	23		12
Unbilled revenues	57		67
Fuel, materials and supplies	140		151
Prepayments	14		5
Regulatory assets	6		16
Other current assets	—		2
Total Current Assets	364		375
Property, Plant and Equipment
Regulated utility plant	5,234		4,804
Less: accumulated depreciation - regulated utility plant	468		404
Regulated utility plant, net	4,766		4,400
Construction work in progress	155		390
Property, Plant and Equipment, net	4,921		4,790
Other Noncurrent Assets
Regulatory assets	437		424
Goodwill	389		389
Other intangibles	63		73
Other noncurrent assets	21		17
Total Other Noncurrent Assets	910		903
Total Assets	$	6,195	$	6,068

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

24

CONDENSED BALANCE SHEETS

Louisville Gas and Electric Company

(Unaudited)

(Millions of Dollars, shares in thousands)

	September 30, 2016		December 31, 2015
Liabilities and Equity
Current Liabilities
Short-term debt	$	128	$	142
Long-term debt due within one year	219		25
Accounts payable	133		157
Accounts payable to affiliates	19		25
Customer deposits	26		26
Taxes	23		20
Price risk management liabilities	6		5
Regulatory liabilities	7		13
Interest	24		11
Asset retirement obligations	39		25
Other current liabilities	36		39
Total Current Liabilities	660		488
Long-term Debt	1,423		1,617
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes	944		829
Investment tax credits	37		35
Accrued pension obligations	18		56
Asset retirement obligations	107		149
Regulatory liabilities	424		431
Price risk management liabilities	48		42
Other deferred credits and noncurrent liabilities	85		91
Total Deferred Credits and Other Noncurrent Liabilities	1,663		1,633
Commitments and Contingent Liabilities (Notes 6 and 10)
Stockholder's Equity
Common stock - no par value (a)	424		424
Additional paid-in capital	1,658		1,611
Earnings reinvested	367		295
Total Equity	2,449		2,330
Total Liabilities and Equity	$	6,195	$	6,068

(a) 75,000 shares authorized; 21,294 shares issued and outstanding at September 30, 2016 and December 31, 2015.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

25

CONDENSED STATEMENTS OF EQUITY

Louisville Gas and Electric Company

(Unaudited)

(Millions of Dollars)

	Common stock shares outstanding (a)	Common stock		Additional paid-in capital		Earnings reinvested			Total
December 31, 2015	21,294	$	424	$	1,611	$	295		$	2,330
Net income						159			159
Capital contributions from LKE				47					47
Cash dividends declared on common stock						(87		)	(87		)
September 30, 2016	21,294	$	424	$	1,658	$	367		$	2,449
December 31, 2014	21,294	$	424	$	1,521	$	229		$	2,174
Net income						146			146
Capital contributions from LKE				20					20
Cash dividends declared on common stock						(81		)	(81		)
September 30, 2015	21,294	$	424	$	1,541	$	294		$	2,259

(a) Shares in thousands. All common shares of LG&E stock are owned by LKE.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

26

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27

CONDENSED STATEMENTS OF INCOME

Kentucky Utilities Company

(Unaudited)

(Millions of Dollars)

	Three Months Ended September 30,					Nine Months Ended September 30,
	2016			2015		2016			2015
Operating Revenues
Retail and wholesale	$	469		$	452	$	1,324		$	1,325
Electric revenue from affiliate	5			9		10			17
Total Operating Revenues	474			461		1,334			1,342
Operating Expenses
Operation
Fuel	141			146		374			428
Energy purchases	5			5		14			14
Energy purchases from affiliate	2			2		19			32
Other operation and maintenance	107			108		320			321
Depreciation	59			57		175			164
Taxes, other than income	7			7		22			22
Total Operating Expenses	321			325		924			981
Operating Income	153			136		410			361
Other Income (Expense) - net	(3		)	—		(4		)	1
Interest Expense	24			20		71			58
Income Before Income Taxes	126			116		335			304
Income Taxes	48			44		128			115
Net Income (a)	$	78		$	72	$	207		$	189

(a) Net income approximates comprehensive income.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

28

CONDENSED STATEMENTS OF CASH FLOWS

Kentucky Utilities Company

(Unaudited)

(Millions of Dollars)

	Nine Months Ended September 30,
	2016			2015
Cash Flows from Operating Activities
Net income	$	207		$	189
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation	175			164
Amortization	10			8
Defined benefit plans - expense	4			9
Deferred income taxes and investment tax credits	122			132
Other	(1		)	4
Change in current assets and current liabilities
Accounts receivable	(24		)	(11		)
Accounts payable	(11		)	(18		)
Accounts payable to affiliates	2			(7		)
Unbilled revenues	(4		)	6
Fuel, materials and supplies	(4		)	22
Income tax receivable	—			60
Accrued interest	22			19
Other	2			6
Other operating activities
Defined benefit plans - funding	(19		)	(20		)
Expenditures for asset retirement obligations	(4		)	(1		)
Settlement of interest rate swaps	—			(44		)
Other assets	(4		)	(9		)
Other liabilities	(4		)	1
Net cash provided by operating activities	469			510
Cash Flows from Investing Activities
Expenditures for property, plant and equipment	(255		)	(407		)
Other investing activities	1			7
Net cash provided by (used in) investing activities	(254		)	(400		)
Cash Flows from Financing Activities
Issuance of long-term debt	96			500
Retirement of long-term debt	(96		)	—
Net increase (decrease) in short-term debt	(41		)	(236		)
Debt issuance and credit facility costs	(1		)	(4		)
Payment of common stock dividends to parent	(197		)	(106		)
Contributions from parent	20			—
Net cash provided by (used in) financing activities	(219		)	154
Net Increase (Decrease) in Cash and Cash Equivalents	(4		)	264
Cash and Cash Equivalents at Beginning of Period	11			11
Cash and Cash Equivalents at End of Period	$	7		$	275

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

29

CONDENSED BALANCE SHEETS

Kentucky Utilities Company

(Unaudited)

(Millions of Dollars, shares in thousands)

	September 30, 2016		December 31, 2015
Assets
Current Assets
Cash and cash equivalents	$	7	$	11
Accounts receivable (less reserve: 2016, $2; 2015, $2)
Customer	141		117
Other	3		9
Accounts receivable from affiliates	1		1
Unbilled revenues	84		80
Fuel, materials and supplies	152		147
Prepayments	16		8
Regulatory assets	12		19
Other current assets	1		4
Total Current Assets	417		396
Property, Plant and Equipment
Regulated utility plant	7,270		7,099
Less: accumulated depreciation - regulated utility plant	913		759
Regulated utility plant, net	6,357		6,340
Construction work in progress	192		267
Property, Plant and Equipment, net	6,549		6,607
Other Noncurrent Assets
Regulatory assets	337		303
Goodwill	607		607
Other intangibles	40		50
Other noncurrent assets	56		48
Total Other Noncurrent Assets	1,040		1,008
Total Assets	$	8,006	$	8,011

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

30

CONDENSED BALANCE SHEETS

Kentucky Utilities Company

(Unaudited)

(Millions of Dollars, shares in thousands)

	September 30, 2016			December 31, 2015
Liabilities and Equity
Current Liabilities
Short-term debt	$	7		$	48
Accounts payable	67			88
Accounts payable to affiliates	42			39
Customer deposits	29			26
Taxes	23			20
Regulatory liabilities	19			19
Interest	38			16
Asset retirement obligations	15			25
Other current liabilities	35			44
Total Current Liabilities	275			325
Long-term Debt	2,327			2,326
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes	1,166			1,046
Investment tax credits	95			93
Accrued pension obligations	33			46
Asset retirement obligations	261			336
Regulatory liabilities	487			492
Other deferred credits and noncurrent liabilities	46			60
Total Deferred Credits and Other Noncurrent Liabilities	2,088			2,073
Commitments and Contingent Liabilities (Notes 6 and 10)
Stockholder's Equity
Common stock - no par value (a)	308			308
Additional paid-in capital	2,616			2,596
Accumulated other comprehensive loss	(1		)	—
Earnings reinvested	393			383
Total Equity	3,316			3,287
Total Liabilities and Equity	$	8,006		$	8,011

(a) 80,000 shares authorized; 37,818 shares issued and outstanding at September 30, 2016 and December 31, 2015.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

31

CONDENSED STATEMENTS OF EQUITY

Kentucky Utilities Company

(Unaudited)

(Millions of Dollars)

	Common stock shares outstanding (a)	Common stock		Additional paid-in capital		Earnings reinvested			Accumulated other comprehensive loss			Total
December 31, 2015	37,818	$	308	$	2,596	$	383		$	—		$	3,287
Capital contributions from LKE				20								20
Net income						207						207
Cash dividends declared on common stock						(197		)				(197		)
Other comprehensive income (loss)									(1		)	(1		)
September 30, 2016	37,818	$	308	$	2,616	$	393		$	(1	)	$	3,316
December 31, 2014	37,818	$	308	$	2,596	$	302		$	—		$	3,206
Net income						189						189
Cash dividends declared on common stock						(106		)				(106		)
Other comprehensive income (loss)									(1		)	(1		)
September 30, 2015	37,818	$	308	$	2,596	$	385		$	(1	)	$	3,288

(a) Shares in thousands. All common shares of KU stock are owned by LKE.

The accompanying Notes to Condensed Financial Statements are an integral part of the financial statements.

32

Combined Notes to Condensed Financial Statements (Unaudited)

1. Interim Financial Statements

(All Registrants)

Capitalized terms and abbreviations appearing in the unaudited combined notes to condensed financial statements are defined in the glossary. Dollars are in millions, except per share data, unless otherwise noted. The specific Registrant to which disclosures are applicable is identified in parenthetical headings in italics above the applicable disclosure or within the applicable disclosure. Within combined disclosures, amounts are disclosed for any Registrant when significant.

The accompanying unaudited condensed financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all of the information and footnote disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation in accordance with GAAP are reflected in the condensed financial statements. All adjustments are of a normal recurring nature, except as otherwise disclosed. Each Registrant's Balance Sheet at December 31, 2015 is derived from that Registrant's 2015 audited Balance Sheet. The financial statements and notes thereto should be read in conjunction with the financial statements and notes contained in each Registrant's 2015 Form 10-K. The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year ending December 31, 2016 or other future periods, because results for interim periods can be disproportionately influenced by various factors, developments and seasonal variations.

The classification of certain prior period amounts has been changed to conform to the presentation in the September 30, 2016 financial statements.

(PPL)

"Income (Loss) from Discontinued Operations (net of income taxes)" on the Statements of Income includes the activities of PPL Energy Supply, substantially representing PPL's former Supply segment, which was spun off and distributed to PPL shareowners on June 1, 2015. In addition, the Statement of Cash Flows for the nine months ended September 30, 2015 separately reports the cash flows of the discontinued operations. See Note 8 for additional information.

2. Summary of Significant Accounting Policies

(All Registrants)

The following accounting policy disclosures represent updates to Note 1 to each indicated Registrant's 2015 Form 10-K and should be read in conjunction with those disclosures.

Accounts Receivable(PPL and PPL Electric)

In accordance with a PUC-approved purchase of accounts receivable program, PPL Electric purchases certain accounts receivable from alternative electricity suppliers at a discount, which reflects a provision for uncollectible accounts. The alternative electricity suppliers have no continuing involvement or interest in the purchased accounts receivable. The purchased accounts receivable are initially recorded at fair value using a market approach based on the purchase price paid and are classified as Level 2 in the fair value hierarchy. During the three and nine months ended September 30, 2016, PPL Electric purchased $365 million and $1.0 billion of accounts receivable from unaffiliated third parties. During the three and nine months ended September 30, 2015, PPL Electric purchased $361 million and $968 million of accounts receivable from unaffiliated third parties. PPL Electric's purchases from PPL EnergyPlus for the nine months ended September 30, 2015 were $146 million. As a result of the June 1, 2015 spinoff of PPL Energy Supply and creation of Talen Energy, PPL EnergyPlus (renamed Talen Energy Marketing) is no longer an affiliate of PPL Electric. PPL Electric's purchases from Talen Energy Marketing subsequent to May 31, 2015 are included as purchases from an unaffiliated third party.

Discount Rate Change for U.K. Pension Plans(PPL)

In selecting the discount rate for its U.K. pension plans, WPD historically used a single weighted-average discount rate in the calculation of net periodic defined benefit cost. WPD began using individual spot rates to measure service cost and interest cost for the calculation of net periodic defined benefit cost in 2016. For the three and nine months ended September 30, 2016, this

33

change in discount rate resulted in lower net periodic defined benefit costs recognized on PPL's Statements of Income of $10 million ($8 million after-tax or $0.01 per share) and $31 million ($25 million after-tax or $0.04 per share).

Foreign Currency Translation and Transactions (PPL)

WPD's functional currency is the GBP, which is the local currency in the U.K. As such, assets and liabilities are translated to U.S. dollars at the exchange rates on the date of consolidation and related revenues and expenses are generally translated at average exchange rates prevailing during the period included in PPL's results of operations. Adjustments resulting from foreign currency translation are recorded in AOCI.

Certain financial information provided for future periods in PPL’s 2015 Form 10-K is impacted by the decrease in the GBP to U.S. dollar exchange rate that occurred subsequent to the U.K.'s vote on June 23, 2016 to withdraw from the European Union.

New Accounting Guidance Adopted(All Registrants)

Accounting for Stock-Based Compensation

Effective January 1, 2016, the Registrants adopted accounting guidance to simplify the accounting for share-based payment transactions. The guidance requires excess tax benefits and tax deficiencies to be recorded as income tax benefit or expense on the statement of income, eliminates the requirement that excess tax benefits be realized before companies can recognize them and changes the threshold for statutory income tax withholding requirements to qualify for equity classification to the maximum statutory tax rates in the applicable jurisdictions. This guidance also changes the classification of excess tax benefits to an operating activity and employee taxes paid when shares are withheld to satisfy the employer's statutory income tax withholding obligation to a financing activity on the statement of cash flows and allows entities to make a policy election to either estimate forfeitures or recognize them when they occur. The adoption of this guidance had the following impacts:

• Using the required prospective method of transition, for the three and nine months ended September 30, 2016, PPL recorded tax benefits of $1 million and $12 million ($0.02 per share), and for the nine months endedSeptember 30, 2016, PPL Electric recorded tax benefits of $7 million, related to excess tax benefits for awards that were exercised and vested for the periods ending September 30, 2016. These amounts were recorded to Income taxes on the Statements of Income and Deferred income taxes on the Balance Sheets. The impact on LKE was not significant.

• PPL elected to use the prospective method of transition for classifying excess tax benefits as an Operating activity on the Statement of Cash Flows. The amounts classified as Financing activities in the prior periods were not significant.

• Upon adoption, using the required modified retrospective method of transition, PPL recorded a cumulative effect adjustment of $7 million to increase Earnings reinvested and decrease Deferred income taxes on the Balance Sheet related to prior period unrecognized excess tax benefits.

• PPL has historically presented employee taxes paid for net settled awards as a Financing activity on the Statement of Cash Flows. Therefore, there is no transition impact for this requirement.

• PPL has elected to recognize forfeitures when they occur. Due to past experience of insignificant forfeitures, there is no transition impact of this policy election.

34

3. Segment and Related Information

(PPL)

See Note 2 in PPL's 2015 Form 10-K for a discussion of reportable segments and related information.

Financial data for the segments and reconciliation to PPL's consolidated results for the periods ended September 30 are:

	Three Months						Nine Months
	2016			2015			2016			2015
Income Statement Data
Revenues from external customers
U.K. Regulated	$	515		$	552		$	1,673		$	1,836
Kentucky Regulated	835			801			2,382			2,414
Pennsylvania Regulated	539			519			1,619			1,625
Corporate and Other	—			6			11			14
Total	$	1,889		$	1,878		$	5,685		$	5,889
Net Income
U.K. Regulated (a)	$	281		$	249		$	915		$	814
Kentucky Regulated	126			111			314			267
Pennsylvania Regulated	91			55			263			191
Corporate and Other (b)	(25		)	(19		)	(55		)	(74		)
Discontinued Operations (c)	—			(3		)	—			(915		)
Total	$	473		$	393		$	1,437		$	283

	September 30, 2016		December 31, 2015
Balance Sheet Data
Assets
U.K. Regulated (d)	$	15,014	$	16,669
Kentucky Regulated	13,853		13,756
Pennsylvania Regulated	9,070		8,511
Corporate and Other (e)	101		365
Total assets	$	38,038	$	39,301

(a) Includes unrealized gains and losses from hedging foreign-currency related economic activity. See Note 14 for additional information.

(b) The nine months ended September 30, 2015 includes transition costs to prepare the Talen Energy organization for the June 1, 2015 spinoff and reconfigure the remaining PPL Services functions. See Note 8 for additional information.

(c) See Note 8 for additional information.

(d) Includes $11.1 billion and $12.2 billion of net PP&E as of September 30, 2016 and December 31, 2015. WPD is not subject to accounting for the effects of certain types of regulation as prescribed by GAAP.

(e) Primarily consists of unallocated items, including cash, PP&E and the elimination of inter-segment transactions.

4. Earnings Per Share

(PPL)

Basic EPS is computed by dividing income available to PPL common shareowners by the weighted-average number of common shares outstanding during the applicable period. Diluted EPS is computed by dividing income available to PPL common shareowners by the weighted-average number of common shares outstanding, increased by incremental shares that would be outstanding if potentially dilutive non-participating securities were converted to common shares as calculated using the Treasury Stock Method. Incremental non-participating securities that have a dilutive impact are detailed in the table below.

Reconciliations of the amounts of income and shares of PPL common stock (in thousands) for the periods ended September 30 used in the EPS calculation are:

35

	Three Months					Nine Months
	2016		2015			2016		2015
Income (Numerator)
Income from continuing operations after income taxes	$	473	$	396		$	1,437	$	1,198
Less amounts allocated to participating securities	1		2			4		5
Income from continuing operations after income taxes available to PPL common shareowners - Basic and Diluted	$	472	$	394		$	1,433	$	1,193
Income (loss) from discontinued operations (net of income taxes) available to PPL common shareowners - Basic and Diluted	$	—	$	(3	)	$	—	$	(915	)
Net income	$	473	$	393		$	1,437	$	283
Less amounts allocated to participating securities	1		2			4		1
Net income available to PPL common shareowners - Basic and Diluted	$	472	$	391		$	1,433	$	282
Shares of Common Stock (Denominator)
Weighted-average shares - Basic EPS	678,114		670,763			676,905		668,731
Add incremental non-participating securities:
Share-based payment awards	2,234		2,939			3,064		2,523
Weighted-average shares - Diluted EPS	680,348		673,702			679,969		671,254
Basic EPS
Available to PPL common shareowners:
Income from continuing operations after income taxes	$	0.70	$	0.59		$	2.12	$	1.78
Income (loss) from discontinued operations (net of income taxes)	—		(0.01		)	—		(1.36		)
Net Income	$	0.70	$	0.58		$	2.12	$	0.42
Diluted EPS
Available to PPL common shareowners:
Income from continuing operations after income taxes	$	0.69	$	0.59		$	2.11	$	1.78
Income (loss) from discontinued operations (net of income taxes)	—		(0.01		)	—		(1.36		)
Net Income	$	0.69	$	0.58		$	2.11	$	0.42

For the periods ended September 30, PPL issued common stock related to stock-based compensation plans and the DRIP as follows (in thousands):

	Three Months		Nine Months
	2016	2015	2016	2015
Stock-based compensation plans (a)	248	1,368	3,168	3,805
DRIP	761	475	1,533	1,318

(a) Includes stock options exercised, vesting of performance units, vesting of restricted stock and restricted stock units and conversion of stock units granted to directors.

See Note 7 for additional information on common stock issued under the ATM Program.

For the periods ended September 30, the following shares (in thousands) were excluded from the computations of diluted EPS because the effect would have been antidilutive.

	Three Months		Nine Months
	2016	2015	2016	2015
Stock options	696	1,484	696	1,218
Performance units	316	—	210	49

36

5. Income Taxes

Reconciliations of income taxes for the periods ended September 30 are as follows.

(PPL)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 35%	$	214		$	189		$	681		$	571
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	13			15			37			44
Valuation allowance adjustments	4			—			13			8
Impact of lower U.K. income tax rates	(37		)	(40		)	(136		)	(138		)
Federal and state tax reserve adjustments (a)	—			(9		)	—			(21		)
Enactment of the U.K. Finance Act 2016 (b)	(42		)	—			(42		)	—
Depreciation not normalized	—			—			(6		)	(4		)
Interest benefit on U.K. financing entities	(4		)	(4		)	(13		)	(15		)
Stock-based compensation (c)	(1		)	—			(12		)	—
Other	(8		)	(7		)	(12		)	(13		)
Total increase (decrease)	(75		)	(45		)	(171		)	(139		)
Total income taxes	$	139		$	144		$	510		$	432

(a) During the three and nine months ended September 30, 2015, PPL recorded a $9 million tax benefit related to a planned amendment of a prior period tax return.

During the nine months ended September 30, 2015, PPL recorded a $12 million tax benefit to adjust the settled refund amount approved by the Joint Committee on Taxation for the open audit years 1998 - 2011.

(b) The U.K. Finance Act 2016, enacted in September 2016, reduces the U.K. statutory income tax rate effective April 1, 2020 from 18% to 17%. As a result, PPL reduced its net deferred tax liabilities and recognized a deferred tax benefit during the three and nine months ended September 30, 2016.

(c) During the three and nine months ended September 30, 2016, PPL recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

(PPL Electric)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	52		$	32		$	149		$	112
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	9			7			27			21
Depreciation not normalized	(2		)	(1		)	(5		)	(3		)
Stock-based compensation (a)	—			—			(7		)	—
Other	(1		)	(3		)	(2		)	—
Total increase (decrease)	6			3			13			18
Total income taxes	$	58		$	35		$	162		$	130

(a) During the nine months ended September 30, 2016, PPL Electric recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

37

(LKE)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	74		$	68		$	189		$	172
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	8			7			20			18
Amortization of investment tax credit	(1		)	(1		)	(2		)	(2		)
Valuation allowance adjustments (a)	—			—			—			8
Stock-based compensation	(1		)	—			(2		)	—
Other	(1		)	(1		)	(3		)	(2		)
Total increase (decrease)	5			5			13			22
Total income taxes	$	79		$	73		$	202		$	194

(a) Represents a valuation allowance against tax credits expiring in 2016 and 2017 that are more likely than not to expire before being utilized.

(LG&E)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	36		$	33		$	90		$	83
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	4			4			10			9
Other	(1		)	(1		)	(2		)	(1		)
Total increase (decrease)	3			3			8			8
Total income taxes	$	39		$	36		$	98		$	91

(KU)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	44		$	41		$	117		$	106
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	5			4			12			11
Other	(1		)	(1		)	(1		)	(2		)
Total increase (decrease)	4			3			11			9
Total income taxes	$	48		$	44		$	128		$	115

Other (PPL)

In February 2015, PPL and the IRS Appeals Division reached a settlement on the amount of PPL's refund from its open audits for the years 1998 - 2011. In April 2015, PPL was notified that the Joint Committee on Taxation approved PPL's settlement. For the nine months ended September 30, 2015, PPL recorded a tax benefit of $24 million. Of this amount, $12 million was reflected in continuing operations. PPL finalized the settlement of interest in the second quarter of 2016 and recorded an additional $3 million tax benefit.

6. Utility Rate Regulation

(All Registrants)

The following table provides information about the regulatory assets and liabilities of cost-based rate-regulated utility operations.

38

	PPL				PPL Electric
	September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015
Current Regulatory Assets:
Environmental cost recovery	$	4	$	24	$	—	$	—
Generation formula rate	12		7		—		—
Transmission service charge	8		10		8		10
Other	6		7		4		3
Total current regulatory assets (a)	$	30	$	48	$	12	$	13
Noncurrent Regulatory Assets:
Defined benefit plans	$	791	$	809	$	456	$	469
Taxes recoverable through future rates	333		326		333		326
Storm costs	71		93		19		30
Unamortized loss on debt	62		68		39		42
Interest rate swaps	143		141		—		—
Accumulated cost of removal of utility plant	143		137		143		137
AROs	208		143		—		—
Other	14		16		1		2
Total noncurrent regulatory assets	$	1,765	$	1,733	$	991	$	1,006

Current Regulatory Liabilities:
Generation supply charge	$	22	$	41	$	22	$	41
Demand side management	6		8		—		—
Gas supply clause	—		6		—		—
Universal service rider	10		5		10		5
Transmission formula rate	25		48		25		48
Fuel adjustment clause	14		14		—		—
Act 129 compliance rider	22		—		22		—
Storm damage expense	13		16		13		16
Other	8		7		2		3
Total current regulatory liabilities	$	120	$	145	$	94	$	113
Noncurrent Regulatory Liabilities:
Accumulated cost of removal of utility plant	$	698	$	691	$	—	$	—
Coal contracts (b)	3		17		—		—
Power purchase agreement - OVEC (b)	77		83		—		—
Net deferred tax assets	23		23		—		—
Act 129 compliance rider	—		22		—		22
Defined benefit plans	27		24		—		—
Interest rate swaps	80		82		—		—
Other	3		3		—		—
Total noncurrent regulatory liabilities	$	911	$	945	$	—	$	22

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	LKE				LG&E				KU
	September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015
Current Regulatory Assets:
Environmental cost recovery	$	4	$	24	$	4	$	13	$	—	$	11
Generation formula rate	12		7		—		—		12		7
Other	2		4		2		3		—		1
Total current regulatory assets	$	18	$	35	$	6	$	16	$	12	$	19
Noncurrent Regulatory Assets:
Defined benefit plans	$	335	$	340	$	211	$	215	$	124	$	125
Storm costs	52		63		29		35		23		28
Unamortized loss on debt	23		26		16		17		7		9
Interest rate swaps	143		141		102		98		41		43
AROs	208		143		77		57		131		86
Plant retirement costs	4		6		—		—		4		6
Other	9		8		2		2		7		6
Total noncurrent regulatory assets	$	774	$	727	$	437	$	424	$	337	$	303

Current Regulatory Liabilities:
Demand side management	$	6	$	8	$	4	$	4	$	2	$	4
Gas supply clause	—		6		—		6		—		—
Fuel adjustment clause	14		14		2		2		12		12
Other	6		4		1		1		5		3
Total current regulatory liabilities	$	26	$	32	$	7	$	13	$	19	$	19
Noncurrent Regulatory Liabilities:
Accumulated cost of removal of utility plant	$	698	$	691	$	306	$	301	$	392	$	390
Coal contracts (b)	3		17		1		7		2		10
Power purchase agreement - OVEC (b)	77		83		53		57		24		26
Net deferred tax assets	23		23		23		23		—		—
Defined benefit plans	27		24		—		—		27		24
Interest rate swaps	80		82		40		41		40		41
Other	3		3		1		2		2		1
Total noncurrent regulatory liabilities	$	911	$	923	$	424	$	431	$	487	$	492

(a) These amounts are included in "Other current assets" on the Balance Sheets.

(b) These liabilities were recorded as offsets to certain intangible assets that were recorded at fair value upon the acquisition of LKE by PPL.

Regulatory Matters

U.K. Activities(PPL)

Ofgem Review of Line Loss Calculation

In 2014, Ofgem issued its final decision on the DPCR4 line loss incentives and penalties mechanism. WPD began refunding its liability for over-recovery of line losses to customers on April 1, 2015, which will continue through March 31, 2019. The liability at September 30, 2016 was $31 million.

Kentucky Activities

Rate Case Proceedings (PPL, LKE, LG&E and KU)

40

On November 1, 2016, LG&E and KU announced that on November 23, 2016, they anticipate filing requests with the KPSC for increases in annual base electricity rates of approximately $103 million at KU and an increase in annual base electricity and gas rates of approximately $94 million and $14 million at LG&E. The proposed base rate increases to be requested are an electricity rate increase of 6.4% at KU and electricity and gas rate increases of 8.5% and 4.2% at LG&E and would become effective in July 2017. LG&E's and KU's applications include requests for CPCNs for implementing an Advanced Metering System program and a Distribution Automation program. The applications are to be based on a forecasted test year of July 1, 2017 through June 30, 2018 and a requested return-on-equity of 10.23%. LG&E and KU cannot predict the outcome of these proceedings.

CPCN and ECR Filings(PPL, LKE, LG&E and KU)

On August 8, 2016, the KPSC issued an order approving CPCNs and ECR rate treatment regarding environmental construction projects relating to the EPA's regulations addressing the handling of coal combustion by-products and MATS. The construction projects began in 2016 and are expected to continue through 2023. The KPSC order established a 9.8% authorized return on equity for these projects. Recovery of costs has commenced with bills rendered on and after August 31, 2016.

Gas Franchise(LKE and LG&E)

LG&E’s existing gas franchise agreement for the Louisville/Jefferson County service area expired on March 31, 2016. LG&E submitted a proposed bid for a new franchise agreement on June 9, 2016. On August 30, 2016, LG&E and Louisville/Jefferson County entered into a revised franchise agreement with a 5-year term (with renewal options). The franchise fee may be modified at Louisville/Jefferson County's election upon 60 days' notice. However, any franchise fee is capped at 3% of gross receipts for natural gas service within the franchise area. The agreement further provides that if the KPSC determines that the franchise fee should be recovered from LG&E's customers, the franchise fee shall revert to zero. On August 30, 2016, LG&E filed an application in a KPSC proceeding to review and rule upon the recoverability of the franchise fee.

Louisville/Jefferson County submitted a motion to dismiss the proceeding filed by LG&E, and further filed a KPSC complaint against LG&E relating to these issues. On October 19, 2016, the KPSC issued an order rejecting Louisville/Jefferson County's complaint and provided Louisville/Jefferson County 20 days to file an amended complaint. Until the KPSC issues orders in these proceedings, LG&E cannot predict the outcome of this matter but does not anticipate that it will have a material effect on its financial condition or results of operation. LG&E continues to provide gas service to customers in this franchise area at existing rates, but without collecting or remitting a franchise fee.

Pennsylvania Activities(PPL and PPL Electric)

Act 129

Act 129 requires Pennsylvania Electric Distribution Companies (EDCs) to meet, by specified dates, specified goals for reduction in customer electricity usage and peak demand. EDCs not meeting the requirements of Act 129 are subject to significant penalties. In November 2015, PPL Electric filed with the PUC its Act 129 Phase III Energy Efficiency and Conservation Plan for the period June 1, 2016 through May 31, 2021. In January 2016, PPL Electric and the other parties to the case reached a settlement of all major issues and filed that settlement with the Administrative Law Judge. In June 2016, the PUC issued a final order approving PPL Electric's Phase III Plan as modified by the settlement, allowing PPL Electric to recover, through the Act 129 compliance rider, a maximum $313 million in program cost over the five-year period June 1, 2016 through May 31, 2021.     

Act 129 also requires Default Service Providers (DSP) to provide electricity generation supply service to customers pursuant to a PUC-approved default service procurement plan through auctions, requests for proposal and bilateral contracts at the sole discretion of the DSP. Act 129 requires a mix of spot market purchases, short-term contracts and long-term contracts (4 to 20 years), with long-term contracts limited to 25% of load unless otherwise approved by the PUC. A DSP is able to recover the costs associated with its default service procurement plan.

PPL Electric has received PUC approval of its biannual DSP procurement plans for all prior periods required under Act 129. In January 2016, PPL Electric filed a Petition for Approval of a new DSP procurement plan with the PUC for the period June 1, 2017 through May 31, 2021. The parties to the proceeding reached a settlement on all but one issue and a partial settlement agreement and briefs on the open issue were submitted to the Administrative Law Judge (ALJ) in July 2016. In August 2016, the ALJ issued an initial decision, and certain parties filed exceptions and reply exceptions. In October 2016, the PUC issued an order approving the partial settlement agreement and adopting the initial decision with minor modifications.

41

7. Financing Activities

Credit Arrangements and Short-term Debt

(All Registrants)

The Registrants maintain credit facilities to enhance liquidity, provide credit support and provide a backstop to commercial paper programs. For reporting purposes, on a consolidated basis, the credit facilities and commercial paper programs of PPL Electric, LKE, LG&E and KU also apply to PPL and the credit facilities and commercial paper programs of LG&E and KU also apply to LKE. The amounts borrowed below are recorded as "Short-term debt" on the Balance Sheets. The following credit facilities were in place at: 

	September 30, 2016									December 31, 2015
	Expiration Date	Capacity		Borrowed		Letters of Credit and Commercial Paper Issued		Unused Capacity		Borrowed		Letters of Credit and Commercial Paper Issued
PPL
U.K.
WPD plc
Syndicated Credit Facility	Jan 2021	£	210	£	153	£	—	£	57	£	133	£	—
WPD (South West)
Syndicated Credit Facility	July 2021	245		100		—		145		—		—
WPD (East Midlands)
Syndicated Credit Facility	July 2021	300		31		—		269		—		—
WPD (West Midlands)
Syndicated Credit Facility	July 2021	300		—		—		300		—		—
Uncommitted Credit Facilities		40		—		4		36		—		4
Total U.K. Credit Facilities (a)		£	1,095	£	284	£	4	£	807	£	133	£	4
U.S.
PPL Capital Funding
Syndicated Credit Facility	Jan 2021	$	700	$	—	$	—	$	700	$	—	$	151
Syndicated Credit Facility	Nov 2018	300		—		—		300		—		300
Bilateral Credit Facility	Mar 2017	150		—		17		133		—		20
Total PPL Capital Funding Credit Facilities		$	1,150	$	—	$	17	$	1,133	$	—	$	471
PPL Electric
Syndicated Credit Facility	Jan 2021	$	400	$	—	$	131	$	269	$	—	$	1
LKE
Syndicated Credit Facility (b)	Oct 2018	$	75	$	—	$	—	$	75	$	75	$	—
LG&E
Syndicated Credit Facility	Dec 2020	$	500	$	—	$	128	$	372	$	—	$	142
KU
Syndicated Credit Facility	Dec 2020	$	400	$	—	$	7	$	393	$	—	$	48
Letter of Credit Facility	Oct 2017	198		—		198		—		—		198
Total KU Credit Facilities		$	598	$	—	$	205	$	393	$	—	$	246

42

(a) WPD plc's amounts borrowed at September 30, 2016 and December 31, 2015 were USD-denominated borrowings of $200 million for both periods, which bore interest at 1.35% and 1.83%. The unused capacity reflects the amount borrowed in GBP of £153 million as of the date borrowed. WPD (South West) amount borrowed at September 30, 2016 was a GBP-denominated borrowing which equated to $131 million and bore interest at 0.68%. WPD (East Midlands) amount borrowed at September 30, 2016 was a GBP-denominated borrowing which equated to $40 million and bore interest at 0.66%. At September 30, 2016, the unused capacity under the U.K. credit facilities was approximately $1.1 billion.

(b) LKE's interest rate on outstanding borrowings at December 31, 2015 was 1.68%.

PPL, PPL Electric, LG&E and KU maintain commercial paper programs to provide an additional financing source to fund short-term liquidity needs, as necessary. Commercial paper issuances, included in "Short-term debt" on the Balance Sheets, are supported by the respective Registrant's Syndicated Credit Facility. The following commercial paper programs were in place at: 

	September 30, 2016							December 31, 2015
	Weighted - Average Interest Rate	Capacity		Commercial Paper Issuances		Unused Capacity		Weighted - Average Interest Rate	Commercial Paper Issuances
PPL Capital Funding		$	1,000	$	—	$	1,000	0.78%	$	451
PPL Electric	0.74%	400		130		270			—
LG&E	0.73%	350		128		222		0.71%	142
KU	0.66%	350		7		343		0.72%	48
Total		$	2,100	$	265	$	1,835		$	641

(LKE)

See Note 11 for discussion of intercompany borrowings.

Long-term Debt

(PPL)

In May 2016, PPL Capital Funding issued $650 million of 3.10% Senior Notes due 2026. PPL Capital Funding received proceeds of $645 million, net of a discount and underwriting fees, which will be used to invest in or make loans to subsidiaries of PPL, to repay short-term debt and for general corporate purposes.

In May 2016, WPD (East Midlands) borrowed £100 million at 0.4975% under a new ten-year index linked term loan agreement, which will be used for general corporate purposes.

In May 2016, WPD plc repaid the entire $460 million principal amount of its 3.90% Senior Notes upon maturity.

In October 2016, WPD (East Midlands) issued an additional £40 million of its 2.671% Index-linked Senior Notes due 2043. WPD (East Midlands) received proceeds of £83 million, which equated to $101 million at the time of issuance, net of fees and including a premium. The principal amount of the notes is adjusted based on changes in a specified index, as detailed in the terms of the related indentures. The proceeds will be used for general corporate purposes.

(PPL and PPL Electric)

In March 2016, the LCIDA issued $116 million of Pollution Control Revenue Refunding Bonds, Series 2016A due 2029 and $108 million of Pollution Control Revenue Refunding Bonds, Series 2016B due 2027 on behalf of PPL Electric. The bonds were issued bearing interest at an initial term rate of 0.90% through their mandatory purchase dates of September 1, 2017 and August 15, 2017. Thereafter, the method of determining the interest rate on the bonds may be converted from time to time at PPL Electric's option. The proceeds of the bonds were used to redeem $116 million of 4.70% Pollution Control Revenue Refunding Bonds, 2005 Series A due 2029 and $108 million of 4.75% Pollution Control Revenue Refunding Bonds, 2005 Series B due 2027 previously issued by the LCIDA on behalf of PPL Electric.

In connection with the issuance of each of these new series of LCIDA bonds, PPL Electric entered into a loan agreement with the LCIDA pursuant to which the LCIDA has loaned to PPL Electric the proceeds of the LCIDA bonds on payment terms that correspond to the LCIDA bonds. In order to secure its obligations under the loan agreement, PPL Electric issued $224 million of First Mortgage Bonds under its 2001 Mortgage Indenture, which also have payment terms that correspond to the LCIDA bonds.

43

(PPL, LKE and LG&E) 

In September 2016, the County of Trimble, Kentucky issued $125 million of Pollution Control Revenue Refunding Bonds, 2016 Series A (Louisville Gas and Electric Company Project) due 2044 on behalf of LG&E. The bonds were issued with a floating interest rate that initially will reset weekly. The method of determining the interest rate on the bonds may be converted from time to time at LG&E’s option. The proceeds of the bonds were used to redeem $83 million of Pollution Control Revenue Refunding Bonds, 2000 Series A (Louisville Gas and Electric Company Project) due 2030 and $42 million of Pollution Control Revenue Refunding Bonds, 2002 Series A (Louisville Gas and Electric Company Project) due 2032 previously issued by the County of Trimble, Kentucky on behalf of LG&E.

(PPL, LKE and KU) 

In August 2016, the County of Carroll, Kentucky issued $96 million of Pollution Control Revenue Refunding Bonds, 2016 Series A (Kentucky Utilities Company Project) due 2042 on behalf of KU. The bonds were issued bearing interest at an initial term rate of 1.05% through their mandatory purchase date of September 1, 2019. Thereafter, the method of determining the interest rate on the bonds may be converted from time to time at KU’s option. The proceeds of the bonds were used to redeem $96 million of Pollution Control Revenue Refunding Bonds, 2002 Series C (Kentucky Utilities Company Project) due 2032 previously issued by the County of Carroll, Kentucky on behalf of KU.

(PPL)

ATM Program

In February 2015, PPL filed a registration statement with the SEC and entered into two separate equity distribution agreements, pursuant to which PPL may sell, from time to time, up to an aggregate of $500 million of its common stock. For the periods ended September 30, PPL issued the following:

	Three Months				Nine Months
	2016		2015		2016		2015
Number of shares (in thousands)	710		436		710		858
Average share price	$	35.23	$	32.95	$	35.23	$	33.33
Net Proceeds	$	25	$	14	$	25	$	28

Distributions

In August 2016, PPL declared a quarterly common stock dividend, payable October 3, 2016, of 38 cents per share (equivalent to $1.52 per annum). Future dividends, declared at the discretion of the Board of Directors, will depend upon future earnings, cash flows, financial and legal requirements and other factors.

8. Acquisitions, Development and Divestitures

(All Registrants)

The Registrants from time to time evaluate opportunities for potential acquisitions, divestitures and development projects. Development projects are reexamined based on market conditions and other factors to determine whether to proceed with, modify or terminate the projects. Any resulting transactions may impact future financial results. See Note 8 in the Registrants' 2015 Form 10-K for additional information.

(PPL)

Discontinued Operations

Spinoff of PPL Energy Supply

In June 2015, PPL completed the spinoff of PPL Energy Supply, which combined its competitive power generation businesses with those of Riverstone to form a new, stand-alone, publicly traded company named Talen Energy.

44

Following completion of the spinoff, PPL shareowners owned 65% of Talen Energy and affiliates of Riverstone owned 35%. The spinoff had no effect on the number of PPL common shares owned by PPL shareowners or the number of shares of PPL common stock outstanding. The transaction is intended to be tax-free to PPL and its shareowners for U.S. federal income tax purposes.

PPL has no continuing ownership interest in or control of Talen Energy and Talen Energy Supply (formerly PPL Energy Supply). See Note 8 in PPL's 2015 Form 10-K for additional information.

Loss on Spinoff

In June 2015, in conjunction with the accounting for the spinoff, PPL evaluated whether the fair value of the Supply segment's net assets was less than the carrying value as of the June 1, 2015 spinoff date.

PPL considered several valuation methodologies to derive a fair value estimate of its Supply segment at the spinoff date. These methodologies included considering the closing "when-issued" Talen Energy market value on June 1, 2015 (the spinoff date), adjusted for the proportional share of the equity value attributable to the Supply segment, as well as, the valuation methods consistently used in PPL's goodwill impairment assessments - an income approach using a discounted cash flow analysis of the Supply segment and an alternative market approach considering market multiples of comparable companies.

Although the Talen Energy market value approach utilized the most observable inputs of the three approaches, PPL considered certain limitations of the "when-issued" trading market for the spinoff transaction including the short trading duration, lack of liquidity in the market and anticipated initial Talen stock ownership base selling pressure, among other factors, and concluded that these factors limited this input being solely determinative of the fair value of the Supply segment. As such, PPL also considered the other valuation approaches in estimating the overall fair value, but ultimately assigned the highest weighting to the Talen Energy market value approach.

The following table summarizes PPL's fair value analysis:

Approach	Weighting	Weighted Fair Value (in billions)
Talen Energy Market Value	50%	$	1.4
Income/Discounted Cash Flow	30%	1.1
Alternative Market (Comparable Company)	20%	0.7
Estimated Fair Value		$	3.2

A key assumption included in the fair value estimate is the application of a control premium of 25% in the two market approaches. PPL concluded it was appropriate to apply a control premium in these approaches as the goodwill impairment testing guidance was followed in determining the estimated fair value of the Supply segment which had historically been a reporting unit for PPL. This guidance provides that the market price of an individual security (and thus the market capitalization of a reporting unit with publicly traded equity securities) may not be representative of the fair value of the reporting unit. This guidance also indicates that substantial value may arise to a controlling shareholder from the ability to take advantage of synergies and other benefits that arise from control over another entity, and that the market price of a company's individual share of stock does not reflect this additional value to a controlling shareholder. Therefore, the quoted market price need not be the sole measurement basis for determining the fair value, and including a control premium is appropriate in measuring the fair value of a reporting unit.

In determining the control premium, PPL reviewed premiums received during the prior five years in market sales transactions obtained from observable independent power producer and hybrid utility transactions greater than $1 billion. Premiums for these transactions ranged from 5% to 42% with a median of approximately 25%. Given these metrics, PPL concluded a control premium of 25% to be reasonable for both of the market valuation approaches used.

Assumptions used in the discounted cash flow analysis included forward energy prices, forecasted generation, and forecasted operation and maintenance expenditures that were consistent with assumptions used in the Energy Supply portion of the Talen Energy business planning process at that time and a market participant discount rate.

45

Using these methodologies and weightings, PPL determined the estimated fair value of the Supply segment (classified as Level 3) was below its carrying value of $4.1 billion and recorded a loss on the spinoff of $879 million in the second quarter of 2015, which is reflected in discontinued operations and is nondeductible for tax purposes. This amount served to reduce the basis of the net assets accounted for as a dividend at the June 1, 2015 spinoff date.

Costs of Spinoff

Employee-related costs incurred in the nine months ended September 30, 2015 primarily included accelerated stock-based compensation and pro-rated performance-based cash incentive and stock-based compensation awards, primarily for PPL Energy Supply employees and for PPL Services employees who became PPL Energy Supply employees in connection with the transaction. PPL Energy Supply recognized $24 million of these costs at the spinoff closing date, which are reflected in discontinued operations.

PPL also recorded $44 million of third-party costs related to this transaction during the nine months ended September 30, 2015. Of these costs, $31 million were primarily for bank advisory, legal and accounting fees to facilitate the transaction, and are reflected in discontinued operations. An additional $13 million of consulting and other costs were incurred to prepare the new Talen Energy organization for the spinoff and reconfigure the remaining PPL service functions. These costs are primarily recorded in "Other operation and maintenance" on the Statement of Income.

At the close of the transaction, $72 million ($42 million after-tax) of cash flow hedges, primarily unamortized losses on PPL interest rate swaps recorded in AOCI and designated as cash flow hedges of PPL Energy Supply's future interest payments, were reclassified into earnings and are reflected in discontinued operations for the nine months ended September 30, 2015.

Continuing Involvement(PPL and PPL Electric)

As a result of the spinoff, PPL and PPL Energy Supply entered into a Transition Services Agreement (TSA) that terminates no later than two years after the spinoff. Pursuant to the TSA, PPL is providing Talen Energy certain information technology, financial and accounting, human resource and other specified services. For the three and nine months ended September 30, 2016, the amounts PPL billed Talen Energy for these services were $9 million and $29 million. For the three and nine months ended September 30, 2015, the amounts PPL billed Talen Energy for these services were $11 million and $14 million. In general, the fees for the transition services allow the provider to recover its cost of the services, including overheads, but without margin or profit.

Additionally, prior to the spinoff, through the annual competitive solicitation process, PPL EnergyPlus was awarded supply contracts for a portion of the PLR generation supply for PPL Electric, which were retained by Talen Energy Marketing as part of the spinoff. PPL Electric's supply contracts with Talen Energy Marketing extend through November 2016. Energy purchases from PPL EnergyPlus were previously included in PPL Electric's Statements of Income as "Energy purchases from affiliate" but were eliminated in PPL's Consolidated Statements of Income.

For the three and nine months ended September 30, 2016, PPL Electric's energy purchases from Talen Energy Marketing were $15 million and $98 million. For the three and nine months ended September 30, 2015, PPL Electric's energy purchases from Talen Energy Marketing were not significant. These energy purchases are no longer considered affiliate transactions.

Summarized Results of Discontinued Operations(PPL)

The operations of the Supply segment prior to the spinoff on June 1, 2015 are included in "Income (Loss) from Discontinued Operations (net of income taxes)" on the Statements of Income. Following are the components of Discontinued Operations in the Statement of Income for the periods ended September 30, 2015:

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	Three Months			Nine Months
Operating revenues	$	—		$	1,427
Operating expenses	—			1,328
Other Income (Expense) - net	—			(22		)
Interest expense (a)	—			150
Income (loss) before income taxes	—			(73		)
Income tax expense (benefit)	3			(37		)
Loss on spinoff	—			(879		)
Income (Loss) from Discontinued Operations (net of income taxes)	$	(3	)	$	(915	)

(a) Includes interest associated with the Supply segment with no additional allocation as the Supply segment was sufficiently capitalized.

Development

Regional Transmission Line Expansion Plan(PPL and PPL Electric)

Northeast/Pocono

In October 2012, the FERC issued an order in response to PPL Electric's December 2011 request for ratemaking incentives for the Northeast/Pocono Reliability project (a new 58-mile, 230 kV transmission line that includes three new substations and upgrades to adjacent facilities). The FERC granted the incentive for inclusion in rate base of all prudently incurred construction work in progress costs but denied the requested incentive for a 100 basis point adder to the return on equity.

In December 2012, PPL Electric submitted an application to the PUC requesting permission to site and construct the project. In January 2014, the PUC issued a final order approving the application. The line was energized in April 2016, completing the approximately $350 million project which includes additional substation security enhancements. Costs related to the project are included on the Balance Sheets, primarily in "Regulated utility plant."

9. Defined Benefits

(PPL, LKE and LG&E)

Certain net periodic defined benefit costs are applied to accounts that are further distributed among capital, expense and regulatory assets, including certain costs allocated to applicable subsidiaries for plans sponsored by PPL Services and LKE. Following are the net periodic defined benefit costs (credits) of the plans sponsored by PPL and its subsidiaries, LKE and its subsidiaries and LG&E for the periods ended September 30:

	Pension Benefits
	Three Months												Nine Months
	U.S.						U.K.						U.S.						U.K.
	2016			2015			2016 (a)			2015			2016			2015			2016 (a)			2015
PPL
Service cost	$	16		$	20		$	17		$	21		$	49		$	76		$	53		$	60
Interest cost	44			42			58			80			131			152			182			236
Expected return on plan assets	(57		)	(56		)	(124		)	(133		)	(171		)	(201		)	(389		)	(393		)
Amortization of:
Prior service cost	2			1			—			—			6			5			—			—
Actuarial loss	12			18			34			39			37			65			107			118
Net periodic defined benefit costs (credits) before settlements	17			25			(15		)	7			52			97			(47		)	21
Settlements	3			—			—			—			3			—			—			—
Net periodic defined benefit costs (credits) (b)	$	20		$	25		$	(15	)	$	7		$	55		$	97		$	(47	)	$	21

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	Pension Benefits
	Three Months								Nine Months
	U.S.						U.K.		U.S.						U.K.
	2016			2015			2016 (a)	2015	2016			2015			2016 (a)	2015
LKE
Service cost	$	6		$	7				$	18		$	20
Interest cost	18			17					53			51
Expected return on plan assets	(23		)	(22		)			(68		)	(66		)
Amortization of:
Prior service cost	2			1					6			5
Actuarial loss	5			9					15			26
Net periodic defined benefit costs	$	8		$	12				$	24		$	36
LG&E
Service cost	$	—		$	—				$	1		$	1
Interest cost	4			3					11			10
Expected return on plan assets	(5		)	(5		)			(15		)	(15		)
Amortization of:
Prior service cost	1			1					3			2
Actuarial loss	2			3					5			9
Net periodic defined benefit costs	$	2		$	2				$	5		$	7

(a) See Note 2 for a discussion of changes to the discount rate used for the U.K. Pension Plans.

(b) For the nine months ended September 30, 2015, the total net periodic defined benefit cost includes $18 million reflected in discontinued operations related to costs allocated from PPL's plans to PPL Energy Supply prior to the spinoff.

	Other Postretirement Benefits
	Three Months						Nine Months
	2016			2015			2016			2015
PPL
Service cost	$	2		$	2		$	6		$	9
Interest cost	6			6			19			20
Expected return on plan assets	(6		)	(6		)	(17		)	(20		)
Amortization of actuarial loss	1			—			1			—
Net periodic defined benefit costs	$	3		$	2		$	9		$	9
LKE
Service cost	$	1		$	1		$	3		$	4
Interest cost	2			2			7			7
Expected return on plan assets	(2		)	(1		)	(5		)	(4		)
Amortization of prior service cost	1			1			2			2
Net periodic defined benefit costs	$	2		$	3		$	7		$	9

(PPL Electric, LG&E and KU)

In addition to the specific plans it sponsors, LG&E is allocated costs of defined benefit plans sponsored by LKE. PPL Electric and KU do not directly sponsor any defined benefit plans. PPL Electric is allocated costs of defined benefit plans sponsored by PPL Services and KU is allocated costs of defined benefit plans sponsored by LKE. These allocations are based on participation in those plans, which management believes are reasonable. For the periods ended September 30, PPL Services allocated the following net periodic defined benefit costs to PPL Electric, and LKE allocated the following net periodic defined benefit costs to LG&E and KU:

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	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric	$	6	$	8	$	17	$	24
LG&E	2		3		7		10
KU	2		4		8		13

Cash Flows - U.S. Pension Plans

(PPL & LKE)

During the nine months endedSeptember 30, 2016, LKE contributed $66 million to its pension plans. LKE does not anticipate making any additional significant contributions to these plans in 2016.

(PPL, LKE and LG&E)

During the nine months endedSeptember 30, 2016, LG&E contributed $35 million to its pension plan. LG&E does not anticipate making any additional contributions to the plan in 2016.

10. Commitments and Contingencies

Legal Matters

(All Registrants)

PPL and its subsidiaries are involved in legal proceedings, claims and litigation in the ordinary course of business. PPL and its subsidiaries cannot predict the outcome of such matters, or whether such matters may result in material liabilities, unless otherwise noted.

WKE Indemnification(PPL and LKE)

See footnote (e) to the table in "Guarantees and Other Assurances" below for information on an LKE indemnity relating to its former WKE lease, including related legal proceedings.

Cane Run Environmental Claims(PPL, LKE and LG&E)

In December 2013, six residents, on behalf of themselves and others similarly situated, filed a class action complaint against LG&E and PPL in the U.S. District Court for the Western District of Kentucky alleging violations of the Clean Air Act and RCRA. In addition, these plaintiffs assert common law claims of nuisance, trespass and negligence. These plaintiffs seek injunctive relief and civil penalties, plus costs and attorney fees, for the alleged statutory violations. Under the common law claims, these plaintiffs seek monetary compensation and punitive damages for property damage and diminished property values for a class consisting of residents within four miles of the Cane Run plant. In their individual capacities, these plaintiffs seek compensation for alleged adverse health effects. In response to a motion to dismiss filed by PPL and LG&E, in July 2014, the court dismissed the plaintiffs' RCRA claims and all but one Clean Air Act claim, but declined to dismiss their common law tort claims. Upon motion of LG&E and PPL, the district court certified for appellate review the issue of whether the state common law claims are preempted by federal statute. In December 2014, the U.S. Court of Appeals for the Sixth Circuit issued an order granting appellate review regarding the above matter. Oral argument before the Sixth Circuit was held in August 2015. In November 2015, the Sixth Circuit issued an opinion affirming the District Court's ruling that plaintiffs' state law claims are not preempted by the Clean Air Act and remanding the matter to the District Court for further proceedings. The District Court has issued an order setting a discovery schedule through the second quarter of 2017. PPL, LKE and LG&E cannot predict the outcome of this matter. LG&E retired one coal-fired unit at the Cane Run plant in March 2015 and the remaining two coal-fired units at the plant in June 2015.

Mill Creek Environmental Claims(PPL, LKE and LG&E)

In May 2014, the Sierra Club filed a citizen suit against LG&E in the U.S. District Court for the Western District of Kentucky for alleged violations of the Clean Water Act. The Sierra Club alleged that various discharges at the Mill Creek plant constituted violations of the plant's water discharge permit. The Sierra Club sought civil penalties, injunctive relief, costs and attorney's fees. The parties reached a proposed settlement in the matter on September 27, 2016, which has been submitted to

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the court. LG&E has agreed to limited alterations to outfall facilities and discharge practices and to fund $1 million in environmental enhancement projects focused on tree planting and water quality in Kentucky. The settlement includes no finding or agreement of any violation of law by LG&E and does not involve fines or civil penalties. The U.S. Department of Justice has 45 days to review the settlement before the court can approve. PPL, LKE and LG&E cannot predict the ultimate outcome of this matter, but do not presently expect the matter to have a material effect on plant operation, capital expenditures or operating costs, or to result in significant charges beyond the amounts previously recorded.

E.W. Brown Environmental Claims(PPL, LKE and KU)

In October 2015, KU received a notice of intent from Earthjustice and the Sierra Club informing certain federal and state agencies of the Sierra Club's intent to file a citizen suit, following expiration of the mandatory 60-day notification period, for alleged violations of the Clean Water Act. The claimants allege discharges at the E.W. Brown plant in violation of applicable rules and the plant's water discharge permit. The claimants assert that, unless the alleged discharges are promptly brought into compliance, it intends to seek civil penalties, injunctive relief and attorney's fees. In November 2015, the claimants submitted an amended notice of intent to add the Kentucky Waterways Alliance as a claimant. On October 26, 2016, the claimants submitted an additional notice of intent alleging management of waste in a manner that may present an imminent and substantial endangerment under the RCRA. PPL, LKE and KU cannot predict the outcome of this matter or the potential impact on the operations of the E. W. Brown plant, including increased capital or operating costs, if any.

(PPL, LKE, LG&E and KU)

Trimble County Unit 2 Air Permit

The Sierra Club and other environmental groups petitioned the Kentucky Environmental and Public Protection Cabinet to overturn the air permit issued for the Trimble County Unit 2 baseload coal-fired generating unit, but the agency upheld the permit in an order issued in September 2007. In response to subsequent petitions by environmental groups, the EPA ordered certain non-material changes to the permit which, in January 2010, were incorporated into a final revised permit issued by the Kentucky Division for Air Quality. In March 2010, the environmental groups petitioned the EPA to object to the revised state permit. Until the EPA issues a final ruling on the pending petition and all available appeals are exhausted, PPL, LKE, LG&E and KU cannot predict the outcome of this matter or the potential impact on the operations of the Trimble County plant, including increased capital or operating costs, if any.

Trimble County Water Discharge Permit

In May 2010, the Kentucky Waterways Alliance and other environmental groups filed a petition with the Kentucky Energy and Environment Cabinet (KEEC) challenging the Kentucky Pollutant Discharge Elimination System permit issued in April 2010, which covers water discharges from the Trimble County plant. In November 2010, the KEEC issued a final order upholding the permit, which was subsequently appealed by the environmental groups. In September 2013, the Franklin Circuit Court reversed the KEEC order upholding the permit and remanded the permit to the agency for further proceedings. LG&E and the KEEC appealed the order to the Kentucky Court of Appeals. In July 2015, the Court of Appeals upheld the lower court ruling. On February 10, 2016, the Kentucky Supreme Court issued an order granting discretionary review and oral arguments were held on September 14, 2016. PPL, LKE, LG&E and KU are unable to predict the outcome of this matter or the potential impact on the operations of the Trimble County plant, including increased capital or operating costs, if any.

Regulatory Issues(All Registrants)

See Note 6 for information on regulatory matters related to utility rate regulation.

Electricity - Reliability Standards

The NERC is responsible for establishing and enforcing mandatory reliability standards (Reliability Standards) regarding the bulk electric system in North America. The FERC oversees this process and independently enforces the Reliability Standards.

The Reliability Standards have the force and effect of law and apply to certain users of the bulk electric system, including electric utility companies, generators and marketers. Under the Federal Power Act, the FERC may assess civil penalties for certain violations.

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LG&E, KU and PPL Electric monitor their compliance with the Reliability Standards and self-report or self-log potential violations of applicable reliability requirements whenever identified, and submit accompanying mitigation plans, as required. The resolution of a small number of potential violations is pending. Penalties incurred to date have not been significant. Any Regional Reliability Entity (including RFC or SERC) determination concerning the resolution of violations of the Reliability Standards remains subject to the approval of the NERC and the FERC.

In the course of implementing their programs to ensure compliance with the Reliability Standards by those PPL affiliates subject to the standards, certain other instances of potential non-compliance may be identified from time to time. The Registrants cannot predict the outcome of these matters, and cannot estimate a range of reasonably possible losses, if any.

Environmental Matters

(All Registrants)

Due to the environmental issues discussed below or other environmental matters, it may be necessary for the Registrants to modify, curtail, replace or cease operation of certain facilities or performance of certain operations to comply with statutes, regulations and other requirements of regulatory bodies or courts. In addition, legal challenges to new environmental permits or rules add to the uncertainty of estimating the future cost of these permits and rules.

WPD's distribution businesses are subject to certain statutory and regulatory environmental requirements. In connection with the matters discussed below, it may be necessary for WPD to incur significant compliance costs, which costs may be recoverable through rates subject to the approval of Ofgem. PPL believes that WPD has taken and continues to take measures to comply with all applicable environmental laws and regulations.

LG&E and KU are entitled to recover, through the ECR mechanism, certain costs of complying with the Clean Air Act, as amended, and those federal, state, or local environmental requirements applicable to coal combustion wastes and by-products from facilities that generate electricity from coal in accordance with approved compliance plans. Costs not covered by the ECR mechanism for LG&E and KU and all such costs for PPL Electric are subject to rate recovery before the companies' respective state regulatory authorities, or the FERC, if applicable. Because neither WPD nor PPL Electric owns any generating plants, their exposure to related environmental compliance costs is reduced. PPL, PPL Electric, LKE, LG&E and KU can provide no assurances as to the ultimate outcome of future environmental or rate proceedings before regulatory authorities.

Air

(PPL, LKE, LG&E and KU)

The Clean Air Act, which regulates air pollutants from mobile and stationary sources in the United States, has a significant impact on the operation of fossil fuel plants. The Clean Air Act requires the EPA periodically to review and establish concentration levels in the ambient air for six criteria pollutants to protect public health and welfare. These concentration levels are known as NAAQS. The six criteria pollutants are carbon monoxide, lead, nitrogen dioxide, ozone, particulate matter and sulfur dioxide.

Federal environmental regulation of these criteria pollutants require states to adopt implementation plans, known as state implementation plans, for certain pollutants, which detail how the state will attain the standards that are mandated by the relevant law or regulation. Each state identifies the areas within its boundaries that meet the NAAQS (attainment areas) and those that do not (non-attainment areas), and must develop a state implementation plan both to bring non-attainment areas into compliance with the NAAQS and to maintain good air quality in attainment areas. In addition, for attainment of ozone and fine particulates standards, states in the eastern portion of the country, including Kentucky, are subject to a regional program developed by the EPA known as the Cross-State Air Pollution Rule. The NAAQS, future revisions to the NAAQS and state implementation plans, or future revisions to regional programs, may require installation of additional pollution controls, the costs of which PPL, LKE, LG&E and KU believe are subject to cost recovery.

Although PPL, LKE, LG&E and KU do not anticipate significant costs to comply with these programs, changes in market or operating conditions could result in different costs than anticipated.

National Ambient Air Quality Standards (NAAQS)

Under the Clean Air Act, the EPA is required to reassess the NAAQS for certain air pollutants on a five-year schedule. In 2008, the EPA revised the NAAQS for ozone and proposed to further strengthen the standard in November 2014. The EPA released a

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new ozone standard on October 1, 2015. The states and EPA will determine attainment with the new ozone standard through review of relevant ambient air monitoring data, with attainment or nonattainment designations scheduled no later than October 2017. States are also obligated to address interstate transport issues associated with new ozone standards through the establishment of "good neighbor" state implementation plans for those states that are found to contribute significantly to another state's non-attainment. States that are not in the ozone transport region, including Kentucky, are working together to evaluate further nitrogen oxide reductions from fossil-fueled plants with SCRs. The nature and timing of any additional reductions resulting from these evaluations cannot be predicted at this time.

In 2010, the EPA finalized revised NAAQS for sulfur dioxide and required states to identify areas that meet those standards and areas that are in "non-attainment". In July 2013, the EPA finalized non-attainment designations for parts of the country, including part of Jefferson County in Kentucky. Attainment must be achieved by 2018. PPL, LKE, LG&E and KU anticipate that certain previously required compliance measures, such as upgraded or new sulfur dioxide Scrubbers at certain plants and the retirement of coal-fired generating units at LG&E's Cane Run plant and KU's Green River plant, will help to achieve compliance with the new sulfur dioxide and ozone standards. If additional reductions are required, the costs could be significant.

Mercury and Air Toxics Standards (MATS)

In February 2012, the EPA finalized the MATS rule requiring reductions of mercury and other hazardous air pollutants from fossil-fuel fired power plants, with an effective date of April 16, 2012. The MATS rule was challenged by industry groups and states and was upheld by the U.S. Court of Appeals for the D. C. Circuit Court (D.C. Circuit Court) in April 2014. A group of states subsequently petitioned the U.S. Supreme Court (Supreme Court) to review this decision and, in June 2015, the Supreme Court held that the EPA failed to properly consider costs when deciding to regulate hazardous air emissions from power plants under MATS. The Supreme Court remanded the matter to the D.C. Circuit Court, which in December 2015 remanded the rule to the EPA without vacating it. The EPA has proposed a supplemental finding regarding costs of the rule and has announced that it intends to make a final determination in 2016. The EPA's MATS rule remains in effect during the pendency of the ongoing proceedings.

LG&E and KU have installed significant controls in response to the MATS rule and in conjunction with compliance with other environmental requirements, including fabric-filter baghouses, upgraded Scrubbers or chemical additive systems for which appropriate KPSC authorization and/or ECR treatment has been received. LG&E and KU have received KPSC approval for a compliance plan providing for installation of additional MATS-related controls; however, the estimated cost of these controls is not expected to be significant for either LG&E or KU. PPL, LKE, LG&E and KU cannot predict the outcome of the MATS rule or its potential impact, if any, on plant operations, rate treatment or future capital or operating needs. See Note 6 for additional information.

New Source Review (NSR)

The NSR litigation brought by the EPA, states and environmental groups against coal-fired generating plants in past years continues to proceed through the courts. Although none of this litigation directly involves PPL, LKE, LG&E or KU, it can influence the permitting of large capital projects at LG&E's and KU's power plants, the costs of which cannot presently be determined but could be significant.

Climate Change

There is continuing world-wide attention focused on issues related to climate change. In June 2016, the President announced that the United States, Canada and Mexico have established the North American Climate, Clean Energy, and Environment Partnership Plan which specifies actions to promote clean energy, address climate change and protect the environment. The plan includes a goal to provide 50% of the energy used in North America from clean energy sources by 2025. The plan does not impose any nation-specific requirements.

In December 2015, 195 nations, including the U.S., signed the Paris Agreement on Climate which establishes a comprehensive framework for the reduction of greenhouse gas (GHG) emissions from both developed and developing nations. Although the agreement does not establish binding reduction requirements, it requires each nation to prepare, communicate and maintain GHG reduction commitments. Reductions can be achieved in a variety of ways, including energy conservation, power plant efficiency improvements, reduced utilization of coal-fired generation or replacing coal-fired generation with natural gas or renewable generation. Based on EPA's Clean Power Plan described below, the U.S. has committed to an initial reduction target of 26% to 28% below 2005 levels by 2025.

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The U.K. has enacted binding carbon reduction requirements that are applicable to WPD. Under the U.K. law, WPD must purchase carbon allowances to offset emissions associated with WPD’s operations. The cost of these allowances is included in WPD’s current operating expenses. WPD expects these expenses to decrease as a result of energy efficiency measures and the removal of 18 fuel sources previously included in the allowance requirements.

The EPA's Rules under Section 111 of the Clean Air Act

As further described below, the EPA finalized rules imposing GHG emission standards for both new and existing power plants in the United States. The EPA has also issued a proposed federal implementation plan that would apply to any states that fail to submit an acceptable state implementation plan under these rules. The EPA's authority to promulgate these regulations under Section 111 of the Clean Air Act has been challenged in the D.C. Circuit Court by several states and industry groups. On February 9, 2016, the Supreme Court stayed the rule for existing plants (the Clean Power Plan) pending the D.C. Circuit Court's review and subsequent review by the Supreme Court if a writ of certiorari is filed and granted.

The EPA's rule for new power plants imposes separate emission standards for coal and natural gas units based on the application of different technologies. The coal standard is based on the application of partial carbon capture and sequestration technology, but because this technology is not presently commercially viable, the rule effectively precludes the construction of new coal-fired plants. The standard for NGCC power plants is the same as the EPA proposed in 2012 and is not continuously achievable. The preclusion of new coal-fired plants and the compliance difficulties posed for new natural gas-fired plants could have a significant industry-wide impact.

The EPA's Clean Power Plan

The EPA's rule for existing power plants, referred to as the Clean Power Plan, was published in the Federal Register in October 2015. The Clean Power Plan contains state-specific rate-based and mass-based reduction goals and guidelines for the development, submission and implementation of state implementation plans to achieve the state goals. State-specific goals were calculated from 2012 data by applying the EPA's broad interpretation and definition of the BSER, resulting in the most stringent targets to be met in 2030, with interim targets to be met beginning in 2022. The EPA believes it has offered some flexibility to the states as to how their compliance plans can be crafted, including the option to use a rate-based approach (limit emissions per megawatt hour) or a mass-based approach (limit total tons of emissions per year), and the option to demonstrate compliance through emissions trading and multi-state collaborations. Under the rate-based approach, Kentucky would need to make a 41% reduction from its 2012 emissions rate and under a mass-based approach it would need to make a 36% reduction. These reductions are significantly greater than initially proposed and present significant challenges to the state. If the Clean Power Plan is ultimately upheld and Kentucky fails to develop an approvable implementation plan by the applicable deadline, the EPA would impose a federal implementation plan that could be more stringent than what the state plan might provide. Depending on the provisions of the Kentucky implementation plan, LG&E and KU may need to modify their current portfolio of generating assets during the next decade and/or participate in an allowance trading program.

LG&E and KU are participating in the ongoing regulatory processes at the state and federal level. Various states, industry groups and individual companies including LKE have filed petitions for reconsideration with EPA and petitions for review with the D.C. Circuit Court challenging the Clean Power Plan. In February 2016, the U.S. Supreme Court stayed the rule pending the D.C. Circuit Court's review. A ruling from the D.C. Circuit Court may occur in late 2016 or in early 2017. PPL, LKE, LG&E and KU cannot predict the outcome of this matter or the potential impact, if any, on plant operations, or future capital or operating costs. PPL, LKE, LG&E and KU believe that the costs, which could be significant, would be subject to rate recovery.

In April 2014, the Kentucky General Assembly passed legislation limiting the measures that the Kentucky Energy and Environment Cabinet may consider in setting performance standards to comply with the EPA's regulations governing GHG emissions from existing sources. The legislation provides that such state GHG performance standards shall be based on emission reductions, efficiency measures and other improvements available at each power plant, rather than renewable energy, end-use energy efficiency, fuel switching and re-dispatch. These statutory restrictions may make it more difficult for Kentucky to achieve the GHG reduction levels that the EPA has established for Kentucky.

Sulfuric Acid Mist Emissions (PPL, LKE and LG&E)

In June 2016, the EPA issued a notice of violation under the Clean Air Act alleging that LG&E violated applicable rules relating to sulfuric acid mist emissions at its Mill Creek plant. The notice alleges failure to install proper controls, failure to operate the facility consistent with good air pollution control practice, and causing emissions exceeding applicable requirements or constituting a nuisance or endangerment. LG&E believes it has complied with applicable regulations during the relevant time period. Discussions between the EPA and LG&E are ongoing. PPL, LKE and LG&E are unable to predict the outcome of this

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matter or the potential impact on operations of the Mill Creek plant, including increased capital or operating costs, and potential civil penalties or remedial measures, if any.

Water/Waste

(PPL, LKE, LG&E and KU)

Coal Combustion Residuals (CCRs)

In April 2015, the EPA published its final rule regulating CCRs. CCRs include fly ash, bottom ash and sulfur dioxide scrubber wastes. The rule became effective in October 2015. It imposes extensive new requirements, including location restrictions, design and operating standards, groundwater monitoring and corrective action requirements, and closure and post-closure care requirements on CCR impoundments and landfills that are located on active power plants in the United States and not closed. Under the rule, the EPA will regulate CCRs as non-hazardous under Subtitle D of RCRA and allow beneficial use of CCRs, with some restrictions. The rule's requirements for covered CCR impoundments and landfills include implementation of groundwater monitoring and commencement or completion of closure activities generally between three and ten years from certain triggering events. This self-implementing rule requires posting of compliance documentation on a publicly accessible website and is enforceable solely through citizen suits. LG&E and KU are also subject to state rules applicable to CCR management which may potentially be modified to reflect some or all requirements of the federal rule. Industry groups, environmental groups, individual companies and others have filed legal challenges to the final rule which are pending before the D.C. Circuit Court of Appeals.

LG&E and KU have received KPSC approval for a compliance plan providing for construction of additional landfill capacity at the Brown Station, closure of impoundments at the Mill Creek, Trimble County, Brown, and Ghent stations, and construction of process water management facilities at those plants. In addition to the foregoing measures required for compliance with federal CCR rule requirements, LG&E and KU also received KPSC approval for their plans to close impoundments at the retired Green River, Pineville and Tyrone plants to comply with applicable state law requirements. See Note 6 for additional information.

In connection with the final CCR rule, LG&E and KU recorded adjustments to existing AROs during 2015 and 2016. See Note 16 for additional information. Further changes to AROs, current capital plans or operating costs may be required as estimates are refined based on closure developments, groundwater monitoring results, and regulatory or legal proceedings. Costs relating to this rule are subject to rate recovery.

Clean Water Act

Regulations under the federal Clean Water Act dictate permitting and mitigation requirements for facilities and construction projects in the United States. Many of those requirements relate to power plant operations, including requirements related to the treatment of pollutants in effluents prior to discharge, the temperature of effluent discharges and the location, design and construction of cooling water intake structures at generating facilities, standards intended to protect aquatic organisms by reducing capture in the screens attached to cooling water intake structures (impingement) at generating facilities and the water volume brought into the facilities (entrainment). The requirements could impose significant costs for LG&E and KU which are subject to rate recovery.

Effluent Limitations Guidelines (ELGs)

In September 2015, the EPA released its final effluent limitations guidelines for wastewater discharge permits for new and existing steam electricity generating facilities. The rule provides strict technology-based discharge limitations for control of pollutants in scrubber wastewater, fly ash and bottom ash transport water, mercury control wastewater, gasification wastewater and combustion residual leachate. The new guidelines require deployment of additional control technologies providing physical, chemical and biological treatment of wastewaters. The guidelines also mandate operational changes including "no discharge" requirements for fly ash and bottom ash transport waters and mercury control wastewaters. The implementation date for individual generating stations will be determined by the states on a case-by-case basis according to criteria provided by the EPA, but the requirements of the rule must be fully implemented no later than 2023. It has not been decided how Kentucky intends to integrate the ELGs into its routine permit renewal process. Industry groups, environmental groups, individual companies and others have filed legal challenges to the final rule which have been consolidated before the United States Fifth Circuit Court of Appeals. LG&E and KU are developing compliance strategies and schedules. PPL, LKE, LG&E and KU are unable to fully estimate compliance costs or timing at this time, although certain preliminary estimates are included in current

54

capital forecasts for applicable periods. Costs to comply with ELGs or other discharge limits, which are expected to be significant, are subject to rate recovery.

Clean Water Act Section 316(b)

The EPA's final 316(b) rule for existing facilities became effective in October 2014, and regulates cooling water intake structures and their impact on aquatic organisms. States are allowed broad discretion to make site-specific determinations under the rule. The rule requires existing facilities to choose between several options to reduce the impact to aquatic organisms that become trapped against water intake screens (impingement) and to determine the intake structure's impact on aquatic organisms pulled through a plant's cooling water system (entrainment). Plants equipped with closed-cycle cooling, an acceptable option, would likely not incur substantial costs. Once-through systems would likely require additional technology to comply with the rule. Based on studies conducted by LG&E and KU to date, all plants will incur only insignificant operational costs. In addition, LG&E's Mill Creek Unit 1 is expected to incur capital costs. PPL, LKE, LG&E and KU are evaluating compliance strategies but do not presently expect the compliance costs, which are subject to rate recovery, to be significant.

(All Registrants)

Waters of the United States (WOTUS)

The U.S. Court of Appeals for the Sixth Circuit has issued a stay of EPA's rule on the definition of WOTUS pending the court's review of the rule. The effect of the stay is that the WOTUS rule is not in effect anywhere in the United States. The ultimate outcome of the court's review of the rule remains uncertain. Because of the strict permitting programs already in place in Kentucky and Pennsylvania, the Registrants do not expect the rule to have a significant impact on their operations.

Other Issues

The EPA is reassessing its polychlorinated biphenyls (PCB) regulations under the Toxic Substance Control Act, which was significantly updated in June 2016. In 2010, the EPA issued an Advanced Notice of Proposed Rulemaking for changes to these regulations. The rulemaking, which could lead to a phase-out in the United States of all or some equipment containing PCBs, is not likely to be affected by the revisions to the Toxic Substances Control Act. The EPA has postponed the release of revisions to its proposed rulemaking. The Registrants cannot predict at this time the outcome of the proposed EPA rulemaking and what impact, if any, it would have on their facilities, but the costs could be significant.

Superfund and Other Remediation(All Registrants)

PPL Electric is potentially responsible for a share of the costs at several sites listed by the EPA under the federal Superfund program, including the Columbia Gas Plant site and the Brodhead site. Clean-up actions have been or are being undertaken at all of these sites, the costs of which have not been significant to PPL Electric. Should the EPA require different or additional measures in the future, however, or should PPL Electric's share of costs at multi-party sites increase substantially more than expected, the costs could be significant.

PPL Electric, LG&E and KU are investigating, responding to agency inquiries, remediating, or have completed the remediation of, several sites that were not addressed under a regulatory program such as Superfund, but for which PPL Electric, LG&E and KU may be liable for remediation. These include a number of former coal gas manufacturing plants in Pennsylvania and Kentucky previously owned or operated or currently owned by predecessors or affiliates of PPL Electric, LG&E and KU. To date, the costs of these sites have not been significant.

There are additional sites, formerly owned or operated by PPL Electric, LG&E and KU predecessors or affiliates. LG&E and KU lack information on the condition of such additional sites and are therefore unable to estimate any potential liability they may have or a range of reasonably possible losses, if any, related to these sites. At September 30, 2016 and December 31, 2015, PPL Electric had a recorded liability of $10 million representing its best estimate of the probable loss incurred to remediate additional sites previously owned or operated by PPL Electric predecessors or affiliates. Depending on the outcome of investigations at sites where investigations have not begun or been completed, or developments at sites for which information is incomplete, the costs of remediation and other liabilities could be significant and may be as much as approximately $30 million.

The EPA is evaluating the risks associated with polycyclic aromatic hydrocarbons and naphthalene, chemical by-products of coal gas manufacturing. As a result of the EPA's evaluation, individual states may establish stricter standards for water quality and soil cleanup. This could require several PPL subsidiaries to take more extensive assessment and remedial actions at former

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coal gas manufacturing plants. PPL, PPL Electric, LKE, LG&E and KU cannot estimate a range of reasonably possible losses, if any, related to these matters.

From time to time, PPL's subsidiaries in the United States undertake remedial action in response to notices of violations, spills or other releases at various on-site and off-site locations, negotiate with the EPA and state and local agencies regarding actions necessary for compliance with applicable requirements, negotiate with property owners and other third parties alleging impacts from PPL's operations and undertake similar actions necessary to resolve environmental matters that arise in the course of normal operations. Based on analyses to date, resolution of these environmental matters is not expected to have a significant adverse impact on the operations of PPL Electric, LG&E and KU.

Future cleanup or remediation work at sites under review, or at sites not yet identified, may result in significant additional costs for PPL, PPL Electric, LKE, LG&E and KU. Insurance policies maintained by LKE, LG&E and KU may be applicable to certain of the costs or other obligations related to these matters but the amount of insurance coverage or reimbursement cannot be estimated or assured.

European Union Creosote Ban(PPL)

In 2011, the European Commission amended the European Union Biocides Directive to ban the use of creosote in contact with soil. Creosote is a wood preservative used to extend the life of wooden poles that support power lines. Although European Union member countries were required to pass implementing laws by 2012, the U.K. has not passed an implementing law and there are no legal penalties for failing to do so. The recent U.K. referendum in favor of the U.K.'s withdrawal from the European Union further reduces the likelihood that the U.K. will implement the European Union directive. In the unlikely event that the U.K. were to ban the use of creosote, WPD's creosote-treated wood poles would need to be replaced with an acceptable alternative at the time of routine replacement. Although the aggregate cost to replace poles could be significant, it would be incurred as poles are replaced in the ordinary course and would be subject to rate recovery. WPD has 1.4 million wood poles in its system. There are currently no alternative wood preservatives available that are acceptable to the industry and/or regulators.

Other

Guarantees and Other Assurances

(All Registrants)

In the normal course of business, the Registrants enter into agreements that provide financial performance assurance to third parties on behalf of certain subsidiaries. Such agreements include, for example, guarantees, stand-by letters of credit issued by financial institutions and surety bonds issued by insurance companies. These agreements are entered into primarily to support or enhance the creditworthiness attributed to a subsidiary on a stand-alone basis or to facilitate the commercial activities in which these subsidiaries engage.

(PPL)

PPL fully and unconditionally guarantees all of the debt securities of PPL Capital Funding.

(All Registrants)

The table below details guarantees provided as of September 30, 2016. "Exposure" represents the estimated maximum potential amount of future payments that could be required to be made under the guarantee. The probability of expected payment/performance under each of these guarantees is remote except for "WPD guarantee of pension and other obligations of unconsolidated entities" and "Indemnification of lease termination and other divestitures." The total recorded liability at September 30, 2016, was $22 million for PPL and $17 million for LKE. The total recorded liability at December 31, 2015, was $25 million for PPL and $18 million for LKE. For reporting purposes, on a consolidated basis, all guarantees of PPL Electric, LKE, LG&E and KU also apply to PPL, and all guarantees of LG&E and KU also apply to LKE.

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	Exposure at September 30, 2016			Expiration Date
PPL
Indemnifications related to the WPD Midlands acquisition			(a)
WPD indemnifications for entities in liquidation and sales of assets	$	10	(b)	2019
WPD guarantee of pension and other obligations of unconsolidated entities	109		(c)
PPL Electric
Guarantee of inventory value	15		(d)	2018
LKE
Indemnification of lease termination and other divestitures	301		(e)	2021 - 2023
LG&E and KU
LG&E and KU guarantee of shortfall related to OVEC			(f)

(a) Indemnifications related to certain liabilities, including a specific unresolved tax issue and those relating to properties and assets owned by the seller that were transferred to WPD Midlands in connection with the acquisition. A cross indemnity has been received from the seller on the tax issue. The maximum exposure and expiration of these indemnifications cannot be estimated because the maximum potential liability is not capped and the expiration date is not specified in the transaction documents.

(b) Indemnification to the liquidators and certain others for existing liabilities or expenses or liabilities arising during the liquidation process. The indemnifications are limited to distributions made from the subsidiary to its parent either prior or subsequent to liquidation or are not explicitly stated in the agreements. The indemnifications generally expire two to seven years subsequent to the date of dissolution of the entities. The exposure noted only includes those cases where the agreements provide for specific limits.

In connection with their sales of various businesses, WPD and its affiliates have provided the purchasers with indemnifications that are standard for such transactions, including indemnifications for certain pre-existing liabilities and environmental and tax matters or have agreed to continue their obligations under existing third-party guarantees, either for a set period of time following the transactions or upon the condition that the purchasers make reasonable efforts to terminate the guarantees. Additionally, WPD and its affiliates remain secondarily responsible for lease payments under certain leases that they have assigned to third parties.

(c) Relates to certain obligations of discontinued or modified electric associations that were guaranteed at the time of privatization by the participating members. Costs are allocated to the members and can be reallocated if an existing member becomes insolvent. At September 30, 2016, WPD has recorded an estimated discounted liability for which the expected payment/performance is probable. Neither the expiration date nor the maximum amount of potential payments for certain obligations is explicitly stated in the related agreements, and as a result, the exposure has been estimated.

(d) A third party logistics firm provides inventory procurement and fulfillment services. The logistics firm has title to the inventory, however, upon termination of the contracts, PPL Electric has guaranteed to purchase any remaining inventory that has not been used or sold.

(e) LKE provides certain indemnifications covering the due and punctual payment, performance and discharge by each party of its respective obligations. The most comprehensive of these guarantees is the LKE guarantee covering operational, regulatory and environmental commitments and indemnifications made by WKE under a 2009 Transaction Termination Agreement. This guarantee has a term of 12 years ending July 2021, and a maximum exposure of $200 million, exclusive of certain items such as government fines and penalties that fall outside the cap. Another WKE-related LKE guarantee covers other indemnifications related to the purchase price of excess power, has a term expiring in 2023, and a maximum exposure of $100 million. In May 2012, LKE's indemnitee received an unfavorable arbitration panel's decision interpreting this matter. In October 2014, LKE's indemnitee filed a motion for discretionary review with the Kentucky Supreme Court seeking to overturn the arbitration decision, and such motion was denied by the court in September 2015. In September 2015, a counterparty issued a demand letter to LKE's indemnitee. In February 2016, the counterparty filed a complaint in Henderson, Kentucky Circuit Court, seeking an award of damages in the matter. The proceeding is currently in the discovery phase. LKE does not believe appropriate contractual, legal or commercial grounds exist for the claim made and has disputed the demands. LKE believes its indemnification obligations in the WKE matter remain subject to various uncertainties, including additional legal and contractual developments, as well as future prices, availability and demand for the subject excess power. Although the parties have also conducted certain settlement discussions, the ultimate outcomes of the WKE termination-related indemnifications cannot be predicted at this time. Additionally, LKE has indemnified various third parties related to historical obligations for other divested subsidiaries and affiliates. The indemnifications vary by entity and the maximum exposures range from being capped at the sale price to no specified maximum, and LKE could be required to perform on these indemnifications in the event of covered losses or liabilities being claimed by an indemnified party. LKE cannot predict the ultimate outcomes of the various indemnification scenarios, but does not expect such outcomes to result in significant losses above the amounts recorded.

(f) Pursuant to the OVEC power purchase contract, LG&E and KU are obligated to pay for their share of OVEC's excess debt service, post-retirement and decommissioning costs, as well as any shortfall from amounts included within a demand charge designed and expected to cover these costs over the term of the contract. LKE's proportionate share of OVEC's outstanding debt was $124 million at September 30, 2016, consisting of LG&E's share of $86 million and KU's share of $38 million. The maximum exposure and the expiration date of these potential obligations are not presently determinable. See "Energy Purchase Commitments" and "Guarantees and Other Assurances" in Note 13 in PPL's, LKE's, LG&E's and KU's 2015 Form 10-K for additional information on the OVEC power purchase contract.

The Registrants provide other miscellaneous guarantees through contracts entered into in the normal course of business. These guarantees are primarily in the form of indemnification or warranties related to services or equipment and vary in duration. The amounts of these guarantees often are not explicitly stated, and the overall maximum amount of the obligation under such guarantees cannot be reasonably estimated. Historically, no significant payments have been made with respect to these types of guarantees and the probability of payment/performance under these guarantees is remote.

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PPL, on behalf of itself and certain of its subsidiaries, maintains insurance that covers liability assumed under contract for bodily injury and property damage. The coverage provides maximum aggregate coverage of $225 million. This insurance may be applicable to obligations under certain of these contractual arrangements.

11. Related Party Transactions

Support Costs(PPL Electric, LKE, LG&E and KU)

PPL Services and LKS provide their respective PPL and LKE subsidiaries and each other with administrative, management and support services. PPL EU Services provides the majority of financial, supply chain, human resources and facilities management services primarily to PPL Electric. PPL Services provides certain corporate functions to PPL Electric. For all service companies, the costs of these services are charged to the respective recipients as direct support costs. General costs that cannot be directly attributed to a specific entity are allocated and charged to the respective recipients as indirect support costs. PPL Services and PPL EU Services use a three-factor methodology that includes the applicable recipients' invested capital, operation and maintenance expenses and number of employees to allocate indirect costs. LKS bases its indirect allocations on the subsidiaries' number of employees, total assets, revenues, number of customers and/or other statistical information. PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

In addition to the charges for services noted above, LKS makes payments on behalf of LG&E and KU for fuel purchases and other costs for products or services provided by third parties. LG&E and KU also provide services to each other and to LKS. Billings between LG&E and KU relate to labor and overheads associated with union and hourly employees performing work for the other company, charges related to jointly-owned generating units and other miscellaneous charges. Tax settlements between LKE and LG&E and LKE and KU are reimbursed through LKS.

Intercompany Borrowings(LKE)

LKE maintains a $225 million revolving line of credit with a PPL Energy Funding subsidiary whereby LKE can borrow funds on a short-term basis at market-based rates. At September 30, 2016 and December 31, 2015, $138 million and $54 million were outstanding and were reflected in "Notes payable with affiliate" on the Balance Sheets. The interest rate on borrowings is equal to one-month LIBOR plus a spread. The interest rates on the outstanding borrowing at September 30, 2016 and December 31, 2015 were 2.02% and 1.74%.

LKE has a $400 millionten-year note with a PPL affiliate with an interest rate of 3.5%. At September 30, 2016 and December 31, 2015, the note was reflected in "Long-term debt to affiliate" on the Balance Sheets.

Other(PPL Electric, LG&E and KU)

See Note 9 for discussions regarding intercompany allocations associated with defined benefits.

12. Other Income (Expense) - net

(PPL)

"Other Income (Expense) - net" for the three and nine months ended September 30, 2016 and 2015 consisted primarily of gains on foreign currency contracts to economically hedge PPL's translation risk related to its GBP denominated earnings in the U.K. See Note 14 for additional information on these derivatives.

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13. Fair Value Measurements

(All Registrants)

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). A market approach (generally, data from market transactions), an income approach (generally, present value techniques and option-pricing models) and/or a cost approach (generally, replacement cost) are used to measure the fair value of an asset or liability, as appropriate. These valuation approaches incorporate inputs such as observable, independent market data and/or unobservable data that management believes are predicated on the assumptions market participants would use to price an asset or liability. These inputs may incorporate, as applicable, certain risks such as nonperformance risk, which includes credit risk. The fair value of a group of financial assets and liabilities is measured on a net basis. Transfers between levels are recognized at end-of-reporting-period values. During the three and nine months ended September 30, 2016 and 2015, there were no transfers between Level 1 and Level 2. See Note 1 in each Registrant's 2015 Form 10-K for information on the levels in the fair value hierarchy.

Recurring Fair Value Measurements

The assets and liabilities measured at fair value were:

	September 30, 2016								December 31, 2015
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
PPL
Assets
Cash and cash equivalents	$	416	$	416	$	—	$	—	$	836	$	836	$	—	$	—
Restricted cash and cash equivalents (a)	29		29		—		—		33		33		—		—
Price risk management assets (b):
Foreign currency contracts	110		—		110		—		209		—		209		—
Cross-currency swaps	153		—		153		—		86		—		86		—
Total price risk management assets	263		—		263		—		295		—		295		—
Auction rate securities (c)	—		—		—		—		2		—		—		2
Total assets	$	708	$	445	$	263	$	—	$	1,166	$	869	$	295	$	2
Liabilities
Price risk management liabilities (b):
Interest rate swaps	$	54	$	—	$	54	$	—	$	71	$	—	$	71	$	—
Foreign currency contracts	14		—		14		—		1		—		1		—
Total price risk management liabilities	$	68	$	—	$	68	$	—	$	72	$	—	$	72	$	—
PPL Electric
Assets
Cash and cash equivalents	$	36	$	36	$	—	$	—	$	47	$	47	$	—	$	—
Restricted cash and cash equivalents (a)	2		2		—		—		2		2		—		—
Total assets	$	38	$	38	$	—	$	—	$	49	$	49	$	—	$	—
LKE
Assets
Cash and cash equivalents	$	11	$	11	$	—	$	—	$	30	$	30	$	—	$	—
Cash collateral posted to counterparties (d)	8		8		—		—		9		9		—		—
Total assets	$	19	$	19	$	—	$	—	$	39	$	39	$	—	$	—

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	September 30, 2016								December 31, 2015
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Liabilities
Price risk management liabilities:
Interest rate swaps	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
Total price risk management liabilities	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
LG&E
Assets
Cash and cash equivalents	$	4	$	4	$	—	$	—	$	19	$	19	$	—	$	—
Cash collateral posted to counterparties (d)	8		8		—		—		9		9		—		—
Total assets	$	12	$	12	$	—	$	—	$	28	$	28	$	—	$	—
Liabilities
Price risk management liabilities:
Interest rate swaps	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
Total price risk management liabilities	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
KU
Assets
Cash and cash equivalents	$	7	$	7	$	—	$	—	$	11	$	11	$	—	$	—
Total assets	$	7	$	7	$	—	$	—	$	11	$	11	$	—	$	—

(a) Current portion is included in "Other current assets" and long-term portion is included in "Other noncurrent assets" on the Balance Sheets.

(b) Current portion is included in "Price risk management assets" and "Other current liabilities" and noncurrent portion is included in "Price risk management assets" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

(c) Included in "Other noncurrent assets" on the Balance Sheets.

(d) Included in "Other noncurrent assets" on the Balance Sheets. Represents cash collateral posted to offset the exposure with counterparties related to certain interest rate swaps under master netting arrangements that are not offset.

Price Risk Management Assets/Liabilities - Interest Rate Swaps/Foreign Currency Contracts/Cross-Currency Swaps (PPL, LKE, LG&E and KU)

To manage interest rate risk, PPL, LKE, LG&E and KU use interest rate contracts such as forward-starting swaps, floating-to-fixed swaps and fixed-to-floating swaps. To manage foreign currency risk, PPL uses foreign currency contracts such as forwards, options and cross-currency swaps that contain characteristics of both interest rate and foreign currency contracts. An income approach is used to measure the fair value of these contracts, utilizing readily observable inputs, such as forward interest rates (e.g., LIBOR and government security rates) and forward foreign currency exchange rates (e.g., GBP), as well as inputs that may not be observable, such as credit valuation adjustments. In certain cases, market information cannot practicably be obtained to value credit risk and therefore internal models are relied upon. These models use projected probabilities of default and estimated recovery rates based on historical observances. When the credit valuation adjustment is significant to the overall valuation, the contracts are classified as Level 3.

Nonrecurring Fair Value Measurements (PPL)

See Note 8 for information regarding the estimated fair value of the Supply segment's net assets as of the June 1, 2015 spinoff date.

Financial Instruments Not Recorded at Fair Value(All Registrants)

The carrying amounts of long-term debt on the Balance Sheets and their estimated fair values are set forth below. The fair values were estimated using an income approach by discounting future cash flows at estimated current cost of funding rates, which incorporate the credit risk of the Registrants. Long-term debt is classified as Level 2. The effect of third-party credit enhancements is not included in the fair value measurement.

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	September 30, 2016				December 31, 2015
	Carrying Amount (a)		Fair Value		Carrying Amount (a)		Fair Value
PPL	$	18,512	$	23,180	$	19,048	$	21,218
PPL Electric	2,831		3,372		2,828		3,088
LKE	5,089		5,832		5,088		5,384
LG&E	1,642		1,852		1,642		1,704
KU	2,327		2,701		2,326		2,467

(a) Amounts are net of debt issuance costs.

The carrying value of short-term debt (including notes between affiliates), when outstanding, approximates fair value due to the variable interest rates associated with the short-term debt and is classified as Level 2.

14. Derivative Instruments and Hedging Activities

Risk Management Objectives

(All Registrants)

PPL has a risk management policy approved by the Board of Directors to manage market risk associated with commodities, interest rates on debt issuances and foreign exchange (including price, liquidity and volumetric risk) and credit risk (including non-performance risk and payment default risk). The Risk Management Committee, comprised of senior management and chaired by the Director-Risk Management, oversees the risk management function. Key risk control activities designed to ensure compliance with the risk policy and detailed programs include, but are not limited to, credit review and approval, validation of transactions, verification of risk and transaction limits, value-at-risk analyses (VaR, a statistical model that attempts to estimate the value of potential loss over a given holding period under normal market conditions at a given confidence level) and the coordination and reporting of the Enterprise Risk Management program.

Market Risk

Market risk includes the potential loss that may be incurred as a result of price changes associated with a particular financial or commodity instrument as well as market liquidity and volumetric risks. Forward contracts, futures contracts, options, swaps and structured transactions are utilized as part of risk management strategies to minimize unanticipated fluctuations in earnings caused by changes in commodity prices, interest rates and foreign currency exchange rates. Many of the contracts meet the definition of a derivative. All derivatives are recognized on the Balance Sheets at their fair value, unless NPNS is elected.

The following summarizes the market risks that affect PPL and its subsidiaries.

Interest rate risk

• PPL and its subsidiaries are exposed to interest rate risk associated with forecasted fixed-rate and existing floating-rate debt issuances. PPL and WPD hold over-the-counter cross currency swaps to limit exposure to market fluctuations on interest and principal payments from changes in foreign currency exchange rates and interest rates. LKE and LG&E utilize over-the-counter interest rate swaps to limit exposure to market fluctuations on floating-rate debt. PPL, LKE, LG&E and KU utilize forward starting interest rate swaps to hedge changes in benchmark interest rates, when appropriate, in connection with future debt issuances.

• PPL and its subsidiaries are exposed to interest rate risk associated with debt securities and derivatives held by defined benefit plans. This risk is significantly mitigated to the extent that the plans are sponsored at, or sponsored on behalf of, the regulated domestic utilities and for certain plans at WPD due to the recovery mechanisms in place.

Foreign currency risk

• PPL is exposed to foreign currency exchange risk primarily associated with its investments in and earnings of U.K. affiliates.

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Commodity price risk

PPL is exposed to commodity price risk through its domestic subsidiaries as described below.

• PPL Electric is exposed to commodity price risk from its obligation as PLR; however, its PUC-approved cost recovery mechanism substantially eliminates its exposure to this risk. PPL Electric also mitigates its exposure to commodity price risk by entering into full-requirement supply agreements to serve its PLR customers. These supply agreements transfer the commodity price risk associated with the PLR obligation to the energy suppliers.

• LG&E's and KU's rates include certain mechanisms for fuel and fuel-related expenses. In addition, LG&E's rates include a mechanism for natural gas supply expenses. These mechanisms generally provide for timely recovery of market price fluctuations associated with these expenses.

Volumetric risk

PPL is exposed to volumetric risk through its subsidiaries as described below.

• WPD is exposed to volumetric risk which is significantly mitigated as a result of the method of regulation in the U.K. Under the RIIO - ED1 price control period, recovery of such exposure occurs on a two year lag. See Note 1 in PPL's 2015 Form 10-K for additional information on revenue recognition under RIIO - ED1.

• PPL Electric, LG&E and KU are exposed to volumetric risk on retail sales, mainly due to weather and other economic conditions for which there is limited mitigation between rate cases.

Equity securities price risk

• PPL and its subsidiaries are exposed to equity securities price risk associated with defined benefit plans. This risk is significantly mitigated at the regulated domestic utilities and for certain plans at WPD due to the recovery mechanisms in place.

• PPL is exposed to equity securities price risk from future stock sales and/or purchases.

Credit Risk

Credit risk is the potential loss that may be incurred due to a counterparty's non-performance.

PPL is exposed to credit risk from "in-the-money" interest rate and foreign currency derivatives with financial institutions, as well as additional credit risk through certain of its subsidiaries, as discussed below.

In the event a supplier of LKE (through its subsidiaries LG&E and KU) or PPL Electric defaults on its obligation, those entities would be required to seek replacement power or replacement fuel in the market. In general, subject to regulatory review or other processes, appropriate incremental costs incurred by these entities would be recoverable from customers through applicable rate mechanisms, thus mitigating the financial risk for these entities.

PPL and its subsidiaries have credit policies in place to manage credit risk, including the use of an established credit approval process, daily monitoring of counterparty positions and the use of master netting agreements or provisions. These agreements generally include credit mitigation provisions, such as margin, prepayment or collateral requirements. PPL and its subsidiaries may request additional credit assurance, in certain circumstances, in the event that the counterparties' credit ratings fall below investment grade, their tangible net worth falls below specified percentages or their exposures exceed an established credit limit.

Master Netting Arrangements

Net derivative positions on the balance sheets are not offset against the right to reclaim cash collateral (a receivable) or the obligation to return cash collateral (a payable) under master netting arrangements.

PPL, LKE, LG&E and KU had no obligation to return cash collateral under master netting arrangements at September 30, 2016 and December 31, 2015.

PPL, LKE and LG&E posted $8 million of cash collateral under master netting arrangements at September 30, 2016 and $9 million of cash collateral under master netting arrangements at December 31, 2015.

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KU did not post any cash collateral under master netting arrangements at September 30, 2016 and December 31, 2015.

See "Offsetting Derivative Instruments" below for a summary of derivative positions presented in the balance sheets where a right of setoff exists under these arrangements.

Interest Rate Risk

(All Registrants)

PPL and its subsidiaries issue debt to finance their operations, which exposes them to interest rate risk. Various financial derivative instruments are utilized to adjust the mix of fixed and floating interest rates in their debt portfolio, adjust the duration of the debt portfolio and lock in benchmark interest rates in anticipation of future financing, when appropriate. Risk limits under PPL's risk management program are designed to balance risk exposure to volatility in interest expense and changes in the fair value of the debt portfolio due to changes in benchmark interest rates. In addition, the interest rate risk of certain subsidiaries is potentially mitigated as a result of the existing regulatory framework or the timing of rate cases.

Cash Flow Hedges

(PPL)

Interest rate risks include exposure to adverse interest rate movements for outstanding variable rate debt and for future anticipated financings. Financial interest rate swap contracts that qualify as cash flow hedges may be entered into to hedge floating interest rate risk associated with both existing and anticipated debt issuances. PPL held no such contracts at September 30, 2016.

For the three months ended September 30, 2016, PPL had no hedge ineffectiveness associated with interest rate derivatives and an insignificant amount of hedge ineffectiveness for the three months ended September 30, 2015. For the nine months ended September 30, 2016 and 2015, PPL had an insignificant amount of ineffectiveness associated with interest rate derivatives.

At September 30, 2016, PPL held an aggregate notional value in cross-currency interest rate swap contracts of $802 million that range in maturity from 2017 through 2028 to hedge the interest payments and principal of WPD's U.S. dollar-denominated senior notes. In May 2016, $460 million of WPD's U.S. dollar-denominated senior notes were repaid upon maturity and $460 million notional value of cross-currency interest rate swap contracts matured. PPL recorded a $46 million gain upon settlement of the cross-currency interest rate swap contracts, which largely offset a loss recorded on the revaluation of U.S. dollar-denominated senior notes.

Cash flow hedges are discontinued if it is no longer probable that the original forecasted transaction will occur by the end of the originally specified time period and any amounts previously recorded in AOCI are reclassified into earnings once it is determined that the hedged transaction is not probable of occurring.

PPL had no cash flow hedges reclassified into earnings associated with discontinued cash flow hedges for the three and nine months ended September 30, 2016. As a result of the June 1, 2015 spinoff of PPL Energy Supply, all PPL cash flow hedges associated with PPL Energy Supply were ineffective and discontinued and therefore, reclassified into earnings during the second quarter 2015 and reflected in discontinued operations for the nine months ended September 30, 2015. See Note 8 for additional information.

At September 30, 2016, the accumulated net unrecognized after-tax gains (losses) on qualifying derivatives that are expected to be reclassified into earnings during the next 12 months were insignificant. Amounts are reclassified as the hedged interest expense is recorded.

Economic Activity(PPL, LKE and LG&E)

LG&E enters into interest rate swap contracts that economically hedge interest payments on variable rate debt. Because realized gains and losses from the swaps, including a terminated swap contract, are recoverable through regulated rates, any subsequent changes in fair value of these derivatives are included in regulatory assets or liabilities until they are realized as interest expense. Realized gains and losses are recognized in "Interest Expense" on the Statements of Income at the time the underlying hedged interest expense is recorded. At September 30, 2016, LG&E held contracts with a notional amount of $179 million that range in maturity through 2033.

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Foreign Currency Risk

(PPL)

PPL is exposed to foreign currency risk, primarily through investments in and earnings of U.K. affiliates. PPL has adopted a foreign currency risk management program designed to hedge certain foreign currency exposures, including firm commitments, recognized assets or liabilities, anticipated transactions and net investments. In addition, PPL enters into financial instruments to protect against foreign currency translation risk of expected GBP earnings.

Net Investment Hedges

PPL enters into foreign currency contracts on behalf of a subsidiary to protect the value of a portion of its net investment in WPD. There were no such contracts outstanding at September 30, 2016.

At September 30, 2016, PPL had $22 million of accumulated net investment hedge after tax gains (losses) that were included in the foreign currency translation adjustment component of AOCI, compared to $19 million at December 31, 2015.

Economic Activity

PPL enters into foreign currency contracts on behalf of a subsidiary to economically hedge GBP-denominated anticipated earnings. At September 30, 2016, the total exposure hedged by PPL was approximately £1.8 billion (approximately $2.4 billion based on contracted rates). These contracts had termination dates ranging from October 2016 through December 2018.

In the third quarter of 2016, PPL settled foreign currency hedges related to 2017 and 2018 anticipated earnings, resulting in receipt of approximately $310 million of cash, and entered into new hedges at current market rates. The notional amount of the settled hedges was approximately £1.3 billion (approximately $2.0 billion based on contracted rates) with termination dates from January 2017 through November 2018. The settlement did not have a significant impact on net income as the hedge values were previously marked to fair value and recognized in "Other Income (Expense) - net" on the Statement of Income.

Accounting and Reporting

(All Registrants)

All derivative instruments are recorded at fair value on the Balance Sheet as an asset or liability unless NPNS is elected. NPNS contracts for PPL and PPL Electric include certain full-requirement purchase contracts and other physical purchase contracts. Changes in the fair value of derivatives not designated as NPNS are recognized in earnings unless specific hedge accounting criteria are met and designated as such, except for the changes in fair values of LG&E's and KU's interest rate swaps that are recognized as regulatory assets or regulatory liabilities. See Note 6 for amounts recorded in regulatory assets and regulatory liabilities at September 30, 2016 and December 31, 2015.

See Notes 1 and 17 in each Registrant's 2015 Form 10-K for additional information on accounting policies related to derivative instruments.

(PPL)

The following table presents the fair value and location of derivative instruments recorded on the Balance Sheets.

64

	September 30, 2016								December 31, 2015
	Derivatives designated as hedging instruments				Derivatives not designated as hedging instruments				Derivatives designated as hedging instruments				Derivatives not designated as hedging instruments
	Assets		Liabilities		Assets		Liabilities		Assets		Liabilities		Assets		Liabilities
Current:
Price Risk Management
Assets/Liabilities (a):
Interest rate swaps (b)	$	—	$	—	$	—	$	6	$	—	$	24	$	—	$	5
Cross-currency swaps (b)	6		—		—		—		35		—		—		—
Foreign currency contracts	—		—		72		2		10		—		94		1
Total current	6		—		72		8		45		24		94		6
Noncurrent:
Price Risk Management
Assets/Liabilities (a):
Interest rate swaps (b)	—		—		—		48		—		—		—		42
Cross-currency swaps (b)	147		—		—		—		51		—		—		—
Foreign currency contracts	—		—		38		12		—		—		105		—
Total noncurrent	147		—		38		60		51		—		105		42
Total derivatives	$	153	$	—	$	110	$	68	$	96	$	24	$	199	$	48

(a) Current portion is included in "Price risk management assets" and "Other current liabilities" and noncurrent portion is included in "Price risk management assets" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

(b) Excludes accrued interest, if applicable.

The following tables present the pre-tax effect of derivative instruments recognized in income, OCI or regulatory assets and regulatory liabilities for the periods ended September 30, 2016.

							Three Months					Nine Months
Derivative Relationships	Derivative Gain (Loss) Recognized in OCI (Effective Portion)					Location of Gain (Loss) Recognized in Income on Derivative	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)		Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
	Three Months		Nine Months
Cash Flow Hedges:
Interest rate swaps	$	—	$	(21	)	Interest expense	$	(2	)	$	—	$	(5	)	$	—
Cross-currency swaps	78		87			Interest expense	2			—		2			—
						Other income (expense) - net	86			—		80			—
Total	$	78	$	66			$	86		$	—	$	77		$	—
Net Investment Hedges:
Foreign currency contracts	$	—	$	4

65

Derivatives Not Designated as	Location of Gain (Loss) Recognized in
Hedging Instruments	Income on Derivative	Three Months			Nine Months
Foreign currency contracts	Other income (expense) - net	$	49		$	280
Interest rate swaps	Interest expense	(2		)	(6		)
	Total	$	47		$	274
Derivatives Not Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	2		$	(7	)

The following tables present the pre-tax effect of derivative instruments recognized in income, OCI or regulatory assets and regulatory liabilities for the periods ended September 30, 2015.

								Three Months					Nine Months
Derivative Relationships	Derivative Gain (Loss) Recognized in OCI (Effective Portion)						Location of Gain (Loss) Recognized in Income on Derivative	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)		Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
	Three Months			Nine Months
Cash Flow Hedges:
Interest rate swaps	$	(27	)	$	(29	)	Interest expense	$	(2	)	$	—	$	(9	)	$	—
							Discontinued operations	—			—		—			(77		)
Cross-currency swaps	(3		)	33			Interest expense	(1		)	—		1			—
							Other income (expense) - net	(10		)	—		22			—
Commodity contracts	—			—			Discontinued operations	—			—		13			7
Total	$	(30	)	$	4			$	(13	)	$	—	$	27		$	(70	)
Net Investment Hedges:
Foreign currency contracts	$	7		$	6

Derivatives Not Designated as	Location of Gain (Loss) Recognized in
Hedging Instruments	Income on Derivative	Three Months			Nine Months
Foreign currency contracts	Other income (expense) - net	$	78		$	64
Interest rate swaps	Interest expense	(2		)	(6		)
	Total	$	76		$	58
Derivatives Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(42	)	$	(22	)
Derivatives Not Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(5	)	$	(2	)

(LKE)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

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	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(42	)	$	(22	)

(LG&E)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(21	)	$	(11	)

(KU)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(21	)	$	(11	)

(LKE and LG&E)

The following table presents the fair value and the location on the Balance Sheets of derivatives not designated as hedging instruments.

	September 30, 2016				December 31, 2015
	Assets		Liabilities			Assets		Liabilities
Current:
Price Risk Management
Assets/Liabilities:
Interest rate swaps	$	—	$	6		$	—	$	5
Total current	—		6			—		5
Noncurrent:
Price Risk Management
Assets/Liabilities:
Interest rate swaps	—		48			—		42
Total noncurrent	—		48			—		42
Total derivatives	$	—	$	54		$	—	$	47

The following tables present the pre-tax effect of derivatives not designated as cash flow hedges that are recognized in income or regulatory assets for the periods ended September 30, 2016.

67

	Location of Gain (Loss) Recognized in
Derivative Instruments	Income on Derivatives	Three Months			Nine Months
Interest rate swaps	Interest expense	$	(2	)	$	(6	)
	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	2		$	(7	)

The following tables present the pre-tax effect of derivatives not designated as cash flow hedges that are recognized in income or regulatory assets for the periods ended September 30, 2015.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Income on Derivatives	Three Months			Nine Months
Interest rate swaps	Interest expense	$	(2	)	$	(6	)
	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(5	)	$	(2	)

(PPL, LKE, LG&E and KU)

Offsetting Derivative Instruments

PPL, LKE, LG&E and KU or certain of their subsidiaries have master netting arrangements in place and also enter into agreements pursuant to which they purchase or sell certain energy and other products. Under the agreements, upon termination of the agreement as a result of a default or other termination event, the non-defaulting party typically would have a right to set off amounts owed under the agreement against any other obligations arising between the two parties (whether under the agreement or not), whether matured or contingent and irrespective of the currency, place of payment or place of booking of the obligation.

PPL, LKE, LG&E and KU have 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 derivatives agreements. The table below summarizes the derivative positions presented in the balance sheets where a right of setoff exists under these arrangements and related cash collateral received or pledged.

	Assets								Liabilities
			Eligible for Offset								Eligible for Offset
	Gross		Derivative Instruments		Cash Collateral Received		Net		Gross		Derivative Instruments		Cash Collateral Pledged		Net
September 30, 2016
Treasury Derivatives
PPL	$	263	$	14	$	—	$	249	$	68	$	14	$	8	$	46
LKE	—		—		—		—		54		—		8		46
LG&E	—		—		—		—		54		—		8		46

December 31, 2015
Treasury Derivatives
PPL	$	295	$	25	$	—	$	270	$	72	$	25	$	9	$	38
LKE	—		—		—		—		47		—		9		38
LG&E	—		—		—		—		47		—		9		38

Credit Risk-Related Contingent Features

Certain derivative contracts contain credit risk-related contingent features which, when in a net liability position, would permit the counterparties to require the transfer of additional collateral upon a decrease in the credit ratings of PPL, LKE, LG&E and

68

KU or certain of their subsidiaries. Most of these features would require the transfer of additional collateral or permit the counterparty to terminate the contract if the applicable credit rating were to fall below investment grade. Some of these features also would allow the counterparty to require additional collateral upon each downgrade in credit rating at levels that remain above investment grade. In either case, if the applicable credit rating were to fall below investment grade, and assuming no assignment to an investment grade affiliate were allowed, most of these credit contingent features require either immediate payment of the net liability as a termination payment or immediate and ongoing full collateralization on derivative instruments in net liability positions.

Additionally, certain derivative contracts contain credit risk-related contingent features that require adequate assurance of performance be provided if the other party has reasonable concerns regarding the performance of PPL's, LKE's, LG&E's, and KU's obligations under the contracts. A counterparty demanding adequate assurance could require a transfer of additional collateral or other security, including letters of credit, cash and guarantees from a creditworthy entity. This would typically involve negotiations among the parties. However, amounts disclosed below represent assumed immediate payment or immediate and ongoing full collateralization for derivative instruments in net liability positions with "adequate assurance" features.

(PPL, LKE and LG&E)

At September 30, 2016, derivative contracts in a net liability position that contain credit risk-related contingent features, collateral posted on those positions and the related effect of a decrease in credit ratings below investment grade are summarized as follows:

	PPL		LKE		LG&E
Aggregate fair value of derivative instruments in a net liability position with credit risk-related contingent features	$	29	$	29	$	29
Aggregate fair value of collateral posted on these derivative instruments	7		7		7
Aggregate fair value of additional collateral requirements in the event of  a credit downgrade below investment grade (a)	22		22		22

(a) Includes the effect of net receivables and payables already recorded on the Balance Sheet.

15. Goodwill and Other Intangible Assets

(PPL)

The change in the carrying amount of goodwill for the nine months ended September 30, 2016 was due to the effect of foreign currency exchange rates on the U.K. Regulated segment.

The change in the other intangible assets for the nine months ended September 30, 2016 was primarily due to an increase in the gross carrying amount of indefinite lived intangibles at WPD attributable to new easements of $73 million, partially offset by the effect of foreign currency exchange rates.

16. Asset Retirement Obligations

(PPL, LKE, LG&E and KU)

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

69

LG&E and KU recorded decreases to existing ARO balances of $118 million ($24 million at LG&E and $94 million at KU) during the three and nine months ended September 30, 2016 due to revisions in the amounts and timing of future expected costs related to the closure of CCR impoundments. These revisions are the result of changes in closure plans related to expected costs and timing of closure. Further changes to AROs, capital plans or operating costs may be required as estimates of future cash flows are refined based on closure developments and regulatory or legal proceedings.

PPL's, LKE's, LG&E's and KU's ARO liabilities are primarily related to CCR closure costs. See Note 10 for information on the final CCR rule and Note 6 for information on the rate recovery applications with the KPSC. LG&E's and KU's accretion and ARO-related depreciation expense are recorded as a regulatory asset, such that there is no net earnings impact.

17. Accumulated Other Comprehensive Income (Loss)

(PPL and LKE)

The after-tax changes in AOCI by component for the periods ended September 30 were as follows.

	Foreign currency translation adjustments			Unrealized gains (losses)									Defined benefit plans
				Available- for-sale securities			Qualifying derivatives			Equity investees' AOCI			Prior service costs			Actuarial gain (loss)			Total
PPL
June 30, 2016	$	(716	)	$	—		$	(5	)	$	(1	)	$	(5	)	$	(2,130	)	$	(2,857	)
Amounts arising during the period	(641		)	—			62			—			—			(6		)	(585		)
Reclassifications from AOCI	—			—			(69		)	—			—			31			(38		)
Net OCI during the period	(641		)	—			(7		)	—			—			25			(623		)
September 30, 2016	$	(1,357	)	$	—		$	(12	)	$	(1	)	$	(5	)	$	(2,105	)	$	(3,480	)
December 31, 2015	$	(520	)	$	—		$	(7	)	$	—		$	(6	)	$	(2,195	)	$	(2,728	)
Amounts arising during the period	(837		)	—			57			—			—			(4		)	(784		)
Reclassifications from AOCI	—			—			(62		)	(1		)	1			94			32
Net OCI during the period	(837		)	—			(5		)	(1		)	1			90			(752		)
September 30, 2016	$	(1,357	)	$	—		$	(12	)	$	(1	)	$	(5	)	$	(2,105	)	$	(3,480	)
June 30, 2015	$	(435	)	$	—		$	2		$	—		$	(3	)	$	(1,848	)	$	(2,284	)
Amounts arising during the period	52			—			(19		)	—			—			—			33
Reclassifications from AOCI	—			—			10			—			—			35			45
Net OCI during the period	52			—			(9		)	—			—			35			78
September 30, 2015	$	(383	)	$	—		$	(7	)	$	—		$	(3	)	$	(1,813	)	$	(2,206	)
December 31, 2014	$	(286	)	$	202		$	20		$	1		$	3		$	(2,214	)	$	(2,274	)
Amounts arising during the period	(97		)	7			8			—			(6		)	52			(36		)
Reclassifications from AOCI	—			(2		)	20			(1		)	—			111			128
Net OCI during the period	(97		)	5			28			(1		)	(6		)	163			92
Distribution of PPL Energy Supply (Note 8)	—			(207		)	(55		)	—			—			238			(24		)
September 30, 2015	$	(383	)	$	—		$	(7	)	$	—		$	(3	)	$	(1,813	)	$	(2,206	)
LKE
June 30, 2016										$	(1	)	$	(9	)	$	(33	)	$	(43	)
Amounts arising during the period										—			—			—			—
Reclassifications from AOCI										—			—			1			1
Net OCI during the period										—			—			1			1
September 30, 2016										$	(1	)	$	(9	)	$	(32	)	$	(42	)

70

	Foreign currency translation adjustments	Unrealized gains (losses)					Defined benefit plans
		Available- for-sale securities	Qualifying derivatives	Equity investees' AOCI			Prior service costs			Actuarial gain (loss)			Total
December 31, 2015				$	—		$	(10	)	$	(36	)	$	(46	)
Amounts arising during the period				—			—			1			1
Reclassifications from AOCI				(1		)	1			3			3
Net OCI during the period				(1		)	1			4			4
September 30, 2016				$	(1	)	$	(9	)	$	(32	)	$	(42	)
June 30, 2015				$	(1	)	$	(7	)	$	(44	)	$	(52	)
Amounts arising during the period				—			—			—			—
Reclassifications from AOCI				—			—			1			1
Net OCI during the period				—			—			1			1
September 30, 2015				$	(1	)	$	(7	)	$	(43	)	$	(51	)
December 31, 2014				$	—		$	(8	)	$	(37	)	$	(45	)
Amounts arising during the period				—			—			(8		)	(8		)
Reclassifications from AOCI				(1		)	1			2			2
Net OCI during the period				(1		)	1			(6		)	(6		)
September 30, 2015				$	(1	)	$	(7	)	$	(43	)	$	(51	)

(PPL)

The following table presents the gains (losses) and related income taxes for reclassifications from AOCI for the periods ended September 30. The defined benefit plan components of AOCI are not reflected in their entirety in the Statement of Income during the periods; rather, they are included in the computation of net periodic defined benefit costs (credits) and subject to capitalization. See Note 9 for additional information.

	Three Months						Nine Months						Affected Line Item on the
Details about AOCI	2016			2015			2016			2015			Statements of Income
Available-for-sale securities	$	—		$	—		$	—		$	4		Other Income (Expense) - net
Total Pre-tax	—			—			—			4
Income Taxes	—			—			—			(2		)
Total After-tax	—			—			—			2
Qualifying derivatives
Interest rate swaps	(2		)	(2		)	(5		)	(9		)	Interest Expense
	—			—			—			(77		)	Discontinued operations
Cross-currency swaps	86			(10		)	80			22			Other Income (Expense) - net
	2			(1		)	2			1			Interest Expense
Commodity contracts	—			—			—			20			Discontinued operations
Total Pre-tax	86			(13		)	77			(43		)
Income Taxes	(17		)	3			(15		)	23
Total After-tax	69			(10		)	62			(20		)

71

	Three Months						Nine Months						Affected Line Item on the
Details about AOCI	2016			2015			2016			2015			Statements of Income
Equity investees' AOCI	—			—			1			2			Other Income (Expense) - net
Total Pre-tax	—			—			1			2
Income Taxes	—			—			—			(1		)
Total After-tax	—			—			1			1
Defined benefit plans
Prior service costs	(1		)	—			(2		)	—
Net actuarial loss	(41		)	(45		)	(121		)	(146		)
Total Pre-tax	(42		)	(45		)	(123		)	(146		)
Income Taxes	11			10			28			35
Total After-tax	(31		)	(35		)	(95		)	(111		)
Total reclassifications during the period	$	38		$	(45	)	$	(32	)	$	(128	)

18. New Accounting Guidance Pending Adoption

(All Registrants)

Accounting for Revenue from Contracts with Customers

In May 2014, the Financial Accounting Standards Board (FASB) issued accounting guidance that establishes a comprehensive new model for the recognition of revenue from contracts with customers. This model is based on the core principle that revenue should be recognized 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.

For public business entities, this guidance can be applied using either a full retrospective or modified retrospective transition method, beginning in annual reporting periods after December 15, 2017 and interim periods within those years. Public business entities may early adopt this guidance in annual reporting periods beginning after December 15, 2016. The Registrants expect to adopt this guidance effective January 1, 2018.

The Registrants continue to assess the impact of adopting this guidance, as well as the transition method they will use, and are monitoring the development of industry specific application guidance which could impact those assessments.

Accounting for Leases

In February 2016, the FASB issued accounting guidance for leases. This new guidance requires lessees to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). For income statement purposes, the FASB retained a dual model for lessees, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line expense (similar to current operating leases) while finance leases will result in a front-loaded expense pattern (similar to current capital leases). Classification will be based on criteria that are largely similar to those applied in current lease accounting, but without explicit bright lines.

Lessor accounting under the new guidance is similar to the current model, but updated to align with certain changes to the lessee model and the new revenue recognition standard. Similar to current practice, lessors will classify leases as operating, direct financing, or sales-type.

The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition, and provides for certain practical expedients. Transition will require application of the new guidance at the beginning of the earliest comparative period presented.

The Registrants are currently assessing the impact of adopting this guidance.

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Accounting for Financial Instrument Credit Losses

In June 2016, the FASB issued accounting guidance that requires the use of a current expected credit loss (CECL) model for the measurement of credit losses on financial instruments within the scope of this guidance, which includes accounts receivable. The CECL model requires an entity to measure credit losses using historical information, current information and reasonable and supportable forecasts of future events, rather than the incurred loss impairment model required under current GAAP.

For public business entities, this guidance will be applied using a modified retrospective approach and is effective for fiscal years beginning after December 15, 2019, and interim periods within those years. All entities may early adopt this guidance beginning after December 15, 2018, including interim periods within those years.

The Registrants are currently assessing the impact of adopting this guidance and the period that they will adopt this guidance.

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Item 2. Combined Management's Discussion and Analysis of Financial Condition and

Results of Operations

(All Registrants)

This "Item 2. Combined Management's Discussion and Analysis of Financial Condition and Results of Operations" is separately filed by PPL, PPL Electric, LKE, LG&E and KU. Information contained herein relating to any individual Registrant is filed by such Registrant solely on its own behalf, and no Registrant makes any representation as to information relating to any other Registrant. The specific Registrant to which disclosures are applicable is identified in parenthetical headings in italics above the applicable disclosure or within the applicable disclosure for each Registrant's related activities and disclosures. Within combined disclosures, amounts are disclosed for individual Registrants when significant.

The following should be read in conjunction with the Registrants' Condensed Consolidated Financial Statements and the accompanying Notes and with the Registrants' 2015 Form 10-K. Capitalized terms and abbreviations are defined in the glossary. Dollars are in millions, except per share data, unless otherwise noted.

"Management's Discussion and Analysis of Financial Condition and Results of Operations" includes the following information:

• "Overview" provides a description of each Registrant's business strategy and a discussion of important financial and operational developments.

• "Results of Operations" for all Registrants includes a "Statement of Income Analysis" which discusses significant changes in principal line items on the Statements of Income, comparing the three and nine months ended September 30, 2016 with the same periods in 2015. For PPL, it also provides a detailed analysis of earnings by segment and a description of key factors expected to impact future earnings. The segment earnings discussion includes financial information prepared in accordance with GAAP as well as non-GAAP financial measures including "Earnings from Ongoing Operations" and "Margins". This discussion provides explanations of the non-GAAP financial measures and a reconciliation of the non-GAAP financial measures to the most comparable GAAP measure. For PPL Electric, LKE, LG&E and KU, a summary of earnings is also provided.

• "Financial Condition - Liquidity and Capital Resources" provides an analysis of the Registrants' liquidity positions and credit profiles. This section also includes a discussion of rating agency actions.

• "Financial Condition - Risk Management" provides an explanation of the Registrants' risk management programs relating to market and credit risk.

Overview

Introduction

(PPL)

PPL, headquartered in Allentown, Pennsylvania, is a utility holding company. PPL, through its regulated utility subsidiaries, delivers electricity to customers in the U.K., Pennsylvania, Kentucky, Virginia and Tennessee; delivers natural gas to customers in Kentucky; and generates electricity from power plants in Kentucky. In June 2015, PPL completed the spinoff of PPL Energy Supply which combined its competitive power generation businesses with those of Riverstone to form a new, stand-alone, publicly traded company named Talen Energy. See Note 8 in PPL's 2015 Form 10-K for additional information.

PPL's principal subsidiaries are shown below (* denotes SEC registrant).

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		PPL Corporation*
				PPL Capital Funding ●Provides financing for the operations of PPL and certain subsidiaries
PPL Global ●Engages in the regulated distribution of electricity in the U.K.		LKE*			PPL Electric* ●Engages in the regulated transmission and distribution of electricity in Pennsylvania
	LG&E* ●Engages in the regulated generation, transmission, distribution and sale of electricity and distribution and sale of natural gas in Kentucky		KU* ●Engages in the regulated generation, transmission, distribution and sale of electricity, primarily in Kentucky
U.K. Regulated Segment		Kentucky Regulated Segment			Pennsylvania Regulated Segment

PPL's reportable segments' results primarily represent the results of PPL Global, LKE and PPL Electric, except that the reportable segments are also allocated certain corporate level financing and other costs that are not included in the results of PPL Global, LKE and PPL Electric. PPL Global is not a registrant, however PPL Global's unaudited annual consolidated financial statements are furnished on a Form 8-K with the SEC.

In addition to PPL, the other Registrants included in this filing are as follows.

(PPL Electric)

PPL Electric, headquartered in Allentown, Pennsylvania, is a direct wholly owned subsidiary of PPL and a regulated public utility that is an electricity transmission and distribution service provider in eastern and central Pennsylvania. PPL Electric is subject to regulation as a public utility by the PUC, and certain of its transmission activities are subject to the jurisdiction of the FERC under the Federal Power Act. PPL Electric delivers electricity in its Pennsylvania service area and provides electricity supply to retail customers in that area as a PLR under the Customer Choice Act.

(LKE)

LKE, headquartered in Louisville, Kentucky, is a wholly owned subsidiary of PPL and a holding company that owns regulated utility operations through its subsidiaries, LG&E and KU, which constitute substantially all of LKE's assets. LG&E and KU are engaged in the generation, transmission, distribution and sale of electricity. LG&E also engages in the distribution and sale of natural gas. LG&E and KU maintain separate corporate identities and serve customers in Kentucky under their respective names. KU also serves customers in Virginia under the Old Dominion Power name and in Tennessee under the KU name.

(LG&E)

LG&E, headquartered in Louisville, Kentucky, is a wholly owned subsidiary of LKE and a regulated utility engaged in the generation, transmission, distribution and sale of electricity and distribution and sale of natural gas in Kentucky. LG&E is subject to regulation as a public utility by the KPSC, and certain of its transmission activities are subject to the jurisdiction of the FERC under the Federal Power Act.

(KU)

KU, headquartered in Lexington, Kentucky, is a wholly owned subsidiary of LKE and a regulated utility engaged in the generation, transmission, distribution and sale of electricity in Kentucky, Virginia and Tennessee. KU is subject to regulation as

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a public utility by the KPSC, the VSCC and the Tennessee Regulatory Authority, and certain of its transmission and wholesale power activities are subject to the jurisdiction of the FERC under the Federal Power Act. KU serves its Virginia customers under the Old Dominion Power name and its Kentucky and Tennessee customers under the KU name.

Business Strategy

(All Registrants)

Following the June 1, 2015 spinoff of PPL Energy Supply, PPL completed its strategic transformation to a fully regulated business model consisting of seven diverse, high-performing utilities. These utilities are located in the U.K., Pennsylvania and Kentucky and each jurisdiction has different regulatory structures and customer classes. The Company believes this diverse portfolio provides strong earnings and dividend growth potential that will create significant value for its shareowners and positions PPL well for continued growth and success.

PPL's businesses of WPD, PPL Electric, LG&E and KU plan to achieve growth by providing efficient, reliable and safe operations and strong customer service, maintaining constructive regulatory relationships and achieving timely recovery of costs. These businesses are expected to achieve strong, long-term growth in rate base and RAV, as applicable, driven by planned significant capital expenditures to maintain existing assets and improve system reliability and, for LKE, LG&E and KU, to comply with federal and state environmental regulations related to coal-fired electricity generation facilities. Additionally, significant transmission rate base growth is expected through 2020 at PPL Electric.

For the U.S. businesses, our strategy is to recover capital project costs efficiently through various rate-making mechanisms, including periodic base rate case proceedings using forward test years, annual FERC formula rate mechanisms and other regulatory agency-approved recovery mechanisms designed to limit regulatory lag. In Kentucky, the KPSC has adopted a series of regulatory mechanisms (ECR, DSM, GLT, fuel adjustment clause, gas supply clause and recovery on construction work in progress) that reduce regulatory lag and provide timely recovery of and return on, as appropriate, prudently incurred costs. In addition, the KPSC requires a utility to obtain a CPCN prior to constructing a facility, unless the construction is an ordinary extension of existing facilities in the usual course of business or does not involve sufficient capital outlay to materially affect the utility's financial condition. Although such KPSC proceedings do not directly address cost recovery issues, the KPSC, in awarding a CPCN, concludes that the public convenience and necessity require the construction of the facility on the basis that the facility is the lowest reasonable cost alternative to address the need. In Pennsylvania, the FERC transmission formula rate, DSIC mechanism, Smart Meter Rider and other recovery mechanisms are in place to reduce regulatory lag and provide for timely recovery of and a return on prudently incurred costs.

Rate base growth in the domestic utilities is expected to result in strong earnings growth for the foreseeable future. Net income from the U.K. Regulated segment is expected to be relatively flat through 2016. In 2017, earnings are expected to decline for the U.K. Regulated segment mainly due to the unfavorable impact of lower GBP to U.S. dollar exchange rates. RAV growth is expected in the U.K. Regulated segment through the RIIO-ED1 price control period and earnings are expected to grow after 2017 commensurate with RAV growth. See "Item 1. Business - Segment Information - U.K. Regulated Segment" of PPL's 2015 Form 10-K for additional information on RIIO-ED1.

To manage financing costs and access to credit markets, and to fund capital expenditures, a key objective of the Registrants is to maintain their investment grade credit ratings and adequate liquidity positions. In addition, the Registrants have financial and operational risk management programs that, among other things, are designed to monitor and manage exposure to earnings and cash flow volatility, as applicable, related to changes in interest rates, foreign currency exchange rates and counterparty credit quality. To manage these risks, PPL generally uses contracts such as forwards, options and swaps. See "Financial Condition - Risk Management" below for further information.

Earnings generated by PPL's U.K. subsidiaries are subject to foreign currency translation risk. Due to the significant earnings contributed from WPD, PPL enters into foreign currency contracts to economically hedge the value of the GBP versus the U.S. dollar. See "Financial and Operational Developments - U.K. Membership in European Union" for a discussion of the U.K. earnings hedging activity in the third and fourth quarters of 2016.

The U.K. subsidiaries also have currency exposure to the U.S. dollar to the extent of their U.S. dollar denominated debt. To manage these risks, PPL generally uses contracts such as forwards, options and cross-currency swaps that contain characteristics of both interest rate and foreign currency exchange contracts.

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As discussed above, a key component of this strategy is to maintain constructive relationships with regulators in all jurisdictions in which we operate (U.K., U.S. federal and state). This is supported by our strong culture of integrity and delivering on commitments to customers, regulators and shareowners, and a commitment to continue to improve our customer service, reliability and efficiency of operations.

Financial and Operational Developments

(PPL)

U.K. Membership in European Union

Significant uncertainty exists concerning the effects of the June 23, 2016 referendum in favor of the U.K. withdrawal from the European Union (EU). In October 2016, the U.K. Prime Minister, Theresa May, announced her intent to invoke Article 50 of the Lisbon Treaty (Article 50) by March 31, 2017. Article 50 specifies that if a member state decides to withdraw from the EU, it should notify the European Council of its intention to leave the EU, negotiate the terms of withdrawal and establish the legal grounds for its future relationship with the EU. Article 50 provides two years from the date of the Article 50 notification to conclude negotiations. Failure to complete negotiations within two years, unless negotiations are extended, would result in the treaties governing the EU no longer being applicable to the U.K. with there being no agreement in place governing the U.K.'s relationship with the EU. Under the terms of Article 50, negotiations can only be extended beyond two years if all of the 27 remaining EU states agree to an extension. Any withdrawal agreement will need to be approved by both the European Council and the European Parliament. There remains significant uncertainty as to whether the events referred to in the Prime Minister's announcement will occur within the times suggested as well as the ultimate outcome of the withdrawal negotiations and the related impact on the U.K. economy and the GBP to U.S. dollar exchange rate.

In response to the decrease in the GBP to U.S. dollar exchange rate that occurred subsequent to the U.K.'s vote to withdraw from the EU, PPL has executed additional hedges to mitigate the foreign currency exposure to the Company's U.K. earnings. In the third quarter of 2016, PPL settled existing hedges related to 2017 and 2018 anticipated earnings, resulting in receipt of approximately $310 million of cash, and entered into new hedges at current market rates. The notional amount of the settled hedges was approximately £1.3 billion (approximately $2.0 billion based on contracted rates) with termination dates from January 2017 through November 2018. The settlement did not have a significant impact on net income as the hedge values were previously marked to fair value and recognized in "Other Income (Expense) - net" on the Statement of Income.

Additionally, in the third and fourth quarters of 2016, PPL restructured existing hedges related to 2016 and 2017 anticipated earnings and entered into additional hedges using forward contracts for 2018. This restructuring did not have a significant impact on 2016 expected net income as the hedge values continue to be marked to fair value. As of October 31, 2016, PPL's foreign currency exposure related to budgeted earnings is 91% hedged for the remainder of 2016 at an average rate of $1.29 per GBP, 94% hedged for 2017 at an average rate of $1.25 per GBP and 93% hedged for 2018 at an average rate of $1.42 per GBP.

PPL cannot predict either the short-term or long-term impact to foreign exchange rates or long-term impact on PPL's financial condition that may be experienced as a result of any actions that may be taken by the U.K. government to withdraw from the EU, although such impacts could be significant.

Regulatory Requirements

(All Registrants)

The Registrants cannot predict the impact that future regulatory requirements may have on their financial condition or results of operations.

(PPL, LKE, LG&E and KU)

The businesses of LKE, LG&E and KU are subject to extensive federal, state and local environmental laws, rules and regulations, including those pertaining to CCRs, GHGs, ELGs, MATS and the Clean Power Plan. See Note 6, Note 10 and Note 16 to the Financial Statements for a discussion of the other significant environmental matters.

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(PPL)

Discontinued Operations

The operations of PPL's Supply segment prior to its June 1, 2015, spinoff are included in "Income (Loss) from Discontinued Operations (net of income taxes)" on the September 2015 Statements of Income.

See Note 8 to the Financial Statements for additional information related to the spinoff of PPL Energy Supply, including the components of Discontinued Operations.

U.K. Distribution Revenue Reduction

In December 2013, WPD and other U.K. DNOs announced agreements with the U.K. Department of Energy and Climate Change and Ofgem to a reduction of £5 per residential customer of electricity distribution revenues that otherwise would have been collected in the regulatory year beginning April 1, 2014. Full recovery of the revenue reduction in GBP, together with the associated carrying cost will occur in the regulatory year which began April 1, 2016. Under GAAP, WPD does not record a receivable for under-recovery of regulated income (which this reduction represents). As a result, revenues for the U.K. Regulated segment were adversely affected by $19 million ($15 million after-tax or $0.02 per share) in 2015 and $40 million ($31 million after-tax or $0.05 per share) in 2014. Revenues for the U.K. Regulated segment were positively affected by $14 million ($11 million after-tax or $0.02 per share) and $24 million ($19 million after-tax or $0.03 per share) for the three and nine months ended September 30, 2016. PPL projects revenues in 2016 will be positively affected by $37 million ($29 million after-tax or $0.04 per share) and revenues for 2017 will be positively affected by $17 million ($14 million after-tax or $0.02 per share).

U.K. Tax Rate Change

The U.K. Finance Act 2016, enacted in September 2016, reduces the U.K. statutory income tax rate effective April 1, 2020 from 18% to 17%. As a result of this change, PPL reduced its net deferred tax liabilities and recognized an income tax benefit of $42 million in the third quarter of 2016. Of this amount, $37 million relates to deferred taxes recorded in prior years and is treated as a special item.

Discount Rate Change for U.K. Pension Plans

In selecting the discount rate for its U.K. pension plans, WPD historically used a single weighted-average discount rate in the calculation of net periodic defined benefit cost. WPD began using individual spot rates to measure service cost and interest cost for the calculation of net periodic defined benefit cost in 2016. For the three and nine months endedSeptember 30, 2016, this change in discount rate resulted in lower net periodic defined benefit costs recognized on PPL's Statement of Income of $10 million ($8 million after-tax or $0.01 per share) and $31 million ($25 million after-tax or $0.04 per share). Based on current estimates, PPL expects this change to reduce net periodic defined benefit costs recognized on PPL's Statement of Income by $40 million ($32 million after-tax or $0.05 per share) in 2016. See "Application of Critical Accounting Policies-Defined Benefits" in PPL's 2015 Form 10-K for additional information.

Rate Case Proceedings

(PPL, LKE, LG&E and KU)

On November 1, 2016, LG&E and KU announced that on November 23, 2016, they anticipate filing requests with the KPSC for increases in annual base electricity rates of approximately $103 million at KU and an increase in annual base electricity and gas rates of approximately $94 million and $14 million at LG&E. The proposed base rate increases to be requested are an electricity rate increase of 6.4% at KU and electricity and gas rate increases of 8.5% and 4.2% at LG&E and would become effective in July 2017. LG&E's and KU's applications include requests for CPCNs for implementing an Advanced Metering System program and a Distribution Automation program. The applications are to be based on a forecasted test year of July 1, 2017 through June 30, 2018 and a requested return-on-equity of 10.23%. LG&E and KU cannot predict the outcome of these proceedings.

(LKE and KU)

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On October 31, 2016, KU filed a request with the FERC to modify its formula rates to provide for the recovery of CCR impoundment closure costs from its departing municipal customers. The filing was made in accordance with FERC Order No. 631 whereby a rate filing is required to include the costs of ARO's in rates. If approved, KU will begin including the closure costs in its annual true-up filing for 2016 for new rates effective July 1, 2017. The filing is not expected to have a material impact on KU.

Results of Operations

(PPL)

The "Statement of Income Analysis" discussion addresses significant changes in principal line items on PPL's Statements of Income, comparing the three and nine months ended September 30, 2016 with the same periods in 2015. The discussion for PPL provides a review of results by reportable segment. The "Segment Earnings" discussion includes financial information prepared in accordance with GAAP as well as non-GAAP financial measures, including “Earnings from Ongoing Operations” and “Margins”. This discussion provides explanations of the non-GAAP financial measures and a reconciliation of those measures to the most comparable GAAP measure.

Tables analyzing changes in amounts between periods within "Statement of Income Analysis" and "Segment Earnings" are presented on a constant U.K. foreign currency exchange rate basis, where applicable, in order to isolate the impact of the change in the exchange rate on the item being explained. Results computed on a constant U.K. foreign currency exchange rate basis are calculated by translating current year results at the prior year weighted-average U.K. foreign currency exchange rate.

(PPL Electric, LKE, LG&E and KU)

A "Statement of Income Analysis, Earnings and Margins" is presented separately for PPL Electric, LKE, LG&E and KU.

The "Statement of Income Analysis" addresses significant changes in principal line items on the Statements of Income comparing the three and nine months ended September 30, 2016 with the same periods in 2015 and provides a summary of earnings. The "Margins" discussion includes a reconciliation of non-GAAP financial measures to "Operating Income."

(All Registrants)

The results for interim periods can be disproportionately influenced by numerous factors and developments and by seasonal variations. As such, the results of operations for interim periods do not necessarily indicate results or trends for the year or future periods.

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PPL Statement of Income Analysis, Segment Earnings and Margins

Statement of Income Analysis

Net income for the periods ended September 30 includes the following results.

	Three Months								Nine Months
	2016		2015			$ Change			2016		2015			$ Change
Operating Revenues	$	1,889	$	1,878		$	11		$	5,685	$	5,889		$	(204	)
Operating Expenses
Operation
Fuel	227		228			(1		)	607		695			(88		)
Energy purchases	151		177			(26		)	531		676			(145		)
Other operation and maintenance	417		482			(65		)	1,292		1,405			(113		)
Depreciation	232		226			6			692		658			34
Taxes, other than income	76		79			(3		)	229		241			(12		)
Total Operating Expenses	1,103		1,192			(89		)	3,351		3,675			(324		)
Other Income (Expense) - net	49		75			(26		)	284		61			223
Interest Expense	223		221			2			671		645			26
Income Taxes	139		144			(5		)	510		432			78
Income from Continuing Operations After Income Taxes	473		396			77			1,437		1,198			239
Income (Loss) from Discontinued Operations (net of income taxes)	—		(3		)	3			—		(915		)	915
Net Income	$	473	$	393		$	80		$	1,437	$	283		$	1,154

Operating Revenues

The increase (decrease) in operating revenues for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Domestic:
PPL Electric Distribution price (a)	$	23		$	97
PPL Electric Distribution volume	11			(23		)
PPL Electric PLR Revenue (b)	(21		)	(125		)
PPL Electric Transmission Formula Rate	12			47
LKE Base rates	—			68
LKE Volumes	32			(38		)
LKE Fuel and other energy prices (b)	(11		)	(85		)
LKE ECR	8			30
Other	(6		)	(12		)
Total Domestic	48			(41		)
U.K.:
Price	59			29
Volume	(16		)	(37		)
Foreign currency exchange rates	(77		)	(139		)
Other	(3		)	(16		)
Total U.K.	(37		)	(163		)
Total	$	11		$	(204	)

(a) Distribution rate case effective January 1, 2016, resulted in increases of $41 million and $121 million for the three and nine months ended September 30, 2016.

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(b) Decreases due to lower recoveries of fuel and energy purchases due to lower commodity costs at LKE and lower recoveries of energy purchases at PPL Electric.

Fuel

Fuel decreased $88 million for the nine months ended September 30, 2016 compared with 2015, primarily due to a decrease in market prices for coal and natural gas.

Energy Purchases

Energy purchases decreased by $26 million for the three months ended September 30, 2016 compared with 2015, primarily due to a $37 million decrease in PLR prices, partially offset by a $14 million increase in PLR volumes at PPL Electric.

Energy purchases decreased by $145 million for the nine months endedSeptember 30, 2016 compared with 2015, primarily due to a $90 million decrease in PLR prices and a $23 million decrease in PLR volumes at PPL Electric, a $14 million decrease in natural gas volumes and a $13 million decrease in natural gas prices at LKE.

Other Operation and Maintenance

The increase (decrease) in other operation and maintenance for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Domestic:
LKE coal plant operations and maintenance (a)	$	2		$	(12	)
LKE pension expense (b)	(2		)	(10		)
PPL Electric Act 129 costs incurred	(7		)	(14		)
PPL Electric vegetation management	(5		)	1
PPL Electric payroll-related costs	(7		)	(19		)
PPL Electric storm costs	1			7
PPL Electric bad debts	(5		)	(6		)
Corporate costs previously included in discontinued operations (c)	1			10
Other	(3		)	5
U.K.:
Network maintenance	(2		)	13
Foreign currency exchange rates	(10		)	(19		)
Pension (d)	(21		)	(64		)
Other	(7		)	(5		)
Total	$	(65	)	$	(113	)

(a) The decrease for the nine month period was primarily due to a reduction of costs associated with the 2015 retirement of units at the Cane Run and Green River plants, partially offset by Cane Run 7 operations.

(b) The decrease for the nine month period was primarily due to higher discount rates and deferred amortization of actuarial losses.

(c) The increase for the nine month period was due to corporate costs allocated to PPL Energy Supply (and included in discontinued operations) prior to the June 2015 spinoff. As a result of the spinoff on June 1, 2015, these corporate costs now remain in continuing operations.

(d) The decreases were primarily due to an increase in estimated returns on higher asset balances and lower interest costs due to a change in the discount rate methodology.

Depreciation

Depreciation increased by $6 million and $34 million for the three and nine months ended September 30, 2016 compared with 2015, primarily due to additional assets placed into service, partially offset by the impact of foreign currency exchange rates at WPD, net of retirements.

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Other Income (Expense) - net

Other income (expense) - net decreased by $26 million and increased by $223 million for the three and nine months ended September 30, 2016 compared with 2015, primarily due to changes in realized and unrealized gains on foreign currency contracts to economically hedge GBP denominated earnings from WPD.

Interest Expense 

The increase (decrease) in interest expense for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Long-term debt interest expense (a)	$	17		$	58
Foreign currency exchange rates	(14		)	(25		)
Other	(1		)	(7		)
Total	$	2		$	26

(a) The increase in both periods was primarily due to debt issuances at WPD in November 2015, LG&E and KU in September 2015 and PPL Capital Funding in May 2016 as well as higher interest rates on bonds refinanced in September 2015 at LG&E and KU.

Income Taxes 

The increase (decrease) in income taxes for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Change in pre-tax income at current period tax rates	$	23		$	103
Valuation allowances adjustments	4			5
Impact of U.K. income tax rates	3			2
Federal and state tax reserve adjustments (a)	9			21
U.K. Finance Act 2016 adjustment (b)	(42		)	(42		)
Stock-based compensation (c)	(1		)	(12		)
Other	(1		)	1
Total	$	(5	)	$	78

(a) During the three and nine months ended September 30, 2015, PPL recorded a $9 million tax benefit related to a planned amendment of a prior period tax return.

During the nine months ended September 30, 2015, PPL recorded a tax benefit to adjust the settled refund amount approved by the Joint Committee on Taxation for the open audit years 1998-2011.

(b) The U.K. Finance Act 2016, enacted in September 2016, reduces the U.K. statutory income tax rate effective April 1, 2020 from 18% to 17%. As a result, PPL reduced its net deferred tax liabilities and recognized a deferred tax benefit during the three and nine months ended September 30, 2016.

(c) During the three and nine months ended September 30, 2016, PPL recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 to the Financial Statements for additional information.

See Note 5 to the Financial Statements for additional information.

Income (Loss) from Discontinued Operations (net of income taxes)

Income (Loss) from Discontinued Operations (net of income taxes) includes the results of operations of PPL Energy Supply, which was spun off from PPL on June 1, 2015 and substantially represents PPL's former Supply segment. See "Discontinued Operations" in Note 8 to the Financial Statements for additional information.

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Segment Earnings

PPL's net income by reportable segments for the periods ended September 30 were as follows:

	Three Months									Nine Months
	2016			2015			$ Change			2016			2015			$ Change
U.K. Regulated	$	281		$	249		$	32		$	915		$	814		$	101
Kentucky Regulated	126			111			15			314			267			47
Pennsylvania Regulated	91			55			36			263			191			72
Corporate and Other (a)	(25		)	(19		)	(6		)	(55		)	(74		)	19
Discontinued Operations (b)	—			(3		)	3			—			(915		)	915
Net Income	$	473		$	393		$	80		$	1,437		$	283		$	1,154

(a) Primarily represents financing and certain other costs incurred at the corporate level that have not been allocated or assigned to the segments, which are presented to reconcile segment information to PPL's consolidated results. The nine months ended September 30, 2015 also includes certain costs related to the spinoff of PPL Energy Supply. See Note 8 to the Financial Statements for additional information.

(b) As a result of the spinoff of PPL Energy Supply, substantially representing PPL's former Supply segment, the earnings of the Supply segment prior to the spinoff are included in Discontinued Operations. The nine months ended September 30, 2015 includes an $879 million charge reflecting the difference between PPL's recorded value for the Supply segment and its estimated fair value as of the spinoff date, determined in accordance with applicable accounting rules under GAAP. See Note 8 to the Financial Statements for additional information.

Earnings from Ongoing Operations

Management utilizes "Earnings from Ongoing Operations" as a non-GAAP financial measure that should not be considered as an alternative to net income, an indicator of operating performance determined in accordance with GAAP. PPL believes that Earnings from Ongoing Operations is useful and meaningful to investors because it provides management's view of PPL's earnings performance as another criterion in making investment decisions. In addition, PPL's management uses Earnings from Ongoing Operations in measuring achievement of certain corporate performance goals, including targets for certain executive incentive compensation. Other companies may use different measures to present financial performance. 

Earnings from Ongoing Operations is adjusted for the impact of special items. Special items are presented in the financial tables on an after-tax basis with the related income taxes on special items separately disclosed. Income taxes on special items, when applicable, are calculated based on the effective tax rate of the entity where the activity is recorded. Special items include:

• Unrealized gains or losses on foreign currency-related economic hedges (as discussed below).

• Supply segment discontinued operations.

• Gains and losses on sales of assets not in the ordinary course of business.

• Impairment charges. 

• Workforce reduction and other restructuring effects.

• Acquisition and divestiture-related adjustments.

• Other charges or credits that are, in management's view, non-recurring or otherwise not reflective of the company's ongoing operations.

Unrealized gains or losses on foreign currency economic hedges include the changes in fair value of foreign currency contracts used to hedge GBP-denominated anticipated earnings. The changes in fair value of these contracts are recognized immediately within GAAP earnings. Management believes that excluding these amounts from Earnings from Ongoing Operations until settlement of the contracts provides a better matching of the financial impacts of those contracts with the economic value of PPL's underlying hedged earnings. See Note 14 to the Financial Statements and "Risk Management" below for additional information on foreign currency-related economic activity.

PPL's Earnings from Ongoing Operations by reportable segment for the periods ended September 30 were as follows:

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	Three Months									Nine Months
	2016			2015			$ Change			2016			2015			$ Change
U.K. Regulated	$	235		$	195		$	40		$	741		$	774		$	(33	)
Kentucky Regulated	126			112			14			314			280			34
Pennsylvania Regulated	91			55			36			263			191			72
Corporate and Other	(25		)	(15		)	(10		)	(53		)	(50		)	(3		)
Earnings from Ongoing Operations	$	427		$	347		$	80		$	1,265		$	1,195		$	70

See "Reconciliation of Earnings from Ongoing Operations" below for a reconciliation of this non-GAAP financial measure to Net Income.

U.K. Regulated Segment

The U.K. Regulated segment consists of PPL Global, which primarily includes WPD's regulated electricity distribution operations, the results of hedging the translation of WPD's earnings from GBP into U.S. dollars, and certain costs, such as U.S. income taxes, administrative costs and allocated financing costs. The U.K. Regulated segment represents 64% of PPL's Net Income for the nine months ended September 30, 2016 and 39% of PPL's assets at September 30, 2016.

Net Income and Earnings from Ongoing Operations for the periods ended September 30 include the following results.

	Three Months							Nine Months
	2016		2015		$ Change			2016		2015		$ Change
Operating revenues	$	515	$	552	$	(37	)	$	1,673	$	1,836	$	(163	)
Other operation and maintenance	78		118		(40		)	260		332		(72		)
Depreciation	58		63		(5		)	178		181		(3		)
Taxes, other than income	34		38		(4		)	104		111		(7		)
Total operating expenses	170		219		(49		)	542		624		(82		)
Other Income (Expense) - net	50		77		(27		)	283		65		218
Interest Expense	100		109		(9		)	310		312		(2		)
Income Taxes	14		52		(38		)	189		151		38
Net Income	281		249		32			915		814		101
Less: Special Items	46		54		(8		)	174		40		134
Earnings from Ongoing Operations	$	235	$	195	$	40		$	741	$	774	$	(33	)

The following after-tax gains (losses), which management considers special items, impacted the U.K. Regulated segment's results and are excluded from Earnings from Ongoing Operations during the periods ended September 30.

	Income Statement Line Item	Three Months					Nine Months
		2016			2015		2016			2015
Foreign currency-related economic hedges, net of tax of $103, ($29), $34, ($10) (a)	Other Income (Expense) - net	$	(193	)	$	54	$	(65	)	$	20
Settlement of foreign currency contracts, net of tax of ($108), $0, ($108), $0 (b)	Other Income (Expense) - net	202			—		202			—
Change in U.K. tax rate (c)	Income Taxes	37			—		37			—
WPD Midlands acquisition-related adjustment, net of tax of $0, $0, $0, ($1)	Other operation and maintenance	—			—		—			2
Settlement of certain income tax positions (d)	Income Taxes	—			—		—			18
Total special items		$	46		$	54	$	174		$	40

(a) Represents unrealized gains (losses) on contracts that economically hedge anticipated GBP-denominated earnings. The three and nine months ended September 30, 2016 include the reversal of $310 million ($202 million after-tax) of unrealized gains related to the settlement of 2017 and 2018 contracts.

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(b) In the third quarter of 2016, PPL settled 2017 and 2018 foreign currency contracts, resulting in $310 million of cash received ($202 million after-tax). The settlement did not have a material impact on net income as the contracts were previously marked to fair value and recognized in "Other Income (Expense)-net" on the Statement of Income.

(c) The U.K. Finance Act 2016, enacted in September 2016, reduces the U.K. statutory income tax rate effective April 1, 2020 from 18% to 17%. As a result of this change, PPL reduced its net deferred tax liabilities and recognized an income tax benefit of $42 million in the third quarter of 2016. Of this amount, $37 million relates to deferred taxes recorded in prior years and was treated as a special item.

(d) Relates to the April 2015 settlement of the IRS audit for the tax years 1998-2011. See Note 5 to the Financial Statements for additional information.

The changes in the components of the U.K. Regulated segment's results between these periods are due to the factors set forth below, which reflect amounts classified as U.K. Gross Margins, the items that management considers special and the effects of movements in foreign currency exchange, including the effects of foreign currency hedge contracts, on separate lines and not in their respective Statement of Income line items.

	Three Months			Nine Months
U.K.
Gross margins	$	45		$	(11	)
Other operation and maintenance	26			49
Depreciation	(3		)	(12		)
Interest expense	(5		)	(23		)
Other	(1		)	(3		)
Income taxes	(5		)	13
U.S.
Interest expense and other	2			(3		)
Income taxes	(10		)	(5		)
Foreign currency exchange, after-tax	(9		)	(38		)
Earnings from Ongoing Operations	40			(33		)
Special items, after-tax	(8		)	134
Net Income	$	32		$	101

U.K.

• See "Margins - Changes in Margins" for an explanation of U.K. Gross Margins.

• Lower other operation and maintenance expense for the three month period primarily due to $21 million from lower pension expense due to an increase in estimated returns on higher asset balances and lower interest costs due to a change in the discount rate methodology and $2 million from lower network maintenance expense.

• Lower other operation and maintenance expense for the nine month period primarily due to $64 million from lower pension expense due to an increase in estimated returns on higher asset balances and lower interest costs due to a change in the discount rate methodology, partially offset by $13 million from higher network maintenance expense.

Kentucky Regulated Segment

The Kentucky Regulated segment consists primarily of LKE's regulated electricity generation, transmission and distribution operations of LG&E and KU, as well as LG&E's regulated distribution and sale of natural gas. In addition, certain financing costs are allocated to the Kentucky Regulated segment. The Kentucky Regulated segment represents 22% of PPL's Net Income for the nine months endedSeptember 30, 2016 and 36% of PPL's assets at September 30, 2016.

Net Income and Earnings from Ongoing Operations for the periods ended September 30 include the following results.

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	Three Months									Nine Months
	2016			2015			$ Change			2016			2015			$ Change
Operating revenues	$	835		$	801		$	34		$	2,382		$	2,414		$	(32	)
Fuel	227			228			(1		)	607			695			(88		)
Energy purchases	24			23			1			118			143			(25		)
Other operation and maintenance	197			202			(5		)	603			625			(22		)
Depreciation	102			97			5			301			286			15
Taxes, other than income	16			14			2			46			43			3
Total operating expenses	566			564			2			1,675			1,792			(117		)
Other Income (Expense) - net	(3		)	(2		)	(1		)	(9		)	(8		)	(1		)
Interest Expense	65			56			9			194			167			27
Income Taxes	75			68			7			190			180			10
Net Income	126			111			15			314			267			47
Less: Special Items	—			(1		)	1			—			(13		)	13
Earnings from Ongoing Operations	$	126		$	112		$	14		$	314		$	280		$	34

The following after-tax gains (losses), which management considers special items, impacted the Kentucky Regulated segment's results and are excluded from Earnings from Ongoing Operations during the periods ended September 30.

	Income Statement Line Item	Three Months					Nine Months
		2016		2015			2016		2015
LKE acquisition-related adjustment, net of tax of $0, $0, $0, $0 (a)	Other Income (Expense) - net	$	—	$	(1	)	$	—	$	(5	)
Certain valuation allowances, net of tax of $0, $0, $0, $0 (b)	Income Taxes	—		—			—		(8		)
Total Special Items		$	—	$	(1	)	$	—	$	(13	)

(a) Recorded at PPL and allocated to the Kentucky Regulated segment. The amount represents a settlement between E.ON AG (a German corporation and the indirect parent of E.ON US Investments Corp., the former parent of LKE) and PPL for a tax matter.

(b) Recorded at LKE and represents a valuation allowance against tax credits expiring in 2016 and 2017 that are more likely than not to expire before being utilized.

The changes in the components of the Kentucky Regulated segment's results between these periods are due to the factors set forth below, which reflect amounts classified as Kentucky Gross Margins and the items that management considers special on separate lines and not in their respective Statement of Income line items.

	Three Months			Nine Months
Kentucky Gross Margins	$	27		$	63
Other operation and maintenance	10			26
Depreciation	(2		)	(1		)
Taxes, other than income	(3		)	(3		)
Other Income (Expense) - net	(2		)	(6		)
Interest Expense	(9		)	(27		)
Income Taxes	(7		)	(18		)
Special items, after-tax	1			13
Net Income	$	15		$	47

• See "Margins - Changes in Margins" for an explanation of Kentucky Gross Margins.

• Lower other operation and maintenance expense for the nine month period primarily due to $12 million of lower coal plant operations and maintenance expense as a result of units retired in 2015 at the Cane Run and Green River plants and $10 million of lower pension expense mainly due to higher discount rates and deferred amortization of actuarial losses.

• Higher interest expense for the three and nine month periods primarily due to the September 2015 issuance of $550 million of incremental First Mortgage Bonds by LG&E and KU, higher interest rates on the September 2015 issuance of $500

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million of First Mortgage Bonds by LG&E and KU used to retire the same amount of First Mortgage Bonds in November 2015 and $400 million of notes refinanced by LKE in November 2015.

Pennsylvania Regulated Segment

The Pennsylvania Regulated segment includes the regulated electricity transmission and distribution operations of PPL Electric. In addition, certain costs are allocated to the Pennsylvania Regulated segment. The Pennsylvania Regulated segment represents 18% of PPL's Net Income for the nine months endedSeptember 30, 2016 and 24% of PPL's assets at September 30, 2016.

Net Income and Earnings from Ongoing Operations for the periods ended September 30 include the following results.

	Three Months							Nine Months
	2016		2015		$ Change			2016		2015		$ Change
Operating revenues	$	539	$	519	$	20		$	1,619	$	1,625	$	(6	)
Energy purchases
External	129		154		(25		)	414		519		(105		)
Intersegment	—		—		—			—		14		(14		)
Other operation and maintenance	143		162		(19		)	431		435		(4		)
Depreciation	64		55		9			185		158		27
Taxes, other than income	26		27		(1		)	79		87		(8		)
Total operating expenses	362		398		(36		)	1,109		1,213		(104		)
Other Income (Expense) - net	4		1		3			12		5		7
Interest Expense	32		32		—			97		96		1
Income Taxes	58		35		23			162		130		32
Net Income	91		55		36			263		191		72
Less: Special Items (a)	—		—		—			—		—		—
Earnings from Ongoing Operations	$	91	$	55	$	36		$	263	$	191	$	72

(a) There are no items that management considers special for the periods presented.

The changes in the components of the Pennsylvania Regulated segment's results between these periods were due to the factors set forth below, which reflect amounts classified as Pennsylvania Gross Delivery Margins on a separate line and not in their respective Statement of Income line items.

	Three Months			Nine Months
Pennsylvania Gross Delivery Margins	$	52		$	126
Other operation and maintenance	12			(3		)
Depreciation	(9		)	(27		)
Taxes, other than income	1			2
Other Income (Expense) - net	3			7
Interest Expense	—			(1		)
Income Taxes	(23		)	(32		)
Net Income	$	36		$	72

• See "Margins - Changes in Margins" for an explanation of Pennsylvania Gross Delivery Margins.

• Lower other operation and maintenance expense for the three month period primarily due to $6 million of lower payroll related costs and $6 million of lower bad debt expenses.

• Higher other operation and maintenance expense for the nine month period primarily due to $10 million of higher corporate service costs allocated to PPL Electric and $9 million of higher costs for additional work done by outside vendors, offset by $19 million of lower payroll related costs.

• Higher depreciation expense for the three and nine month periods primarily due to transmission and distribution additions placed into service related to the ongoing efforts to improve reliability and replace aging infrastructure, net of retirements.

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• Higher income taxes for the three and nine month periods primarily due to higher pre-tax income.

Reconciliation of Earnings from Ongoing Operations

The following tables contain after-tax gains (losses), in total, which management considers special items, that are excluded from Earnings from Ongoing Operations and a reconciliation to PPL's "Net Income" for the periods ended September 30.

	2016 Three Months
	U.K. Regulated			KY Regulated		PA Regulated		Corporate and Other			Discontinued Operations		Total
Net Income	$	281		$	126	$	91	$	(25	)	$	—	$	473
Less: Special Items (expense) benefit:
Foreign currency-related economic hedges, net of tax of $103	(193		)	—		—		—			—		(193		)
Other:
Settlement of foreign currency contracts, net of tax of ($108)	202			—		—		—			—		202
Change in U.K. tax rate	37			—		—		—			—		37
Total Special Items	46			—		—		—			—		46
Earnings from Ongoing Operations	$	235		$	126	$	91	$	(25	)	$	—	$	427

	2015 Three Months
	U.K. Regulated		KY Regulated			PA Regulated		Corporate and Other			Discontinued Operations			Total
Net Income	$	249	$	111		$	55	$	(18	)	$	(4	)	$	393
Less: Special Items (expense) benefit:
Foreign currency-related economic hedges, net of tax of ($29)	54		—			—		—			—			54
Spinoff of the Supply segment:
Discontinued operations, net of tax of ($3)	—		—			—		—			(4		)	(4		)
Transition and transaction costs, net of tax of $1	—		—			—		(1		)	—			(1		)
Employee transitional services, net of tax of $1	—		—			—		(1		)	—			(1		)
Separation benefits, net of tax of $0	—		—			—		(1		)	—			(1		)
Other:
LKE acquisition-related adjustment, net of tax of $0	—		(1		)	—		—			—			(1		)
Total Special Items	54		(1		)	—		(3		)	(4		)	46
Earnings from Ongoing Operations	$	195	$	112		$	55	$	(15	)	$	—		$	347

	2016 Nine Months
	U.K. Regulated			KY Regulated		PA Regulated		Corporate and Other			Discontinued Operations		Total
Net Income	$	915		$	314	$	263	$	(55	)	$	—	$	1,437
Less: Special Items (expense) benefit:
Foreign currency-related economic hedges, net of tax of $34	(65		)	—		—		—			—		(65		)
Spinoff of the Supply segment, net of tax of $2	—			—		—		(2		)	—		(2		)
Other:
Settlement of foreign currency contracts, net of tax of ($108)	202			—		—		—			—		202
Change in U.K. tax rate	37			—		—		—			—		37
Total Special Items	174			—		—		(2		)	—		172
Earnings from Ongoing Operations	$	741		$	314	$	263	$	(53	)	$	—	$	1,265

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	2015 Nine Months
	U.K. Regulated		KY Regulated			PA Regulated		Corporate and Other			Discontinued Operations			Total
Net Income	$	814	$	267		$	191	$	(73	)	$	(916	)	$	283
Less: Special Items (expense) benefit:
Foreign currency-related economic hedges, net of tax of ($10)	20		—			—		—			—			20
Spinoff of the Supply segment:
Discontinued operations, net of tax of $37	—		—			—		—			(916		)	(916		)
Transition and transaction costs, net of tax of $0	—		—			—		(16		)	—			(16		)
Employee transitional services, net of tax of $2	—		—			—		(4		)	—			(4		)
Separation benefits, net of tax of $1	—		—			—		(3		)	—			(3		)
Other:
WPD Midlands acquisition-related adjustment, net of tax of ($1)	2		—			—		—			—			2
Settlement of certain income tax positions	18		—			—		—			—			18
Certain valuation allowances, net of tax of $0	—		(8		)	—		—			—			(8		)
LKE acquisition-related adjustment, net of tax of $0	—		(5		)	—		—			—			(5		)
Total Special Items	40		(13		)	—		(23		)	(916		)	(912		)
Earnings from Ongoing Operations	$	774	$	280		$	191	$	(50	)	$	—		$	1,195

Margins

Management also utilizes the following non-GAAP financial measures as indicators of performance for its businesses:

• "U.K. Gross Margins" is a single financial performance measure of the electricity distribution operations of the U.K. Regulated segment. In calculating this measure, direct costs such as connection charges from National Grid, which owns and manages the electricity transmission network in England and Wales, and Ofgem license fees (recorded in "Other operation and maintenance" on the Statements of Income) are deducted from operating revenues, as they are costs passed through to customers. As a result, this measure represents the net revenues from the delivery of electricity across WPD's distribution network in the U.K. and directly related activities.

• "Kentucky Gross Margins" is a single financial performance measure of the electricity generation, transmission and distribution operations of the Kentucky Regulated segment, LKE, LG&E and KU, as well as the Kentucky Regulated segment's, LKE's and LG&E's distribution and sale of natural gas. In calculating this measure, fuel, energy purchases and certain variable costs of production (recorded in "Other operation and maintenance" on the Statements of Income) are deducted from revenues. In addition, certain other expenses, recorded in "Other operation and maintenance", "Depreciation" and "Taxes, other than income" on the Statements of Income, associated with approved cost recovery mechanisms are offset against the recovery of those expenses, which are included in revenues. These mechanisms allow for direct recovery of these expenses and, in some cases, returns on capital investments and performance incentives. As a result, this measure represents the net revenues from electricity and gas operations.

• "Pennsylvania Gross Delivery Margins" is a single financial performance measure of the electricity transmission and distribution delivery operations of the Pennsylvania Regulated segment and PPL Electric. In calculating this measure, utility revenues and expenses associated with approved recovery mechanisms, including energy provided as a PLR, are offset with minimal impact on earnings. Costs associated with these mechanisms are recorded in "Energy purchases," "Other operation and maintenance," (which are primarily Act 129 and Universal Service program costs), and "Taxes, other than income," which is primarily gross receipts tax. This performance measure includes PLR energy purchases by PPL Electric from PPL EnergyPlus, which are reflected in "Energy purchases from affiliate" in the reconciliation tables. As a result of the June 2015 spinoff of PPL Energy Supply and the formation of Talen Energy, PPL EnergyPlus (renamed Talen Energy Marketing) is no longer an affiliate of PPL Electric. PPL Electric's purchases from Talen Energy Marketing subsequent to May 31, 2015 are reflected in "Energy Purchases" in the reconciliation tables. This measure represents the net revenues from the Pennsylvania Regulated segment's and PPL Electric's electricity delivery operations.

These measures are not intended to replace "Operating Income," which is determined in accordance with GAAP, as an indicator of overall operating performance. Other companies may use different measures to analyze and report their results of operations.

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Management believes these measures provide additional useful criteria to make investment decisions. These performance measures are used, in conjunction with other information, by senior management and PPL's Board of Directors to manage operations and analyze actual results compared with budget.

Changes in Margins

The following table shows Margins by PPL's reportable segment and by component, as applicable, for the periods ended September 30 as well as the change between periods. The factors that gave rise to the changes are described following the table.

	Three Months							Nine Months
	2016		2015		$ Change			2016		2015		$ Change
U.K.
U.K. Gross Margins	$	476	$	505	$	(29	)	$	1,566	$	1,709	$	(143	)
Impact of changes in foreign currency exchange rates					(74		)					(132		)
Change in U.K. Gross Margins excluding impact of foreign currency exchange rates					$	45						$	(11	)
Kentucky Regulated
Kentucky Gross Margins
LG&E	$	237	$	225	$	12		$	676	$	661	$	15
KU	300		285		15			857		809		48
LKE	$	537	$	510	$	27		$	1,533	$	1,470	$	63
Pennsylvania Regulated
Pennsylvania Gross Delivery Margins
Distribution	$	246	$	207	$	39		$	721	$	642	$	79
Transmission	115		102		13			332		285		47
Total	$	361	$	309	$	52		$	1,053	$	927	$	126

U.K. Gross Margins

U.K. Gross Margins, excluding the impact of changes in foreign currency exchange rates, increased for the three months ended September 30, 2016 compared with 2015 primarily due to $59 million from the April 1, 2016 price increase, which includes $14 million of the recovery of prior customer rebates, partially offset by $16 million of lower volumes.

U.K. Gross Margins, excluding the impact of changes in foreign currency exchange rates, decreased for the nine months ended September 30, 2016 compared with 2015 primarily due to $89 million from the April 1, 2015 price decrease resulting from the commencement of RIIO-ED1 and lower volumes of $37 million, partially offset by $97 million from the April 1, 2016 price increase, which includes $24 million of the recovery of prior customer rebates, and $21 million of other revenue adjustments in 2016.

Kentucky Gross Margins

Kentucky Gross Margins increased for the three months ended September 30, 2016 compared with 2015 primarily due to $22 million of increased sales volumes ($9 million at LG&E and $13 million at KU) driven by warmer weather.

Kentucky Gross Margins increased for the nine months endedSeptember 30, 2016 compared with 2015 primarily due to higher base rates of $68 million ($4 million at LG&E and $64 million at KU) and returns on additional environmental capital investments of $11 million at LG&E. The increase in base rates was the result of new rates approved by the KPSC effective July 1, 2015. These increases were partially offset by lower sales volumes of $10 million ($2 million at LG&E and $8 million at KU) driven by milder weather in the first quarter of 2016.

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Pennsylvania Gross Delivery Margins

Distribution

Distribution margins increased for the three months ended September 30, 2016 compared with 2015 primarily due to $30 million of higher base rates, effective January 1, 2016 as a result of the 2015 rate case combined with a $12 million favorable impact of warmer summer weather.

Distribution margins increased for the nine months ended September 30, 2016 compared with 2015 primarily due to $93 million of higher base rates, effective January 1, 2016, partially offset by a $13 million unfavorable impact of milder winter weather.

Transmission

Transmission margins increased for the three and nine month periods ended September 30, 2016 compared with 2015 primarily due to returns on additional capital investments focused on replacing aging infrastructure and improving reliability.

Reconciliation of Margins

The following table contains the components from the Statement of Income that are included in the non-GAAP financial measures and a reconciliation to PPL's "Operating Income" for the periods ended September 30.

	2016 Three Months												2015 Three Months
	U.K. Gross Margins			Kentucky Gross Margins		PA Gross Delivery Margins		Other (a)			Operating Income (b)		U.K. Gross Margins			Kentucky Gross Margins		PA Gross Delivery Margins		Other (a)			Operating Income (b)
Operating Revenues	$	504	(c)	$	835	$	539	$	11		$	1,889	$	540	(c)	$	801	$	519	$	18		$	1,878
Operating Expenses
Fuel	—			227		—		—			227		—			228		—		—			228
Energy purchases	—			24		129		(2		)	151		—			23		154		—			177
Other operation and maintenance	28			33		24		332			417		35			28		31		388			482
Depreciation	—			14		—		218			232		—			11		—		215			226
Taxes, other than income	—			—		25		51			76		—			1		25		53			79
Total Operating Expenses	28			298		178		599			1,103		35			291		210		656			1,192
Total	$	476		$	537	$	361	$	(588	)	$	786	$	505		$	510	$	309	$	(638	)	$	686
	2016 Nine Months												2015 Nine Months
	U.K. Gross Margins			Kentucky Gross Margins		PA Gross Delivery Margins		Other (a)			Operating Income (b)		U.K. Gross Margins			Kentucky Gross Margins		PA Gross Delivery Margins		Other (a)			Operating Income (b)
Operating Revenues	$	1,641	(c)	$	2,382	$	1,619	$	43		$	5,685	$	1,801	(c)	$	2,414	$	1,625	$	49		$	5,889
Operating Expenses
Fuel	—			607		—		—			607		—			695		—		—			695
Energy purchases	—			118		414		(1		)	531		—			143		519		14			676
Energy purchases from affiliate	—			—		—		—			—		—			—		14		(14		)	—
Other operation and maintenance	75			81		77		1,059			1,292		92			77		84		1,152			1,405
Depreciation	—			40		—		652			692		—			26		—		632			658
Taxes, other than income	—			3		75		151			229		—			3		81		157			241
Total Operating Expenses	75			849		566		1,861			3,351		92			944		698		1,941			3,675
Total	$	1,566		$	1,533	$	1,053	$	(1,818	)	$	2,334	$	1,709		$	1,470	$	927	$	(1,892	)	$	2,214

(a) Represents amounts excluded from Margins.

91

(b) As reported on the Statements of Income.

(c) Excludes ancillary revenues of $11 million and $32 million for the three and nine months ended September 30, 2016 and $12 million and $35 million for the three and nine months ended September 30, 2015.

2016 Outlook

(PPL)

Higher net income is expected in 2016 compared with 2015, primarily attributable to the results of the 2015 spinoff of the Supply segment. Higher Earnings from Ongoing Operations are expected in 2016 compared with 2015, primarily attributable to increases in the Pennsylvania Regulated and Kentucky Regulated segments. The following projections and factors underlying these projections are provided for PPL's segments and the Corporate and Other category and the related Registrants.

(PPL's U.K. Regulated Segment)

Net income is expected to be relatively flat in 2016 compared with 2015. Lower Earnings from Ongoing Operations are projected in 2016 compared with 2015 due to the unfavorable impact of lower GBP exchange rates, higher interest expense and depreciation, partially offset by higher revenues and lower operation and maintenance expense, including pension expense.

(PPL's Kentucky Regulated Segment and LKE, LG&E and KU)

Higher net income and Earnings from Ongoing Operations are projected in 2016 compared with 2015, primarily driven by electric and gas base rate increases effective July 1, 2015, higher returns on additional environmental capital investments, and lower operation and maintenance expense, partially offset by higher depreciation and higher interest expense.

(PPL's Pennsylvania Regulated Segment and PPL Electric)

Higher net income and Earnings from Ongoing Operations are projected in 2016 compared with 2015, primarily driven by higher base electricity rates for distribution effective January 1, 2016, and higher transmission earnings from additional capital investments, partially offset by higher depreciation and a benefit received in 2015 from the release of a gross receipts tax reserve.

(PPL's Corporate and Other Category)

Relatively flat costs are projected in 2016 compared with 2015.

(All Registrants)

Earnings in future periods are subject to various risks and uncertainties. See "Forward-Looking Information," the rest of this Item 2, Notes 6 and 10 to the Financial Statements and "Item 1A. Risk Factors" in this Form 10-Q (as applicable) and "Item 1. Business" and "Item 1A. Risk Factors" in the Registrants' 2015 Form 10-K for a discussion of the risks, uncertainties and factors that may impact future earnings.

92

PPL Electric: Statement of Income Analysis, Earnings and Margins

Statement of Income Analysis

Net income for the periods ended September 30 includes the following results.

	Three Months							Nine Months
	2016		2015		$ Change			2016		2015		$ Change
Operating Revenues	$	539	$	519	$	20		$	1,619	$	1,625	$	(6	)
Operating Expenses
Operation
Energy purchases	129		154		(25		)	414		519		(105		)
Energy purchases from affiliate	—		—		—			—		14		(14		)
Other operation and maintenance	144		162		(18		)	431		435		(4		)
Depreciation	64		55		9			185		158		27
Taxes, other than income	26		27		(1		)	79		87		(8		)
Total Operating Expenses	363		398		(35		)	1,109		1,213		(104		)
Other Income (Expense) - net	4		1		3			12		5		7
Interest Expense	32		32		—			97		96		1
Income Taxes	58		35		23			162		130		32
Net Income	$	90	$	55	$	35		$	263	$	191	$	72

Operating Revenues

The increase (decrease) in operating revenues for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Distribution Price (a)	$	23		$	97
Distribution volume	11			(23		)
PLR (b)	(21		)	(125		)
Transmission Formula Rate	12			47
Other	(5		)	(2		)
Total	$	20		$	(6	)

(a) Distribution rate case effective January 1, 2016, resulted in increases of $41 million and $121 million for the three and nine months ended September 30, 2016.

(b) Decreases due to lower recoveries of energy purchases as described below.

Energy Purchases

Energy purchases decreased by $25 million for the three months ended September 30, 2016 compared with 2015 due to lower PLR prices of $37 million, partially offset by higher PLR volumes of $14 million.

Energy purchases decreased by $105 million for the nine months endedSeptember 30, 2016 compared with 2015 due to lower PLR prices of $90 million, lower PLR volumes of $11 million and lower capacity volumes of $4 million.

Energy Purchases from Affiliate

Energy purchases from affiliate decreased by $14 million for the nine months ended September 30, 2016 compared with 2015 as a result of the June 1, 2015 PPL Energy Supply spinoff.

93

Other Operation and Maintenance

The increase (decrease) in other operation and maintenance for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Corporate service costs	$	1		$	10
Contractor-related expenses	6			12
Vegetation management	(5		)	1
Storm costs	1			7
Payroll-related costs	(7		)	(19		)
Act 129	(7		)	(14		)
Universal service programs	—			3
Bad Debts	(5		)	(6		)
Other	(2		)	2
Total	$	(18	)	$	(4	)

Depreciation

Depreciation increased by $9 million and $27 million for the three and nine months ended September 30, 2016 compared with 2015, primarily due to additional assets placed into service, related to the ongoing efforts to ensure the reliability of the delivery system and the replacement of aging infrastructure, net of retirements.

Income Taxes

The increase (decrease) in income taxes for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months		Nine Months
Change in pre-tax income at current period tax rates	$	22	$	43
Stock-based compensation (a)	—		(7		)
Other	1		(4		)
Total	$	23	$	32

(a) During the nine months ended September 30, 2016, PPL Electric recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 to the Financial Statements for additional information.

See Note 5to the Financial Statements for additional information.

Earnings

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Net Income	$	90	$	55	$	263	$	191
Special item, gains (losses), after-tax (a)	—		—		—		—

(a) There are no items management considers special for the periods presented.

Earnings increased for the three month period in 2016 compared with 2015 primarily due to higher base electricity rates for distribution effective January 1, 2016, a favorable impact of weather, higher transmission margins from additional capital investments, and lower other operation and maintenance expense, partially offset by higher depreciation.

Earnings increased for the nine month period in 2016 compared with 2015 primarily due to higher base electricity rates for distribution effective January 1, 2016, and higher transmission margins, partially offset by higher depreciation.

94

The table below quantifies the changes in the components of Net Income between these periods, which reflect amounts classified as Pennsylvania Gross Delivery Margins on a separate line and not in their respective Statement of Income line items.

	Three Months			Nine Months
Pennsylvania Gross Delivery Margins	$	52		$	126
Other operation and maintenance	11			(3		)
Depreciation	(9		)	(27		)
Taxes, other than income	1			2
Other Income (Expense) - net	3			7
Interest Expense	—			(1		)
Income Taxes	(23		)	(32		)
Net Income	$	35		$	72

Margins

"Pennsylvania Gross Delivery Margins" is a non-GAAP financial performance measure that management utilizes as an indicator of the performance of its business. See PPL's "Results of Operations - Margins" for information on why management believes this measure is useful and for explanations of the underlying drivers of the changes between periods.

The following tables contain the components from the Statements of Income that are included in this non-GAAP financial measure and a reconciliation to "Operating Income" for the periods ended September 30. 

	2016 Three Months							2015 Three Months
	PA Gross Delivery Margins		Other (a)			Operating Income (b)		PA Gross Delivery Margins		Other (a)			Operating Income (b)
Operating Revenues	$	539	$	—		$	539	$	519	$	—		$	519
Operating Expenses
Energy purchases	129		—			129		154		—			154
Other operation and maintenance	24		120			144		31		131			162
Depreciation	—		64			64		—		55			55
Taxes, other than income	25		1			26		25		2			27
Total Operating Expenses	178		185			363		210		188			398
Total	$	361	$	(185	)	$	176	$	309	$	(188	)	$	121
	2016 Nine Months							2015 Nine Months
	PA Gross Delivery Margins		Other (a)			Operating Income (b)		PA Gross Delivery Margins		Other (a)			Operating Income (b)
Operating Revenues	$	1,619	$	—		$	1,619	$	1,625	$	—		$	1,625
Operating Expenses
Energy purchases	414		—			414		519		—			519
Energy purchases from affiliate	—		—			—		14		—			14
Other operation and maintenance	77		354			431		84		351			435
Depreciation	—		185			185		—		158			158
Taxes, other than income	75		4			79		81		6			87
Total Operating Expenses	566		543			1,109		698		515			1,213
Total	$	1,053	$	(543	)	$	510	$	927	$	(515	)	$	412

(a) Represents amounts excluded from Margins.

(b) As reported on the Statements of Income.

95

LKE: Statement of Income Analysis, Earnings and Margins

Statement of Income Analysis

Net income for the periods ended September 30 includes the following results.

	Three Months									Nine Months
	2016			2015			$ Change			2016			2015			$ Change
Operating Revenues	$	835		$	801		$	34		$	2,382		$	2,414		$	(32	)
Operating Expenses
Operation
Fuel	227			228			(1		)	607			695			(88		)
Energy purchases	24			23			1			118			143			(25		)
Other operation and maintenance	197			202			(5		)	603			625			(22		)
Depreciation	102			97			5			301			286			15
Taxes, other than income	16			14			2			46			43			3
Total Operating Expenses	566			564			2			1,675			1,792			(117		)
Other Income (Expense) - net	(3		)	(1		)	(2		)	(9		)	(3		)	(6		)
Interest Expense	50			43			7			147			127			20
Interest Expense with Affiliate	4			—			4			12			1			11
Income Taxes	79			73			6			202			194			8
Net Income	$	133		$	120		$	13		$	337		$	297		$	40

Operating Revenues

The increase (decrease) in operating revenues for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Base rates	$	—		$	68
Volumes	32			(38		)
Fuel and other energy prices (a)	(11		)	(85		)
ECR	8			30
Other	5			(7		)
Total	$	34		$	(32	)

(a) The decrease for the nine month period was due to lower recoveries of fuel and energy purchases due to lower commodity costs as described below.

Fuel

Fuel decreased $88 million for the nine months ended September 30, 2016 compared with 2015, primarily due to a decrease in market prices for coal and natural gas.

Energy Purchases

Energy purchases decreased $25 million for the nine months ended September 30, 2016 compared with 2015 primarily due to a $14 million decrease in natural gas volumes, driven by milder weather in the first quarter of 2016, and $13 million of lower natural gas prices.

96

Other Operation and Maintenance

The increase (decrease) in other operation and maintenance for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Coal plant operations and maintenance (a)	$	2		$	(12	)
Pension (b)	(2		)	(10		)
Other	(5		)	—
Total	$	(5	)	$	(22	)

(a) The decrease for the nine month period was primarily due to a reduction of costs associated with the 2015 retirement of units at the Cane Run and Green River plants, partially offset by Cane Run 7 operations.

(b) The decrease for the nine month period was primarily due to higher discount rates and deferred amortization of actuarial losses.

Depreciation

Depreciation increased $15 million for the nine months ended September 30, 2016 compared with 2015 primarily due to additional assets placed into service, net of retirements.

Interest Expense

Interest expense increased $11 million and $31 million for the three and nine months ended September 30, 2016 compared with 2015 primarily due to the September 2015 issuance of $550 million of incremental First Mortgage Bonds by LG&E and KU, higher interest rates on the September 2015 issuance of $500 million of First Mortgage Bonds by LG&E and KU used to retire the same amount of First Mortgage Bonds in November 2015 and $400 million of notes refinanced in November 2015.

Income Taxes

The increase (decrease) in income taxes for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Change in pre-tax income at current period tax rates	$	7		$	19
Certain valuation allowances (a)	—			(8		)
Other	(1		)	(3		)
Total	$	6		$	8

(a) The decrease for the nine month period represents a valuation allowance, established in 2015, against tax credits expiring in 2016 and 2017 that are more likely than not to expire before being utilized.

Earnings

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Net Income	$	133	$	120	$	337	$	297
Special items, gains (losses), after-tax	—		—		—		(8		)

Earnings increased for the three month period in 2016 compared with 2015 primarily due to higher sales volumes, driven by warmer weather, and lower other operation and maintenance expense, partially offset by higher interest expense.

Excluding special items, earnings increased for the nine month period in 2016 compared with 2015 primarily due to higher base electricity rates effective July 1, 2015, lower other operation and maintenance expense and higher returns on additional environmental capital investments, partially offset by higher interest expense and lower sales volumes driven by milder weather in the first quarter of 2016.

97

The table below quantifies the changes in the components of Net Income between these periods, which reflect amounts classified as Margins and an item that management considers special on separate lines and not in their respective Statement of Income line items.  

	Three Months			Nine Months
Margins	$	27		$	63
Other operation and maintenance	10			26
Depreciation	(2		)	(1		)
Taxes, other than income	(3		)	(3		)
Other Income (Expense) - net	(2		)	(6		)
Interest Expense	(11		)	(31		)
Income Taxes	(6		)	(16		)
Special items, gains (losses), after-tax	—			8
Net Income	$	13		$	40

(a) See PPL's "Results of Operations - Segment Earnings - Kentucky Regulated Segment" for details of the special item.

Margins

"Margins" is a non-GAAP financial performance measure that management utilizes as an indicator of the performance of its business. See PPL's "Results of Operations - Margins" for an explanation of why management believes this measure is useful and the factors underlying changes between periods. Within PPL's discussion, LKE's Margins are referred to as "Kentucky Gross Margins."

The following tables contain the components from the Statements of Income that are included in this non-GAAP financial measure and a reconciliation to "Operating Income" for the periods ended September 30.

	2016 Three Months							2015 Three Months
	Margins		Other (a)			Operating Income (b)		Margins		Other (a)			Operating Income (b)
Operating Revenues	$	835	$	—		$	835	$	801	$	—		$	801
Operating Expenses
Fuel	227		—			227		228		—			228
Energy purchases	24		—			24		23		—			23
Other operation and maintenance	33		164			197		28		174			202
Depreciation	14		88			102		11		86			97
Taxes, other than income	—		16			16		1		13			14
Total Operating Expenses	298		268			566		291		273			564
Total	$	537	$	(268	)	$	269	$	510	$	(273	)	$	237
	2016 Nine Months							2015 Nine Months
	Margins		Other (a)			Operating Income (b)		Margins		Other (a)			Operating Income (b)
Operating Revenues	$	2,382	$	—		$	2,382	$	2,414	$	—		$	2,414
Operating Expenses
Fuel	607		—			607		695		—			695
Energy purchases	118		—			118		143		—			143
Other operation and maintenance	81		522			603		77		548			625
Depreciation	40		261			301		26		260			286
Taxes, other than income	3		43			46		3		40			43
Total Operating Expenses	849		826			1,675		944		848			1,792
Total	$	1,533	$	(826	)	$	707	$	1,470	$	(848	)	$	622

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(a) Represents amounts excluded from Margins.

(b) As reported on the Statements of Income.

LG&E: Statement of Income Analysis, Earnings and Margins

Statement of Income Analysis

Net income for the periods ended September 30 includes the following results.

	Three Months									Nine Months
	2016			2015			$ Change			2016			2015			$ Change
Operating Revenues
Retail and wholesale	$	366		$	349		$	17		$	1,058		$	1,089		$	(31	)
Electric revenue from affiliate	2			2			—			19			32			(13		)
Total Operating Revenues	368			351			17			1,077			1,121			(44		)
Operating Expenses
Operation
Fuel	86			82			4			233			267			(34		)
Energy purchases	19			18			1			104			129			(25		)
Energy purchases from affiliate	5			9			(4		)	10			17			(7		)
Other operation and maintenance	85			87			(2		)	264			286			(22		)
Depreciation	43			40			3			126			122			4
Taxes, other than income	9			7			2			24			21			3
Total Operating Expenses	247			243			4			761			842			(81		)
Other Income (Expense) - net	(1		)	(1		)	—			(6		)	(3		)	(3		)
Interest Expense	18			13			5			53			39			14
Income Taxes	39			36			3			98			91			7
Net Income	$	63		$	58		$	5		$	159		$	146		$	13

Operating Revenues

The increase (decrease) in operating revenues for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Base rates	$	—		$	4
Volumes	15			(30		)
Fuel and other energy prices (a)	(4		)	(36		)
ECR	5			21
Other	1			(3		)
Total	$	17		$	(44	)

(a) The decrease for the three and nine month periods was due to lower recoveries of fuel and energy purchases due to lower commodity costs, as described below.

Fuel

Fuel increased $4 million for the three months ended September 30, 2016 compared with 2015, due to an $11 million increase in volumes, driven by warmer weather, partially offset by a $7 million decrease in commodity costs, as a result of a decrease in market prices for coal and natural gas.

99

Fuel decreased $34 million for the nine months endedSeptember 30, 2016 compared with 2015, due to a $25 million decrease in commodity costs, as a result of a decrease in market prices for coal and natural gas, and a $9 million decrease in volumes, driven by milder weather in the first quarter of 2016.

Energy purchases

Energy purchases decreased $25 million for the nine months endedSeptember 30, 2016 compared with 2015 primarily due to a $14 million decrease in natural gas volumes, driven by milder weather during the first quarter of 2016, and $13 million of lower natural gas prices.

Energy purchases from affiliate

Energy purchases from affiliate decreased $4 million for the three months ended September 30, 2016 compared with 2015 primarily due to decreased generation available from KU.

Other Operation and Maintenance

The increase (decrease) in other operation and maintenance for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Coal plant operations and maintenance (a)	$	(1	)	$	(13	)
Pension (b)	—			(6		)
Other	(1		)	(3		)
Total	$	(2	)	$	(22	)

(a) The decrease for the nine month period was primarily due to a reduction of costs associated with the 2015 retirement of units at the Cane Run plant, partially offset by Cane Run 7 operations.

(b) The decrease for the nine month period was primarily due to higher discount rates and deferred amortization of actuarial losses.

Interest Expense

Interest expense increased $5 million and $14 million for the three and nine months ended September 30, 2016 compared with 2015 primarily due to the September 2015 issuance of $300 million of incremental First Mortgage Bonds and higher interest rates on the September 2015 issuance of $250 million of First Mortgage Bonds used to retire the same amount of First Mortgage Bonds in November 2015.

Earnings

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Net Income	$	63	$	58	$	159	$	146
Special items, gains (losses), after-tax (a)	—		—		—		—

(a) There are no items management considers special for the periods presented.

Earnings increased for the three month period in 2016 compared with 2015 primarily due to higher sales volumes, driven by warmer weather, and lower other operation and maintenance expense, partially offset by higher interest expense.

Earnings increased for the nine month period in 2016 compared with 2015 primarily due to higher returns on additional environmental capital investments and lower other operation and maintenance expense, partially offset by higher interest expense.

The table below quantifies the changes in the components of Net Income between these periods, which reflect amounts classified as Margins on a separate line and not in their respective Statement of Income line items.

100

	Three Months			Nine Months
Margins	$	12		$	15
Other operation and maintenance	4			21
Depreciation	—			4
Taxes, other than income	(3		)	(3		)
Other Income (Expense) - net	—			(3		)
Interest Expense	(5		)	(14		)
Income Taxes	(3		)	(7		)
Net Income	$	5		$	13

Margins

"Margins" is a non-GAAP financial performance measure that management utilizes as an indicator of the performance of its business. See PPL's "Results of Operations - Margins" for an explanation of why management believes this measure is useful and the factors underlying changes between periods. Within PPL's discussion, LG&E's Margins are included in "Kentucky Gross Margins."

The following tables contain the components from the Statements of Income that are included in this non-GAAP financial measure and a reconciliation to "Operating Income" for the periods ended September 30.

	2016 Three Months							2015 Three Months
	Margins		Other (a)			Operating Income (b)		Margins		Other (a)			Operating Income (b)
Operating Revenues	$	368	$	—		$	368	$	351	$	—		$	351
Operating Expenses
Fuel	86		—			86		82		—			82
Energy purchases, including affiliate	24		—			24		27		—			27
Other operation and maintenance	13		72			85		11		76			87
Depreciation	8		35			43		5		35			40
Taxes, other than income	—		9			9		1		6			7
Total Operating Expenses	131		116			247		126		117			243
Total	$	237	$	(116	)	$	121	$	225	$	(117	)	$	108
	2016 Nine Months							2015 Nine Months
	Margins		Other (a)			Operating Income (b)		Margins		Other (a)			Operating Income (b)
Operating Revenues	1,077		$	—		$	1,077	$	1,121	$	—		$	1,121
Operating Expenses
Fuel	233		—			233		267		—			267
Energy purchases, including affiliate	114		—			114		146		—			146
Other operation and maintenance	32		232			264		33		253			286
Depreciation	20		106			126		12		110			122
Taxes, other than income	2		22			24		2		19			21
Total Operating Expenses	401		360			761		460		382			842
Total	676		$	(360	)	$	316	$	661	$	(382	)	$	279

(a) Represents amounts excluded from Margins.

(b) As reported on the Statements of Income.

101

KU: Statement of Income Analysis, Earnings and Margins

Statement of Income Analysis

Net income for the periods ended September 30 includes the following results.

	Three Months								Nine Months
	2016			2015		$ Change			2016			2015		$ Change
Operating Revenues
Retail and wholesale	$	469		$	452	$	17		$	1,324		$	1,325	$	(1	)
Electric revenue from affiliate	5			9		(4		)	10			17		(7		)
Total Operating Revenues	474			461		13			1,334			1,342		(8		)
Operating Expenses
Operation
Fuel	141			146		(5		)	374			428		(54		)
Energy purchases	5			5		—			14			14		—
Energy purchases from affiliate	2			2		—			19			32		(13		)
Other operation and maintenance	107			108		(1		)	320			321		(1		)
Depreciation	59			57		2			175			164		11
Taxes, other than income	7			7		—			22			22		—
Total Operating Expenses	321			325		(4		)	924			981		(57		)
Other Income (Expense) - net	(3		)	—		(3		)	(4		)	1		(5		)
Interest Expense	24			20		4			71			58		13
Income Taxes	48			44		4			128			115		13
Net Income	$	78		$	72	$	6		$	207		$	189	$	18

Operating Revenue

The increase (decrease) in operating revenue for the periods ended September 30, 2016 compared with 2015 was due to:

	Three Months			Nine Months
Base rates	$	—		$	64
Volumes	13			(27		)
Fuel and other energy prices (a)	(6		)	(50		)
ECR	3			8
Other	3			(3		)
Total	$	13		$	(8	)

(a) The decrease for the three and nine month periods was due to lower recoveries of fuel and energy purchases due to lower commodity costs as described below.

Fuel

Fuel decreased $5 million for the three months ended September 30, 2016 compared with 2015, due to a decrease in market prices for coal and natural gas.

Fuel decreased $54 million for the nine months endedSeptember 30, 2016 compared with 2015, due to a $49 million decrease in commodity costs, as a result of a decrease in market prices for coal and natural gas, and a $5 million decrease in volumes, driven by milder weather during the first quarter of 2016.

102

Earnings

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Net Income	$	78	$	72	$	207	$	189
Special items, gains (losses), after-tax (a)	—		—		—		—

(a) There are no items management considers special for the periods presented.

Earnings increased for the three month period in 2016 compared with 2015 primarily due to higher sales volumes, driven by warmer weather, and lower other operation and maintenance expense, partially offset by higher interest expense.

Earnings increased for the nine month period in 2016 compared with 2015 primarily due to higher base electricity rates, effective July 1, 2015 and lower other operation and maintenance expense, partially offset by higher interest expense and lower sales volumes, driven by milder weather during the first quarter of 2016.

The table below quantifies the changes in the components of Net Income between these periods, which reflect amounts classified as Margins on a separate line and not in their respective Statement of Income line items.

	Three Months			Nine Months
Margins	$	15		$	48
Other operation and maintenance	4			6
Depreciation	(2		)	(5		)
Other Income (Expense) - net	(3		)	(5		)
Interest Expense	(4		)	(13		)
Income Taxes	(4		)	(13		)
Net Income	$	6		$	18

Margins

"Margins" is a non-GAAP financial performance measure that management utilizes as an indicator of the performance of its business. See PPL's "Results of Operations - Margins" for an explanation of why management believes this measure is useful and the factors underlying changes between periods. Within PPL's discussion, KU's Margins are included in "Kentucky Gross Margins."

The following tables contain the components from the Statements of Income that are included in this non-GAAP financial measure and a reconciliation to "Operating Income" for the periods ended September 30.

103

	2016 Three Months							2015 Three Months
	Margins		Other (a)			Operating Income (b)		Margins		Other (a)			Operating Income (b)
Operating Revenues	$	474	$	—		$	474	$	461	$	—		$	461
Operating Expenses
Fuel	141		—			141		146		—			146
Energy purchases, including affiliate	7		—			7		7		—			7
Other operation and maintenance	20		87			107		17		91			108
Depreciation	6		53			59		6		51			57
Taxes, other than income	—		7			7		—		7			7
Total Operating Expenses	174		147			321		176		149			325
Total	$	300	$	(147	)	$	153	$	285	$	(149	)	$	136
	2016 Nine Months							2015 Nine Months
	Margins		Other (a)			Operating Income (b)		Margins		Other (a)			Operating Income (b)
Operating Revenues	$	1,334	$	—		$	1,334	$	1,342	$	—		$	1,342
Operating Expenses
Fuel	374		—			374		428		—			428
Energy purchases, including affiliate	33		—			33		46		—			46
Other operation and maintenance	49		271			320		44		277			321
Depreciation	20		155			175		14		150			164
Taxes, other than income	1		21			22		1		21			22
Total Operating Expenses	477		447			924		533		448			981
Total	$	857	$	(447	)	$	410	$	809	$	(448	)	$	361

(a) Represents amounts excluded from Margins.

(b) As reported on the Statements of Income.

Financial Condition

The remainder of this Item 2 in this Form 10-Q is presented on a combined basis, providing information, as applicable, for all Registrants.

Liquidity and Capital Resources

(All Registrants)

The Registrants had the following at:

	PPL (a)		PPL Electric		LKE		LG&E		KU
September 30, 2016
Cash and cash equivalents	$	416	$	36	$	11	$	4	$	7
Short-term debt	636		130		135		128		7
Notes payable with affiliate			—		138		—		—
December 31, 2015
Cash and cash equivalents	$	836	$	47	$	30	$	19	$	11
Short-term debt	916		—		265		142		48
Notes payable with affiliate			—		54		—		—

(a) At September 30, 2016, $8 million of cash and cash equivalents were denominated in GBP. If these amounts would be remitted as dividends, PPL would not anticipate a material incremental U.S. tax cost. Historically, dividends paid by foreign subsidiaries have been limited to distributions of the current year's earnings. See Note 5 to the Financial Statements in PPL's 2015 Form 10-K for additional information on undistributed earnings of WPD.

104

(PPL)

The Statements of Cash Flows separately report the cash flows of the discontinued operations in 2015. The "Operating Activities", "Investing Activities" and "Financing Activities" sections below included only the cash flows of continuing operations.

(All Registrants)

Net cash provided by (used in) operating, investing and financing activities for the nine month period ended September 30, and the changes between periods, were as follows.

	PPL			PPL Electric			LKE			LG&E			KU
2016
Operating activities	$	2,230		$	595		$	816		$	383		$	469
Investing activities	(2,066		)	(740		)	(599		)	(343		)	(254		)
Financing activities	(558		)	134			(236		)	(55		)	(219		)
2015
Operating activities	$	1,688		$	373		$	895		$	469		$	510
Investing activities	(2,463		)	(764		)	(921		)	(519		)	(400		)
Financing activities	231			203			460			220			154
Change  - Cash Provided (Used)
Operating activities	$	542		$	222		$	(79	)	$	(86	)	$	(41	)
Investing activities	397			24			322			176			146
Financing activities	(789		)	(69		)	(696		)	(275		)	(373		)

Operating Activities

The components of the change in cash provided by (used in) operating activities for the nine months ended September 30, 2016 compared with 2015 were as follows.

	PPL		PPL Electric		LKE			LG&E			KU
Change - Cash Provided (Used)
Net income	$	239	$	72	$	40		$	13		$	18
Non-cash components	146		42		(7		)	—			(7		)
Working capital	102		74		(168		)	(99		)	(94		)
Defined benefit plan funding	51		33		(16		)	(20		)	1
Other operating activities	4		1		72			20			41
Total	$	542	$	222	$	(79	)	$	(86	)	$	(41	)

(PPL)

PPL's cash provided by operating activities from continuing operations in 2016 increased $542 million in 2016 compared with 2015.

• Income from continuing operations increased by $239 million between the periods. This included an additional $146 million of net non-cash charges, including $124 million of lower unrealized gains on hedging activities primarily due to the settlement of hedges in the third quarter of 2016 and an increase in deferred income taxes, partially offset by defined benefit plan income (primarily due to an increase in estimated returns on higher asset balances and lower interest costs due to a change in the discount rate for the U.K. pension plans).

• The $102 million increase in cash from changes in working capital was primarily due to an increase in taxes payable (primarily due to an increase in current income tax expense in 2016) and an increase in accounts payable (due to timing of payments), partially offset by an increase in unbilled revenues (due to lower volumes as a result of unfavorable weather as compared to 2015) and a net increase in current regulatory assets and regulatory liabilities (due to the timing of rate recovery mechanisms).

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• Defined benefit plan funding was $51 million lower in 2016.

(PPL Electric)

PPL Electric's cash provided by operating activities in 2016 increased $222 million in 2016 compared with 2015.

• The increase in non-cash components of $42 million in 2016 compared with 2015 was primarily due to an increase in depreciation and deferred income tax expense.

• The $74 million increase in cash from changes in working capital was primarily due to an increase in accounts payable (primarily due to timing of payments) and a decrease in prepayments (primarily due to higher tax prepayments in 2015) partially offset by a net increase in current regulatory assets and regulatory liabilities (due to the timing of rate recovery mechanisms).

• Defined benefit plan funding was $33 million lower in 2016.

(LKE)

LKE's cash provided by operating activities in 2016 decreased $79 million compared with 2015.

• The decrease in cash from working capital was driven primarily by lower tax payments received from PPL for the use of prior year excess tax depreciation deductions. Other decreases in cash were related to accounts receivable and unbilled revenues due to lower weather volatility during the measurement periods in 2016, and coal and natural gas inventories due to milder weather in the first quarter of 2016, partially offset by lower payments on accounts payable due to lower fuel purchases.

• The increase in cash from other operating activities was driven primarily by a decrease in cash outflows for the settlement of interest rate swaps. LG&E and KU settled interest rate swaps in the third quarter of 2015 which did not occur in 2016.

(LG&E)

LG&E's cash provided by operating activities in 2016 decreased $86 million compared with 2015.

• The decrease in cash from working capital was driven primarily by lower tax payments received from LKE for the use of prior year excess tax depreciation deductions. Other decreases in cash were related to accounts receivable and unbilled revenues due to lower weather volatility during the measurement periods in 2016, coal and natural gas inventories due to milder weather in the first quarter of 2016, and accounts receivable from affiliates due to lower intercompany settlements associated with capital expenditures, partially offset by lower payments on accounts payable due to lower fuel purchases.

• The increase in cash from other operating activities was driven primarily by a decrease in cash outflows for the settlement of interest rate swaps. LG&E settled interest rate swaps in the third quarter of 2015 which did not occur in 2016.

(KU)

KU's cash provided by operating activities in 2016 decreased $41 million compared with 2015.

• The decrease in cash from working capital was driven primarily by lower tax payments received from LKE for the use of prior year excess tax depreciation deductions. Other decreases in cash were related to accounts receivable and unbilled revenues due to lower weather volatility during the measurement periods in 2016, and coal inventory due to milder weather in the first quarter of 2016, partially offset by accounts payable to affiliates due to lower intercompany settlements associated with capital expenditures and lower payments on accounts payable due to lower fuel purchases.

• The increase in cash from other operating activities was driven primarily by a decrease in cash outflows for the settlement of interest rate swaps. KU settled interest rate swaps in the third quarter of 2015 which did not occur in 2016.

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Investing Activities

(All Registrants)

Expenditures for Property, Plant and Equipment

Investment in PP&E is the primary investing activity of the registrants. The change in expenditures for PP&E for the nine months ended September 30, 2016 compared with 2015 was as follows.

	PPL		PPL Electric		LKE		LG&E		KU
Decrease	$	487	$	19	$	328	$	176	$	152

For PPL, the decrease in expenditures was due to lower project expenditures at WPD, PPL Electric Utilities, LG&E, and KU. The decrease in expenditures for WPD was primarily due to a decrease in expenditures to enhance system reliability associated with the end of the DPCR5 price control period and changes in foreign currency exchange rates. The decrease in expenditures for PPL Electric was primarily due to the completion of the Susquehanna-Roseland transmission project and the completion of the Northeast Pocono reliability project. The decrease in expenditures for LG&E was primarily driven by the completion of the environmental air projects at LG&E's Mill Creek plant. The decrease in expenditures for KU was primarily driven by the completion of the environmental air projects at KU's Ghent plant and the CCR project at KU's E.W. Brown plant.

Financing Activities

(All Registrants)

The components of the change in cash provided by (used in) financing activities for the nine months ended September 30, 2016 compared with 2015 was as follows.

	PPL			PPL Electric			LKE			LG&E			KU
Change - Cash Provided (Used)
Debt issuance/retirement, net	$	(801	)	$	—		$	(1,050	)	$	(550	)	$	(500	)
Settlement of cross-currency swaps	46			—			—			—			—
Stock issuances/redemptions, net	(12		)	—			—			—			—
Dividends	(22		)	(53		)	—			(6		)	(91		)
Capital contributions/distributions, net	—			(75		)	(85		)	27			20
Change in short-term debt, net	3			62			370			250			195
Notes payable with affiliate	—			—			63			—			—
Other financing activities	(3		)	(3		)	6			4			3
Total	$	(789	)	$	(69	)	$	(696	)	$	(275	)	$	(373	)

See Note 7 to the Financial Statements in this Form 10-Q for information on 2016 short and long-term debt activity, equity transactions and PPL dividends. See the Registrants' 2015 Form 10-K for information on 2015 activity.

Credit Facilities

The Registrants maintain credit facilities to enhance liquidity, provide credit support and provide a backstop to commercial paper programs. Amounts borrowed under these credit facilities are reflected in "Short-term debt" on the Balance Sheets. At September 30, 2016, the total committed borrowing capacity and the use of that capacity under these credit facilities was as follows:

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External

	Committed Capacity		Borrowed		Letters of Credit and Commercial Paper Issued		Unused Capacity
PPL Capital Funding Credit Facilities	$	1,150	$	—	$	17	$	1,133
PPL Electric Credit Facility	400		—		131		269
LKE Credit Facility	75		—		—		75
LG&E Credit Facility	500		—		128		372
KU Credit Facilities	598		—		205		393
Total LKE	1,173		—		333		840
Total U.S. Credit Facilities (a)	$	2,723	$	—	$	481	$	2,242
Total U.K. Credit Facilities (b)	£	1,055	£	284	£	—	£	771

(a) The commitments under the U.S. credit facilities are provided by a diverse bank group, with no one bank and its affiliates providing an aggregate commitment of more than the following percentages of the total committed capacity: PPL - 11%, PPL Electric - 7%, LKE - 21%, LG&E - 7% and KU - 37%.

(b) The amounts borrowed at September 30, 2016 were a USD-denominated borrowing of $200 million and GBP-denominated borrowings which equated to $171 million. The unused capacity reflects the USD-denominated borrowing amount borrowed in GBP of £153 million as of the date borrowed. At September 30, 2016, the USD equivalent of unused capacity under the U.K. committed credit facilities was $1 billion.

The commitments under the U.K. credit facilities are provided by a diverse bank group, with no one bank providing more than 13% of the total committed capacity.

See Note 7 to the Financial Statements for further discussion of the Registrants' credit facilities.

Intercompany (LKE, LG&E and KU)

	Committed Capacity		Borrowed		Other Used Capacity		Unused Capacity
LKE Credit Facility	$	225	$	138	$	—	$	87
LG&E Money Pool (a)	500		—		128		372
KU Money Pool (a)	500		—		7		493

(a) LG&E and KU participate in an intercompany money pool agreement whereby LKE, LG&E and/or KU make available funds up to $500 million at an interest rate based on a market index of commercial paper issues. However, the FERC has issued a maximum short-term debt limit for each utility at $500 million from any source.

See Note 11 to the Financial Statements for further discussion of intercompany credit facilities.

Commercial Paper(All Registrants)

PPL, PPL Electric, LG&E and KU maintain commercial paper programs to provide an additional financing source to fund short-term liquidity needs, as necessary. Commercial paper issuances, included in "Short-term debt" on the Balance Sheets, are supported by the respective Registrant's Syndicated Credit Facility. The following commercial paper programs were in place at September 30, 2016:

	Capacity		Commercial Paper Issuances		Unused Capacity
PPL Capital Funding	$	1,000	$	—	$	1,000
PPL Electric	400		130		270
LG&E	350		128		222
KU	350		7		343
Total LKE	700		135		565
Total PPL	$	2,100	$	265	$	1,835

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Long-term Debt

(PPL)

In May 2016, PPL Capital Funding issued $650 million of 3.10% Senior Notes due 2026. PPL Capital Funding received proceeds of $645 million, net of a discount and underwriting fees, which will be used to invest in or make loans to subsidiaries of PPL, to repay short-term debt and for general corporate purposes.

In May 2016, WPD (East Midlands) borrowed £100 million at 0.4975% under a new ten-year index linked term loan agreement, which will be used for general corporate purposes.

In May 2016, WPD plc repaid the entire $460 million principal amount of its 3.90% Senior Notes upon maturity.

In October 2016, WPD (East Midlands) issued an additional £40 million of its 2.671% Index-linked Senior Notes due 2043. WPD (East Midlands) received proceeds of £83 million, which equated to $101 million at the time of issuance, net of fees and including a premium. The principal amount of the notes is adjusted based on changes in a specified index, as detailed in the terms of the related indentures. The proceeds will be used for general corporate purposes.

(PPL and PPL Electric)

In March 2016, the LCIDA issued $116 million of Pollution Control Revenue Refunding Bonds, Series 2016A due 2029 and $108 million of Pollution Control Revenue Refunding Bonds, Series 2016B due 2027 on behalf of PPL Electric. The bonds were issued bearing interest at an initial term rate of 0.90% through their mandatory purchase dates of September 1, 2017 and August 15, 2017. Thereafter, the method of determining the interest rate on the bonds may be converted from time to time at PPL Electric's option. The proceeds of the bonds were used to redeem $116 million of 4.70% Pollution Control Revenue Refunding Bonds, 2005 Series A due 2029 and $108 million of 4.75% Pollution Control Revenue Refunding Bonds, 2005 Series B due 2027 previously issued by the LCIDA on behalf of PPL Electric.

In connection with the issuance of each of these new series of LCIDA bonds, PPL Electric entered into a loan agreement with the LCIDA pursuant to which the LCIDA has loaned to PPL Electric the proceeds of the LCIDA bonds on payment terms that correspond to the LCIDA bonds. In order to secure its obligations under the loan agreement, PPL Electric issued $224 million of First Mortgage Bonds under its 2001 Mortgage Indenture, which also have payment terms that correspond to the LCIDA bonds.

(PPL, LKE and LG&E) 

In September 2016, the County of Trimble, Kentucky issued $125 million of Pollution Control Revenue Refunding Bonds, 2016 Series A (Louisville Gas and Electric Company Project) due 2044 on behalf of LG&E. The bonds were issued with a floating interest rate that initially will reset weekly. The method of determining the interest rate on the bonds may be converted from time to time at LG&E’s option. The proceeds of the bonds were used to redeem $83 million of Pollution Control Revenue Refunding Bonds, 2000 Series A (Louisville Gas and Electric Company Project) due 2030 and $42 million of Pollution Control Revenue Refunding Bonds, 2002 Series A (Louisville Gas and Electric Company Project) due 2032 previously issued by the County of Trimble, Kentucky on behalf of LG&E.

(PPL, LKE and KU) 

In August 2016, the County of Carroll, Kentucky issued $96 million of Pollution Control Revenue Refunding Bonds, 2016 Series A (Kentucky Utilities Company Project) due 2042 on behalf of KU. The bonds were issued bearing interest at an initial term rate of 1.05% through their mandatory purchase date of September 1, 2019. Thereafter, the method of determining the interest rate on the bonds may be converted from time to time at KU’s option. The proceeds of the bonds were used to redeem $96 million of Pollution Control Revenue Refunding Bonds, 2002 Series C (Kentucky Utilities Company Project) due 2032 previously issued by the County of Carroll, Kentucky on behalf of KU.

(PPL)

ATM Program

For the periods ended September 30, PPL issued the following:

109

	Three Months				Nine Months
	2016		2015		2016		2015
Number of shares (in thousands)	710		436		710		858
Average share price	$	35.23	$	32.95	$	35.23	$	33.33
Net Proceeds	$	25	$	14	$	25	$	28

Common Stock Dividends

In August 2016, PPL declared a quarterly common stock dividend, payable October 3, 2016, of 38 cents per share (equivalent to $1.52 per annum). Future dividends, declared at the discretion of the Board of Directors, will depend upon future earnings, cash flows, financial and legal requirements and other factors.

Capital Expenditures

Capital expenditure plans are revised periodically to reflect changes in operational, market and regulatory conditions. In the second quarter of 2016, PPL decreased its projected capital spending for the period 2016 through 2020 related to distribution facilities by approximately $1.1 billion from the $9.5 billion projection previously disclosed in PPL's 2015 Form 10‑K. The decreased projected capital spending results from a change in the forecasted GBP to U.S. dollar exchange rate from $1.60 to $1.30 for WPD expenditures that decreased each yearly estimate by approximately $220 million.

Contractual Obligations

In 2016, PPL decreased its estimated contractual cash obligations by approximately $2.0 billion from the $39.1 billion estimate previously disclosed in PPL's 2015 Form 10-K. The decrease was primarily a result of the change in the GBP to U.S. dollar exchange rate from $1.50 to $1.30 as of September 30, 2016 for WPD's obligations. The decreases in PPL's estimated contractual cash obligations by year were as follows.

	Total			2016			2017 - 2018			2019 - 2020			After 2020
Total Change in Contractual Cash Obligations	$	(2,003	)	$	(36	)	$	(100	)	$	(121	)	$	(1,746	)

Rating Agency Actions

(All Registrants)

Moody's and S&P have periodically reviewed the credit ratings of the debt of the Registrants and their subsidiaries. Based on their respective independent reviews, the rating agencies may make certain ratings revisions or ratings affirmations.

A credit rating reflects an assessment by the rating agency of the creditworthiness associated with an issuer and particular securities that it issues. The credit ratings of the Registrants and their subsidiaries are based on information provided by the Registrants and other sources. The ratings of Moody's and S&P are not a recommendation to buy, sell or hold any securities of the Registrants or their subsidiaries. Such ratings may be subject to revisions or withdrawal by the agencies at any time and should be evaluated independently of each other and any other rating that may be assigned to the securities. The credit ratings of the Registrants and their subsidiaries affect their liquidity, access to capital markets and cost of borrowing under their credit facilities.

The rating agencies have taken the following actions related to the Registrants and their subsidiaries during 2016:

(PPL)

In February 2016, Moody's and S&P affirmed their commercial paper ratings for PPL Capital Funding's $1.0 billion commercial paper program.

In May 2016, Moody's and S&P assigned ratings of Baa2 and BBB+ to PPL Capital Funding's $650 million 3.10% Senior Notes due 2026.

110

In June 2016, S&P assigned a long-term issuer rating of A- and a short-term issuer rating of A-2 to PPL Capital Funding.

(PPL Electric)

In February 2016, Moody's and S&P affirmed their commercial paper ratings for PPL Electric's $400 million commercial paper program.

In February 2016, Moody's and S&P assigned ratings of A1 and A to LCIDA's $116 million 0.90% Pollution Control Revenue Refunding Bonds due 2029 and $108 million 0.90% Pollution Control Revenue Refunding Bonds due 2027, issued on behalf of PPL Electric.

(LG&E)

In September 2016, Moody's and S&P assigned ratings of A1 and A to LG&E's Trimble Country 2016 Series A $125 million Pollution Control Revenue Refunding Bonds due 2044.

(KU)

In August 2016, Moody's and S&P assigned ratings of A1 and A to KU's Carroll County 2016 Series A $96 million Pollution Control Revenue Refunding Bonds due 2042.

Ratings Triggers

(PPL, LKE, LG&E and KU)

Various derivative and non-derivative contracts, including contracts for the sale and purchase of electricity and fuel, commodity transportation and storage, interest rate and foreign currency instruments (for PPL), contain provisions that require the posting of additional collateral or permit the counterparty to terminate the contract, if PPL's, LKE's, LG&E's or KU's or their subsidiaries' credit rating, as applicable, were to fall below investment grade. See Note 14 to the Financial Statements for a discussion of "Credit Risk-Related Contingent Features," including a discussion of the potential additional collateral requirements for PPL, LKE and LG&E for derivative contracts in a net liability position at September 30, 2016.

(All Registrants)

For additional information on the Registrants' liquidity and capital resources, see "Item 7. Combined Management's Discussion and Analysis of Financial Condition and Results of Operations," in the Registrants' 2015 Form 10-K.

Risk Management

Market Risk

(All Registrants)

See Notes 13 and 14 to the Financial Statements for information about the Registrants' risk management objectives, valuation techniques and accounting designations.

The forward-looking information presented below provides estimates of what may occur in the future, assuming certain adverse market conditions and model assumptions. Actual future results may differ materially from those presented. These are not precise indicators of expected future losses, but are rather only indicators of possible losses under normal market conditions at a given confidence level.

Interest Rate Risk

The Registrants and their subsidiaries issue debt to finance their operations, which exposes them to interest rate risk. The Registrants and their subsidiaries utilize various financial derivative instruments to adjust the mix of fixed and floating interest rates in their debt portfolios, adjust the duration of their debt portfolios and lock in benchmark interest rates in anticipation of future financing, when appropriate. Risk limits under the risk management program are designed to balance risk exposure to volatility in interest expense and changes in the fair value of the debt portfolios due to changes in the absolute level of interest

111

rates. In addition, the interest rate risk of certain subsidiaries is potentially mitigated as a result of the existing regulatory framework or the timing of rate cases.

The following interest rate hedges were outstanding at September 30, 2016.

	Exposure Hedged		Fair Value, Net - Asset (Liability) (a)			Effect of a 10% Adverse Movement in Rates (b)			Maturities Ranging Through
PPL
Cash flow hedges
Cross-currency swaps (c)	$	802	$	155		$	(96	)	2028
Economic hedges
Interest rate swaps (d)	179		(54		)	(2		)	2033
LKE
Economic hedges
Interest rate swaps (d)	179		(54		)	(2		)	2033
LG&E
Economic hedges
Interest rate swaps (d)	179		(54		)	(2		)	2033

(a) Includes accrued interest, if applicable.

(b) Effects of adverse movements decrease assets or increase liabilities, as applicable, which could result in an asset becoming a liability. Sensitivities represent a 10% adverse movement in interest rates, except for cross-currency swaps which also includes a 10% adverse movement in foreign currency exchange rates.

(c) Cross-currency swaps are utilized to hedge the principal and interest payments of WPD's U.S. dollar-denominated senior notes. Changes in the fair value of these instruments are recorded in equity and reclassified into earnings in the same period during which the item being hedged affects earnings.

(d) Realized changes in the fair value of such economic hedges are recoverable through regulated rates and any subsequent changes in the fair value of these derivatives are included in regulatory assets or regulatory liabilities.

The Registrants are exposed to a potential increase in interest expense and to changes in the fair value of their debt portfolios. The estimated impact of a 10% adverse movement in interest rates on interest expense at September 30, 2016 was insignificant for PPL, PPL Electric, LKE, LG&E and KU. The estimated impact of a 10% adverse movement in interest rates on the fair value of debt at September 30, 2016 is shown below.

	10% Adverse Movement in Rates
PPL	$	543
PPL Electric	136
LKE	175
LG&E	65
KU	98

Foreign Currency Risk (PPL)

PPL is exposed to foreign currency risk primarily through investments in U.K. affiliates. Under its risk management program, PPL may enter into financial instruments to hedge certain foreign currency exposures, including translation risk of expected earnings, firm commitments, recognized assets or liabilities, anticipated transactions and net investments.

The following foreign currency hedges were outstanding at September 30, 2016.

112

	Exposure Hedged		Fair Value, Net - Asset (Liability)		Effect of a 10% Adverse Movement in Foreign Currency Exchange Rates (a)			Maturities Ranging Through
Economic hedges (b)	£	1,791	$	96	$	(214	)	2018

(a) Effects of adverse movements decrease assets or increase liabilities, as applicable, which could result in an asset becoming a liability.

(b) To economically hedge the translation risk of expected earnings denominated in GBP.

(All Registrants)

Commodity Price Risk

PPL is exposed to commodity price risk through its domestic subsidiaries as described below.

• PPL Electric is exposed to commodity price risk from its obligation as PLR; however, its PUC-approved cost recovery mechanism substantially eliminates its exposure to this risk. PPL Electric also mitigates its exposure to commodity price risk by entering into full-requirement supply agreements to serve its PLR customers. These supply agreements transfer the commodity price risk associated with the PLR obligation to the energy suppliers.

• LG&E's and KU's rates include certain mechanisms for fuel and fuel-related expenses. In addition, LG&E's rates include a mechanism for natural gas supply expenses. These mechanisms generally provide for timely recovery of market price fluctuations associated with these expenses.

Volumetric Risk

PPL is exposed to volumetric risk through its subsidiaries as described below.

• WPD is exposed to volumetric risk which is significantly mitigated as a result of the method of regulation in the U.K. Under the RIIO - ED1 price control period, recovery of such exposure occurs on a two year lag. See Note 1 in PPL's 2015 Form 10-K for additional information on revenue recognition under RIIO - ED1.

• PPL Electric, LG&E and KU are exposed to volumetric risk on retail sales, mainly due to weather and other economic conditions for which there is limited mitigation between rate cases.

Credit Risk(All Registrants)

See Notes 13 and 14 to the Financial Statements in this Form 10-Q and "Risk Management - Credit Risk" in the Registrants' 2015 Form 10-K for additional information.

Foreign Currency Translation(PPL)

The value of the British pound sterling fluctuates in relation to the U.S. dollar. Changes in this exchange rate resulted in a foreign currency translation loss of $840 million for the nine months ended September 30, 2016, which primarily reflected a $1.6 billion decrease to PP&E and $375 million decrease to goodwill partially offset by a $995 million decrease to long-term debt and a $160 million decrease to other net liabilities. Changes in this exchange rate resulted in a foreign currency translation loss of $101 million for the nine months ended September 30, 2015, which primarily reflected a $209 million decrease to PP&E and $54 million decrease to goodwill partially offset by a $131 million decrease to long-term debt and a $31 million decrease to other net liabilities. The impact of foreign currency translation is recorded in AOCI.

Related Party Transactions(All Registrants)

The Registrants are not aware of any material ownership interests or operating responsibility by senior management in outside partnerships, including leasing transactions with variable interest entities, or other entities doing business with the Registrants. See Note 11 to the Financial Statements for additional information on related party transactions for PPL Electric, LKE, LG&E and KU.

113

Acquisitions, Development and Divestitures(All Registrants)

The Registrants from time to time evaluate opportunities for potential acquisitions, divestitures and development projects. Development projects are reexamined based on market conditions and other factors to determine whether to proceed with, modify or terminate the projects. Any resulting transactions may impact future financial results. See Note 8 to the Financial Statements for information on the more significant activities.

Environmental Matters(All Registrants)

Extensive federal, state and local environmental laws and regulations are applicable to PPL's, PPL Electric's, LKE's, LG&E's and KU's air emissions, water discharges and the management of hazardous and solid waste, as well as other aspects of the Registrants' businesses. The cost of compliance or alleged non-compliance cannot be predicted with certainty but could be significant. In addition, costs may increase significantly if the requirements or scope of environmental laws or regulations, or similar rules, are expanded or changed. Costs may take the form of increased capital expenditures or operating and maintenance expenses, monetary fines, penalties or other restrictions. Many of these environmental law considerations are also applicable to the operations of key suppliers, or customers, such as coal producers and industrial power users, and may impact the cost for their products or their demand for the Registrants' services. Increased capital and operating costs are subject to rate recovery. PPL, PPL Electric, LKE, LG&E and KU can provide no assurances as to the ultimate outcome of future environmental or rate proceedings before regulatory authorities.

See Note 10 to the Financial Statements for a discussion of the more significant environmental matters including:

• Legal Matters,

• Climate Change,

• Coal Combustion Residuals,

• Effluent Limitations Guidelines,

• Mercury and Air Toxics Standards,

• National Ambient Air Quality Standards, and

• Superfund and Other Remediation.

Additionally, see "Item 1. Business - Environmental Matters" in the Registrants' 2015 Form 10-K for additional information on environmental matters.

New Accounting Guidance(All Registrants)

See Notes 2 and 18 to the Financial Statements for a discussion of new accounting guidance adopted and pending adoption.

Application of Critical Accounting Policies(All Registrants)

Financial condition and results of operations are impacted by the methods, assumptions and estimates used in the application of critical accounting policies. The following table summarizes the accounting policies by Registrant that are particularly important to an understanding of the reported financial condition or results of operations, and require management to make estimates or other judgments of matters that are inherently uncertain. See "Item 7. Combined Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Registrants' 2015 Form 10-K for a discussion of each critical accounting policy.

114

		PPL
	PPL	Electric	LKE	LG&E	KU
Defined Benefits	X	X	X	X	X
Loss Accruals	X	X	X	X	X
Income Taxes	X	X	X	X	X
Goodwill Impairment	X		X	X	X
AROs	X		X	X	X
Price Risk Management	X
Regulatory Assets and Liabilities	X	X	X	X	X
Revenue Recognition - Unbilled Revenue		X	X	X	X

115

PPL Corporation

PPL Electric Utilities Corporation

LG&E and KU Energy LLC

Louisville Gas and Electric Company

Kentucky Utilities Company

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Reference is made to "Risk Management" in "Item 2. Combined Management's Discussion and Analysis of Financial Condition and Results of Operations."

Item 4. Controls and Procedures

(a) Evaluation of disclosure controls and procedures.

The Registrants' principal executive officers and principal financial officers, based on their evaluation of the Registrants' disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the Securities Exchange Act of 1934) have concluded that, as of September 30, 2016, the Registrants' disclosure controls and procedures are effective to ensure that material information relating to the Registrants and their consolidated subsidiaries is recorded, processed, summarized and reported within the time periods specified by the SEC's rules and forms, particularly during the period for which this quarterly report has been prepared. The aforementioned principal officers have concluded that the disclosure controls and procedures are also effective to ensure that information required to be disclosed in reports filed under the Exchange Act is accumulated and communicated to management, including the principal executive and principal financial officers, to allow for timely decisions regarding required disclosure.

(b) Change in internal controls over financial reporting.

The Registrants' principal executive officers and principal financial officers have concluded that there were no changes in the Registrants' internal control over financial reporting during the Registrants' third fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Registrants' internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

For information regarding pending administrative and judicial proceedings involving regulatory, environmental and other matters, which information is incorporated by reference into this Part II, see:

• "Item 3. Legal Proceedings" in each Registrant's 2015 Form 10-K; and

• Notes 6 and 10 to the Financial Statements.

Item 1A. Risk Factors

There have been no material changes in the Registrants' risk factors from those disclosed in "Item 1A. Risk Factors" of the Registrants' 2015 Form 10-K and Form 10-Q for the period ending June 30, 2016 except the following:

(PPL)

Risks related to our U.K. segment

PPL’s earnings may be adversely affected as a result of the June 23, 2016 referendum in the U.K. to withdraw from the European Union.

Significant uncertainty exists concerning the effects of the June 23, 2016 referendum in favor of the U.K. withdrawal from the European Union, including whether formal withdrawal will occur and the nature and duration of negotiations between the U.K. and European Union as to the terms of any withdrawal. PPL cannot predict the impact, either short-term or long-term, on foreign exchange rates or PPL’s long-term financial condition that may be experienced as a result of any actions that may be taken by the U.K. government to withdraw from the European Union, although such impacts could be significant.

116

Item 4. Mine Safety Disclosures

Not applicable.

Item 6. Exhibits

The following Exhibits indicated by an asterisk preceding the Exhibit number are filed herewith. The balance of the Exhibits has heretofore been filed with the Commission and pursuant to Rule 12(b)-32 are incorporated herein by reference. Exhibits indicated by a [_] are filed or listed pursuant to Item 601(b)(10)(iii) of Regulation S-K.

4(a)	-	Loan Agreement dated as of August 1, 2016 between Kentucky Utilities Company and the County of Carroll, Kentucky (Exhibit 4(a) to Kentucky Utilities Company Form 8-K Report (File No. 1-3464) dated August 26, 2016)
4(b)	-	Supplemental Indenture No. 5, dated as of August 1, 2016, of Kentucky Utilities Company to The Bank of New York Mellon, as Trustee (Exhibit 4(b) to Kentucky Utilities Company Form 8-K Report (File No. 1-3464) dated August 26, 2016)
4(c)	-	Loan Agreement dated as of September 1, 2016 between Louisville Gas and Electric Company and the County of Trimble, Kentucky (Exhibit 4(a) to Louisville Gas and Electric Company Form 8-K Report (File No. 1-2893) dated September 15, 2016)
4(d)	-	Supplemental Indenture No. 5, dated as of September 1, 2016, of Louisville Gas and Electric Company to The Bank of New York Mellon, as Trustee (Exhibit 4(b) to Louisville Gas and Electric Company Form 8-K Report (File No. 1-2893) dated September 15, 2016)
*10(a)	-	£50,000,000 Facility Letter entered into between Western Power Distribution (South West) plc and Svenska Handelsbanken AB dated as of October 11, 2016
*12(a)	-	PPL Corporation and Subsidiaries Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends
*12(b)	-	PPL Electric Utilities Corporation and Subsidiaries Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends
*12(c)	-	LG&E and KU Energy LLC and Subsidiaries Computation of Ratio of Earnings to Fixed Charges
*12(d)	-	Louisville Gas and Electric Company Computation of Ratio of Earnings to Fixed Charges
*12(e)	-	Kentucky Utilities Company Computation of Ratio of Earnings to Fixed Charges
Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, for the quarterly period ended September 30, 2016, filed by the following officers for the following companies:
*31(a)	-	PPL Corporation's principal executive officer
*31(b)	-	PPL Corporation's principal financial officer
*31(c)	-	PPL Electric Utilities Corporation's principal executive officer
*31(d)	-	PPL Electric Utilities Corporation's principal financial officer
*31(e)	-	LG&E and KU Energy LLC's principal executive officer
*31(f)	-	LG&E and KU Energy LLC's principal financial officer
*31(g)	-	Louisville Gas and Electric Company's principal executive officer
*31(h)	-	Louisville Gas and Electric Company's principal financial officer
*31(i)	-	Kentucky Utilities Company's principal executive officer
*31(j)	-	Kentucky Utilities Company's principal financial officer

117

Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, for the quarterly period ended September 30, 2016, furnished by the following officers for the following companies:
*32(a)	-	PPL Corporation's principal executive officer and principal financial officer
*32(b)	-	PPL Electric Utilities Corporation's principal executive officer and principal financial officer
*32(c)	-	LG&E and KU Energy LLC's principal executive officer and principal financial officer
*32(d)	-	Louisville Gas and Electric Company's principal executive officer and principal financial officer
*32(e)	-	Kentucky Utilities Company's principal executive officer and principal financial officer
101.INS	-	XBRL Instance Document
101.SCH	-	XBRL Taxonomy Extension Schema
101.CAL	-	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	-	XBRL Taxonomy Extension Definition Linkbase
101.LAB	-	XBRL Taxonomy Extension Label Linkbase
101.PRE	-	XBRL Taxonomy Extension Presentation Linkbase

118

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrants have duly caused this report to be signed on their behalf by the undersigned thereunto duly authorized. The signature for each undersigned company shall be deemed to relate only to matters having reference to such company or its subsidiaries.

		PPL Corporation
		(Registrant)
Date:	November 1, 2016	/s/  Stephen K. Breininger
		Stephen K. Breininger Vice President and Controller
		(Principal Accounting Officer)
		PPL Electric Utilities Corporation
		(Registrant)
Date:	November 1, 2016	/s/  Marlene C. Beers
		Marlene C. Beers Controller
		(Principal Financial Officer and Principal Accounting Officer)

		LG&E and KU Energy LLC
		(Registrant)
		Louisville Gas and Electric Company
		(Registrant)
		Kentucky Utilities Company
		(Registrant)
Date:	November 1, 2016	/s/  Kent W. Blake
		Kent W. Blake Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

119

EX-10.A

Exhibit 10(a)

The Directors

Western Power Distribution (South West) plc

Avonbank

Feeder Road

Bristol

BS2 0TB

Date: 10^th October 2016

Dear Sirs

In accordance with arrangements recently agreed between us, we hereby set out in this letter (the "Facility Letter") the terms and conditions upon which we, Svenska Handelsbanken AB (publ) (the "Bank"), are prepared to make available an uncommitted money market facility (the "Facility") to you, Western Power Distribution (South West) plc , Company Number 2366894 (the "Borrower")

This Facility Letter is open for acceptance within 30 days of the date hereof or such later date as the Bank shall agree after which it shall expire.

This Facility Letter supersedes all prior agreements, arrangements or correspondence between the Bank and the Borrower in relation to the Facility.

The principal terms on which the Facility is made available are set out in Clause 1.1, subject to the terms and conditions contained in the remainder of this Facility Letter.

1.1 Outline Terms

• Amount & Type of Facility:	£50,000,000 (fifty million pounds sterling) money market facility.
	•	Arrangement Fee £15,000 payable on signing this Facility Letter.
	•	Annual Fee £7,500 payable yearly in advance with effect from 1st September 2017
	•	Breakage Fee £300 payable on the date a Drawing or any part thereof is repaid or prepaid other than on the relevant Maturity Date.
	•	Break Costs (if applicable).

Svenska Handelsbanken AB (publ)	Telephone 0117 302 0080
66 Queens Square	Fax 0117 302 0077
Bristol	www.handelsbanken.co.uk/bristolqueensquare
BS1 4JP	SWIFT HANDGB22
Handelsbanken is the trading name of Svenska Handelsbanken AB (publ). Registered Office: Svenska Handelsbanken AB (publ), 3 Thomas More Square, London, E1W 1WY. Registered in England and Wales No, BR 000589. Incorporated in Sweden with limited liability. Registered in Sweden No, 502007-7862. Head Office in Stockholm. Authorised by the Swedish Financial Supervisory Authority (Finansinspektionen) and the Prudential Regulation Authority and subject to limited regulation by the Financial Conduct Authority and Prudential Regulation Authority. Details about the extent of our authorisation and regulation by the Prudential Regulation Authority, and regulation by the Financial Conduct Authority are available from us on request.

• Review Date:	On or around 31st August annually.
• Specified Purpose	General business purposes.

1.2 Definitions and Interpretation

Unless defined elsewhere the definitions which shall apply to the Facility Letter are contained in Schedule 2.

2 The Facility

The Borrower may only use the Facility for the Specified Purpose and furthermore undertakes not to use the Facility for any purpose or in any manner that would result in a breach by it, or any other person, of any provision of the Bribery Act 2010.

3 Conditions Precedent

3.1 The Facility shall be available for use by the Borrower only when the Bank (i) shall have received, to its satisfaction as to their form and substance, the documents and evidence set out in Schedule 1 and (ii) is satisfied that the other conditions detailed in Schedule 1 have been satisfied.

3.2 The Conditions Precedent set out in Schedule 1 are for the sole benefit of the Bank, and the Bank may in its sole and absolute discretion make the Facility, or a part thereof, available notwithstanding that one or more of such conditions have not been fulfilled on terms that such condition or conditions shall be fulfilled within such period or periods thereafter as the Bank shall determine unless the Bank shall otherwise agree to waive such condition or conditions in its sole and absolute discretion.

4 Utilisation, Availability and Termination

4.1 Utilisation of the Facility ("Facility Utilisation") will be calculated as the aggregate value of outstanding Drawings.

4.2 Facility Utilisation at any time shall not exceed the Limit and the Bank is not obliged to allow or continue to allow any utilisation in excess of the Limit.

4.3 The Facility is uncommitted and shall remain available to the Borrower until further notice but shall be subject to cancellation at any time by either the Bank or the Borrower giving written notice to the other. In the event of such cancellation no further Drawings shall be made available and the Bank will be entitled to require the Borrower to immediately repay all Drawings in accordance with the provisions of Clause 5.5.

4.4 The Bank shall review the Facility on each Review Date and may contact you to discuss your future requirements. Whenever we review the Facility, we may charge you a renewal fee.

4.5 All sums outstanding under the Facility together with interest thereon, and any fees, costs, charges and expenses payable hereunder shall be repayable upon demand at all times.

5 Drawings

5.1 Borrowings by way of drawings shall be permitted at the Bank's discretion (together the "Drawings" each a "Drawing").

5.2 Each Drawing shall be for an amount, a period and at an interest rate, all to be mutually agreed at the time of each such Drawing, such period to expire no later than the next Quarter Day unless otherwise agreed by the Bank.

5.3 Interest on Drawings shall be payable by the Borrower in full in immediately available funds, on the relevant Maturity Date and on any date that a Drawing is renewed for a further period pursuant to Clause 5.4.

5.4 Each Drawing shall be repaid in full by the Borrower on the relevant Maturity Date unless the Bank, in its sole discretion, shall agree to renew any such Drawing for a further period in which case the Maturity Date for such Drawing shall be extended accordingly.

5.5 Notwithstanding any other term of this Facility Letter each Drawing together with interest thereon, and any fees, costs, charges and expenses payable hereunder shall be repayable upon demand and in the event that the Facility is cancelled or demand is made by the Bank, the Bank shall be entitled at the cost of the Borrower to break any interest period that may be applicable to a Drawing and the Borrower shall pay to the Bank the Breakage Fee and all Break Costs arising as a result thereof together with accrued interest. In the event that the Bank shall exercise such right all Drawings outstanding shall thereafter be fixed for such interest periods as shall be determined by the Bank in its sole and absolute discretion.

5.6 If there is a repayment, prepayment or recovery of all or any part of a Drawing other than on the relevant Maturity Date, then the Borrower will pay to the Bank on demand an amount equal to the Break Costs together with the Breakage Fee and the Borrower indemnifies the Bank against any other costs, liabilities or expenses incurred by the Bank in connection with that early repayment, prepayment or recovery.

5.7 Any notice of prepayment under this Facility Letter shall be irrevocable and the provisions of this Clause 5 shall apply to any prepayment.

5.8 If the prepayment sum is received by the Bank after 10 am then the Bank may treat such prepayment as if it had been received on the next Business Day. Any prepayment must be accompanied by any Breakage Fee and all Break Costs arising as a result thereof together with accrued interest.

6 Fees

6.1 In consideration of the Bank making the Facility available hereunder the Borrower shall pay to the Bank, the Bank's Fees which if not previously paid shall be deducted from any Drawing made hereunder. Any fees as set out in Clause 1.1 not due on first utilisation shall be debited to the Borrower’s account and be payable in advance at the time or times and in the manner set out in Clause 1.1.

6.2 In the event that the level of administration undertaken by the Bank in connection with the operation and monitoring of the Facility shall in the opinion of the Bank have increased or be likely to increase from that envisaged by the Bank when the Facility was originally agreed then the Bank shall have the right to charge the Borrower an Administration Fee.

7 Increased Costs and Default Interest

7.1 The Borrower shall, within three Business Days of a demand by the Bank, pay the Bank the amount of any Increased Costs incurred by the Bank as a result of (i) the introduction of or any change in (or in the interpretation, administration or application of) any law, regulation or directive (whether or not having the force of law) or (ii) compliance with any law, regulation or directive (whether or not having the force of law) made after the date of this Facility Letter.

7.2 In this Facility Letter "Increased Costs" means:

7.2.1 a reduction in the rate of return from the Facility or on the Bank’s overall capital;

7.2.2 an additional or increased cost; or

7.2.3 a reduction of any amount due and payable under this Facility Letter,

which is incurred or suffered by the Bank to the extent that it is attributable to the Bank having entered into this Facility Letter or funding or performing its obligations under this Facility Letter.

7.3 The Bank prior to making a claim pursuant to Clause 7.1 above shall notify the Borrower of the event giving rise to the claim and shall, as soon as practicable after a demand by the Borrower, provide a certificate confirming the amount of its Increased Costs.

7.4 If the Borrower shall fail to pay any sum due hereunder or under the judgement of any court in connection herewith on the due date therefor, then as a separate obligation the Borrower shall pay to the Bank interest at the Default Rate on any such sum due to the Bank up to the date on which such sum is repaid and any other amounts outstanding under this Facility Letter have been paid in full. Interest shall be payable at the rate both before and after demand, court decree or judgment on such dates advised by the Bank to the Borrower any such interest which is not paid when due shall be added to the overdue sum and itself bear interest accordingly.

7.5 The Bank's certificate as to the amounts due pursuant to this Clause 7 shall be final and conclusive, save for manifest error.

8 Financial Information

The Borrower shall forthwith provide to the Bank such financial information as the Bank may request from time to time including, but not limited to the Financial Statements of the Borrower within 180 days of the end of each financial year.

9 Payments, Calculations and Tax Indemnity

9.1 All interest shall accrue from day to day and be calculated on the basis of the actual number of days elapsed within a year of 365 days.

9.2 All sums payable by the Borrower to the Bank shall be paid without deduction for or on account of any set-off or counter-claim and free and clear of any deduction or withholding of any nature (including taxation) unless such a deduction or withholding is required by law.

9.3 If any amount is required by law to be deducted or withheld from any sum payable hereunder then the Borrower shall pay such an additional amount as will ensure that, after the making of such deduction or withholding, the Bank shall receive a net sum equal to the sums which the Bank would have received had no such deduction or withholding been required to be made.

9.4 The Borrower shall (within three Business Days of demand by the Bank) pay to the Bank an amount equal to the loss, liability or cost which the Bank determines will be or has been (directly or indirectly) suffered for or on account of Tax by the Bank in respect of the Facility Letter.

9.5 Clause 9.4 above shall not apply:

9.5.1 with respect to any Tax assessed on the Bank under the law of the jurisdiction in which the Bank is incorporated or, if different, the jurisdiction (or jurisdictions) in which the Bank is treated as resident for tax purposes, if that Tax is imposed on or calculated by reference to the net income received or receivable (but not any sum deemed to be received or receivable) by the Bank; or

9.5.2 to the extent a loss, liability or cost is compensated for by an increased payment under Clause 9.3.

9.6 If the Bank makes (or intends to make) a claim under Clause 9.4 above, it shall notify the Borrower as soon as is reasonably practicable of the event which has caused (or will cause) that claim, however, the Bank’s entitlement to exercise its rights under Clause 9.4 above is not conditional on such notification being made in accordance with this Clause 9.6.

9.7 For the purposes of Clauses 9.4 and 9.5:

"Tax" means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same).

10 Security

The Facility will be secured by any security which the Bank may in the future obtain.

11 Set-Off

11.1 In addition to any other rights to which it may be entitled the Bank may retain, set off or appropriate any credit balances in name of the Borrower (whether current or not yet due) against the Borrower’s obligations to the Bank under this Facility Letter. The Bank may exercise any of these rights without prior notice both before and after demand and in so doing may convert to sterling at the prevailing market rate of exchange any balance which is in a currency other than sterling.

11.2 Nothing expressed or implied in this Facility Letter or any other document in connection herewith shall be regarded as in any way negating or affecting any right which the Bank may have under applicable law to apply any credit balances to which the Borrower is entitled on any account of the Borrower in or towards satisfaction of any sum due from the Borrower hereunder.

12 Severance

If at any time any one or more of the provisions of this Facility Letter is or becomes invalid, illegal or unenforceable for any reason whatsoever, the validity, legality and enforceability of the remaining provisions hereof shall not thereby be affected, reduced or impaired in any way.

13 Remedies, Waivers, Amendments and Consents

13.1 No failure on the part of the Bank to exercise, and no delay on its part in exercising, any right or remedy under this Facility Letter will operate as a waiver thereof, nor will any single or partial exercise of any right or remedy preclude any other or further exercise thereof or the exercise of any other right or remedy. The rights and remedies provided in this Facility Letter are cumulative and not exclusive of any rights or remedies provided by law or otherwise.

13.2 Save to the extent expressly provided to the contrary in this Facility Letter a person who is not a party to this Facility Letter may not enforce any of its terms under the Contracts (Rights of Third Parties) Act 1999.

14 Assignment and Transferability

14.1 The Borrower may not assign, transfer or otherwise dispose of all or any part of its rights, benefits or obligations under this Facility Letter.

14.2 Subject to clause 14.3 below, the Bank may, with the prior written consent of the Borrower (such consent not to be unreasonably withheld or delayed) at any time and its own cost assign, novate or transfer all or any part of its rights, benefits and obligations under this Facility Letter or grant participations therein to any one or more banks or financial institutions and the Borrower and any other party to this Facility Letter hereby agree to execute any documents required to enable the Bank so to do (provided that the Borrower and any such other party shall neither be required thereby to pay any greater amount to satisfy its obligations hereunder nor be responsible for any legal or statutory costs or duties arising therefrom) and the Borrower and any other party to this Facility Letter further agrees that the Bank may disclose any information to any such bank or financial institution for said purpose.

14.3 The consent of the Borrower will be deemed to have been given if:

14.3.1 the transfer is to an Affiliate of the Bank;

14.3.2 a breach of the Borrower’s obligations has occurred and is continuing; or

14.3.3 within 10 Business Days of receipt by the Borrower of a written application for consent, it has not been expressly refused, provided, in each case, that at the time of the proposed transfer no deduction or withholding would be required by law in respect of any payment to the transferee at such time to the extent that no deduction or withholding would have been required in respect of a payment to the Bank.

15 Costs and Expenses

15.1 The Borrower agrees that the costs and expenses, including legal fees, disbursements registration fees and value added tax thereon, incurred by the Bank in connection with the preparation, negotiation, execution and registration of this Facility Letter, and any other documents required in connection with the Facility shall be for the Borrower’s account and the Borrower hereby indemnifies the Bank in respect of payment thereof.

15.2 The Borrower further undertakes to reimburse and indemnify the Bank for any and all costs, interest, charges and expenses incurred by the Bank, as well after as before judgement, in connection with preserving, enforcing or seeking to preserve or enforce its rights in respect of this Facility Letter or any amendment thereto, or in connection with the granting of any approvals or consents hereunder.

16 Notices

16.1 Each notice or other communication to be given under this Facility Letter shall be given in writing in English and, unless otherwise provided, shall be made by hand, fax or letter. For the avoidance of doubt, notices shall not be validly served by e-mail.

Any notice or other communication to be given by one party to another under this Facility Letter shall (unless one party has by no less than 5 Business Days' notice to the other party specified another address) and shall be given:-

16.1.1 in the case of the Borrower to its registered office; and

16.1.2 in the case of the Bank to the address detailed above.

16.2 Any notice or other communication given by any party shall be deemed to have been received:

16.2.1 in the case of a notice given by hand, at the time of day of actual delivery; or

16.2.2 if sent by fax, with a confirmed receipt of transmission from the receiving machine, on the day on which it is transmitted; or

16.2.3 if posted, by 10 am on the second Business Day following the day on which it was despatched by first class mail postage prepaid,

provided that a notice given in accordance with the above but received on a day which is not a Business Day or after normal business hours in the place of receipt shall be deemed to have been received on the next Business Day.

17 Governing Law

This Facility Letter shall be governed by and construed in accordance with the laws of England and Wales.

If you are in agreement with the aforesaid provisions, please sign and return the enclosed copy of this Facility Letter, as your acceptance of the terms and conditions set out herein.

Yours faithfully

For and on behalf of

SVENSKA HANDELSBANKEN AB (publ)

Authorised SignatoryAuthorised Signatory

The Borrower hereby confirms and accepts the above mentioned terms and conditions contained in this Facility Letter and the following Schedules.

Signed for and on behalf of the Borrower

Authorised SignatoryAuthorised Signatory

.............................................

Date

Schedule 1 – Conditions Precedent

1 A copy of this Facility Letter signed by duly authorised officials accepting on behalf of the Borrower or the terms and conditions set out herein;

2 A Bank Mandate duly completed by or on behalf of the Borrower, together with such other documents as the Bank shall require to complete its account opening formalities and to ensure compliance with money laundering obligations;

3 Such form of mandate or authority as the officers of the Borrower may be empowered to issue to bankers concerning the negotiation of any money market utilisation under this Facility Letter on behalf of the Borrower and to sign and/or endorse any documents required under or in connection with this Facility Letter on behalf of the Borrower;

4 A copy of the Borrower’s Certificate of Incorporation;

5 A copy certified as true and accurate by a Director or the Secretary of the Borrower of a resolution authorising the appropriate officials to act on behalf of and to bind the Borrower in the acceptance of the terms and conditions of this Facility Letter and the execution of this Facility Letter any other necessary supporting documents ancillary thereto; and

6 The Bank's Fees then due.

Schedule 2 – Definitions and Interpretation

"Administration Fee"means an administration fee of such amount or administration fees of such amounts as shall be determined by the Bank in its absolute discretion from time to time to fully compensate the Bank for the additional costs incurred or likely to be incurred by it in the operation and monitoring of the Facility. Such fee or fees will be payable on the Bank’s first demand.

"Bank’s Fees" means the Bank’s fees set out in Clause 1.1.

"Break Costs" means the amount (if any) by which:

(a) the interest which the Bank should have received for the period from the date of receipt of all or any part of a Drawing or any unpaid sum to the last day of the current fixed rate period in respect of that Drawing or unpaid sum, had the principal amount or unpaid sum received been paid on the Maturity Date;

exceeds:

(b) the amount which that Bank would be able to obtain by placing an amount equal to the principal amount or unpaid sum received by it on deposit with a leading bank in the relevant interbank market for a period starting on the Business Day following receipt or recovery and ending on the relevant Maturity Date

and the provisions of this definition shall apply to each successive interest period for any unpaid amount or unpaid Drawing.

"Breakage Fee"meansthe Bank’s breakage administration fee detailed in Clause 1.1.

"Business Day" means a day (other than a Saturday or Sunday) when the branch of the Bank at which the Borrower's account is located is open for business.

"Default Rate" means the aggregate of (i) the Bank's default interest margin in force from time to time, currently 2% per annum and (ii) the cost to the Bank of funding that sum during that period by whatever means it considers appropriate.

"Financial Statements" means audited annual profit and loss account, balance sheet and cash flow statement for each financial year (consolidated for each financial year during which any relevant corporate body has a subsidiary) together with related directors' or members’ reports (as appropriate) and auditors' reports and the notes attached thereto.

"Limit" means the amount of the Facility set out in Clause 1.1.

"Maturity Date" means the agreed date for repayment of each Drawing.

"Quarter Day" means the Business Day falling on, or, if such day is not a Business Day the Business Day immediately before, each of 31^st March, 30^th June, 30^th September or 31^st December each year or any other quarter day that the Bank may advise the Borrower in replacement therefor from time to time as a consequence of a change in the Bank’s internal accounting policies.

"Sterling" and the sign "£" mean the lawful currency of the United Kingdom.

Interpretation

Any reference in this Facility Letter to:

(a) statutes, statutory provisions and other legislation shall include all amendments, substitutions, modifications and re-enactments for the time being in force and shall include any orders, regulations, instruments or other subordinate legislation made under the relevant legislation.

(b) "including" shall not be construed as limiting the generality of the words preceding it;

(c) any clause, paragraph or schedule shall be construed as a reference to the clauses in this Facility Letter, the schedules to this Facility Letter and the paragraphs in such schedules;

(d) the singular shall include the plural and vice versa and words denoting any gender shall include all genders and if any party to this Facility Letter constitutes more than one person all covenants, conditions and obligations shall be deemed to be given by all such parties on a joint and several basis unless this Facility Letter specifically provides otherwise;

(e) this Facility Letter and to any provisions of it or to any other document referred to in this Facility Letter shall be construed as references to it in force for the time being and as amended, varied, supplemented, restated, substituted or novated from time to time;

(f) a person is to be construed to include references to a corporation, firm, company, partnership, joint venture, unincorporated body of persons, individual or any state or any agency of a state, whether or not a separate legal entity;

(g) any person is to be construed to include that person's assignees or transferees or successors in title, whether direct or indirect;

(h) any word or phrase includes all derivations thereof;

(i) a matter being in the opinion of the Bank or at the Bank's discretion shall be in the sole opinion of the Bank taking into consideration the Bank's interests hereunder and in the case of the Bank's discretion it shall be at the Bank's sole unfettered discretion without taking into consideration other party's interests.

Clause headings are for ease of reference only and are not to affect the interpretation of this Facility Letter.

Resolution re Facility Letter

Extract from the Minutes of a Meeting of the Directors

of Western Power Distribution (South West) plc (the 'Company')

"After due consideration of all the circumstances and on being satisfied that it is for the benefit of the Company and in the interests of the Company for the purpose of carrying on its business the Company agreed to enter into the Facility Letter in the form now produced (the "Letter").

It was resolved that the Letter be executed for and on behalf of the Company either by a Director and its Secretary, or by two Directors.

I hereby certify that the foregoing is a true extract from the Minutes of a Meeting of the Directors at which (all appropriate interests having been declared) a quorum entitled to vote was present duly held on the               day of                              2016 and that a true copy of the Letter has been retained by the Company.

Secretary                                                                                                                 

EX-12.A

Exhibit 12(a)

PPL CORPORATION AND SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND

PREFERRED STOCK DIVIDENDS

(Millions of Dollars)

	Nine Months Ended September 30,		Years Ended December 31, (a)
	2016		2015			2014		2013		2012		2011
Earnings, as defined:
Income from Continuing Operations Before Income Taxes	$	1,947	$	2,068		$	2,129	$	1,728	$	1,406	$	922
Adjustment to reflect earnings from equity method investments on a cash basis (b)	—		(1		)	—		—		34		—
	1,947		2,067			2,129		1,728		1,440		922
Total fixed charges as below	689		1,054			1,095		1,096		1,065		1,022
Less:
Capitalized interest	3		11			11		11		6		4
Preferred security distributions of subsidiaries on a pre-tax basis	—		—			—		—		5		23
Interest expense and fixed charges related to discontinued operations	—		150			186		235		235		231
Total fixed charges included in Income from Continuing Operations Before Income Taxes	686		893			898		850		819		764
Total earnings	$	2,633	$	2,960		$	3,027	$	2,578	$	2,259	$	1,686
Fixed charges, as defined:
Interest charges (c)	$	681	$	1,038		$	1,073	$	1,058	$	1,019	$	955
Estimated interest component of operating rentals	8		16			22		38		41		44
Preferred security distributions of subsidiaries on a pre-tax basis	—		—			—		—		5		23
Total fixed charges (d)	$	689	$	1,054		$	1,095	$	1,096	$	1,065	$	1,022
Ratio of earnings to fixed charges	3.8		2.8			2.8		2.4		2.1		1.7
Ratio of earnings to combined fixed charges and preferred stock dividends (e)	3.8		2.8			2.8		2.4		2.1		1.7

(a)	Reflects PPL's Supply segment as Discontinued Operations. See Note 8 to the Financial Statements for additional information.
(b)	Includes other-than-temporary impairment loss of $25 million in 2012.
(c)	Includes interest on long-term and short-term debt, as well as amortization of debt discount, expense and premium - net.
(d)	Interest on unrecognized tax benefits is not included in fixed charges.
(e)	PPL, the parent holding company, does not have any preferred stock outstanding; therefore, the ratio of earnings to combined fixed charges and preferred stock dividends is the same as the ratio of earnings to fixed charges.

EX-12.B

Exhibit 12(b)

PPL ELECTRIC UTILITIES CORPORATION AND SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND

PREFERRED STOCK DIVIDENDS

(Millions of Dollars)

	Nine Months Ended September 30,		Years Ended December 31,
	2016		2015		2014		2013		2012		2011
Earnings, as defined:
Income Before Income Taxes	$	425	$	416	$	423	$	317	$	204	$	257
Total fixed charges as below	105		139		131		117		107		105
Total earnings	$	530	$	555	$	554	$	434	$	311	$	362
Fixed charges, as defined:
Interest charges (a)	$	102	$	135	$	127	$	113	$	104	$	102
Estimated interest component of operating rentals	3		4		4		4		3		3
Total fixed charges (b)	$	105	$	139	$	131	$	117	$	107	$	105
Ratio of earnings to fixed charges	5.0		4.0		4.2		3.7		2.9		3.4
Preferred stock dividend requirements on a pre-tax basis	$	—	$	—	$	—	$	—	$	6	$	21
Fixed charges, as above	105		139		131		117		107		105
Total fixed charges and preferred stock dividends	$	105	$	139	$	131	$	117	$	113	$	126
Ratio of earnings to combined fixed charges and preferred stock dividends	5.0		4.0		4.2		3.7		2.8		2.9

(a)	Includes interest on long-term and short-term debt, as well as amortization of debt discount, expense and premium - net.
(b)	Interest on unrecognized tax benefits is not included in fixed charges.

EX-12.C

Exhibit 12(c)

LG&E AND KU ENERGY LLC AND SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(Millions of Dollars)

	Nine Months Ended September 30,		Years Ended December 31,
	2016		2015			2014			2013			2012		2011
Earnings, as defined:
Income from Continuing Operations Before Income Taxes	$	539	$	603		$	553		$	551		$	331	$	419
Adjustment to reflect earnings from equity method investments on a cash basis (a)	—		(1		)	(1		)	(1		)	33		(1		)
	539		602			552			550			364		418
Total fixed charges as below	165		189			173			151			157		153
Total earnings	$	704	$	791		$	725		$	701		$	521	$	571
Fixed charges, as defined:
Interest charges (b) (c)	$	159	$	181		$	167		$	145		$	151	$	147
Estimated interest component of operating rentals	6		8			6			6			6		6
Total fixed charges	$	165	$	189		$	173		$	151		$	157	$	153
Ratio of earnings to fixed charges	4.3		4.2			4.2			4.6			3.3		3.7

(a)	Includes other-than-temporary impairment loss of $25 million in 2012.
(b)	Includes interest on long-term and short-term debt, as well as amortization of loss on reacquired debt and amortization of debt discount, expense and premium - net.
(c)	Includes a credit for amortization of a fair market value adjustment of $7 million in 2013.

EX-12.D

Exhibit 12(d)

LOUISVILLE GAS AND ELECTRIC COMPANY

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(Millions of Dollars)

	Nine Months Ended September 30,		Years Ended December 31,
	2016		2015		2014		2013		2012		2011
Earnings, as defined:
Income Before Income Taxes	$	257	$	299	$	272	$	257	$	192	$	195
Total fixed charges as below	56		61		51		36		44		46
Total earnings	$	313	$	360	$	323	$	293	$	236	$	241
Fixed charges, as defined:
Interest charges (a) (b)	$	53	$	57	$	49	$	34	$	42	$	44
Estimated interest component of operating rentals	3		4		2		2		2		2
Total fixed charges	$	56	$	61	$	51	$	36	$	44	$	46
Ratio of earnings to fixed charges	5.6		5.9		6.3		8.1		5.4		5.2

(a)	Includes interest on long-term and short-term debt, as well as amortization of loss on reacquired debt and amortization of debt discount, expense and premium - net.
(b)	Includes a credit for amortization of a fair market value adjustment of $7 million in 2013.

EX-12.E

Exhibit 12(e)

KENTUCKY UTILITIES COMPANY

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(Millions of Dollars)

	Nine Months Ended September 30,		Years Ended December 31,
	2016		2015			2014			2013			2012		2011
Earnings, as defined:
Income Before Income Taxes	$	335	$	374		$	355		$	360		$	215	$	282
Adjustment to reflect earnings from equity method investments on a cash basis (a)	—		(1		)	(1		)	(1		)	33		(1		)
	335		373			354			359			248		281
Total fixed charges as below	74		86			80			73			72		73
Total earnings	$	409	$	459		$	434		$	432		$	320	$	354
Fixed charges, as defined:
Interest charges (b)	$	71	$	82		$	77		$	70		$	69	$	70
Estimated interest component of operating rentals	3		4			3			3			3		3
Total fixed charges	$	74	$	86		$	80		$	73		$	72	$	73
Ratio of earnings to fixed charges	5.5		5.3			5.4			5.9			4.4		4.8

(a)	Includes other-than-temporary impairment loss of $25 million in 2012.
(b)	Includes interest on long-term and short-term debt, as well as amortization of loss on reacquired debt and amortization of debt discount, expense and premium - net.

EX-31.A

Exhibit 31(a)

CERTIFICATION

I, WILLIAM H. SPENCE, certify that:

1. I have reviewed this quarterly report on Form 10-Q of PPL Corporation (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  William H. Spence
		William H. Spence
		Chairman, President and Chief Executive Officer
		(Principal Executive Officer)
		PPL Corporation

EX-31.B

Exhibit 31(b)

CERTIFICATION

I, VINCENT SORGI, certify that:

1. I have reviewed this quarterly report on Form 10-Q of PPL Corporation (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Vincent Sorgi
		Vincent Sorgi
		Senior Vice President and Chief Financial Officer
		(Principal Financial Officer)
		PPL Corporation

EX-31.C

Exhibit 31(c)

CERTIFICATION

I, GREGORY N. DUDKIN, certify that:

1. I have reviewed this quarterly report on Form 10-Q of PPL Electric Utilities Corporation (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Gregory N. Dudkin
		Gregory N. Dudkin
		President
		(Principal Executive Officer)
		PPL Electric Utilities Corporation

EX-31.D

Exhibit 31(d)

CERTIFICATION

I, MARLENE C. BEERS, certify that:

1. I have reviewed this quarterly report on Form 10-Q of PPL Electric Utilities Corporation (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Marlene C. Beers
		Marlene C. Beers
		Controller
		(Principal Financial Officer and Principal Accounting Officer)
		PPL Electric Utilities Corporation

EX-31.E

Exhibit 31(e)

CERTIFICATION

I, VICTOR A. STAFFIERI, certify that:

1. I have reviewed this quarterly report on Form 10-Q of LG&E and KU Energy LLC (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Victor A. Staffieri
		Victor A. Staffieri
		Chairman of the Board, Chief Executive Officer and President
		(Principal Executive Officer)
		LG&E and KU Energy LLC

EX-31.F

Exhibit 31(f)

CERTIFICATION

I, KENT W. BLAKE, certify that:

1. I have reviewed this quarterly report on Form 10-Q of LG&E and KU Energy LLC (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Kent W. Blake
		Kent W. Blake
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)
		LG&E and KU Energy LLC

EX-31.G

Exhibit 31(g)

CERTIFICATION

I, VICTOR A. STAFFIERI, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Louisville Gas and Electric Company (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Victor A. Staffieri
		Victor A. Staffieri
		Chairman of the Board, Chief Executive Officer and President
		(Principal Executive Officer)
		Louisville Gas and Electric Company

EX-31.H

Exhibit 31(h)

CERTIFICATION

I, KENT W. BLAKE, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Louisville Gas and Electric Company (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Kent W. Blake
		Kent W. Blake
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)
		Louisville Gas and Electric Company

EX-31.I

Exhibit 31(i)

CERTIFICATION

I, VICTOR A. STAFFIERI, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Kentucky Utilities Company (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Victor A. Staffieri
		Victor A. Staffieri
		Chairman of the Board, Chief Executive Officer and President
		(Principal Executive Officer)
		Kentucky Utilities Company

EX-31.J

Exhibit 31(j)

CERTIFICATION

I, KENT W. BLAKE, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Kentucky Utilities Company (the "registrant");

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 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 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.

Date:	November 1, 2016	/s/  Kent W. Blake
		Kent W. Blake
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)
		Kentucky Utilities Company

EX-32.A

Exhibit 32(a)

CERTIFICATE PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

FOR PPL CORPORATION'S FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2016

In connection with the quarterly report on Form 10-Q of PPL Corporation (the "Company") for the quarter ended September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Covered Report"), we, William H. Spence, the Principal Executive Officer of the Company, and Vincent Sorgi, the Principal Financial Officer of the Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, hereby certify that:

• The Covered Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

• The information contained in the Covered Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	November 1, 2016	/s/  William H. Spence
		William H. Spence
		Chairman, President and Chief Executive Officer
		(Principal Executive Officer)
		PPL Corporation
		/s/  Vincent Sorgi
		Vincent Sorgi
		Senior Vice President and Chief Financial Officer
		(Principal Financial Officer)
		PPL Corporation

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.B

Exhibit 32(b)

CERTIFICATE PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

FOR PPL CORPORATION'S FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2016

In connection with the quarterly report on Form 10-Q of PPL Electric Utilities Corporation (the "Company") for the quarter ended September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Covered Report"), we, Gregory N. Dudkin, the Principal Executive Officer of the Company, and Marlene C. Beers, the Principal Financial Officer of the Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, hereby certify that:

• The Covered Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

• The information contained in the Covered Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	November 1, 2016	/s/  Gregory N. Dudkin
		Gregory N. Dudkin
		President
		(Principal Executive Officer)
		PPL Electric Utilities Corporation
		/s/  Marlene C. Beers
		Marlene C. Beers
		Controller
		(Principal Financial Officer and Principal Accounting Officer)
		PPL Electric Utilities Corporation

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.C

Exhibit 32(c)

CERTIFICATE PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

FOR PPL CORPORATION'S FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2016

In connection with the quarterly report on Form 10-Q of LG&E and KU Energy LLC (the "Company") for the quarter ended September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Covered Report"), we, Victor A. Staffieri, the Principal Executive Officer of the Company, and Kent W. Blake, the Principal Financial Officer of the Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, hereby certify that:

• The Covered Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

• The information contained in the Covered Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	November 1, 2016	/s/  Victor A. Staffieri
		Victor A. Staffieri
		Chairman of the Board, Chief Executive Officer and President
		(Principal Executive Officer)
		LG&E and KU Energy LLC
		/s/  Kent W. Blake
		Kent W. Blake
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)
		LG&E and KU Energy LLC

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.D

Exhibit 32(d)

CERTIFICATE PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

FOR PPL CORPORATION'S FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2016

In connection with the quarterly report on Form 10-Q of Louisville Gas and Electric Company (the "Company") for the quarter ended September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Covered Report"), we, Victor A. Staffieri, the Principal Executive Officer of the Company, and Kent W. Blake, the Principal Financial Officer of the Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, hereby certify that:

• The Covered Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

• The information contained in the Covered Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	November 1, 2016	/s/  Victor A. Staffieri
		Victor A. Staffieri
		Chairman of the Board, Chief Executive Officer and President
		(Principal Executive Officer)
		Louisville Gas and Electric Company
		/s/  Kent W. Blake
		Kent W. Blake
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)
		Louisville Gas and Electric Company

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.E

Exhibit 32(e)

CERTIFICATE PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

FOR PPL CORPORATION'S FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2016

In connection with the quarterly report on Form 10-Q of Kentucky Utilities Company (the "Company") for the quarter ended September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Covered Report"), we, Victor A. Staffieri, the Principal Executive Officer of the Company, and Kent W. Blake, the Principal Financial Officer of the Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, hereby certify that:

• The Covered Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

• The information contained in the Covered Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	November 1, 2016	/s/  Victor A. Staffieri
		Victor A. Staffieri
		Chairman of the Board, Chief Executive Officer and President
		(Principal Executive Officer)
		Kentucky Utilities Company
		/s/  Kent W. Blake
		Kent W. Blake
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)
		Kentucky Utilities Company

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 26, 2016
Document Entity Information [Line Items]
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Entity Registrant Name	PPL Corp
Entity Central Index Key	0000922224
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		679,627,323
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3
PPL Electric Utilities Corp [Member]
Document Entity Information [Line Items]
Amendment Flag	false
Entity Registrant Name	PPL ELECTRIC UTILITIES CORP
Entity Central Index Key	0000317187
Entity Well-known Seasoned Issuer	No
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		66,368,056
LG And E And KU Energy LLC [Member]
Document Entity Information [Line Items]
Amendment Flag	false
Entity Registrant Name	LG&E & KU Energy LLC
Entity Central Index Key	0001518339
Entity Well-known Seasoned Issuer	No
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		0
Louisville Gas And Electric Co [Member]
Document Entity Information [Line Items]
Amendment Flag	false
Entity Registrant Name	LOUISVILLE GAS & ELECTRIC CO
Entity Central Index Key	0000060549
Entity Well-known Seasoned Issuer	No
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		21,294,223
Kentucky Utilities Co [Member]
Document Entity Information [Line Items]
Amendment Flag	false
Entity Registrant Name	KENTUCKY UTILITIES CO
Entity Central Index Key	0000055387
Entity Well-known Seasoned Issuer	No
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		37,817,878

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) shares in Thousands, $ in Millions		3 Months Ended		9 Months Ended
		Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Operating Revenues
Operating Revenues		$ 1,889	$ 1,878	$ 5,685	$ 5,889
Operation
Fuel		227	228	607	695
Energy purchases		151	177	531	676
Other operation and maintenance		417	482	1,292	1,405
Depreciation		232	226	692	658
Taxes, other than income		76	79	229	241
Total Operating Expenses		1,103	1,192	3,351	3,675
Operating Income		786	686	2,334	2,214
Other Income (Expense) - net		49	75	284	61
Interest Expense		223	221	671	645
Income Before Income Taxes		612	540	1,947	1,630
Income Taxes		139	144	510	432
Income from Continuing Operations After Income Taxes		473	396	1,437	1,198
Income (Loss) from Discontinued Operations (net of income taxes)		0	(3)	0	(915)
Net Income		$ 473	$ 393	$ 1,437	$ 283
Income from Continuing Operations After Income Taxes:
Basic (in dollars per share)		$ 0.70	$ 0.59	$ 2.12	$ 1.78
Diluted (in dollars per share)		0.69	0.59	2.11	1.78
Net Income:
Basic (in dollars per share)		0.70	0.58	2.12	0.42
Diluted (in dollars per share)		0.69	0.58	2.11	0.42
Dividends Declared Per Share of Common Stock (in dollars per share)		$ 0.38	$ 0.3775	$ 1.14	$ 1.1225
Weighted-Average Shares of Common Stock Outstanding (in thousands)
Basic (in shares)		678,114	670,763	676,905	668,731
Diluted (in shares)		680,348	673,702	679,969	671,254
PPL Electric Utilities Corp [Member]
Operating Revenues
Operating Revenues		$ 539	$ 519	$ 1,619	$ 1,625
Operation
Energy purchases		129	154	414	519
Energy purchases from affiliate		0	0	0	14
Other operation and maintenance		144	162	431	435
Depreciation		64	55	185	158
Taxes, other than income		26	27	79	87
Total Operating Expenses		363	398	1,109	1,213
Operating Income		176	121	510	412
Other Income (Expense) - net		4	1	12	5
Interest Expense		32	32	97	96
Income Before Income Taxes		148	90	425	321
Income Taxes		58	35	162	130
Net Income	[1]	90	55	263	191
LG And E And KU Energy LLC [Member]
Operating Revenues
Operating Revenues		835	801	2,382	2,414
Operation
Fuel		227	228	607	695
Energy purchases		24	23	118	143
Other operation and maintenance		197	202	603	625
Depreciation		102	97	301	286
Taxes, other than income		16	14	46	43
Total Operating Expenses		566	564	1,675	1,792
Operating Income		269	237	707	622
Other Income (Expense) - net		(3)	(1)	(9)	(3)
Interest Expense		50	43	147	127
Interest Expense with Affiliate		4	0	12	1
Income Before Income Taxes		212	193	539	491
Income Taxes		79	73	202	194
Net Income		133	120	337	297
Louisville Gas And Electric Co [Member]
Operating Revenues
Retail and wholesale		366	349	1,058	1,089
Electric revenue from affiliate		2	2	19	32
Operating Revenues		368	351	1,077	1,121
Operation
Fuel		86	82	233	267
Energy purchases		19	18	104	129
Energy purchases from affiliate		5	9	10	17
Other operation and maintenance		85	87	264	286
Depreciation		43	40	126	122
Taxes, other than income		9	7	24	21
Total Operating Expenses		247	243	761	842
Operating Income		121	108	316	279
Other Income (Expense) - net		(1)	(1)	(6)	(3)
Interest Expense		18	13	53	39
Income Before Income Taxes		102	94	257	237
Income Taxes		39	36	98	91
Net Income	[1]	63	58	159	146
Kentucky Utilities Co [Member]
Operating Revenues
Retail and wholesale		469	452	1,324	1,325
Electric revenue from affiliate		5	9	10	17
Operating Revenues		474	461	1,334	1,342
Operation
Fuel		141	146	374	428
Energy purchases		5	5	14	14
Energy purchases from affiliate		2	2	19	32
Other operation and maintenance		107	108	320	321
Depreciation		59	57	175	164
Taxes, other than income		7	7	22	22
Total Operating Expenses		321	325	924	981
Operating Income		153	136	410	361
Other Income (Expense) - net		(3)	0	(4)	1
Interest Expense		24	20	71	58
Income Before Income Taxes		126	116	335	304
Income Taxes		48	44	128	115
Net Income	[2]	$ 78	$ 72	$ 207	$ 189

[1] Net income equals comprehensive income.

[2] Net income approximates comprehensive income.

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Net income	$ 473	$ 393	$ 1,437	$ 283
Amounts arising during the period - gains (losses), net of tax (expense) benefit:
Foreign currency translation adjustments, net of tax	(641)	52	(837)	(97)
Available-for-sale securities, net of tax	0	0	0	7
Qualifying derivatives, net of tax	62	(19)	57	8
Defined benefit plans:
Prior service costs, net of tax	0	0	0	(6)
Net actuarial gain (loss), net of tax	(6)	0	(4)	52
Reclassifications from accumulated other comprehensive income (loss) - (gains) losses, net of tax expense (benefit):
Available-for-sale securities, net of tax	0	0	0	(2)
Qualifying derivatives, net of tax	(69)	10	(62)	20
Equity investees' other comprehensive (income) loss, net of tax	0	0	(1)	(1)
Defined benefit plans:
Prior service costs, net of tax	0	0	1	0
Net actuarial loss, net of tax	31	35	94	111
Total other comprehensive income (loss)	(623)	78	(752)	92
Comprehensive income (loss)	(150)	471	685	375
LG And E And KU Energy LLC [Member]
Net income	133	120	337	297
Defined benefit plans:
Net actuarial gain (loss), net of tax	0	0	1	(8)
Reclassifications from accumulated other comprehensive income (loss) - (gains) losses, net of tax expense (benefit):
Equity investees' other comprehensive (income) loss, net of tax	0	0	(1)	(1)
Defined benefit plans:
Prior service costs, net of tax	0	0	1	1
Net actuarial loss, net of tax	1	1	3	2
Total other comprehensive income (loss)	1	1	4	(6)
Comprehensive income (loss)	$ 134	$ 121	$ 341	$ 291

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (Parenthetical) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Tax effect of foreign currency translation adjustments arising during the period	$ (2)	$ (3)	$ (4)	$ (2)
Tax effect of available-for-sale securities arising during the period	0	0	0	(9)
Tax effect of qualifying derivatives arising during the period	(16)	11	(9)	4
Tax effect of defined benefit plans - prior service costs arising during period	0	0	0	4
Tax effect of defined benefit plans - net actuarial gain (loss) arising during period	4	0	3	(36)
Tax effect of available-for-sale securities reclassified from accumulated other comprehensive income (loss)	0	0	0	2
Tax effect of qualifying derivatives reclassified from accumulated other comprehensive income (loss)	17	(3)	15	(23)
Tax effect of equity investees' other comprehensive income (loss) reclassified from accumulated other comprehensive income (loss)	0	0	0	1
Tax effect of prior service costs reclassified from accumulated other comprehensive income (loss)	(1)	0	(1)	0
Tax effect of net actuarial loss reclassified from accumulated other comprehensive income (loss)	(10)	(10)	(27)	(35)
LG And E And KU Energy LLC [Member]
Tax effect of defined benefit plans - net actuarial gain (loss) arising during period	0	0	(1)	5
Tax effect of equity investees' other comprehensive income (loss) reclassified from accumulated other comprehensive income (loss)	0	0	0	1
Tax effect of prior service costs reclassified from accumulated other comprehensive income (loss)	(1)	0	(1)	0
Tax effect of net actuarial loss reclassified from accumulated other comprehensive income (loss)	$ 0	$ 0	$ (1)	$ (1)

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions		9 Months Ended
		Sep. 30, 2016	Sep. 30, 2015
Cash Flows from Operating Activities
Net Income		$ 1,437	$ 283
(Income) Loss from discontinued operations (net of income taxes)		0	915
Income from Continuing Operations After Income Taxes		1,437	1,198
Adjustments to reconcile Income from continuing operations (net of taxes) to net cash provided by operating activities - continuing operations
Depreciation		692	658
Amortization		54	46
Defined benefit plans - expense (income)		(29)	44
Deferred income taxes and investment tax credits		436	359
Unrealized (gains) losses on derivatives, and other hedging activities		107	(17)
Stock-based compensation expense		23	26
Other		(12)	9
Change in current assets and current liabilities
Accounts receivable		(29)	(5)
Accounts payable		(40)	(180)
Unbilled revenues		32	91
Fuel, materials and supplies		8	60
Prepayments		(34)	(43)
Taxes payable		40	(142)
Regulatory assets and liabilities		(32)	46
Other		(21)	(5)
Other operating activities
Defined benefit plans - funding		(345)	(396)
Settlement of interest rate swaps		0	(88)
Other assets		18	(42)
Other liabilities		(75)	69
Net cash provided by operating activities - continuing operations		2,230	1,688
Net cash provided by operating activities - discontinued operations		0	343
Net cash provided by operating activities		2,230	2,031
Cash Flows from Investing Activities
Expenditures for property, plant and equipment		(2,073)	(2,560)
Expenditures for intangible assets		(23)	(32)
Proceeds from the sale of other investments		2	136
Other investing activities		28	(7)
Net cash provided by (used in) investing activities - continuing operations		(2,066)	(2,463)
Net cash provided by (used in) investing activities - discontinued operations		0	(149)
Net cash provided by (used in) investing activities		(2,066)	(2,612)
Cash Flows from Financing Activities
Issuance of long-term debt		1,241	1,137
Retirement of long-term debt		(905)	0
Settlement of cross-currency swaps		46	0
Issuance of common stock		133	145
Payment of common stock dividends		(772)	(750)
Net increase (decrease) in short-term debt		(268)	(271)
Other financing activities		(33)	(30)
Net cash provided by (used in) financing activities - continuing operations		(558)	231
Net cash provided by (used in) financing activities - discontinued operations		0	(546)
Net cash distributions to parent from discontinued operations		0	132
Net cash provided by (used in) financing activities		(558)	(183)
Effect of Exchange Rates on Cash and Cash Equivalents		(26)	(6)
Net (Increase) Decrease in Cash and Cash Equivalents included in Discontinued Operations		0	(352)
Net Increase (Decrease) in Cash and Cash Equivalents		(420)	(418)
Cash and Cash Equivalents at Beginning of Period		836	1,399
Cash and Cash Equivalents at End of Period		416	981
PPL Electric Utilities Corp [Member]
Cash Flows from Operating Activities
Net Income	[1]	263	191
Adjustments to reconcile Income from continuing operations (net of taxes) to net cash provided by operating activities - continuing operations
Depreciation		185	158
Amortization		19	19
Defined benefit plans - expense (income)		9	13
Deferred income taxes and investment tax credits		151	127
Other		(14)	(9)
Change in current assets and current liabilities
Accounts receivable		(6)	18
Accounts payable		(1)	(140)
Unbilled revenues		10	28
Prepayments		29	(17)
Taxes payable		(6)	(50)
Regulatory assets and liabilities		(41)	46
Other		(13)	13
Other operating activities
Defined benefit plans - funding		0	(33)
Other assets		15	(6)
Other liabilities		(5)	15
Net cash provided by operating activities - continuing operations		595	373
Cash Flows from Investing Activities
Expenditures for property, plant and equipment		(739)	(758)
Expenditures for intangible assets		0	(9)
Other investing activities		(1)	3
Net cash provided by (used in) investing activities - continuing operations		(740)	(764)
Cash Flows from Financing Activities
Issuance of long-term debt		224	0
Retirement of long-term debt		(224)	0
Contributions from parent		200	275
Payment of common stock dividends to parent		(193)	(140)
Net increase (decrease) in short-term debt		130	68
Other financing activities		(3)	0
Net cash provided by (used in) financing activities - continuing operations		134	203
Cash and Cash Equivalents, Period Increase (Decrease)		(11)	(188)
Cash and Cash Equivalents at Beginning of Period		47	214
Cash and Cash Equivalents at End of Period		36	26
LG And E And KU Energy LLC [Member]
Cash Flows from Operating Activities
Net Income		337	297
Adjustments to reconcile Income from continuing operations (net of taxes) to net cash provided by operating activities - continuing operations
Depreciation		301	286
Amortization		21	18
Defined benefit plans - expense (income)		20	29
Deferred income taxes and investment tax credits		212	199
Other		0	29
Change in current assets and current liabilities
Accounts receivable		(43)	(1)
Accounts payable		7	(34)
Accounts payable to affiliates		4	(7)
Unbilled revenues		6	19
Fuel, materials and supplies		7	43
Income tax receivable		0	132
Accrued interest		42	37
Other		(4)	(2)
Other operating activities
Defined benefit plans - funding		(82)	(66)
Expenditures for asset retirement obligations		(15)	(5)
Settlement of interest rate swaps		0	(88)
Other assets		1	(4)
Other liabilities		2	13
Net cash provided by operating activities - continuing operations		816	895
Cash Flows from Investing Activities
Expenditures for property, plant and equipment		(600)	(928)
Other investing activities		1	7
Net cash provided by (used in) investing activities - continuing operations		(599)	(921)
Cash Flows from Financing Activities
Net increase (decrease) in notes payable with affiliate		84	21
Issuance of long-term debt		221	1,050
Retirement of long-term debt		(221)	0
Debt issuance and credit facility costs		(3)	(9)
Net increase (decrease) in short-term debt		(130)	(500)
Distributions to member		(224)	(157)
Contributions from member		37	55
Net cash provided by (used in) financing activities - continuing operations		(236)	460
Net Increase (Decrease) in Cash and Cash Equivalents		(19)	434
Cash and Cash Equivalents at Beginning of Period		30	21
Cash and Cash Equivalents at End of Period		11	455
Louisville Gas And Electric Co [Member]
Cash Flows from Operating Activities
Net Income	[1]	159	146
Adjustments to reconcile Income from continuing operations (net of taxes) to net cash provided by operating activities - continuing operations
Depreciation		126	122
Amortization		10	9
Defined benefit plans - expense (income)		6	10
Deferred income taxes and investment tax credits		117	93
Other		0	25
Change in current assets and current liabilities
Accounts receivable		(19)	10
Accounts receivable from affiliates		(11)	4
Accounts payable		24	(14)
Accounts payable to affiliates		(6)	(1)
Unbilled revenues		10	13
Fuel, materials and supplies		11	21
Income tax receivable		2	74
Accrued interest		13	9
Other		1	8
Other operating activities
Defined benefit plans - funding		(45)	(25)
Expenditures for asset retirement obligations		(11)	(4)
Settlement of interest rate swaps		0	(44)
Other assets		(3)	10
Other liabilities		(1)	3
Net cash provided by operating activities - continuing operations		383	469
Cash Flows from Investing Activities
Expenditures for property, plant and equipment		(343)	(519)
Net cash provided by (used in) investing activities - continuing operations		(343)	(519)
Cash Flows from Financing Activities
Issuance of long-term debt		125	550
Retirement of long-term debt		(125)	0
Contributions from parent		47	20
Debt issuance and credit facility costs		(1)	(5)
Payment of common stock dividends to parent		(87)	(81)
Net increase (decrease) in short-term debt		(14)	(264)
Net cash provided by (used in) financing activities - continuing operations		(55)	220
Net Increase (Decrease) in Cash and Cash Equivalents		(15)	170
Cash and Cash Equivalents at Beginning of Period		19	10
Cash and Cash Equivalents at End of Period		4	180
Kentucky Utilities Co [Member]
Cash Flows from Operating Activities
Net Income	[2]	207	189
Adjustments to reconcile Income from continuing operations (net of taxes) to net cash provided by operating activities - continuing operations
Depreciation		175	164
Amortization		10	8
Defined benefit plans - expense (income)		4	9
Deferred income taxes and investment tax credits		122	132
Other		(1)	4
Change in current assets and current liabilities
Accounts receivable		(24)	(11)
Accounts payable		(11)	(18)
Accounts payable to affiliates		2	(7)
Unbilled revenues		(4)	6
Fuel, materials and supplies		(4)	22
Income tax receivable		0	60
Accrued interest		22	19
Other		2	6
Other operating activities
Defined benefit plans - funding		(19)	(20)
Expenditures for asset retirement obligations		(4)	(1)
Settlement of interest rate swaps		0	(44)
Other assets		(4)	(9)
Other liabilities		(4)	1
Net cash provided by operating activities - continuing operations		469	510
Cash Flows from Investing Activities
Expenditures for property, plant and equipment		(255)	(407)
Other investing activities		1	7
Net cash provided by (used in) investing activities - continuing operations		(254)	(400)
Cash Flows from Financing Activities
Issuance of long-term debt		96	500
Retirement of long-term debt		(96)	0
Contributions from parent		20	0
Debt issuance and credit facility costs		(1)	(4)
Payment of common stock dividends to parent		(197)	(106)
Net increase (decrease) in short-term debt		(41)	(236)
Net cash provided by (used in) financing activities - continuing operations		(219)	154
Net Increase (Decrease) in Cash and Cash Equivalents		(4)	264
Cash and Cash Equivalents at Beginning of Period		11	11
Cash and Cash Equivalents at End of Period		$ 7	$ 275

[1] Net income equals comprehensive income.

[2] Net income approximates comprehensive income.

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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Millions		Sep. 30, 2016	Dec. 31, 2015
Current Assets
Cash and cash equivalents		$ 416	$ 836
Accounts receivable (less reserve:)
Customer		687	673
Other		45	59
Unbilled revenues		393	453
Fuel, materials and supplies		346	357
Prepayments		97	66
Price risk management assets		78	139
Regulatory assets	[1]	30	48
Other current assets		37	63
Total Current Assets		2,099	2,646
Property, Plant and Equipment
Regulated utility plant		34,427	34,399
Less: accumulated depreciation - regulated utility plant		5,938	5,683
Regulated utility plant, net		28,489	28,716
Non-regulated property, plant and equipment		451	516
Less: accumulated depreciation - non-regulated property, plant and equipment		155	165
Non-regulated property, plant and equipment, net		296	351
Construction work in progress		1,184	1,315
Property, Plant and Equipment, net		29,969	30,382
Other Noncurrent Assets
Regulatory assets		1,765	1,733
Goodwill		3,175	3,550
Other intangibles		693	679
Price risk management assets		185	156
Other noncurrent assets		152	155
Total Other Noncurrent Assets		5,970	6,273
Total Assets		38,038	39,301
Current Liabilities
Short-term debt		636	916
Long-term debt due within one year		443	485
Accounts payable		741	812
Taxes		117	85
Interest		315	303
Dividends		259	255
Customer deposits		302	326
Regulatory liabilities		120	145
Other current liabilities		479	549
Total Current Liabilities		3,412	3,876
Long-term Debt
Long-term Debt		18,069	18,563
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes		3,810	3,440
Investment tax credits		133	128
Accrued pension obligations		878	1,405
Asset retirement obligations		413	536
Regulatory liabilities		911	945
Other deferred credits and noncurrent liabilities		437	489
Total Deferred Credits and Other Noncurrent Liabilities		6,582	6,943
Commitments and Contingent Liabilities
Equity
Common stock	[2]	7	7
Additional paid-in capital		9,824	9,687
Earnings reinvested		3,624	2,953
Accumulated other comprehensive loss		(3,480)	(2,728)
Total Equity		9,975	9,919
Total Liabilities and Equity		38,038	39,301
PPL Electric Utilities Corp [Member]
Current Assets
Cash and cash equivalents		36	47
Accounts receivable (less reserve:)
Customer		290	286
Other		12	10
Unbilled revenues		81	91
Fuel, materials and supplies		28	34
Prepayments		37	66
Regulatory assets	[1]	12	13
Other current assets		15	21
Total Current Assets		499	555
Property, Plant and Equipment
Regulated utility plant		9,360	8,734
Less: accumulated depreciation - regulated utility plant		2,698	2,573
Regulated utility plant, net		6,662	6,161
Construction work in progress		657	530
Property, Plant and Equipment, net		7,319	6,691
Other Noncurrent Assets
Regulatory assets		991	1,006
Other intangibles		247	244
Other noncurrent assets		14	15
Total Other Noncurrent Assets		1,252	1,265
Total Assets		9,070	8,511
Current Liabilities
Short-term debt		130	0
Long-term debt due within one year		224	0
Accounts payable		357	288
Accounts payable to affiliates		33	35
Taxes		18	24
Interest		31	37
Customer deposits		22	31
Regulatory liabilities		94	113
Other current liabilities		69	77
Total Current Liabilities		978	605
Long-term Debt
Long-term Debt		2,607	2,828
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes		1,823	1,663
Accrued pension obligations		185	183
Regulatory liabilities		0	22
Other deferred credits and noncurrent liabilities		88	91
Total Deferred Credits and Other Noncurrent Liabilities		2,096	1,959
Commitments and Contingent Liabilities
Equity
Common stock	[3]	364	364
Additional paid-in capital		2,134	1,934
Earnings reinvested		891	821
Total Equity		3,389	3,119
Total Liabilities and Equity		9,070	8,511
LG And E And KU Energy LLC [Member]
Current Assets
Cash and cash equivalents		11	30
Accounts receivable (less reserve:)
Customer		250	209
Other		13	17
Unbilled revenues		141	147
Fuel, materials and supplies		292	298
Prepayments		31	23
Regulatory assets		18	35
Other current assets		1	6
Total Current Assets		757	765
Property, Plant and Equipment
Regulated utility plant		12,510	11,906
Less: accumulated depreciation - regulated utility plant		1,382	1,163
Regulated utility plant, net		11,128	10,743
Construction work in progress		349	660
Property, Plant and Equipment, net		11,477	11,403
Other Noncurrent Assets
Regulatory assets		774	727
Goodwill		996	996
Other intangibles		103	123
Other noncurrent assets		80	76
Total Other Noncurrent Assets		1,953	1,922
Total Assets		14,187	14,090
Current Liabilities
Short-term debt		135	265
Long-term debt due within one year		219	25
Notes payable with affiliate		138	54
Accounts payable		216	266
Accounts payable to affiliates		9	5
Taxes		49	46
Price risk management liabilities		6	5
Interest		74	32
Customer deposits		55	52
Regulatory liabilities		26	32
Asset retirement obligations		54	50
Other current liabilities		111	135
Total Current Liabilities		1,092	967
Long-term Debt
Long-term debt		4,470	4,663
Long-term debt to affiliate		400	400
Long-term Debt		4,870	5,063
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes		1,673	1,463
Investment tax credits		132	128
Accrued pension obligations		242	296
Asset retirement obligations		368	485
Regulatory liabilities		911	923
Price risk management liabilities		48	42
Other deferred credits and noncurrent liabilities		180	206
Total Deferred Credits and Other Noncurrent Liabilities		3,554	3,543
Commitments and Contingent Liabilities
Equity
Accumulated other comprehensive loss		(42)	(46)
Member's equity		4,671	4,517
Total Liabilities and Equity		14,187	14,090
Louisville Gas And Electric Co [Member]
Current Assets
Cash and cash equivalents		4	19
Accounts receivable (less reserve:)
Customer		109	92
Other		11	11
Accounts receivable from affiliates		23	12
Unbilled revenues		57	67
Fuel, materials and supplies		140	151
Prepayments		14	5
Regulatory assets		6	16
Other current assets		0	2
Total Current Assets		364	375
Property, Plant and Equipment
Regulated utility plant		5,234	4,804
Less: accumulated depreciation - regulated utility plant		468	404
Regulated utility plant, net		4,766	4,400
Construction work in progress		155	390
Property, Plant and Equipment, net		4,921	4,790
Other Noncurrent Assets
Regulatory assets		437	424
Goodwill		389	389
Other intangibles		63	73
Other noncurrent assets		21	17
Total Other Noncurrent Assets		910	903
Total Assets		6,195	6,068
Current Liabilities
Short-term debt		128	142
Long-term debt due within one year		219	25
Accounts payable		133	157
Accounts payable to affiliates		19	25
Taxes		23	20
Price risk management liabilities		6	5
Interest		24	11
Customer deposits		26	26
Regulatory liabilities		7	13
Asset retirement obligations		39	25
Other current liabilities		36	39
Total Current Liabilities		660	488
Long-term Debt
Long-term Debt		1,423	1,617
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes		944	829
Investment tax credits		37	35
Accrued pension obligations		18	56
Asset retirement obligations		107	149
Regulatory liabilities		424	431
Price risk management liabilities		48	42
Other deferred credits and noncurrent liabilities		85	91
Total Deferred Credits and Other Noncurrent Liabilities		1,663	1,633
Commitments and Contingent Liabilities
Equity
Common stock	[4]	424	424
Additional paid-in capital		1,658	1,611
Earnings reinvested		367	295
Total Equity		2,449	2,330
Total Liabilities and Equity		6,195	6,068
Kentucky Utilities Co [Member]
Current Assets
Cash and cash equivalents		7	11
Accounts receivable (less reserve:)
Customer		141	117
Other		3	9
Accounts receivable from affiliates		1	1
Unbilled revenues		84	80
Fuel, materials and supplies		152	147
Prepayments		16	8
Regulatory assets		12	19
Other current assets		1	4
Total Current Assets		417	396
Property, Plant and Equipment
Regulated utility plant		7,270	7,099
Less: accumulated depreciation - regulated utility plant		913	759
Regulated utility plant, net		6,357	6,340
Construction work in progress		192	267
Property, Plant and Equipment, net		6,549	6,607
Other Noncurrent Assets
Regulatory assets		337	303
Goodwill		607	607
Other intangibles		40	50
Other noncurrent assets		56	48
Total Other Noncurrent Assets		1,040	1,008
Total Assets		8,006	8,011
Current Liabilities
Short-term debt		7	48
Accounts payable		67	88
Accounts payable to affiliates		42	39
Taxes		23	20
Interest		38	16
Customer deposits		29	26
Regulatory liabilities		19	19
Asset retirement obligations		15	25
Other current liabilities		35	44
Total Current Liabilities		275	325
Long-term Debt
Long-term Debt		2,327	2,326
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes		1,166	1,046
Investment tax credits		95	93
Accrued pension obligations		33	46
Asset retirement obligations		261	336
Regulatory liabilities		487	492
Other deferred credits and noncurrent liabilities		46	60
Total Deferred Credits and Other Noncurrent Liabilities		2,088	2,073
Commitments and Contingent Liabilities
Equity
Common stock	[5]	308	308
Additional paid-in capital		2,616	2,596
Earnings reinvested		393	383
Accumulated other comprehensive loss		(1)	0
Total Equity		3,316	3,287
Total Liabilities and Equity		$ 8,006	$ 8,011

[1] These amounts are included in "Other current assets" on the Balance Sheets.

[2] shares authorized; 679,268 shares issued and outstanding at September 30, 2016; 780,000 shares authorized; 673,857 shares issued and outstanding at December 31, 2015.

[3] shares authorized; 66,368 shares issued and outstanding at September 30, 2016 and December 31, 2015.

[4] 75,000 shares authorized; 21,294 shares issued and outstanding at September 30, 2016 and December 31, 2015.

[5] 80,000 shares authorized; 37,818 shares issued and outstanding at September 30, 2016 and December 31, 2015.

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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) shares in Thousands, $ in Millions	Sep. 30, 2016	Dec. 31, 2015
Receivables, Net, Current [Abstract]
Accounts receivable reserve for doubtful accounts	$ 48	$ 41
Equity
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock shares authorized (in shares)	1,560,000	780,000
Common stock shares issued (in shares)	679,268	673,857
Common stock shares outstanding (in shares)	679,268	673,857
PPL Electric Utilities Corp [Member]
Receivables, Net, Current [Abstract]
Accounts receivable reserve for doubtful accounts	$ 22	$ 16
Equity
Common stock, no par value (in dollars per share)
Common stock shares authorized (in shares)	170,000	170,000
Common stock shares issued (in shares)	66,368	66,368
Common stock shares outstanding (in shares)	66,368	66,368
LG And E And KU Energy LLC [Member]
Receivables, Net, Current [Abstract]
Accounts receivable reserve for doubtful accounts	$ 24	$ 23
Louisville Gas And Electric Co [Member]
Receivables, Net, Current [Abstract]
Accounts receivable reserve for doubtful accounts	$ 1	$ 1
Equity
Common stock, no par value (in dollars per share)
Common stock shares authorized (in shares)	75,000	75,000
Common stock shares issued (in shares)	21,294	21,294
Common stock shares outstanding (in shares)	21,294	21,294
Kentucky Utilities Co [Member]
Receivables, Net, Current [Abstract]
Accounts receivable reserve for doubtful accounts	$ 2	$ 2
Equity
Common stock, no par value (in dollars per share)	$ 0	$ 0
Common stock shares authorized (in shares)	80,000	80,000
Common stock shares issued (in shares)	37,818	37,818
Common stock shares outstanding (in shares)	37,818	37,818

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CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Millions		Total	Common Stock [Member]		Additional Paid-in Capital [Member]	Earnings Reinvested [Member]	Accumulated Other Comprehensive Loss [Member]	PPL Electric Utilities Corp [Member]		PPL Electric Utilities Corp [Member] Common Stock [Member]		PPL Electric Utilities Corp [Member] Additional Paid-in Capital [Member]		PPL Electric Utilities Corp [Member] Earnings Reinvested [Member]	LG And E And KU Energy LLC [Member]	Louisville Gas And Electric Co [Member]		Louisville Gas And Electric Co [Member] Common Stock [Member]		Louisville Gas And Electric Co [Member] Additional Paid-in Capital [Member]	Louisville Gas And Electric Co [Member] Earnings Reinvested [Member]	Kentucky Utilities Co [Member]		Kentucky Utilities Co [Member] Common Stock [Member]		Kentucky Utilities Co [Member] Additional Paid-in Capital [Member]	Kentucky Utilities Co [Member] Earnings Reinvested [Member]	Kentucky Utilities Co [Member] Accumulated Other Comprehensive Loss [Member]
Balance at beginning of period - shares at Dec. 31, 2014			665,849	[1]						66,368	[2]							21,294	[3]					37,818	[4]
Balance at beginning of period at Dec. 31, 2014		$ 13,628	$ 7		$ 9,433	$ 6,462	$ (2,274)	$ 2,717		$ 364		$ 1,603		$ 750		$ 2,174		$ 424		$ 1,521	$ 229	$ 3,206		$ 308		$ 2,596	$ 302	$ 0
Balance at beginning of period at Dec. 31, 2014															$ 4,248
Common stock shares issued	[1]		5,943
Common stock issued		183			183
Stock-based compensation		14			14
Net income		283				283		191	[5]					191	297	146	[5]				146	189	[6]				189
Contributions from member															55
Capital contributions from parent								322	[7]			322	[7]			20				20
Dividends and dividend equivalents		(754)				(754)
Distribution of PPL Energy Supply		(3,224)				(3,200)	(24)
Dividends declared on common stock								(140)						(140)		(81)					(81)	(106)					(106)
Distributions to member															(157)
Other comprehensive income (loss)		92					92								(6)							(1)						(1)
Balance at end of period - shares at Sep. 30, 2015			671,792	[1]						66,368	[2]							21,294	[3]					37,818	[4]
Balance at end of period at Sep. 30, 2015		$ 10,222	$ 7		9,630	2,791	(2,206)	$ 3,090		$ 364		1,925		801		$ 2,259		$ 424		1,541	294	$ 3,288		$ 308		2,596	385	(1)
Balance at end of period at Sep. 30, 2015															4,437
Balance at beginning of period - shares at Dec. 31, 2015		673,857	673,857	[1]				66,368		66,368	[2]					21,294		21,294	[3]			37,818		37,818	[4]
Balance at beginning of period at Dec. 31, 2015		$ 9,919	$ 7		9,687	2,953	(2,728)	$ 3,119		$ 364		1,934		821		$ 2,330		$ 424		1,611	295	$ 3,287		$ 308		2,596	383	0
Balance at beginning of period at Dec. 31, 2015															4,517
Common stock shares issued	[1]		5,411
Common stock issued		168			168
Stock-based compensation		(31)			(31)
Net income		1,437				1,437		263	[5]					263	337	159	[5]				159	207	[6]				207
Contributions from member															37
Capital contributions from parent								200				200				47				47		20				20
Dividends and dividend equivalents		(773)				(773)
Dividends declared on common stock								$ (193)						(193)		$ (87)					(87)	(197)					(197)
Distributions to member															(224)
Other comprehensive income (loss)		(752)					(752)								4							$ (1)						(1)
Adoption of stock-based compensation guidance cumulative effect adjustment		$ 7				7
Balance at end of period - shares at Sep. 30, 2016		679,268	679,268	[1]				66,368		66,368	[2]					21,294		21,294	[3]			37,818		37,818	[4]
Balance at end of period at Sep. 30, 2016		$ 9,975	$ 7		$ 9,824	$ 3,624	$ (3,480)	$ 3,389		$ 364		$ 2,134		$ 891		$ 2,449		$ 424		$ 1,658	$ 367	$ 3,316		$ 308		$ 2,616	$ 393	$ (1)
Balance at end of period at Sep. 30, 2016															$ 4,671

[1] Shares in thousands. Each share entitles the holder to one vote on any question presented at any shareowners' meeting.

[2] Shares in thousands. All common shares of PPL Electric stock are owned by PPL.

[3] Shares in thousands. All common shares of LG&E stock are owned by LKE.

[4] Shares in thousands. All common shares of KU stock are owned by LKE.

[5] Net income equals comprehensive income.

[6] Net income approximates comprehensive income.

[7] Includes non-cash contributions of $47 million.

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CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) (Parenthetical) $ in Millions	9 Months Ended
	Sep. 30, 2016 Integer	Sep. 30, 2015 USD ($)
Vote per share of PPL's common stock | Integer	1
PPL Electric Utilities Corp [Member]
Non-cash contributions related to remeasurement and separation benefit plans | $		$ 47

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Interim Financial Statements

9 Months Ended

Sep. 30, 2016

Interim Financial Statements [Abstract]

Interim Financial Statements

Interim Financial Statements

(All Registrants)

Capitalized terms and abbreviations appearing in the unaudited combined notes to condensed financial statements are defined in the glossary. Dollars are in millions, except per share data, unless otherwise noted. The specific Registrant to which disclosures are applicable is identified in parenthetical headings in italics above the applicable disclosure or within the applicable disclosure. Within combined disclosures, amounts are disclosed for any Registrant when significant.

The accompanying unaudited condensed financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all of the information and footnote disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation in accordance with GAAP are reflected in the condensed financial statements. All adjustments are of a normal recurring nature, except as otherwise disclosed. Each Registrant's Balance Sheet at December 31, 2015 is derived from that Registrant's 2015 audited Balance Sheet. The financial statements and notes thereto should be read in conjunction with the financial statements and notes contained in each Registrant's 2015 Form 10-K. The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year ending December 31, 2016 or other future periods, because results for interim periods can be disproportionately influenced by various factors, developments and seasonal variations.

The classification of certain prior period amounts has been changed to conform to the presentation in the September 30, 2016 financial statements.

(PPL)

"Income (Loss) from Discontinued Operations (net of income taxes)" on the Statements of Income includes the activities of PPL Energy Supply, substantially representing PPL's former Supply segment, which was spun off and distributed to PPL shareowners on June 1, 2015. In addition, the Statement of Cash Flows for the nine months ended September 30, 2015 separately reports the cash flows of the discontinued operations. See Note 8 for additional information.

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Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

(All Registrants)

The following accounting policy disclosures represent updates to Note 1 to each indicated Registrant's 2015 Form 10-K and should be read in conjunction with those disclosures.

Accounts Receivable(PPL and PPL Electric)

In accordance with a PUC-approved purchase of accounts receivable program, PPL Electric purchases certain accounts receivable from alternative electricity suppliers at a discount, which reflects a provision for uncollectible accounts. The alternative electricity suppliers have no continuing involvement or interest in the purchased accounts receivable. The purchased accounts receivable are initially recorded at fair value using a market approach based on the purchase price paid and are classified as Level 2 in the fair value hierarchy. During the three and nine months ended September 30, 2016, PPL Electric purchased $365 million and $1.0 billion of accounts receivable from unaffiliated third parties. During the three and nine months ended September 30, 2015, PPL Electric purchased $361 million and $968 million of accounts receivable from unaffiliated third parties. PPL Electric's purchases from PPL EnergyPlus for the nine months ended September 30, 2015 were $146 million. As a result of the June 1, 2015 spinoff of PPL Energy Supply and creation of Talen Energy, PPL EnergyPlus (renamed Talen Energy Marketing) is no longer an affiliate of PPL Electric. PPL Electric's purchases from Talen Energy Marketing subsequent to May 31, 2015 are included as purchases from an unaffiliated third party.

Discount Rate Change for U.K. Pension Plans(PPL)

In selecting the discount rate for its U.K. pension plans, WPD historically used a single weighted-average discount rate in the calculation of net periodic defined benefit cost. WPD began using individual spot rates to measure service cost and interest cost for the calculation of net periodic defined benefit cost in 2016. For the three and nine months ended September 30, 2016, this change in discount rate resulted in lower net periodic defined benefit costs recognized on PPL's Statements of Income of $10 million ($8 million after-tax or $0.01 per share) and $31 million ($25 million after-tax or $0.04 per share).

Foreign Currency Translation and Transactions (PPL)

WPD's functional currency is the GBP, which is the local currency in the U.K. As such, assets and liabilities are translated to U.S. dollars at the exchange rates on the date of consolidation and related revenues and expenses are generally translated at average exchange rates prevailing during the period included in PPL's results of operations. Adjustments resulting from foreign currency translation are recorded in AOCI.

Certain financial information provided for future periods in PPL’s 2015 Form 10-K is impacted by the decrease in the GBP to U.S. dollar exchange rate that occurred subsequent to the U.K.'s vote on June 23, 2016 to withdraw from the European Union.

New Accounting Guidance Adopted(All Registrants)

Accounting for Stock-Based Compensation

Effective January 1, 2016, the Registrants adopted accounting guidance to simplify the accounting for share-based payment transactions. The guidance requires excess tax benefits and tax deficiencies to be recorded as income tax benefit or expense on the statement of income, eliminates the requirement that excess tax benefits be realized before companies can recognize them and changes the threshold for statutory income tax withholding requirements to qualify for equity classification to the maximum statutory tax rates in the applicable jurisdictions. This guidance also changes the classification of excess tax benefits to an operating activity and employee taxes paid when shares are withheld to satisfy the employer's statutory income tax withholding obligation to a financing activity on the statement of cash flows and allows entities to make a policy election to either estimate forfeitures or recognize them when they occur. The adoption of this guidance had the following impacts:

• Using the required prospective method of transition, for the three and nine months ended September 30, 2016, PPL recorded tax benefits of $1 million and $12 million ($0.02 per share), and for the nine months endedSeptember 30, 2016, PPL Electric recorded tax benefits of $7 million, related to excess tax benefits for awards that were exercised and vested for the periods ending September 30, 2016. These amounts were recorded to Income taxes on the Statements of Income and Deferred income taxes on the Balance Sheets. The impact on LKE was not significant.

• PPL elected to use the prospective method of transition for classifying excess tax benefits as an Operating activity on the Statement of Cash Flows. The amounts classified as Financing activities in the prior periods were not significant.

• Upon adoption, using the required modified retrospective method of transition, PPL recorded a cumulative effect adjustment of $7 million to increase Earnings reinvested and decrease Deferred income taxes on the Balance Sheet related to prior period unrecognized excess tax benefits.

• PPL has historically presented employee taxes paid for net settled awards as a Financing activity on the Statement of Cash Flows. Therefore, there is no transition impact for this requirement.

• PPL has elected to recognize forfeitures when they occur. Due to past experience of insignificant forfeitures, there is no transition impact of this policy election.

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Segment and Related Information

9 Months Ended

Sep. 30, 2016

Segment Reporting [Abstract]

Segment and Related Information

Segment and Related Information

(PPL)

See Note 2 in PPL's 2015 Form 10-K for a discussion of reportable segments and related information.

Financial data for the segments and reconciliation to PPL's consolidated results for the periods ended September 30 are:

	Three Months						Nine Months
	2016			2015			2016			2015
Income Statement Data
Revenues from external customers
U.K. Regulated	$	515		$	552		$	1,673		$	1,836
Kentucky Regulated	835			801			2,382			2,414
Pennsylvania Regulated	539			519			1,619			1,625
Corporate and Other	—			6			11			14
Total	$	1,889		$	1,878		$	5,685		$	5,889
Net Income
U.K. Regulated (a)	$	281		$	249		$	915		$	814
Kentucky Regulated	126			111			314			267
Pennsylvania Regulated	91			55			263			191
Corporate and Other (b)	(25		)	(19		)	(55		)	(74		)
Discontinued Operations (c)	—			(3		)	—			(915		)
Total	$	473		$	393		$	1,437		$	283

	September 30, 2016		December 31, 2015
Balance Sheet Data
Assets
U.K. Regulated (d)	$	15,014	$	16,669
Kentucky Regulated	13,853		13,756
Pennsylvania Regulated	9,070		8,511
Corporate and Other (e)	101		365
Total assets	$	38,038	$	39,301

(a) Includes unrealized gains and losses from hedging foreign-currency related economic activity. See Note 14 for additional information.

(b) The nine months ended September 30, 2015 includes transition costs to prepare the Talen Energy organization for the June 1, 2015 spinoff and reconfigure the remaining PPL Services functions. See Note 8 for additional information.

(c) See Note 8 for additional information.

(d) Includes $11.1 billion and $12.2 billion of net PP&E as of September 30, 2016 and December 31, 2015. WPD is not subject to accounting for the effects of certain types of regulation as prescribed by GAAP.

(e) Primarily consists of unallocated items, including cash, PP&E and the elimination of inter-segment transactions.

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Earnings Per Share

9 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

(PPL)

Basic EPS is computed by dividing income available to PPL common shareowners by the weighted-average number of common shares outstanding during the applicable period. Diluted EPS is computed by dividing income available to PPL common shareowners by the weighted-average number of common shares outstanding, increased by incremental shares that would be outstanding if potentially dilutive non-participating securities were converted to common shares as calculated using the Treasury Stock Method. Incremental non-participating securities that have a dilutive impact are detailed in the table below.

Reconciliations of the amounts of income and shares of PPL common stock (in thousands) for the periods ended September 30 used in the EPS calculation are:

	Three Months					Nine Months
	2016		2015			2016		2015
Income (Numerator)
Income from continuing operations after income taxes	$	473	$	396		$	1,437	$	1,198
Less amounts allocated to participating securities	1		2			4		5
Income from continuing operations after income taxes available to PPL common shareowners - Basic and Diluted	$	472	$	394		$	1,433	$	1,193
Income (loss) from discontinued operations (net of income taxes) available to PPL common shareowners - Basic and Diluted	$	—	$	(3	)	$	—	$	(915	)
Net income	$	473	$	393		$	1,437	$	283
Less amounts allocated to participating securities	1		2			4		1
Net income available to PPL common shareowners - Basic and Diluted	$	472	$	391		$	1,433	$	282
Shares of Common Stock (Denominator)
Weighted-average shares - Basic EPS	678,114		670,763			676,905		668,731
Add incremental non-participating securities:
Share-based payment awards	2,234		2,939			3,064		2,523
Weighted-average shares - Diluted EPS	680,348		673,702			679,969		671,254
Basic EPS
Available to PPL common shareowners:
Income from continuing operations after income taxes	$	0.70	$	0.59		$	2.12	$	1.78
Income (loss) from discontinued operations (net of income taxes)	—		(0.01		)	—		(1.36		)
Net Income	$	0.70	$	0.58		$	2.12	$	0.42
Diluted EPS
Available to PPL common shareowners:
Income from continuing operations after income taxes	$	0.69	$	0.59		$	2.11	$	1.78
Income (loss) from discontinued operations (net of income taxes)	—		(0.01		)	—		(1.36		)
Net Income	$	0.69	$	0.58		$	2.11	$	0.42

For the periods ended September 30, PPL issued common stock related to stock-based compensation plans and the DRIP as follows (in thousands):

	Three Months		Nine Months
	2016	2015	2016	2015
Stock-based compensation plans (a)	248	1,368	3,168	3,805
DRIP	761	475	1,533	1,318

(a) Includes stock options exercised, vesting of performance units, vesting of restricted stock and restricted stock units and conversion of stock units granted to directors.

See Note 7 for additional information on common stock issued under the ATM Program.

For the periods ended September 30, the following shares (in thousands) were excluded from the computations of diluted EPS because the effect would have been antidilutive.

	Three Months		Nine Months
	2016	2015	2016	2015
Stock options	696	1,484	696	1,218
Performance units	316	—	210	49

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Income Taxes

9 Months Ended

Sep. 30, 2016

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Reconciliations of income taxes for the periods ended September 30 are as follows.

(PPL)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 35%	$	214		$	189		$	681		$	571
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	13			15			37			44
Valuation allowance adjustments	4			—			13			8
Impact of lower U.K. income tax rates	(37		)	(40		)	(136		)	(138		)
Federal and state tax reserve adjustments (a)	—			(9		)	—			(21		)
Enactment of the U.K. Finance Act 2016 (b)	(42		)	—			(42		)	—
Depreciation not normalized	—			—			(6		)	(4		)
Interest benefit on U.K. financing entities	(4		)	(4		)	(13		)	(15		)
Stock-based compensation (c)	(1		)	—			(12		)	—
Other	(8		)	(7		)	(12		)	(13		)
Total increase (decrease)	(75		)	(45		)	(171		)	(139		)
Total income taxes	$	139		$	144		$	510		$	432

(a) During the three and nine months ended September 30, 2015, PPL recorded a $9 million tax benefit related to a planned amendment of a prior period tax return.

During the nine months ended September 30, 2015, PPL recorded a $12 million tax benefit to adjust the settled refund amount approved by the Joint Committee on Taxation for the open audit years 1998 - 2011.

(b) The U.K. Finance Act 2016, enacted in September 2016, reduces the U.K. statutory income tax rate effective April 1, 2020 from 18% to 17%. As a result, PPL reduced its net deferred tax liabilities and recognized a deferred tax benefit during the three and nine months ended September 30, 2016.

(c) During the three and nine months ended September 30, 2016, PPL recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

(PPL Electric)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	52		$	32		$	149		$	112
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	9			7			27			21
Depreciation not normalized	(2		)	(1		)	(5		)	(3		)
Stock-based compensation (a)	—			—			(7		)	—
Other	(1		)	(3		)	(2		)	—
Total increase (decrease)	6			3			13			18
Total income taxes	$	58		$	35		$	162		$	130

(a) During the nine months ended September 30, 2016, PPL Electric recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

(LKE)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	74		$	68		$	189		$	172
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	8			7			20			18
Amortization of investment tax credit	(1		)	(1		)	(2		)	(2		)
Valuation allowance adjustments (a)	—			—			—			8
Stock-based compensation	(1		)	—			(2		)	—
Other	(1		)	(1		)	(3		)	(2		)
Total increase (decrease)	5			5			13			22
Total income taxes	$	79		$	73		$	202		$	194

(a) Represents a valuation allowance against tax credits expiring in 2016 and 2017 that are more likely than not to expire before being utilized.

(LG&E)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	36		$	33		$	90		$	83
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	4			4			10			9
Other	(1		)	(1		)	(2		)	(1		)
Total increase (decrease)	3			3			8			8
Total income taxes	$	39		$	36		$	98		$	91

(KU)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	44		$	41		$	117		$	106
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	5			4			12			11
Other	(1		)	(1		)	(1		)	(2		)
Total increase (decrease)	4			3			11			9
Total income taxes	$	48		$	44		$	128		$	115

Other (PPL)

In February 2015, PPL and the IRS Appeals Division reached a settlement on the amount of PPL's refund from its open audits for the years 1998 - 2011. In April 2015, PPL was notified that the Joint Committee on Taxation approved PPL's settlement. For the nine months ended September 30, 2015, PPL recorded a tax benefit of $24 million. Of this amount, $12 million was reflected in continuing operations. PPL finalized the settlement of interest in the second quarter of 2016 and recorded an additional $3 million tax benefit.

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Utility Rate Regulation

9 Months Ended

Sep. 30, 2016

Regulated Operations [Abstract]

Utility Rate Regulation

Utility Rate Regulation

(All Registrants)

The following table provides information about the regulatory assets and liabilities of cost-based rate-regulated utility operations.

	PPL				PPL Electric
	September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015
Current Regulatory Assets:
Environmental cost recovery	$	4	$	24	$	—	$	—
Generation formula rate	12		7		—		—
Transmission service charge	8		10		8		10
Other	6		7		4		3
Total current regulatory assets (a)	$	30	$	48	$	12	$	13
Noncurrent Regulatory Assets:
Defined benefit plans	$	791	$	809	$	456	$	469
Taxes recoverable through future rates	333		326		333		326
Storm costs	71		93		19		30
Unamortized loss on debt	62		68		39		42
Interest rate swaps	143		141		—		—
Accumulated cost of removal of utility plant	143		137		143		137
AROs	208		143		—		—
Other	14		16		1		2
Total noncurrent regulatory assets	$	1,765	$	1,733	$	991	$	1,006

Current Regulatory Liabilities:
Generation supply charge	$	22	$	41	$	22	$	41
Demand side management	6		8		—		—
Gas supply clause	—		6		—		—
Universal service rider	10		5		10		5
Transmission formula rate	25		48		25		48
Fuel adjustment clause	14		14		—		—
Act 129 compliance rider	22		—		22		—
Storm damage expense	13		16		13		16
Other	8		7		2		3
Total current regulatory liabilities	$	120	$	145	$	94	$	113
Noncurrent Regulatory Liabilities:
Accumulated cost of removal of utility plant	$	698	$	691	$	—	$	—
Coal contracts (b)	3		17		—		—
Power purchase agreement - OVEC (b)	77		83		—		—
Net deferred tax assets	23		23		—		—
Act 129 compliance rider	—		22		—		22
Defined benefit plans	27		24		—		—
Interest rate swaps	80		82		—		—
Other	3		3		—		—
Total noncurrent regulatory liabilities	$	911	$	945	$	—	$	22

	LKE				LG&E				KU
	September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015
Current Regulatory Assets:
Environmental cost recovery	$	4	$	24	$	4	$	13	$	—	$	11
Generation formula rate	12		7		—		—		12		7
Other	2		4		2		3		—		1

	LKE				LG&E				KU
	September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015
Total current regulatory assets	$	18	$	35	$	6	$	16	$	12	$	19
Noncurrent Regulatory Assets:
Defined benefit plans	$	335	$	340	$	211	$	215	$	124	$	125
Storm costs	52		63		29		35		23		28
Unamortized loss on debt	23		26		16		17		7		9
Interest rate swaps	143		141		102		98		41		43
AROs	208		143		77		57		131		86
Plant retirement costs	4		6		—		—		4		6
Other	9		8		2		2		7		6
Total noncurrent regulatory assets	$	774	$	727	$	437	$	424	$	337	$	303

Current Regulatory Liabilities:
Demand side management	$	6	$	8	$	4	$	4	$	2	$	4
Gas supply clause	—		6		—		6		—		—
Fuel adjustment clause	14		14		2		2		12		12
Other	6		4		1		1		5		3
Total current regulatory liabilities	$	26	$	32	$	7	$	13	$	19	$	19
Noncurrent Regulatory Liabilities:
Accumulated cost of removal of utility plant	$	698	$	691	$	306	$	301	$	392	$	390
Coal contracts (b)	3		17		1		7		2		10
Power purchase agreement - OVEC (b)	77		83		53		57		24		26
Net deferred tax assets	23		23		23		23		—		—
Defined benefit plans	27		24		—		—		27		24
Interest rate swaps	80		82		40		41		40		41
Other	3		3		1		2		2		1
Total noncurrent regulatory liabilities	$	911	$	923	$	424	$	431	$	487	$	492

(a) These amounts are included in "Other current assets" on the Balance Sheets.

(b) These liabilities were recorded as offsets to certain intangible assets that were recorded at fair value upon the acquisition of LKE by PPL.

Regulatory Matters

U.K. Activities(PPL)

Ofgem Review of Line Loss Calculation

In 2014, Ofgem issued its final decision on the DPCR4 line loss incentives and penalties mechanism. WPD began refunding its liability for over-recovery of line losses to customers on April 1, 2015, which will continue through March 31, 2019. The liability at September 30, 2016 was $31 million.

Kentucky Activities

Rate Case Proceedings (PPL, LKE, LG&E and KU)

On November 1, 2016, LG&E and KU announced that on November 23, 2016, they anticipate filing requests with the KPSC for increases in annual base electricity rates of approximately $103 million at KU and an increase in annual base electricity and gas rates of approximately $94 million and $14 million at LG&E. The proposed base rate increases to be requested are an electricity rate increase of 6.4% at KU and electricity and gas rate increases of 8.5% and 4.2% at LG&E and would become effective in July 2017. LG&E's and KU's applications include requests for CPCNs for implementing an Advanced Metering System program and a Distribution Automation program. The applications are to be based on a forecasted test year of July 1, 2017 through June 30, 2018 and a requested return-on-equity of 10.23%. LG&E and KU cannot predict the outcome of these proceedings.

CPCN and ECR Filings(PPL, LKE, LG&E and KU)

On August 8, 2016, the KPSC issued an order approving CPCNs and ECR rate treatment regarding environmental construction projects relating to the EPA's regulations addressing the handling of coal combustion by-products and MATS. The construction projects began in 2016 and are expected to continue through 2023. The KPSC order established a 9.8% authorized return on equity for these projects. Recovery of costs has commenced with bills rendered on and after August 31, 2016.

Gas Franchise(LKE and LG&E)

LG&E’s existing gas franchise agreement for the Louisville/Jefferson County service area expired on March 31, 2016. LG&E submitted a proposed bid for a new franchise agreement on June 9, 2016. On August 30, 2016, LG&E and Louisville/Jefferson County entered into a revised franchise agreement with a 5-year term (with renewal options). The franchise fee may be modified at Louisville/Jefferson County's election upon 60 days' notice. However, any franchise fee is capped at 3% of gross receipts for natural gas service within the franchise area. The agreement further provides that if the KPSC determines that the franchise fee should be recovered from LG&E's customers, the franchise fee shall revert to zero. On August 30, 2016, LG&E filed an application in a KPSC proceeding to review and rule upon the recoverability of the franchise fee.

Louisville/Jefferson County submitted a motion to dismiss the proceeding filed by LG&E, and further filed a KPSC complaint against LG&E relating to these issues. On October 19, 2016, the KPSC issued an order rejecting Louisville/Jefferson County's complaint and provided Louisville/Jefferson County 20 days to file an amended complaint. Until the KPSC issues orders in these proceedings, LG&E cannot predict the outcome of this matter but does not anticipate that it will have a material effect on its financial condition or results of operation. LG&E continues to provide gas service to customers in this franchise area at existing rates, but without collecting or remitting a franchise fee.

Pennsylvania Activities(PPL and PPL Electric)

Act 129

Act 129 requires Pennsylvania Electric Distribution Companies (EDCs) to meet, by specified dates, specified goals for reduction in customer electricity usage and peak demand. EDCs not meeting the requirements of Act 129 are subject to significant penalties. In November 2015, PPL Electric filed with the PUC its Act 129 Phase III Energy Efficiency and Conservation Plan for the period June 1, 2016 through May 31, 2021. In January 2016, PPL Electric and the other parties to the case reached a settlement of all major issues and filed that settlement with the Administrative Law Judge. In June 2016, the PUC issued a final order approving PPL Electric's Phase III Plan as modified by the settlement, allowing PPL Electric to recover, through the Act 129 compliance rider, a maximum $313 million in program cost over the five-year period June 1, 2016 through May 31, 2021.     

Act 129 also requires Default Service Providers (DSP) to provide electricity generation supply service to customers pursuant to a PUC-approved default service procurement plan through auctions, requests for proposal and bilateral contracts at the sole discretion of the DSP. Act 129 requires a mix of spot market purchases, short-term contracts and long-term contracts (4 to 20 years), with long-term contracts limited to 25% of load unless otherwise approved by the PUC. A DSP is able to recover the costs associated with its default service procurement plan.

PPL Electric has received PUC approval of its biannual DSP procurement plans for all prior periods required under Act 129. In January 2016, PPL Electric filed a Petition for Approval of a new DSP procurement plan with the PUC for the period June 1, 2017 through May 31, 2021. The parties to the proceeding reached a settlement on all but one issue and a partial settlement agreement and briefs on the open issue were submitted to the Administrative Law Judge (ALJ) in July 2016. In August 2016, the ALJ issued an initial decision, and certain parties filed exceptions and reply exceptions. In October 2016, the PUC issued an order approving the partial settlement agreement and adopting the initial decision with minor modifications.

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Financing Activities

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Financing Activities

Financing Activities

Credit Arrangements and Short-term Debt

(All Registrants)

The Registrants maintain credit facilities to enhance liquidity, provide credit support and provide a backstop to commercial paper programs. For reporting purposes, on a consolidated basis, the credit facilities and commercial paper programs of PPL Electric, LKE, LG&E and KU also apply to PPL and the credit facilities and commercial paper programs of LG&E and KU also apply to LKE. The amounts borrowed below are recorded as "Short-term debt" on the Balance Sheets. The following credit facilities were in place at: 

	September 30, 2016									December 31, 2015
	Expiration Date	Capacity		Borrowed		Letters of Credit and Commercial Paper Issued		Unused Capacity		Borrowed		Letters of Credit and Commercial Paper Issued
PPL
U.K.
WPD plc
Syndicated Credit Facility	Jan 2021	£	210	£	153	£	—	£	57	£	133	£	—
WPD (South West)
Syndicated Credit Facility	July 2021	245		100		—		145		—		—
WPD (East Midlands)
Syndicated Credit Facility	July 2021	300		31		—		269		—		—
WPD (West Midlands)
Syndicated Credit Facility	July 2021	300		—		—		300		—		—
Uncommitted Credit Facilities		40		—		4		36		—		4
Total U.K. Credit Facilities (a)		£	1,095	£	284	£	4	£	807	£	133	£	4
U.S.
PPL Capital Funding
Syndicated Credit Facility	Jan 2021	$	700	$	—	$	—	$	700	$	—	$	151
Syndicated Credit Facility	Nov 2018	300		—		—		300		—		300
Bilateral Credit Facility	Mar 2017	150		—		17		133		—		20
Total PPL Capital Funding Credit Facilities		$	1,150	$	—	$	17	$	1,133	$	—	$	471
PPL Electric
Syndicated Credit Facility	Jan 2021	$	400	$	—	$	131	$	269	$	—	$	1
LKE
Syndicated Credit Facility (b)	Oct 2018	$	75	$	—	$	—	$	75	$	75	$	—
LG&E
Syndicated Credit Facility	Dec 2020	$	500	$	—	$	128	$	372	$	—	$	142
KU
Syndicated Credit Facility	Dec 2020	$	400	$	—	$	7	$	393	$	—	$	48
Letter of Credit Facility	Oct 2017	198		—		198		—		—		198
Total KU Credit Facilities		$	598	$	—	$	205	$	393	$	—	$	246

(a) WPD plc's amounts borrowed at September 30, 2016 and December 31, 2015 were USD-denominated borrowings of $200 million for both periods, which bore interest at 1.35% and 1.83%. The unused capacity reflects the amount borrowed in GBP of £153 million as of the date borrowed. WPD (South West) amount borrowed at September 30, 2016 was a GBP-denominated borrowing which equated to $131 million and bore interest at 0.68%. WPD (East Midlands) amount borrowed at September 30, 2016 was a GBP-denominated borrowing which equated to $40 million and bore interest at 0.66%. At September 30, 2016, the unused capacity under the U.K. credit facilities was approximately $1.1 billion.

(b) LKE's interest rate on outstanding borrowings at December 31, 2015 was 1.68%.

PPL, PPL Electric, LG&E and KU maintain commercial paper programs to provide an additional financing source to fund short-term liquidity needs, as necessary. Commercial paper issuances, included in "Short-term debt" on the Balance Sheets, are supported by the respective Registrant's Syndicated Credit Facility. The following commercial paper programs were in place at: 

	September 30, 2016							December 31, 2015
	Weighted - Average Interest Rate	Capacity		Commercial Paper Issuances		Unused Capacity		Weighted - Average Interest Rate	Commercial Paper Issuances
PPL Capital Funding		$	1,000	$	—	$	1,000	0.78%	$	451
PPL Electric	0.74%	400		130		270			—
LG&E	0.73%	350		128		222		0.71%	142
KU	0.66%	350		7		343		0.72%	48
Total		$	2,100	$	265	$	1,835		$	641

(LKE)

See Note 11 for discussion of intercompany borrowings.

Long-term Debt

(PPL)

In May 2016, PPL Capital Funding issued $650 million of 3.10% Senior Notes due 2026. PPL Capital Funding received proceeds of $645 million, net of a discount and underwriting fees, which will be used to invest in or make loans to subsidiaries of PPL, to repay short-term debt and for general corporate purposes.

In May 2016, WPD (East Midlands) borrowed £100 million at 0.4975% under a new ten-year index linked term loan agreement, which will be used for general corporate purposes.

In May 2016, WPD plc repaid the entire $460 million principal amount of its 3.90% Senior Notes upon maturity.

In October 2016, WPD (East Midlands) issued an additional £40 million of its 2.671% Index-linked Senior Notes due 2043. WPD (East Midlands) received proceeds of £83 million, which equated to $101 million at the time of issuance, net of fees and including a premium. The principal amount of the notes is adjusted based on changes in a specified index, as detailed in the terms of the related indentures. The proceeds will be used for general corporate purposes.

(PPL and PPL Electric)

In March 2016, the LCIDA issued $116 million of Pollution Control Revenue Refunding Bonds, Series 2016A due 2029 and $108 million of Pollution Control Revenue Refunding Bonds, Series 2016B due 2027 on behalf of PPL Electric. The bonds were issued bearing interest at an initial term rate of 0.90% through their mandatory purchase dates of September 1, 2017 and August 15, 2017. Thereafter, the method of determining the interest rate on the bonds may be converted from time to time at PPL Electric's option. The proceeds of the bonds were used to redeem $116 million of 4.70% Pollution Control Revenue Refunding Bonds, 2005 Series A due 2029 and $108 million of 4.75% Pollution Control Revenue Refunding Bonds, 2005 Series B due 2027 previously issued by the LCIDA on behalf of PPL Electric.

In connection with the issuance of each of these new series of LCIDA bonds, PPL Electric entered into a loan agreement with the LCIDA pursuant to which the LCIDA has loaned to PPL Electric the proceeds of the LCIDA bonds on payment terms that correspond to the LCIDA bonds. In order to secure its obligations under the loan agreement, PPL Electric issued $224 million of First Mortgage Bonds under its 2001 Mortgage Indenture, which also have payment terms that correspond to the LCIDA bonds.

(PPL, LKE and LG&E) 

In September 2016, the County of Trimble, Kentucky issued $125 million of Pollution Control Revenue Refunding Bonds, 2016 Series A (Louisville Gas and Electric Company Project) due 2044 on behalf of LG&E. The bonds were issued with a floating interest rate that initially will reset weekly. The method of determining the interest rate on the bonds may be converted from time to time at LG&E’s option. The proceeds of the bonds were used to redeem $83 million of Pollution Control Revenue Refunding Bonds, 2000 Series A (Louisville Gas and Electric Company Project) due 2030 and $42 million of Pollution Control Revenue Refunding Bonds, 2002 Series A (Louisville Gas and Electric Company Project) due 2032 previously issued by the County of Trimble, Kentucky on behalf of LG&E.

(PPL, LKE and KU) 

In August 2016, the County of Carroll, Kentucky issued $96 million of Pollution Control Revenue Refunding Bonds, 2016 Series A (Kentucky Utilities Company Project) due 2042 on behalf of KU. The bonds were issued bearing interest at an initial term rate of 1.05% through their mandatory purchase date of September 1, 2019. Thereafter, the method of determining the interest rate on the bonds may be converted from time to time at KU’s option. The proceeds of the bonds were used to redeem $96 million of Pollution Control Revenue Refunding Bonds, 2002 Series C (Kentucky Utilities Company Project) due 2032 previously issued by the County of Carroll, Kentucky on behalf of KU.

(PPL)

ATM Program

In February 2015, PPL filed a registration statement with the SEC and entered into two separate equity distribution agreements, pursuant to which PPL may sell, from time to time, up to an aggregate of $500 million of its common stock. For the periods ended September 30, PPL issued the following:

	Three Months				Nine Months
	2016		2015		2016		2015
Number of shares (in thousands)	710		436		710		858
Average share price	$	35.23	$	32.95	$	35.23	$	33.33
Net Proceeds	$	25	$	14	$	25	$	28

Distributions

In August 2016, PPL declared a quarterly common stock dividend, payable October 3, 2016, of 38 cents per share (equivalent to $1.52 per annum). Future dividends, declared at the discretion of the Board of Directors, will depend upon future earnings, cash flows, financial and legal requirements and other factors.

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Acquisitions, Development and Divestitures

9 Months Ended

Sep. 30, 2016

Acquisitions Development And Divestitures [Abstract]

Acquisitions, Development and Divestitures

Acquisitions, Development and Divestitures

(All Registrants)

The Registrants from time to time evaluate opportunities for potential acquisitions, divestitures and development projects. Development projects are reexamined based on market conditions and other factors to determine whether to proceed with, modify or terminate the projects. Any resulting transactions may impact future financial results. See Note 8 in the Registrants' 2015 Form 10-K for additional information.

(PPL)

Discontinued Operations

Spinoff of PPL Energy Supply

In June 2015, PPL completed the spinoff of PPL Energy Supply, which combined its competitive power generation businesses with those of Riverstone to form a new, stand-alone, publicly traded company named Talen Energy.

Following completion of the spinoff, PPL shareowners owned 65% of Talen Energy and affiliates of Riverstone owned 35%. The spinoff had no effect on the number of PPL common shares owned by PPL shareowners or the number of shares of PPL common stock outstanding. The transaction is intended to be tax-free to PPL and its shareowners for U.S. federal income tax purposes.

PPL has no continuing ownership interest in or control of Talen Energy and Talen Energy Supply (formerly PPL Energy Supply). See Note 8 in PPL's 2015 Form 10-K for additional information.

Loss on Spinoff

In June 2015, in conjunction with the accounting for the spinoff, PPL evaluated whether the fair value of the Supply segment's net assets was less than the carrying value as of the June 1, 2015 spinoff date.

PPL considered several valuation methodologies to derive a fair value estimate of its Supply segment at the spinoff date. These methodologies included considering the closing "when-issued" Talen Energy market value on June 1, 2015 (the spinoff date), adjusted for the proportional share of the equity value attributable to the Supply segment, as well as, the valuation methods consistently used in PPL's goodwill impairment assessments - an income approach using a discounted cash flow analysis of the Supply segment and an alternative market approach considering market multiples of comparable companies.

Although the Talen Energy market value approach utilized the most observable inputs of the three approaches, PPL considered certain limitations of the "when-issued" trading market for the spinoff transaction including the short trading duration, lack of liquidity in the market and anticipated initial Talen stock ownership base selling pressure, among other factors, and concluded that these factors limited this input being solely determinative of the fair value of the Supply segment. As such, PPL also considered the other valuation approaches in estimating the overall fair value, but ultimately assigned the highest weighting to the Talen Energy market value approach.

The following table summarizes PPL's fair value analysis:

Approach	Weighting	Weighted Fair Value (in billions)
Talen Energy Market Value	50%	$	1.4
Income/Discounted Cash Flow	30%	1.1
Alternative Market (Comparable Company)	20%	0.7
Estimated Fair Value		$	3.2

A key assumption included in the fair value estimate is the application of a control premium of 25% in the two market approaches. PPL concluded it was appropriate to apply a control premium in these approaches as the goodwill impairment testing guidance was followed in determining the estimated fair value of the Supply segment which had historically been a reporting unit for PPL. This guidance provides that the market price of an individual security (and thus the market capitalization of a reporting unit with publicly traded equity securities) may not be representative of the fair value of the reporting unit. This guidance also indicates that substantial value may arise to a controlling shareholder from the ability to take advantage of synergies and other benefits that arise from control over another entity, and that the market price of a company's individual share of stock does not reflect this additional value to a controlling shareholder. Therefore, the quoted market price need not be the sole measurement basis for determining the fair value, and including a control premium is appropriate in measuring the fair value of a reporting unit.

In determining the control premium, PPL reviewed premiums received during the prior five years in market sales transactions obtained from observable independent power producer and hybrid utility transactions greater than $1 billion. Premiums for these transactions ranged from 5% to 42% with a median of approximately 25%. Given these metrics, PPL concluded a control premium of 25% to be reasonable for both of the market valuation approaches used.

Assumptions used in the discounted cash flow analysis included forward energy prices, forecasted generation, and forecasted operation and maintenance expenditures that were consistent with assumptions used in the Energy Supply portion of the Talen Energy business planning process at that time and a market participant discount rate.

Using these methodologies and weightings, PPL determined the estimated fair value of the Supply segment (classified as Level 3) was below its carrying value of $4.1 billion and recorded a loss on the spinoff of $879 million in the second quarter of 2015, which is reflected in discontinued operations and is nondeductible for tax purposes. This amount served to reduce the basis of the net assets accounted for as a dividend at the June 1, 2015 spinoff date.

Costs of Spinoff

Employee-related costs incurred in the nine months ended September 30, 2015 primarily included accelerated stock-based compensation and pro-rated performance-based cash incentive and stock-based compensation awards, primarily for PPL Energy Supply employees and for PPL Services employees who became PPL Energy Supply employees in connection with the transaction. PPL Energy Supply recognized $24 million of these costs at the spinoff closing date, which are reflected in discontinued operations.

PPL also recorded $44 million of third-party costs related to this transaction during the nine months ended September 30, 2015. Of these costs, $31 million were primarily for bank advisory, legal and accounting fees to facilitate the transaction, and are reflected in discontinued operations. An additional $13 million of consulting and other costs were incurred to prepare the new Talen Energy organization for the spinoff and reconfigure the remaining PPL service functions. These costs are primarily recorded in "Other operation and maintenance" on the Statement of Income.

At the close of the transaction, $72 million ($42 million after-tax) of cash flow hedges, primarily unamortized losses on PPL interest rate swaps recorded in AOCI and designated as cash flow hedges of PPL Energy Supply's future interest payments, were reclassified into earnings and are reflected in discontinued operations for the nine months ended September 30, 2015.

Continuing Involvement(PPL and PPL Electric)

As a result of the spinoff, PPL and PPL Energy Supply entered into a Transition Services Agreement (TSA) that terminates no later than two years after the spinoff. Pursuant to the TSA, PPL is providing Talen Energy certain information technology, financial and accounting, human resource and other specified services. For the three and nine months ended September 30, 2016, the amounts PPL billed Talen Energy for these services were $9 million and $29 million. For the three and nine months ended September 30, 2015, the amounts PPL billed Talen Energy for these services were $11 million and $14 million. In general, the fees for the transition services allow the provider to recover its cost of the services, including overheads, but without margin or profit.

Additionally, prior to the spinoff, through the annual competitive solicitation process, PPL EnergyPlus was awarded supply contracts for a portion of the PLR generation supply for PPL Electric, which were retained by Talen Energy Marketing as part of the spinoff. PPL Electric's supply contracts with Talen Energy Marketing extend through November 2016. Energy purchases from PPL EnergyPlus were previously included in PPL Electric's Statements of Income as "Energy purchases from affiliate" but were eliminated in PPL's Consolidated Statements of Income.

For the three and nine months ended September 30, 2016, PPL Electric's energy purchases from Talen Energy Marketing were $15 million and $98 million. For the three and nine months ended September 30, 2015, PPL Electric's energy purchases from Talen Energy Marketing were not significant. These energy purchases are no longer considered affiliate transactions.

Summarized Results of Discontinued Operations(PPL)

The operations of the Supply segment prior to the spinoff on June 1, 2015 are included in "Income (Loss) from Discontinued Operations (net of income taxes)" on the Statements of Income. Following are the components of Discontinued Operations in the Statement of Income for the periods ended September 30, 2015:

	Three Months			Nine Months
Operating revenues	$	—		$	1,427
Operating expenses	—			1,328
Other Income (Expense) - net	—			(22		)
Interest expense (a)	—			150
Income (loss) before income taxes	—			(73		)
Income tax expense (benefit)	3			(37		)
Loss on spinoff	—			(879		)
Income (Loss) from Discontinued Operations (net of income taxes)	$	(3	)	$	(915	)

(a) Includes interest associated with the Supply segment with no additional allocation as the Supply segment was sufficiently capitalized.

Development

Regional Transmission Line Expansion Plan(PPL and PPL Electric)

Northeast/Pocono

In October 2012, the FERC issued an order in response to PPL Electric's December 2011 request for ratemaking incentives for the Northeast/Pocono Reliability project (a new 58-mile, 230 kV transmission line that includes three new substations and upgrades to adjacent facilities). The FERC granted the incentive for inclusion in rate base of all prudently incurred construction work in progress costs but denied the requested incentive for a 100 basis point adder to the return on equity.

In December 2012, PPL Electric submitted an application to the PUC requesting permission to site and construct the project. In January 2014, the PUC issued a final order approving the application. The line was energized in April 2016, completing the approximately $350 million project which includes additional substation security enhancements. Costs related to the project are included on the Balance Sheets, primarily in "Regulated utility plant."

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Defined Benefits

9 Months Ended

Sep. 30, 2016

Compensation and Retirement Disclosure [Abstract]

Defined Benefits

Defined Benefits

(PPL, LKE and LG&E)

Certain net periodic defined benefit costs are applied to accounts that are further distributed among capital, expense and regulatory assets, including certain costs allocated to applicable subsidiaries for plans sponsored by PPL Services and LKE. Following are the net periodic defined benefit costs (credits) of the plans sponsored by PPL and its subsidiaries, LKE and its subsidiaries and LG&E for the periods ended September 30:

	Pension Benefits
	Three Months												Nine Months
	U.S.						U.K.						U.S.						U.K.
	2016			2015			2016 (a)			2015			2016			2015			2016 (a)			2015
PPL
Service cost	$	16		$	20		$	17		$	21		$	49		$	76		$	53		$	60
Interest cost	44			42			58			80			131			152			182			236
Expected return on plan assets	(57		)	(56		)	(124		)	(133		)	(171		)	(201		)	(389		)	(393		)
Amortization of:
Prior service cost	2			1			—			—			6			5			—			—
Actuarial loss	12			18			34			39			37			65			107			118
Net periodic defined benefit costs (credits) before settlements	17			25			(15		)	7			52			97			(47		)	21
Settlements	3			—			—			—			3			—			—			—
Net periodic defined benefit costs (credits) (b)	$	20		$	25		$	(15	)	$	7		$	55		$	97		$	(47	)	$	21

	Pension Benefits
	Three Months								Nine Months
	U.S.						U.K.		U.S.						U.K.
	2016			2015			2016 (a)	2015	2016			2015			2016 (a)	2015
LKE
Service cost	$	6		$	7				$	18		$	20
Interest cost	18			17					53			51
Expected return on plan assets	(23		)	(22		)			(68		)	(66		)
Amortization of:
Prior service cost	2			1					6			5
Actuarial loss	5			9					15			26
Net periodic defined benefit costs	$	8		$	12				$	24		$	36
LG&E
Service cost	$	—		$	—				$	1		$	1
Interest cost	4			3					11			10
Expected return on plan assets	(5		)	(5		)			(15		)	(15		)
Amortization of:
Prior service cost	1			1					3			2
Actuarial loss	2			3					5			9
Net periodic defined benefit costs	$	2		$	2				$	5		$	7

(a) See Note 2 for a discussion of changes to the discount rate used for the U.K. Pension Plans.

(b) For the nine months ended September 30, 2015, the total net periodic defined benefit cost includes $18 million reflected in discontinued operations related to costs allocated from PPL's plans to PPL Energy Supply prior to the spinoff.

	Other Postretirement Benefits
	Three Months						Nine Months
	2016			2015			2016			2015
PPL
Service cost	$	2		$	2		$	6		$	9
Interest cost	6			6			19			20
Expected return on plan assets	(6		)	(6		)	(17		)	(20		)
Amortization of actuarial loss	1			—			1			—
Net periodic defined benefit costs	$	3		$	2		$	9		$	9
LKE
Service cost	$	1		$	1		$	3		$	4
Interest cost	2			2			7			7
Expected return on plan assets	(2		)	(1		)	(5		)	(4		)
Amortization of prior service cost	1			1			2			2
Net periodic defined benefit costs	$	2		$	3		$	7		$	9

(PPL Electric, LG&E and KU)

In addition to the specific plans it sponsors, LG&E is allocated costs of defined benefit plans sponsored by LKE. PPL Electric and KU do not directly sponsor any defined benefit plans. PPL Electric is allocated costs of defined benefit plans sponsored by PPL Services and KU is allocated costs of defined benefit plans sponsored by LKE. These allocations are based on participation in those plans, which management believes are reasonable. For the periods ended September 30, PPL Services allocated the following net periodic defined benefit costs to PPL Electric, and LKE allocated the following net periodic defined benefit costs to LG&E and KU:

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric	$	6	$	8	$	17	$	24
LG&E	2		3		7		10
KU	2		4		8		13

Cash Flows - U.S. Pension Plans

(PPL & LKE)

During the nine months endedSeptember 30, 2016, LKE contributed $66 million to its pension plans. LKE does not anticipate making any additional significant contributions to these plans in 2016.

(PPL, LKE and LG&E)

During the nine months endedSeptember 30, 2016, LG&E contributed $35 million to its pension plan. LG&E does not anticipate making any additional contributions to the plan in 2016.

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2016

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Legal Matters

(All Registrants)

PPL and its subsidiaries are involved in legal proceedings, claims and litigation in the ordinary course of business. PPL and its subsidiaries cannot predict the outcome of such matters, or whether such matters may result in material liabilities, unless otherwise noted.

WKE Indemnification(PPL and LKE)

See footnote (e) to the table in "Guarantees and Other Assurances" below for information on an LKE indemnity relating to its former WKE lease, including related legal proceedings.

Cane Run Environmental Claims(PPL, LKE and LG&E)

In December 2013, six residents, on behalf of themselves and others similarly situated, filed a class action complaint against LG&E and PPL in the U.S. District Court for the Western District of Kentucky alleging violations of the Clean Air Act and RCRA. In addition, these plaintiffs assert common law claims of nuisance, trespass and negligence. These plaintiffs seek injunctive relief and civil penalties, plus costs and attorney fees, for the alleged statutory violations. Under the common law claims, these plaintiffs seek monetary compensation and punitive damages for property damage and diminished property values for a class consisting of residents within four miles of the Cane Run plant. In their individual capacities, these plaintiffs seek compensation for alleged adverse health effects. In response to a motion to dismiss filed by PPL and LG&E, in July 2014, the court dismissed the plaintiffs' RCRA claims and all but one Clean Air Act claim, but declined to dismiss their common law tort claims. Upon motion of LG&E and PPL, the district court certified for appellate review the issue of whether the state common law claims are preempted by federal statute. In December 2014, the U.S. Court of Appeals for the Sixth Circuit issued an order granting appellate review regarding the above matter. Oral argument before the Sixth Circuit was held in August 2015. In November 2015, the Sixth Circuit issued an opinion affirming the District Court's ruling that plaintiffs' state law claims are not preempted by the Clean Air Act and remanding the matter to the District Court for further proceedings. The District Court has issued an order setting a discovery schedule through the second quarter of 2017. PPL, LKE and LG&E cannot predict the outcome of this matter. LG&E retired one coal-fired unit at the Cane Run plant in March 2015 and the remaining two coal-fired units at the plant in June 2015.

Mill Creek Environmental Claims(PPL, LKE and LG&E)

In May 2014, the Sierra Club filed a citizen suit against LG&E in the U.S. District Court for the Western District of Kentucky for alleged violations of the Clean Water Act. The Sierra Club alleged that various discharges at the Mill Creek plant constituted violations of the plant's water discharge permit. The Sierra Club sought civil penalties, injunctive relief, costs and attorney's fees. The parties reached a proposed settlement in the matter on September 27, 2016, which has been submitted to the court. LG&E has agreed to limited alterations to outfall facilities and discharge practices and to fund $1 million in environmental enhancement projects focused on tree planting and water quality in Kentucky. The settlement includes no finding or agreement of any violation of law by LG&E and does not involve fines or civil penalties. The U.S. Department of Justice has 45 days to review the settlement before the court can approve. PPL, LKE and LG&E cannot predict the ultimate outcome of this matter, but do not presently expect the matter to have a material effect on plant operation, capital expenditures or operating costs, or to result in significant charges beyond the amounts previously recorded.

E.W. Brown Environmental Claims(PPL, LKE and KU)

In October 2015, KU received a notice of intent from Earthjustice and the Sierra Club informing certain federal and state agencies of the Sierra Club's intent to file a citizen suit, following expiration of the mandatory 60-day notification period, for alleged violations of the Clean Water Act. The claimants allege discharges at the E.W. Brown plant in violation of applicable rules and the plant's water discharge permit. The claimants assert that, unless the alleged discharges are promptly brought into compliance, it intends to seek civil penalties, injunctive relief and attorney's fees. In November 2015, the claimants submitted an amended notice of intent to add the Kentucky Waterways Alliance as a claimant. On October 26, 2016, the claimants submitted an additional notice of intent alleging management of waste in a manner that may present an imminent and substantial endangerment under the RCRA. PPL, LKE and KU cannot predict the outcome of this matter or the potential impact on the operations of the E. W. Brown plant, including increased capital or operating costs, if any.

(PPL, LKE, LG&E and KU)

Trimble County Unit 2 Air Permit

The Sierra Club and other environmental groups petitioned the Kentucky Environmental and Public Protection Cabinet to overturn the air permit issued for the Trimble County Unit 2 baseload coal-fired generating unit, but the agency upheld the permit in an order issued in September 2007. In response to subsequent petitions by environmental groups, the EPA ordered certain non-material changes to the permit which, in January 2010, were incorporated into a final revised permit issued by the Kentucky Division for Air Quality. In March 2010, the environmental groups petitioned the EPA to object to the revised state permit. Until the EPA issues a final ruling on the pending petition and all available appeals are exhausted, PPL, LKE, LG&E and KU cannot predict the outcome of this matter or the potential impact on the operations of the Trimble County plant, including increased capital or operating costs, if any.

Trimble County Water Discharge Permit

In May 2010, the Kentucky Waterways Alliance and other environmental groups filed a petition with the Kentucky Energy and Environment Cabinet (KEEC) challenging the Kentucky Pollutant Discharge Elimination System permit issued in April 2010, which covers water discharges from the Trimble County plant. In November 2010, the KEEC issued a final order upholding the permit, which was subsequently appealed by the environmental groups. In September 2013, the Franklin Circuit Court reversed the KEEC order upholding the permit and remanded the permit to the agency for further proceedings. LG&E and the KEEC appealed the order to the Kentucky Court of Appeals. In July 2015, the Court of Appeals upheld the lower court ruling. On February 10, 2016, the Kentucky Supreme Court issued an order granting discretionary review and oral arguments were held on September 14, 2016. PPL, LKE, LG&E and KU are unable to predict the outcome of this matter or the potential impact on the operations of the Trimble County plant, including increased capital or operating costs, if any.

Regulatory Issues(All Registrants)

See Note 6 for information on regulatory matters related to utility rate regulation.

Electricity - Reliability Standards

The NERC is responsible for establishing and enforcing mandatory reliability standards (Reliability Standards) regarding the bulk electric system in North America. The FERC oversees this process and independently enforces the Reliability Standards.

The Reliability Standards have the force and effect of law and apply to certain users of the bulk electric system, including electric utility companies, generators and marketers. Under the Federal Power Act, the FERC may assess civil penalties for certain violations.

LG&E, KU and PPL Electric monitor their compliance with the Reliability Standards and self-report or self-log potential violations of applicable reliability requirements whenever identified, and submit accompanying mitigation plans, as required. The resolution of a small number of potential violations is pending. Penalties incurred to date have not been significant. Any Regional Reliability Entity (including RFC or SERC) determination concerning the resolution of violations of the Reliability Standards remains subject to the approval of the NERC and the FERC.

In the course of implementing their programs to ensure compliance with the Reliability Standards by those PPL affiliates subject to the standards, certain other instances of potential non-compliance may be identified from time to time. The Registrants cannot predict the outcome of these matters, and cannot estimate a range of reasonably possible losses, if any.

Environmental Matters

(All Registrants)

Due to the environmental issues discussed below or other environmental matters, it may be necessary for the Registrants to modify, curtail, replace or cease operation of certain facilities or performance of certain operations to comply with statutes, regulations and other requirements of regulatory bodies or courts. In addition, legal challenges to new environmental permits or rules add to the uncertainty of estimating the future cost of these permits and rules.

WPD's distribution businesses are subject to certain statutory and regulatory environmental requirements. In connection with the matters discussed below, it may be necessary for WPD to incur significant compliance costs, which costs may be recoverable through rates subject to the approval of Ofgem. PPL believes that WPD has taken and continues to take measures to comply with all applicable environmental laws and regulations.

LG&E and KU are entitled to recover, through the ECR mechanism, certain costs of complying with the Clean Air Act, as amended, and those federal, state, or local environmental requirements applicable to coal combustion wastes and by-products from facilities that generate electricity from coal in accordance with approved compliance plans. Costs not covered by the ECR mechanism for LG&E and KU and all such costs for PPL Electric are subject to rate recovery before the companies' respective state regulatory authorities, or the FERC, if applicable. Because neither WPD nor PPL Electric owns any generating plants, their exposure to related environmental compliance costs is reduced. PPL, PPL Electric, LKE, LG&E and KU can provide no assurances as to the ultimate outcome of future environmental or rate proceedings before regulatory authorities.

Air

(PPL, LKE, LG&E and KU)

The Clean Air Act, which regulates air pollutants from mobile and stationary sources in the United States, has a significant impact on the operation of fossil fuel plants. The Clean Air Act requires the EPA periodically to review and establish concentration levels in the ambient air for six criteria pollutants to protect public health and welfare. These concentration levels are known as NAAQS. The six criteria pollutants are carbon monoxide, lead, nitrogen dioxide, ozone, particulate matter and sulfur dioxide.

Federal environmental regulation of these criteria pollutants require states to adopt implementation plans, known as state implementation plans, for certain pollutants, which detail how the state will attain the standards that are mandated by the relevant law or regulation. Each state identifies the areas within its boundaries that meet the NAAQS (attainment areas) and those that do not (non-attainment areas), and must develop a state implementation plan both to bring non-attainment areas into compliance with the NAAQS and to maintain good air quality in attainment areas. In addition, for attainment of ozone and fine particulates standards, states in the eastern portion of the country, including Kentucky, are subject to a regional program developed by the EPA known as the Cross-State Air Pollution Rule. The NAAQS, future revisions to the NAAQS and state implementation plans, or future revisions to regional programs, may require installation of additional pollution controls, the costs of which PPL, LKE, LG&E and KU believe are subject to cost recovery.

Although PPL, LKE, LG&E and KU do not anticipate significant costs to comply with these programs, changes in market or operating conditions could result in different costs than anticipated.

National Ambient Air Quality Standards (NAAQS)

Under the Clean Air Act, the EPA is required to reassess the NAAQS for certain air pollutants on a five-year schedule. In 2008, the EPA revised the NAAQS for ozone and proposed to further strengthen the standard in November 2014. The EPA released a new ozone standard on October 1, 2015. The states and EPA will determine attainment with the new ozone standard through review of relevant ambient air monitoring data, with attainment or nonattainment designations scheduled no later than October 2017. States are also obligated to address interstate transport issues associated with new ozone standards through the establishment of "good neighbor" state implementation plans for those states that are found to contribute significantly to another state's non-attainment. States that are not in the ozone transport region, including Kentucky, are working together to evaluate further nitrogen oxide reductions from fossil-fueled plants with SCRs. The nature and timing of any additional reductions resulting from these evaluations cannot be predicted at this time.

In 2010, the EPA finalized revised NAAQS for sulfur dioxide and required states to identify areas that meet those standards and areas that are in "non-attainment". In July 2013, the EPA finalized non-attainment designations for parts of the country, including part of Jefferson County in Kentucky. Attainment must be achieved by 2018. PPL, LKE, LG&E and KU anticipate that certain previously required compliance measures, such as upgraded or new sulfur dioxide Scrubbers at certain plants and the retirement of coal-fired generating units at LG&E's Cane Run plant and KU's Green River plant, will help to achieve compliance with the new sulfur dioxide and ozone standards. If additional reductions are required, the costs could be significant.

Mercury and Air Toxics Standards (MATS)

In February 2012, the EPA finalized the MATS rule requiring reductions of mercury and other hazardous air pollutants from fossil-fuel fired power plants, with an effective date of April 16, 2012. The MATS rule was challenged by industry groups and states and was upheld by the U.S. Court of Appeals for the D. C. Circuit Court (D.C. Circuit Court) in April 2014. A group of states subsequently petitioned the U.S. Supreme Court (Supreme Court) to review this decision and, in June 2015, the Supreme Court held that the EPA failed to properly consider costs when deciding to regulate hazardous air emissions from power plants under MATS. The Supreme Court remanded the matter to the D.C. Circuit Court, which in December 2015 remanded the rule to the EPA without vacating it. The EPA has proposed a supplemental finding regarding costs of the rule and has announced that it intends to make a final determination in 2016. The EPA's MATS rule remains in effect during the pendency of the ongoing proceedings.

LG&E and KU have installed significant controls in response to the MATS rule and in conjunction with compliance with other environmental requirements, including fabric-filter baghouses, upgraded Scrubbers or chemical additive systems for which appropriate KPSC authorization and/or ECR treatment has been received. LG&E and KU have received KPSC approval for a compliance plan providing for installation of additional MATS-related controls; however, the estimated cost of these controls is not expected to be significant for either LG&E or KU. PPL, LKE, LG&E and KU cannot predict the outcome of the MATS rule or its potential impact, if any, on plant operations, rate treatment or future capital or operating needs. See Note 6 for additional information.

New Source Review (NSR)

The NSR litigation brought by the EPA, states and environmental groups against coal-fired generating plants in past years continues to proceed through the courts. Although none of this litigation directly involves PPL, LKE, LG&E or KU, it can influence the permitting of large capital projects at LG&E's and KU's power plants, the costs of which cannot presently be determined but could be significant.

Climate Change

There is continuing world-wide attention focused on issues related to climate change. In June 2016, the President announced that the United States, Canada and Mexico have established the North American Climate, Clean Energy, and Environment Partnership Plan which specifies actions to promote clean energy, address climate change and protect the environment. The plan includes a goal to provide 50% of the energy used in North America from clean energy sources by 2025. The plan does not impose any nation-specific requirements.

In December 2015, 195 nations, including the U.S., signed the Paris Agreement on Climate which establishes a comprehensive framework for the reduction of greenhouse gas (GHG) emissions from both developed and developing nations. Although the agreement does not establish binding reduction requirements, it requires each nation to prepare, communicate and maintain GHG reduction commitments. Reductions can be achieved in a variety of ways, including energy conservation, power plant efficiency improvements, reduced utilization of coal-fired generation or replacing coal-fired generation with natural gas or renewable generation. Based on EPA's Clean Power Plan described below, the U.S. has committed to an initial reduction target of 26% to 28% below 2005 levels by 2025.

The U.K. has enacted binding carbon reduction requirements that are applicable to WPD. Under the U.K. law, WPD must purchase carbon allowances to offset emissions associated with WPD’s operations. The cost of these allowances is included in WPD’s current operating expenses. WPD expects these expenses to decrease as a result of energy efficiency measures and the removal of 18 fuel sources previously included in the allowance requirements.

The EPA's Rules under Section 111 of the Clean Air Act

As further described below, the EPA finalized rules imposing GHG emission standards for both new and existing power plants in the United States. The EPA has also issued a proposed federal implementation plan that would apply to any states that fail to submit an acceptable state implementation plan under these rules. The EPA's authority to promulgate these regulations under Section 111 of the Clean Air Act has been challenged in the D.C. Circuit Court by several states and industry groups. On February 9, 2016, the Supreme Court stayed the rule for existing plants (the Clean Power Plan) pending the D.C. Circuit Court's review and subsequent review by the Supreme Court if a writ of certiorari is filed and granted.

The EPA's rule for new power plants imposes separate emission standards for coal and natural gas units based on the application of different technologies. The coal standard is based on the application of partial carbon capture and sequestration technology, but because this technology is not presently commercially viable, the rule effectively precludes the construction of new coal-fired plants. The standard for NGCC power plants is the same as the EPA proposed in 2012 and is not continuously achievable. The preclusion of new coal-fired plants and the compliance difficulties posed for new natural gas-fired plants could have a significant industry-wide impact.

The EPA's Clean Power Plan

The EPA's rule for existing power plants, referred to as the Clean Power Plan, was published in the Federal Register in October 2015. The Clean Power Plan contains state-specific rate-based and mass-based reduction goals and guidelines for the development, submission and implementation of state implementation plans to achieve the state goals. State-specific goals were calculated from 2012 data by applying the EPA's broad interpretation and definition of the BSER, resulting in the most stringent targets to be met in 2030, with interim targets to be met beginning in 2022. The EPA believes it has offered some flexibility to the states as to how their compliance plans can be crafted, including the option to use a rate-based approach (limit emissions per megawatt hour) or a mass-based approach (limit total tons of emissions per year), and the option to demonstrate compliance through emissions trading and multi-state collaborations. Under the rate-based approach, Kentucky would need to make a 41% reduction from its 2012 emissions rate and under a mass-based approach it would need to make a 36% reduction. These reductions are significantly greater than initially proposed and present significant challenges to the state. If the Clean Power Plan is ultimately upheld and Kentucky fails to develop an approvable implementation plan by the applicable deadline, the EPA would impose a federal implementation plan that could be more stringent than what the state plan might provide. Depending on the provisions of the Kentucky implementation plan, LG&E and KU may need to modify their current portfolio of generating assets during the next decade and/or participate in an allowance trading program.

LG&E and KU are participating in the ongoing regulatory processes at the state and federal level. Various states, industry groups and individual companies including LKE have filed petitions for reconsideration with EPA and petitions for review with the D.C. Circuit Court challenging the Clean Power Plan. In February 2016, the U.S. Supreme Court stayed the rule pending the D.C. Circuit Court's review. A ruling from the D.C. Circuit Court may occur in late 2016 or in early 2017. PPL, LKE, LG&E and KU cannot predict the outcome of this matter or the potential impact, if any, on plant operations, or future capital or operating costs. PPL, LKE, LG&E and KU believe that the costs, which could be significant, would be subject to rate recovery.

In April 2014, the Kentucky General Assembly passed legislation limiting the measures that the Kentucky Energy and Environment Cabinet may consider in setting performance standards to comply with the EPA's regulations governing GHG emissions from existing sources. The legislation provides that such state GHG performance standards shall be based on emission reductions, efficiency measures and other improvements available at each power plant, rather than renewable energy, end-use energy efficiency, fuel switching and re-dispatch. These statutory restrictions may make it more difficult for Kentucky to achieve the GHG reduction levels that the EPA has established for Kentucky.

Sulfuric Acid Mist Emissions (PPL, LKE and LG&E)

In June 2016, the EPA issued a notice of violation under the Clean Air Act alleging that LG&E violated applicable rules relating to sulfuric acid mist emissions at its Mill Creek plant. The notice alleges failure to install proper controls, failure to operate the facility consistent with good air pollution control practice, and causing emissions exceeding applicable requirements or constituting a nuisance or endangerment. LG&E believes it has complied with applicable regulations during the relevant time period. Discussions between the EPA and LG&E are ongoing. PPL, LKE and LG&E are unable to predict the outcome of this matter or the potential impact on operations of the Mill Creek plant, including increased capital or operating costs, and potential civil penalties or remedial measures, if any.

Water/Waste

(PPL, LKE, LG&E and KU)

Coal Combustion Residuals (CCRs)

In April 2015, the EPA published its final rule regulating CCRs. CCRs include fly ash, bottom ash and sulfur dioxide scrubber wastes. The rule became effective in October 2015. It imposes extensive new requirements, including location restrictions, design and operating standards, groundwater monitoring and corrective action requirements, and closure and post-closure care requirements on CCR impoundments and landfills that are located on active power plants in the United States and not closed. Under the rule, the EPA will regulate CCRs as non-hazardous under Subtitle D of RCRA and allow beneficial use of CCRs, with some restrictions. The rule's requirements for covered CCR impoundments and landfills include implementation of groundwater monitoring and commencement or completion of closure activities generally between three and ten years from certain triggering events. This self-implementing rule requires posting of compliance documentation on a publicly accessible website and is enforceable solely through citizen suits. LG&E and KU are also subject to state rules applicable to CCR management which may potentially be modified to reflect some or all requirements of the federal rule. Industry groups, environmental groups, individual companies and others have filed legal challenges to the final rule which are pending before the D.C. Circuit Court of Appeals.

LG&E and KU have received KPSC approval for a compliance plan providing for construction of additional landfill capacity at the Brown Station, closure of impoundments at the Mill Creek, Trimble County, Brown, and Ghent stations, and construction of process water management facilities at those plants. In addition to the foregoing measures required for compliance with federal CCR rule requirements, LG&E and KU also received KPSC approval for their plans to close impoundments at the retired Green River, Pineville and Tyrone plants to comply with applicable state law requirements. See Note 6 for additional information.

In connection with the final CCR rule, LG&E and KU recorded adjustments to existing AROs during 2015 and 2016. See Note 16 for additional information. Further changes to AROs, current capital plans or operating costs may be required as estimates are refined based on closure developments, groundwater monitoring results, and regulatory or legal proceedings. Costs relating to this rule are subject to rate recovery.

Clean Water Act

Regulations under the federal Clean Water Act dictate permitting and mitigation requirements for facilities and construction projects in the United States. Many of those requirements relate to power plant operations, including requirements related to the treatment of pollutants in effluents prior to discharge, the temperature of effluent discharges and the location, design and construction of cooling water intake structures at generating facilities, standards intended to protect aquatic organisms by reducing capture in the screens attached to cooling water intake structures (impingement) at generating facilities and the water volume brought into the facilities (entrainment). The requirements could impose significant costs for LG&E and KU which are subject to rate recovery.

Effluent Limitations Guidelines (ELGs)

In September 2015, the EPA released its final effluent limitations guidelines for wastewater discharge permits for new and existing steam electricity generating facilities. The rule provides strict technology-based discharge limitations for control of pollutants in scrubber wastewater, fly ash and bottom ash transport water, mercury control wastewater, gasification wastewater and combustion residual leachate. The new guidelines require deployment of additional control technologies providing physical, chemical and biological treatment of wastewaters. The guidelines also mandate operational changes including "no discharge" requirements for fly ash and bottom ash transport waters and mercury control wastewaters. The implementation date for individual generating stations will be determined by the states on a case-by-case basis according to criteria provided by the EPA, but the requirements of the rule must be fully implemented no later than 2023. It has not been decided how Kentucky intends to integrate the ELGs into its routine permit renewal process. Industry groups, environmental groups, individual companies and others have filed legal challenges to the final rule which have been consolidated before the United States Fifth Circuit Court of Appeals. LG&E and KU are developing compliance strategies and schedules. PPL, LKE, LG&E and KU are unable to fully estimate compliance costs or timing at this time, although certain preliminary estimates are included in current capital forecasts for applicable periods. Costs to comply with ELGs or other discharge limits, which are expected to be significant, are subject to rate recovery.

Clean Water Act Section 316(b)

The EPA's final 316(b) rule for existing facilities became effective in October 2014, and regulates cooling water intake structures and their impact on aquatic organisms. States are allowed broad discretion to make site-specific determinations under the rule. The rule requires existing facilities to choose between several options to reduce the impact to aquatic organisms that become trapped against water intake screens (impingement) and to determine the intake structure's impact on aquatic organisms pulled through a plant's cooling water system (entrainment). Plants equipped with closed-cycle cooling, an acceptable option, would likely not incur substantial costs. Once-through systems would likely require additional technology to comply with the rule. Based on studies conducted by LG&E and KU to date, all plants will incur only insignificant operational costs. In addition, LG&E's Mill Creek Unit 1 is expected to incur capital costs. PPL, LKE, LG&E and KU are evaluating compliance strategies but do not presently expect the compliance costs, which are subject to rate recovery, to be significant.

(All Registrants)

Waters of the United States (WOTUS)

The U.S. Court of Appeals for the Sixth Circuit has issued a stay of EPA's rule on the definition of WOTUS pending the court's review of the rule. The effect of the stay is that the WOTUS rule is not in effect anywhere in the United States. The ultimate outcome of the court's review of the rule remains uncertain. Because of the strict permitting programs already in place in Kentucky and Pennsylvania, the Registrants do not expect the rule to have a significant impact on their operations.

Other Issues

The EPA is reassessing its polychlorinated biphenyls (PCB) regulations under the Toxic Substance Control Act, which was significantly updated in June 2016. In 2010, the EPA issued an Advanced Notice of Proposed Rulemaking for changes to these regulations. The rulemaking, which could lead to a phase-out in the United States of all or some equipment containing PCBs, is not likely to be affected by the revisions to the Toxic Substances Control Act. The EPA has postponed the release of revisions to its proposed rulemaking. The Registrants cannot predict at this time the outcome of the proposed EPA rulemaking and what impact, if any, it would have on their facilities, but the costs could be significant.

Superfund and Other Remediation(All Registrants)

PPL Electric is potentially responsible for a share of the costs at several sites listed by the EPA under the federal Superfund program, including the Columbia Gas Plant site and the Brodhead site. Clean-up actions have been or are being undertaken at all of these sites, the costs of which have not been significant to PPL Electric. Should the EPA require different or additional measures in the future, however, or should PPL Electric's share of costs at multi-party sites increase substantially more than expected, the costs could be significant.

PPL Electric, LG&E and KU are investigating, responding to agency inquiries, remediating, or have completed the remediation of, several sites that were not addressed under a regulatory program such as Superfund, but for which PPL Electric, LG&E and KU may be liable for remediation. These include a number of former coal gas manufacturing plants in Pennsylvania and Kentucky previously owned or operated or currently owned by predecessors or affiliates of PPL Electric, LG&E and KU. To date, the costs of these sites have not been significant.

There are additional sites, formerly owned or operated by PPL Electric, LG&E and KU predecessors or affiliates. LG&E and KU lack information on the condition of such additional sites and are therefore unable to estimate any potential liability they may have or a range of reasonably possible losses, if any, related to these sites. At September 30, 2016 and December 31, 2015, PPL Electric had a recorded liability of $10 million representing its best estimate of the probable loss incurred to remediate additional sites previously owned or operated by PPL Electric predecessors or affiliates. Depending on the outcome of investigations at sites where investigations have not begun or been completed, or developments at sites for which information is incomplete, the costs of remediation and other liabilities could be significant and may be as much as approximately $30 million.

The EPA is evaluating the risks associated with polycyclic aromatic hydrocarbons and naphthalene, chemical by-products of coal gas manufacturing. As a result of the EPA's evaluation, individual states may establish stricter standards for water quality and soil cleanup. This could require several PPL subsidiaries to take more extensive assessment and remedial actions at former coal gas manufacturing plants. PPL, PPL Electric, LKE, LG&E and KU cannot estimate a range of reasonably possible losses, if any, related to these matters.

From time to time, PPL's subsidiaries in the United States undertake remedial action in response to notices of violations, spills or other releases at various on-site and off-site locations, negotiate with the EPA and state and local agencies regarding actions necessary for compliance with applicable requirements, negotiate with property owners and other third parties alleging impacts from PPL's operations and undertake similar actions necessary to resolve environmental matters that arise in the course of normal operations. Based on analyses to date, resolution of these environmental matters is not expected to have a significant adverse impact on the operations of PPL Electric, LG&E and KU.

Future cleanup or remediation work at sites under review, or at sites not yet identified, may result in significant additional costs for PPL, PPL Electric, LKE, LG&E and KU. Insurance policies maintained by LKE, LG&E and KU may be applicable to certain of the costs or other obligations related to these matters but the amount of insurance coverage or reimbursement cannot be estimated or assured.

European Union Creosote Ban(PPL)

In 2011, the European Commission amended the European Union Biocides Directive to ban the use of creosote in contact with soil. Creosote is a wood preservative used to extend the life of wooden poles that support power lines. Although European Union member countries were required to pass implementing laws by 2012, the U.K. has not passed an implementing law and there are no legal penalties for failing to do so. The recent U.K. referendum in favor of the U.K.'s withdrawal from the European Union further reduces the likelihood that the U.K. will implement the European Union directive. In the unlikely event that the U.K. were to ban the use of creosote, WPD's creosote-treated wood poles would need to be replaced with an acceptable alternative at the time of routine replacement. Although the aggregate cost to replace poles could be significant, it would be incurred as poles are replaced in the ordinary course and would be subject to rate recovery. WPD has 1.4 million wood poles in its system. There are currently no alternative wood preservatives available that are acceptable to the industry and/or regulators.

Other

Guarantees and Other Assurances

(All Registrants)

In the normal course of business, the Registrants enter into agreements that provide financial performance assurance to third parties on behalf of certain subsidiaries. Such agreements include, for example, guarantees, stand-by letters of credit issued by financial institutions and surety bonds issued by insurance companies. These agreements are entered into primarily to support or enhance the creditworthiness attributed to a subsidiary on a stand-alone basis or to facilitate the commercial activities in which these subsidiaries engage.

(PPL)

PPL fully and unconditionally guarantees all of the debt securities of PPL Capital Funding.

(All Registrants)

The table below details guarantees provided as of September 30, 2016. "Exposure" represents the estimated maximum potential amount of future payments that could be required to be made under the guarantee. The probability of expected payment/performance under each of these guarantees is remote except for "WPD guarantee of pension and other obligations of unconsolidated entities" and "Indemnification of lease termination and other divestitures." The total recorded liability at September 30, 2016, was $22 million for PPL and $17 million for LKE. The total recorded liability at December 31, 2015, was $25 million for PPL and $18 million for LKE. For reporting purposes, on a consolidated basis, all guarantees of PPL Electric, LKE, LG&E and KU also apply to PPL, and all guarantees of LG&E and KU also apply to LKE.

	Exposure at September 30, 2016			Expiration Date
PPL
Indemnifications related to the WPD Midlands acquisition			(a)
WPD indemnifications for entities in liquidation and sales of assets	$	10	(b)	2019
WPD guarantee of pension and other obligations of unconsolidated entities	109		(c)
PPL Electric
Guarantee of inventory value	15		(d)	2018
LKE
Indemnification of lease termination and other divestitures	301		(e)	2021 - 2023
LG&E and KU
LG&E and KU guarantee of shortfall related to OVEC			(f)

(a) Indemnifications related to certain liabilities, including a specific unresolved tax issue and those relating to properties and assets owned by the seller that were transferred to WPD Midlands in connection with the acquisition. A cross indemnity has been received from the seller on the tax issue. The maximum exposure and expiration of these indemnifications cannot be estimated because the maximum potential liability is not capped and the expiration date is not specified in the transaction documents.

(b) Indemnification to the liquidators and certain others for existing liabilities or expenses or liabilities arising during the liquidation process. The indemnifications are limited to distributions made from the subsidiary to its parent either prior or subsequent to liquidation or are not explicitly stated in the agreements. The indemnifications generally expire two to seven years subsequent to the date of dissolution of the entities. The exposure noted only includes those cases where the agreements provide for specific limits.

In connection with their sales of various businesses, WPD and its affiliates have provided the purchasers with indemnifications that are standard for such transactions, including indemnifications for certain pre-existing liabilities and environmental and tax matters or have agreed to continue their obligations under existing third-party guarantees, either for a set period of time following the transactions or upon the condition that the purchasers make reasonable efforts to terminate the guarantees. Additionally, WPD and its affiliates remain secondarily responsible for lease payments under certain leases that they have assigned to third parties.

(c) Relates to certain obligations of discontinued or modified electric associations that were guaranteed at the time of privatization by the participating members. Costs are allocated to the members and can be reallocated if an existing member becomes insolvent. At September 30, 2016, WPD has recorded an estimated discounted liability for which the expected payment/performance is probable. Neither the expiration date nor the maximum amount of potential payments for certain obligations is explicitly stated in the related agreements, and as a result, the exposure has been estimated.

(d) A third party logistics firm provides inventory procurement and fulfillment services. The logistics firm has title to the inventory, however, upon termination of the contracts, PPL Electric has guaranteed to purchase any remaining inventory that has not been used or sold.

(e) LKE provides certain indemnifications covering the due and punctual payment, performance and discharge by each party of its respective obligations. The most comprehensive of these guarantees is the LKE guarantee covering operational, regulatory and environmental commitments and indemnifications made by WKE under a 2009 Transaction Termination Agreement. This guarantee has a term of 12 years ending July 2021, and a maximum exposure of $200 million, exclusive of certain items such as government fines and penalties that fall outside the cap. Another WKE-related LKE guarantee covers other indemnifications related to the purchase price of excess power, has a term expiring in 2023, and a maximum exposure of $100 million. In May 2012, LKE's indemnitee received an unfavorable arbitration panel's decision interpreting this matter. In October 2014, LKE's indemnitee filed a motion for discretionary review with the Kentucky Supreme Court seeking to overturn the arbitration decision, and such motion was denied by the court in September 2015. In September 2015, a counterparty issued a demand letter to LKE's indemnitee. In February 2016, the counterparty filed a complaint in Henderson, Kentucky Circuit Court, seeking an award of damages in the matter. The proceeding is currently in the discovery phase. LKE does not believe appropriate contractual, legal or commercial grounds exist for the claim made and has disputed the demands. LKE believes its indemnification obligations in the WKE matter remain subject to various uncertainties, including additional legal and contractual developments, as well as future prices, availability and demand for the subject excess power. Although the parties have also conducted certain settlement discussions, the ultimate outcomes of the WKE termination-related indemnifications cannot be predicted at this time. Additionally, LKE has indemnified various third parties related to historical obligations for other divested subsidiaries and affiliates. The indemnifications vary by entity and the maximum exposures range from being capped at the sale price to no specified maximum, and LKE could be required to perform on these indemnifications in the event of covered losses or liabilities being claimed by an indemnified party. LKE cannot predict the ultimate outcomes of the various indemnification scenarios, but does not expect such outcomes to result in significant losses above the amounts recorded.

(f) Pursuant to the OVEC power purchase contract, LG&E and KU are obligated to pay for their share of OVEC's excess debt service, post-retirement and decommissioning costs, as well as any shortfall from amounts included within a demand charge designed and expected to cover these costs over the term of the contract. LKE's proportionate share of OVEC's outstanding debt was $124 million at September 30, 2016, consisting of LG&E's share of $86 million and KU's share of $38 million. The maximum exposure and the expiration date of these potential obligations are not presently determinable. See "Energy Purchase Commitments" and "Guarantees and Other Assurances" in Note 13 in PPL's, LKE's, LG&E's and KU's 2015 Form 10-K for additional information on the OVEC power purchase contract.

The Registrants provide other miscellaneous guarantees through contracts entered into in the normal course of business. These guarantees are primarily in the form of indemnification or warranties related to services or equipment and vary in duration. The amounts of these guarantees often are not explicitly stated, and the overall maximum amount of the obligation under such guarantees cannot be reasonably estimated. Historically, no significant payments have been made with respect to these types of guarantees and the probability of payment/performance under these guarantees is remote.

PPL, on behalf of itself and certain of its subsidiaries, maintains insurance that covers liability assumed under contract for bodily injury and property damage. The coverage provides maximum aggregate coverage of $225 million. This insurance may be applicable to obligations under certain of these contractual arrangements.

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Related Party Transactions

9 Months Ended

Sep. 30, 2016

PPL Electric Utilities Corp [Member]

Related Party Transactions [Line Items]

Related Party Transactions

Related Party Transactions

Support Costs(PPL Electric, LKE, LG&E and KU)

PPL Services and LKS provide their respective PPL and LKE subsidiaries and each other with administrative, management and support services. PPL EU Services provides the majority of financial, supply chain, human resources and facilities management services primarily to PPL Electric. PPL Services provides certain corporate functions to PPL Electric. For all service companies, the costs of these services are charged to the respective recipients as direct support costs. General costs that cannot be directly attributed to a specific entity are allocated and charged to the respective recipients as indirect support costs. PPL Services and PPL EU Services use a three-factor methodology that includes the applicable recipients' invested capital, operation and maintenance expenses and number of employees to allocate indirect costs. LKS bases its indirect allocations on the subsidiaries' number of employees, total assets, revenues, number of customers and/or other statistical information. PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

In addition to the charges for services noted above, LKS makes payments on behalf of LG&E and KU for fuel purchases and other costs for products or services provided by third parties. LG&E and KU also provide services to each other and to LKS. Billings between LG&E and KU relate to labor and overheads associated with union and hourly employees performing work for the other company, charges related to jointly-owned generating units and other miscellaneous charges. Tax settlements between LKE and LG&E and LKE and KU are reimbursed through LKS.

Intercompany Borrowings(LKE)

LKE maintains a $225 million revolving line of credit with a PPL Energy Funding subsidiary whereby LKE can borrow funds on a short-term basis at market-based rates. At September 30, 2016 and December 31, 2015, $138 million and $54 million were outstanding and were reflected in "Notes payable with affiliate" on the Balance Sheets. The interest rate on borrowings is equal to one-month LIBOR plus a spread. The interest rates on the outstanding borrowing at September 30, 2016 and December 31, 2015 were 2.02% and 1.74%.

LKE has a $400 millionten-year note with a PPL affiliate with an interest rate of 3.5%. At September 30, 2016 and December 31, 2015, the note was reflected in "Long-term debt to affiliate" on the Balance Sheets.

Other(PPL Electric, LG&E and KU)

See Note 9 for discussions regarding intercompany allocations associated with defined benefits.

LG And E And KU Energy LLC [Member]

Related Party Transactions [Line Items]

Related Party Transactions

Related Party Transactions

Support Costs(PPL Electric, LKE, LG&E and KU)

PPL Services and LKS provide their respective PPL and LKE subsidiaries and each other with administrative, management and support services. PPL EU Services provides the majority of financial, supply chain, human resources and facilities management services primarily to PPL Electric. PPL Services provides certain corporate functions to PPL Electric. For all service companies, the costs of these services are charged to the respective recipients as direct support costs. General costs that cannot be directly attributed to a specific entity are allocated and charged to the respective recipients as indirect support costs. PPL Services and PPL EU Services use a three-factor methodology that includes the applicable recipients' invested capital, operation and maintenance expenses and number of employees to allocate indirect costs. LKS bases its indirect allocations on the subsidiaries' number of employees, total assets, revenues, number of customers and/or other statistical information. PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

In addition to the charges for services noted above, LKS makes payments on behalf of LG&E and KU for fuel purchases and other costs for products or services provided by third parties. LG&E and KU also provide services to each other and to LKS. Billings between LG&E and KU relate to labor and overheads associated with union and hourly employees performing work for the other company, charges related to jointly-owned generating units and other miscellaneous charges. Tax settlements between LKE and LG&E and LKE and KU are reimbursed through LKS.

Intercompany Borrowings(LKE)

LKE maintains a $225 million revolving line of credit with a PPL Energy Funding subsidiary whereby LKE can borrow funds on a short-term basis at market-based rates. At September 30, 2016 and December 31, 2015, $138 million and $54 million were outstanding and were reflected in "Notes payable with affiliate" on the Balance Sheets. The interest rate on borrowings is equal to one-month LIBOR plus a spread. The interest rates on the outstanding borrowing at September 30, 2016 and December 31, 2015 were 2.02% and 1.74%.

LKE has a $400 millionten-year note with a PPL affiliate with an interest rate of 3.5%. At September 30, 2016 and December 31, 2015, the note was reflected in "Long-term debt to affiliate" on the Balance Sheets.

Other(PPL Electric, LG&E and KU)

See Note 9 for discussions regarding intercompany allocations associated with defined benefits.

Louisville Gas And Electric Co [Member]

Related Party Transactions [Line Items]

Related Party Transactions

Related Party Transactions

Support Costs(PPL Electric, LKE, LG&E and KU)

PPL Services and LKS provide their respective PPL and LKE subsidiaries and each other with administrative, management and support services. PPL EU Services provides the majority of financial, supply chain, human resources and facilities management services primarily to PPL Electric. PPL Services provides certain corporate functions to PPL Electric. For all service companies, the costs of these services are charged to the respective recipients as direct support costs. General costs that cannot be directly attributed to a specific entity are allocated and charged to the respective recipients as indirect support costs. PPL Services and PPL EU Services use a three-factor methodology that includes the applicable recipients' invested capital, operation and maintenance expenses and number of employees to allocate indirect costs. LKS bases its indirect allocations on the subsidiaries' number of employees, total assets, revenues, number of customers and/or other statistical information. PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

In addition to the charges for services noted above, LKS makes payments on behalf of LG&E and KU for fuel purchases and other costs for products or services provided by third parties. LG&E and KU also provide services to each other and to LKS. Billings between LG&E and KU relate to labor and overheads associated with union and hourly employees performing work for the other company, charges related to jointly-owned generating units and other miscellaneous charges. Tax settlements between LKE and LG&E and LKE and KU are reimbursed through LKS.

Intercompany Borrowings(LKE)

LKE maintains a $225 million revolving line of credit with a PPL Energy Funding subsidiary whereby LKE can borrow funds on a short-term basis at market-based rates. At September 30, 2016 and December 31, 2015, $138 million and $54 million were outstanding and were reflected in "Notes payable with affiliate" on the Balance Sheets. The interest rate on borrowings is equal to one-month LIBOR plus a spread. The interest rates on the outstanding borrowing at September 30, 2016 and December 31, 2015 were 2.02% and 1.74%.

LKE has a $400 millionten-year note with a PPL affiliate with an interest rate of 3.5%. At September 30, 2016 and December 31, 2015, the note was reflected in "Long-term debt to affiliate" on the Balance Sheets.

Other(PPL Electric, LG&E and KU)

See Note 9 for discussions regarding intercompany allocations associated with defined benefits.

Kentucky Utilities Co [Member]

Related Party Transactions [Line Items]

Related Party Transactions

Related Party Transactions

Support Costs(PPL Electric, LKE, LG&E and KU)

PPL Services and LKS provide their respective PPL and LKE subsidiaries and each other with administrative, management and support services. PPL EU Services provides the majority of financial, supply chain, human resources and facilities management services primarily to PPL Electric. PPL Services provides certain corporate functions to PPL Electric. For all service companies, the costs of these services are charged to the respective recipients as direct support costs. General costs that cannot be directly attributed to a specific entity are allocated and charged to the respective recipients as indirect support costs. PPL Services and PPL EU Services use a three-factor methodology that includes the applicable recipients' invested capital, operation and maintenance expenses and number of employees to allocate indirect costs. LKS bases its indirect allocations on the subsidiaries' number of employees, total assets, revenues, number of customers and/or other statistical information. PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

In addition to the charges for services noted above, LKS makes payments on behalf of LG&E and KU for fuel purchases and other costs for products or services provided by third parties. LG&E and KU also provide services to each other and to LKS. Billings between LG&E and KU relate to labor and overheads associated with union and hourly employees performing work for the other company, charges related to jointly-owned generating units and other miscellaneous charges. Tax settlements between LKE and LG&E and LKE and KU are reimbursed through LKS.

Intercompany Borrowings(LKE)

LKE maintains a $225 million revolving line of credit with a PPL Energy Funding subsidiary whereby LKE can borrow funds on a short-term basis at market-based rates. At September 30, 2016 and December 31, 2015, $138 million and $54 million were outstanding and were reflected in "Notes payable with affiliate" on the Balance Sheets. The interest rate on borrowings is equal to one-month LIBOR plus a spread. The interest rates on the outstanding borrowing at September 30, 2016 and December 31, 2015 were 2.02% and 1.74%.

LKE has a $400 millionten-year note with a PPL affiliate with an interest rate of 3.5%. At September 30, 2016 and December 31, 2015, the note was reflected in "Long-term debt to affiliate" on the Balance Sheets.

Other(PPL Electric, LG&E and KU)

See Note 9 for discussions regarding intercompany allocations associated with defined benefits.

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Other Income (Expense) - net

9 Months Ended

Sep. 30, 2016

Other Nonoperating Income (Expense) [Abstract]

Other Income (Expense) - net

Other Income (Expense) - net

(PPL)

"Other Income (Expense) - net" for the three and nine months ended September 30, 2016 and 2015 consisted primarily of gains on foreign currency contracts to economically hedge PPL's translation risk related to its GBP denominated earnings in the U.K. See Note 14 for additional information on these derivatives.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2016

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

(All Registrants)

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). A market approach (generally, data from market transactions), an income approach (generally, present value techniques and option-pricing models) and/or a cost approach (generally, replacement cost) are used to measure the fair value of an asset or liability, as appropriate. These valuation approaches incorporate inputs such as observable, independent market data and/or unobservable data that management believes are predicated on the assumptions market participants would use to price an asset or liability. These inputs may incorporate, as applicable, certain risks such as nonperformance risk, which includes credit risk. The fair value of a group of financial assets and liabilities is measured on a net basis. Transfers between levels are recognized at end-of-reporting-period values. During the three and nine months ended September 30, 2016 and 2015, there were no transfers between Level 1 and Level 2. See Note 1 in each Registrant's 2015 Form 10-K for information on the levels in the fair value hierarchy.

Recurring Fair Value Measurements

The assets and liabilities measured at fair value were:

	September 30, 2016								December 31, 2015
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
PPL
Assets
Cash and cash equivalents	$	416	$	416	$	—	$	—	$	836	$	836	$	—	$	—
Restricted cash and cash equivalents (a)	29		29		—		—		33		33		—		—
Price risk management assets (b):
Foreign currency contracts	110		—		110		—		209		—		209		—
Cross-currency swaps	153		—		153		—		86		—		86		—
Total price risk management assets	263		—		263		—		295		—		295		—
Auction rate securities (c)	—		—		—		—		2		—		—		2
Total assets	$	708	$	445	$	263	$	—	$	1,166	$	869	$	295	$	2
Liabilities
Price risk management liabilities (b):
Interest rate swaps	$	54	$	—	$	54	$	—	$	71	$	—	$	71	$	—
Foreign currency contracts	14		—		14		—		1		—		1		—
Total price risk management liabilities	$	68	$	—	$	68	$	—	$	72	$	—	$	72	$	—
PPL Electric
Assets
Cash and cash equivalents	$	36	$	36	$	—	$	—	$	47	$	47	$	—	$	—
Restricted cash and cash equivalents (a)	2		2		—		—		2		2		—		—
Total assets	$	38	$	38	$	—	$	—	$	49	$	49	$	—	$	—
LKE
Assets
Cash and cash equivalents	$	11	$	11	$	—	$	—	$	30	$	30	$	—	$	—
Cash collateral posted to counterparties (d)	8		8		—		—		9		9		—		—
Total assets	$	19	$	19	$	—	$	—	$	39	$	39	$	—	$	—

	September 30, 2016								December 31, 2015
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Liabilities
Price risk management liabilities:
Interest rate swaps	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
Total price risk management liabilities	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
LG&E
Assets
Cash and cash equivalents	$	4	$	4	$	—	$	—	$	19	$	19	$	—	$	—
Cash collateral posted to counterparties (d)	8		8		—		—		9		9		—		—
Total assets	$	12	$	12	$	—	$	—	$	28	$	28	$	—	$	—
Liabilities
Price risk management liabilities:
Interest rate swaps	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
Total price risk management liabilities	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
KU
Assets
Cash and cash equivalents	$	7	$	7	$	—	$	—	$	11	$	11	$	—	$	—
Total assets	$	7	$	7	$	—	$	—	$	11	$	11	$	—	$	—

(a) Current portion is included in "Other current assets" and long-term portion is included in "Other noncurrent assets" on the Balance Sheets.

(b) Current portion is included in "Price risk management assets" and "Other current liabilities" and noncurrent portion is included in "Price risk management assets" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

(c) Included in "Other noncurrent assets" on the Balance Sheets.

(d) Included in "Other noncurrent assets" on the Balance Sheets. Represents cash collateral posted to offset the exposure with counterparties related to certain interest rate swaps under master netting arrangements that are not offset.

Price Risk Management Assets/Liabilities - Interest Rate Swaps/Foreign Currency Contracts/Cross-Currency Swaps (PPL, LKE, LG&E and KU)

To manage interest rate risk, PPL, LKE, LG&E and KU use interest rate contracts such as forward-starting swaps, floating-to-fixed swaps and fixed-to-floating swaps. To manage foreign currency risk, PPL uses foreign currency contracts such as forwards, options and cross-currency swaps that contain characteristics of both interest rate and foreign currency contracts. An income approach is used to measure the fair value of these contracts, utilizing readily observable inputs, such as forward interest rates (e.g., LIBOR and government security rates) and forward foreign currency exchange rates (e.g., GBP), as well as inputs that may not be observable, such as credit valuation adjustments. In certain cases, market information cannot practicably be obtained to value credit risk and therefore internal models are relied upon. These models use projected probabilities of default and estimated recovery rates based on historical observances. When the credit valuation adjustment is significant to the overall valuation, the contracts are classified as Level 3.

Nonrecurring Fair Value Measurements (PPL)

See Note 8 for information regarding the estimated fair value of the Supply segment's net assets as of the June 1, 2015 spinoff date.

Financial Instruments Not Recorded at Fair Value(All Registrants)

The carrying amounts of long-term debt on the Balance Sheets and their estimated fair values are set forth below. The fair values were estimated using an income approach by discounting future cash flows at estimated current cost of funding rates, which incorporate the credit risk of the Registrants. Long-term debt is classified as Level 2. The effect of third-party credit enhancements is not included in the fair value measurement.

	September 30, 2016				December 31, 2015
	Carrying Amount (a)		Fair Value		Carrying Amount (a)		Fair Value
PPL	$	18,512	$	23,180	$	19,048	$	21,218
PPL Electric	2,831		3,372		2,828		3,088
LKE	5,089		5,832		5,088		5,384
LG&E	1,642		1,852		1,642		1,704
KU	2,327		2,701		2,326		2,467

(a) Amounts are net of debt issuance costs.

The carrying value of short-term debt (including notes between affiliates), when outstanding, approximates fair value due to the variable interest rates associated with the short-term debt and is classified as Level 2.

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Derivative Instruments and Hedging Activities

9 Months Ended

Sep. 30, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

Risk Management Objectives

(All Registrants)

PPL has a risk management policy approved by the Board of Directors to manage market risk associated with commodities, interest rates on debt issuances and foreign exchange (including price, liquidity and volumetric risk) and credit risk (including non-performance risk and payment default risk). The Risk Management Committee, comprised of senior management and chaired by the Director-Risk Management, oversees the risk management function. Key risk control activities designed to ensure compliance with the risk policy and detailed programs include, but are not limited to, credit review and approval, validation of transactions, verification of risk and transaction limits, value-at-risk analyses (VaR, a statistical model that attempts to estimate the value of potential loss over a given holding period under normal market conditions at a given confidence level) and the coordination and reporting of the Enterprise Risk Management program.

Market Risk

Market risk includes the potential loss that may be incurred as a result of price changes associated with a particular financial or commodity instrument as well as market liquidity and volumetric risks. Forward contracts, futures contracts, options, swaps and structured transactions are utilized as part of risk management strategies to minimize unanticipated fluctuations in earnings caused by changes in commodity prices, interest rates and foreign currency exchange rates. Many of the contracts meet the definition of a derivative. All derivatives are recognized on the Balance Sheets at their fair value, unless NPNS is elected.

The following summarizes the market risks that affect PPL and its subsidiaries.

Interest rate risk

• PPL and its subsidiaries are exposed to interest rate risk associated with forecasted fixed-rate and existing floating-rate debt issuances. PPL and WPD hold over-the-counter cross currency swaps to limit exposure to market fluctuations on interest and principal payments from changes in foreign currency exchange rates and interest rates. LKE and LG&E utilize over-the-counter interest rate swaps to limit exposure to market fluctuations on floating-rate debt. PPL, LKE, LG&E and KU utilize forward starting interest rate swaps to hedge changes in benchmark interest rates, when appropriate, in connection with future debt issuances.

• PPL and its subsidiaries are exposed to interest rate risk associated with debt securities and derivatives held by defined benefit plans. This risk is significantly mitigated to the extent that the plans are sponsored at, or sponsored on behalf of, the regulated domestic utilities and for certain plans at WPD due to the recovery mechanisms in place.

Foreign currency risk

• PPL is exposed to foreign currency exchange risk primarily associated with its investments in and earnings of U.K. affiliates.

Commodity price risk

PPL is exposed to commodity price risk through its domestic subsidiaries as described below.

• PPL Electric is exposed to commodity price risk from its obligation as PLR; however, its PUC-approved cost recovery mechanism substantially eliminates its exposure to this risk. PPL Electric also mitigates its exposure to commodity price risk by entering into full-requirement supply agreements to serve its PLR customers. These supply agreements transfer the commodity price risk associated with the PLR obligation to the energy suppliers.

• LG&E's and KU's rates include certain mechanisms for fuel and fuel-related expenses. In addition, LG&E's rates include a mechanism for natural gas supply expenses. These mechanisms generally provide for timely recovery of market price fluctuations associated with these expenses.

Volumetric risk

PPL is exposed to volumetric risk through its subsidiaries as described below.

• WPD is exposed to volumetric risk which is significantly mitigated as a result of the method of regulation in the U.K. Under the RIIO - ED1 price control period, recovery of such exposure occurs on a two year lag. See Note 1 in PPL's 2015 Form 10-K for additional information on revenue recognition under RIIO - ED1.

• PPL Electric, LG&E and KU are exposed to volumetric risk on retail sales, mainly due to weather and other economic conditions for which there is limited mitigation between rate cases.

Equity securities price risk

• PPL and its subsidiaries are exposed to equity securities price risk associated with defined benefit plans. This risk is significantly mitigated at the regulated domestic utilities and for certain plans at WPD due to the recovery mechanisms in place.

• PPL is exposed to equity securities price risk from future stock sales and/or purchases.

Credit Risk

Credit risk is the potential loss that may be incurred due to a counterparty's non-performance.

PPL is exposed to credit risk from "in-the-money" interest rate and foreign currency derivatives with financial institutions, as well as additional credit risk through certain of its subsidiaries, as discussed below.

In the event a supplier of LKE (through its subsidiaries LG&E and KU) or PPL Electric defaults on its obligation, those entities would be required to seek replacement power or replacement fuel in the market. In general, subject to regulatory review or other processes, appropriate incremental costs incurred by these entities would be recoverable from customers through applicable rate mechanisms, thus mitigating the financial risk for these entities.

PPL and its subsidiaries have credit policies in place to manage credit risk, including the use of an established credit approval process, daily monitoring of counterparty positions and the use of master netting agreements or provisions. These agreements generally include credit mitigation provisions, such as margin, prepayment or collateral requirements. PPL and its subsidiaries may request additional credit assurance, in certain circumstances, in the event that the counterparties' credit ratings fall below investment grade, their tangible net worth falls below specified percentages or their exposures exceed an established credit limit.

Master Netting Arrangements

Net derivative positions on the balance sheets are not offset against the right to reclaim cash collateral (a receivable) or the obligation to return cash collateral (a payable) under master netting arrangements.

PPL, LKE, LG&E and KU had no obligation to return cash collateral under master netting arrangements at September 30, 2016 and December 31, 2015.

PPL, LKE and LG&E posted $8 million of cash collateral under master netting arrangements at September 30, 2016 and $9 million of cash collateral under master netting arrangements at December 31, 2015.

KU did not post any cash collateral under master netting arrangements at September 30, 2016 and December 31, 2015.

See "Offsetting Derivative Instruments" below for a summary of derivative positions presented in the balance sheets where a right of setoff exists under these arrangements.

Interest Rate Risk

(All Registrants)

PPL and its subsidiaries issue debt to finance their operations, which exposes them to interest rate risk. Various financial derivative instruments are utilized to adjust the mix of fixed and floating interest rates in their debt portfolio, adjust the duration of the debt portfolio and lock in benchmark interest rates in anticipation of future financing, when appropriate. Risk limits under PPL's risk management program are designed to balance risk exposure to volatility in interest expense and changes in the fair value of the debt portfolio due to changes in benchmark interest rates. In addition, the interest rate risk of certain subsidiaries is potentially mitigated as a result of the existing regulatory framework or the timing of rate cases.

Cash Flow Hedges

(PPL)

Interest rate risks include exposure to adverse interest rate movements for outstanding variable rate debt and for future anticipated financings. Financial interest rate swap contracts that qualify as cash flow hedges may be entered into to hedge floating interest rate risk associated with both existing and anticipated debt issuances. PPL held no such contracts at September 30, 2016.

For the three months ended September 30, 2016, PPL had no hedge ineffectiveness associated with interest rate derivatives and an insignificant amount of hedge ineffectiveness for the three months ended September 30, 2015. For the nine months ended September 30, 2016 and 2015, PPL had an insignificant amount of ineffectiveness associated with interest rate derivatives.

At September 30, 2016, PPL held an aggregate notional value in cross-currency interest rate swap contracts of $802 million that range in maturity from 2017 through 2028 to hedge the interest payments and principal of WPD's U.S. dollar-denominated senior notes. In May 2016, $460 million of WPD's U.S. dollar-denominated senior notes were repaid upon maturity and $460 million notional value of cross-currency interest rate swap contracts matured. PPL recorded a $46 million gain upon settlement of the cross-currency interest rate swap contracts, which largely offset a loss recorded on the revaluation of U.S. dollar-denominated senior notes.

Cash flow hedges are discontinued if it is no longer probable that the original forecasted transaction will occur by the end of the originally specified time period and any amounts previously recorded in AOCI are reclassified into earnings once it is determined that the hedged transaction is not probable of occurring.

PPL had no cash flow hedges reclassified into earnings associated with discontinued cash flow hedges for the three and nine months ended September 30, 2016. As a result of the June 1, 2015 spinoff of PPL Energy Supply, all PPL cash flow hedges associated with PPL Energy Supply were ineffective and discontinued and therefore, reclassified into earnings during the second quarter 2015 and reflected in discontinued operations for the nine months ended September 30, 2015. See Note 8 for additional information.

At September 30, 2016, the accumulated net unrecognized after-tax gains (losses) on qualifying derivatives that are expected to be reclassified into earnings during the next 12 months were insignificant. Amounts are reclassified as the hedged interest expense is recorded.

Economic Activity(PPL, LKE and LG&E)

LG&E enters into interest rate swap contracts that economically hedge interest payments on variable rate debt. Because realized gains and losses from the swaps, including a terminated swap contract, are recoverable through regulated rates, any subsequent changes in fair value of these derivatives are included in regulatory assets or liabilities until they are realized as interest expense. Realized gains and losses are recognized in "Interest Expense" on the Statements of Income at the time the underlying hedged interest expense is recorded. At September 30, 2016, LG&E held contracts with a notional amount of $179 million that range in maturity through 2033.

Foreign Currency Risk

(PPL)

PPL is exposed to foreign currency risk, primarily through investments in and earnings of U.K. affiliates. PPL has adopted a foreign currency risk management program designed to hedge certain foreign currency exposures, including firm commitments, recognized assets or liabilities, anticipated transactions and net investments. In addition, PPL enters into financial instruments to protect against foreign currency translation risk of expected GBP earnings.

Net Investment Hedges

PPL enters into foreign currency contracts on behalf of a subsidiary to protect the value of a portion of its net investment in WPD. There were no such contracts outstanding at September 30, 2016.

At September 30, 2016, PPL had $22 million of accumulated net investment hedge after tax gains (losses) that were included in the foreign currency translation adjustment component of AOCI, compared to $19 million at December 31, 2015.

Economic Activity

PPL enters into foreign currency contracts on behalf of a subsidiary to economically hedge GBP-denominated anticipated earnings. At September 30, 2016, the total exposure hedged by PPL was approximately £1.8 billion (approximately $2.4 billion based on contracted rates). These contracts had termination dates ranging from October 2016 through December 2018.

In the third quarter of 2016, PPL settled foreign currency hedges related to 2017 and 2018 anticipated earnings, resulting in receipt of approximately $310 million of cash, and entered into new hedges at current market rates. The notional amount of the settled hedges was approximately £1.3 billion (approximately $2.0 billion based on contracted rates) with termination dates from January 2017 through November 2018. The settlement did not have a significant impact on net income as the hedge values were previously marked to fair value and recognized in "Other Income (Expense) - net" on the Statement of Income.

Accounting and Reporting

(All Registrants)

All derivative instruments are recorded at fair value on the Balance Sheet as an asset or liability unless NPNS is elected. NPNS contracts for PPL and PPL Electric include certain full-requirement purchase contracts and other physical purchase contracts. Changes in the fair value of derivatives not designated as NPNS are recognized in earnings unless specific hedge accounting criteria are met and designated as such, except for the changes in fair values of LG&E's and KU's interest rate swaps that are recognized as regulatory assets or regulatory liabilities. See Note 6 for amounts recorded in regulatory assets and regulatory liabilities at September 30, 2016 and December 31, 2015.

See Notes 1 and 17 in each Registrant's 2015 Form 10-K for additional information on accounting policies related to derivative instruments.

(PPL)

The following table presents the fair value and location of derivative instruments recorded on the Balance Sheets.

	September 30, 2016								December 31, 2015
	Derivatives designated as hedging instruments				Derivatives not designated as hedging instruments				Derivatives designated as hedging instruments				Derivatives not designated as hedging instruments
	Assets		Liabilities		Assets		Liabilities		Assets		Liabilities		Assets		Liabilities
Current:
Price Risk Management
Assets/Liabilities (a):
Interest rate swaps (b)	$	—	$	—	$	—	$	6	$	—	$	24	$	—	$	5
Cross-currency swaps (b)	6		—		—		—		35		—		—		—
Foreign currency contracts	—		—		72		2		10		—		94		1
Total current	6		—		72		8		45		24		94		6
Noncurrent:
Price Risk Management
Assets/Liabilities (a):
Interest rate swaps (b)	—		—		—		48		—		—		—		42
Cross-currency swaps (b)	147		—		—		—		51		—		—		—
Foreign currency contracts	—		—		38		12		—		—		105		—
Total noncurrent	147		—		38		60		51		—		105		42
Total derivatives	$	153	$	—	$	110	$	68	$	96	$	24	$	199	$	48

(a) Current portion is included in "Price risk management assets" and "Other current liabilities" and noncurrent portion is included in "Price risk management assets" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

(b) Excludes accrued interest, if applicable.

The following tables present the pre-tax effect of derivative instruments recognized in income, OCI or regulatory assets and regulatory liabilities for the periods ended September 30, 2016.

							Three Months					Nine Months
Derivative Relationships	Derivative Gain (Loss) Recognized in OCI (Effective Portion)					Location of Gain (Loss) Recognized in Income on Derivative	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)		Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
	Three Months		Nine Months
Cash Flow Hedges:
Interest rate swaps	$	—	$	(21	)	Interest expense	$	(2	)	$	—	$	(5	)	$	—
Cross-currency swaps	78		87			Interest expense	2			—		2			—
						Other income (expense) - net	86			—		80			—
Total	$	78	$	66			$	86		$	—	$	77		$	—
Net Investment Hedges:
Foreign currency contracts	$	—	$	4

Derivatives Not Designated as	Location of Gain (Loss) Recognized in
Hedging Instruments	Income on Derivative	Three Months			Nine Months
Foreign currency contracts	Other income (expense) - net	$	49		$	280
Interest rate swaps	Interest expense	(2		)	(6		)
	Total	$	47		$	274
Derivatives Not Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	2		$	(7	)

The following tables present the pre-tax effect of derivative instruments recognized in income, OCI or regulatory assets and regulatory liabilities for the periods ended September 30, 2015.

								Three Months					Nine Months
Derivative Relationships	Derivative Gain (Loss) Recognized in OCI (Effective Portion)						Location of Gain (Loss) Recognized in Income on Derivative	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)		Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
	Three Months			Nine Months
Cash Flow Hedges:
Interest rate swaps	$	(27	)	$	(29	)	Interest expense	$	(2	)	$	—	$	(9	)	$	—
							Discontinued operations	—			—		—			(77		)
Cross-currency swaps	(3		)	33			Interest expense	(1		)	—		1			—
							Other income (expense) - net	(10		)	—		22			—
Commodity contracts	—			—			Discontinued operations	—			—		13			7
Total	$	(30	)	$	4			$	(13	)	$	—	$	27		$	(70	)
Net Investment Hedges:
Foreign currency contracts	$	7		$	6

Derivatives Not Designated as	Location of Gain (Loss) Recognized in
Hedging Instruments	Income on Derivative	Three Months			Nine Months
Foreign currency contracts	Other income (expense) - net	$	78		$	64
Interest rate swaps	Interest expense	(2		)	(6		)
	Total	$	76		$	58
Derivatives Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(42	)	$	(22	)
Derivatives Not Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(5	)	$	(2	)

(LKE)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(42	)	$	(22	)

(LG&E)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(21	)	$	(11	)

(KU)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(21	)	$	(11	)

(LKE and LG&E)

The following table presents the fair value and the location on the Balance Sheets of derivatives not designated as hedging instruments.

	September 30, 2016				December 31, 2015
	Assets		Liabilities			Assets		Liabilities
Current:
Price Risk Management
Assets/Liabilities:
Interest rate swaps	$	—	$	6		$	—	$	5
Total current	—		6			—		5
Noncurrent:
Price Risk Management
Assets/Liabilities:
Interest rate swaps	—		48			—		42
Total noncurrent	—		48			—		42
Total derivatives	$	—	$	54		$	—	$	47

The following tables present the pre-tax effect of derivatives not designated as cash flow hedges that are recognized in income or regulatory assets for the periods ended September 30, 2016.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Income on Derivatives	Three Months			Nine Months
Interest rate swaps	Interest expense	$	(2	)	$	(6	)
	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	2		$	(7	)

The following tables present the pre-tax effect of derivatives not designated as cash flow hedges that are recognized in income or regulatory assets for the periods ended September 30, 2015.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Income on Derivatives	Three Months			Nine Months
Interest rate swaps	Interest expense	$	(2	)	$	(6	)
	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(5	)	$	(2	)

(PPL, LKE, LG&E and KU)

Offsetting Derivative Instruments

PPL, LKE, LG&E and KU or certain of their subsidiaries have master netting arrangements in place and also enter into agreements pursuant to which they purchase or sell certain energy and other products. Under the agreements, upon termination of the agreement as a result of a default or other termination event, the non-defaulting party typically would have a right to set off amounts owed under the agreement against any other obligations arising between the two parties (whether under the agreement or not), whether matured or contingent and irrespective of the currency, place of payment or place of booking of the obligation.

PPL, LKE, LG&E and KU have 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 derivatives agreements. The table below summarizes the derivative positions presented in the balance sheets where a right of setoff exists under these arrangements and related cash collateral received or pledged.

	Assets								Liabilities
			Eligible for Offset								Eligible for Offset
	Gross		Derivative Instruments		Cash Collateral Received		Net		Gross		Derivative Instruments		Cash Collateral Pledged		Net
September 30, 2016
Treasury Derivatives
PPL	$	263	$	14	$	—	$	249	$	68	$	14	$	8	$	46
LKE	—		—		—		—		54		—		8		46
LG&E	—		—		—		—		54		—		8		46

December 31, 2015
Treasury Derivatives
PPL	$	295	$	25	$	—	$	270	$	72	$	25	$	9	$	38
LKE	—		—		—		—		47		—		9		38
LG&E	—		—		—		—		47		—		9		38

Credit Risk-Related Contingent Features

Certain derivative contracts contain credit risk-related contingent features which, when in a net liability position, would permit the counterparties to require the transfer of additional collateral upon a decrease in the credit ratings of PPL, LKE, LG&E and KU or certain of their subsidiaries. Most of these features would require the transfer of additional collateral or permit the counterparty to terminate the contract if the applicable credit rating were to fall below investment grade. Some of these features also would allow the counterparty to require additional collateral upon each downgrade in credit rating at levels that remain above investment grade. In either case, if the applicable credit rating were to fall below investment grade, and assuming no assignment to an investment grade affiliate were allowed, most of these credit contingent features require either immediate payment of the net liability as a termination payment or immediate and ongoing full collateralization on derivative instruments in net liability positions.

Additionally, certain derivative contracts contain credit risk-related contingent features that require adequate assurance of performance be provided if the other party has reasonable concerns regarding the performance of PPL's, LKE's, LG&E's, and KU's obligations under the contracts. A counterparty demanding adequate assurance could require a transfer of additional collateral or other security, including letters of credit, cash and guarantees from a creditworthy entity. This would typically involve negotiations among the parties. However, amounts disclosed below represent assumed immediate payment or immediate and ongoing full collateralization for derivative instruments in net liability positions with "adequate assurance" features.

(PPL, LKE and LG&E)

At September 30, 2016, derivative contracts in a net liability position that contain credit risk-related contingent features, collateral posted on those positions and the related effect of a decrease in credit ratings below investment grade are summarized as follows:

	PPL		LKE		LG&E
Aggregate fair value of derivative instruments in a net liability position with credit risk-related contingent features	$	29	$	29	$	29
Aggregate fair value of collateral posted on these derivative instruments	7		7		7
Aggregate fair value of additional collateral requirements in the event of  a credit downgrade below investment grade (a)	22		22		22

(a) Includes the effect of net receivables and payables already recorded on the Balance Sheet.

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Goodwill

9 Months Ended

Sep. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

(PPL)

The change in the carrying amount of goodwill for the nine months ended September 30, 2016 was due to the effect of foreign currency exchange rates on the U.K. Regulated segment.

The change in the other intangible assets for the nine months ended September 30, 2016 was primarily due to an increase in the gross carrying amount of indefinite lived intangibles at WPD attributable to new easements of $73 million, partially offset by the effect of foreign currency exchange rates.

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Asset Retirement Obligations

9 Months Ended

Sep. 30, 2016

Asset Retirement Obligations [Line Items]

Asset Retirement Obligations

Asset Retirement Obligations

(PPL, LKE, LG&E and KU)

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

LG&E and KU recorded decreases to existing ARO balances of $118 million ($24 million at LG&E and $94 million at KU) during the three and nine months ended September 30, 2016 due to revisions in the amounts and timing of future expected costs related to the closure of CCR impoundments. These revisions are the result of changes in closure plans related to expected costs and timing of closure. Further changes to AROs, capital plans or operating costs may be required as estimates of future cash flows are refined based on closure developments and regulatory or legal proceedings.

PPL's, LKE's, LG&E's and KU's ARO liabilities are primarily related to CCR closure costs. See Note 10 for information on the final CCR rule and Note 6 for information on the rate recovery applications with the KPSC. LG&E's and KU's accretion and ARO-related depreciation expense are recorded as a regulatory asset, such that there is no net earnings impact.

LG And E And KU Energy LLC [Member]

Asset Retirement Obligations [Line Items]

Asset Retirement Obligations

Asset Retirement Obligations

(PPL, LKE, LG&E and KU)

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

LG&E and KU recorded decreases to existing ARO balances of $118 million ($24 million at LG&E and $94 million at KU) during the three and nine months ended September 30, 2016 due to revisions in the amounts and timing of future expected costs related to the closure of CCR impoundments. These revisions are the result of changes in closure plans related to expected costs and timing of closure. Further changes to AROs, capital plans or operating costs may be required as estimates of future cash flows are refined based on closure developments and regulatory or legal proceedings.

PPL's, LKE's, LG&E's and KU's ARO liabilities are primarily related to CCR closure costs. See Note 10 for information on the final CCR rule and Note 6 for information on the rate recovery applications with the KPSC. LG&E's and KU's accretion and ARO-related depreciation expense are recorded as a regulatory asset, such that there is no net earnings impact.

Louisville Gas And Electric Co [Member]

Asset Retirement Obligations [Line Items]

Asset Retirement Obligations

Asset Retirement Obligations

(PPL, LKE, LG&E and KU)

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

LG&E and KU recorded decreases to existing ARO balances of $118 million ($24 million at LG&E and $94 million at KU) during the three and nine months ended September 30, 2016 due to revisions in the amounts and timing of future expected costs related to the closure of CCR impoundments. These revisions are the result of changes in closure plans related to expected costs and timing of closure. Further changes to AROs, capital plans or operating costs may be required as estimates of future cash flows are refined based on closure developments and regulatory or legal proceedings.

PPL's, LKE's, LG&E's and KU's ARO liabilities are primarily related to CCR closure costs. See Note 10 for information on the final CCR rule and Note 6 for information on the rate recovery applications with the KPSC. LG&E's and KU's accretion and ARO-related depreciation expense are recorded as a regulatory asset, such that there is no net earnings impact.

Kentucky Utilities Co [Member]

Asset Retirement Obligations [Line Items]

Asset Retirement Obligations

Asset Retirement Obligations

(PPL, LKE, LG&E and KU)

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

LG&E and KU recorded decreases to existing ARO balances of $118 million ($24 million at LG&E and $94 million at KU) during the three and nine months ended September 30, 2016 due to revisions in the amounts and timing of future expected costs related to the closure of CCR impoundments. These revisions are the result of changes in closure plans related to expected costs and timing of closure. Further changes to AROs, capital plans or operating costs may be required as estimates of future cash flows are refined based on closure developments and regulatory or legal proceedings.

PPL's, LKE's, LG&E's and KU's ARO liabilities are primarily related to CCR closure costs. See Note 10 for information on the final CCR rule and Note 6 for information on the rate recovery applications with the KPSC. LG&E's and KU's accretion and ARO-related depreciation expense are recorded as a regulatory asset, such that there is no net earnings impact.

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Accumulated Other Comprehensive Income (Loss)

9 Months Ended

Sep. 30, 2016

Accumulated Other Comprehensive Income (Loss) [Line Items]

Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Income (Loss)

(PPL and LKE)

The after-tax changes in AOCI by component for the periods ended September 30 were as follows.

	Foreign currency translation adjustments			Unrealized gains (losses)									Defined benefit plans
				Available- for-sale securities			Qualifying derivatives			Equity investees' AOCI			Prior service costs			Actuarial gain (loss)			Total
PPL
June 30, 2016	$	(716	)	$	—		$	(5	)	$	(1	)	$	(5	)	$	(2,130	)	$	(2,857	)
Amounts arising during the period	(641		)	—			62			—			—			(6		)	(585		)
Reclassifications from AOCI	—			—			(69		)	—			—			31			(38		)
Net OCI during the period	(641		)	—			(7		)	—			—			25			(623		)
September 30, 2016	$	(1,357	)	$	—		$	(12	)	$	(1	)	$	(5	)	$	(2,105	)	$	(3,480	)
December 31, 2015	$	(520	)	$	—		$	(7	)	$	—		$	(6	)	$	(2,195	)	$	(2,728	)
Amounts arising during the period	(837		)	—			57			—			—			(4		)	(784		)
Reclassifications from AOCI	—			—			(62		)	(1		)	1			94			32
Net OCI during the period	(837		)	—			(5		)	(1		)	1			90			(752		)
September 30, 2016	$	(1,357	)	$	—		$	(12	)	$	(1	)	$	(5	)	$	(2,105	)	$	(3,480	)
June 30, 2015	$	(435	)	$	—		$	2		$	—		$	(3	)	$	(1,848	)	$	(2,284	)
Amounts arising during the period	52			—			(19		)	—			—			—			33
Reclassifications from AOCI	—			—			10			—			—			35			45
Net OCI during the period	52			—			(9		)	—			—			35			78
September 30, 2015	$	(383	)	$	—		$	(7	)	$	—		$	(3	)	$	(1,813	)	$	(2,206	)
December 31, 2014	$	(286	)	$	202		$	20		$	1		$	3		$	(2,214	)	$	(2,274	)
Amounts arising during the period	(97		)	7			8			—			(6		)	52			(36		)
Reclassifications from AOCI	—			(2		)	20			(1		)	—			111			128
Net OCI during the period	(97		)	5			28			(1		)	(6		)	163			92
Distribution of PPL Energy Supply (Note 8)	—			(207		)	(55		)	—			—			238			(24		)
September 30, 2015	$	(383	)	$	—		$	(7	)	$	—		$	(3	)	$	(1,813	)	$	(2,206	)
LKE
June 30, 2016										$	(1	)	$	(9	)	$	(33	)	$	(43	)
Amounts arising during the period										—			—			—			—
Reclassifications from AOCI										—			—			1			1
Net OCI during the period										—			—			1			1
September 30, 2016										$	(1	)	$	(9	)	$	(32	)	$	(42	)

	Foreign currency translation adjustments	Unrealized gains (losses)					Defined benefit plans
		Available- for-sale securities	Qualifying derivatives	Equity investees' AOCI			Prior service costs			Actuarial gain (loss)			Total
December 31, 2015				$	—		$	(10	)	$	(36	)	$	(46	)
Amounts arising during the period				—			—			1			1
Reclassifications from AOCI				(1		)	1			3			3
Net OCI during the period				(1		)	1			4			4
September 30, 2016				$	(1	)	$	(9	)	$	(32	)	$	(42	)
June 30, 2015				$	(1	)	$	(7	)	$	(44	)	$	(52	)
Amounts arising during the period				—			—			—			—
Reclassifications from AOCI				—			—			1			1
Net OCI during the period				—			—			1			1
September 30, 2015				$	(1	)	$	(7	)	$	(43	)	$	(51	)
December 31, 2014				$	—		$	(8	)	$	(37	)	$	(45	)
Amounts arising during the period				—			—			(8		)	(8		)
Reclassifications from AOCI				(1		)	1			2			2
Net OCI during the period				(1		)	1			(6		)	(6		)
September 30, 2015				$	(1	)	$	(7	)	$	(43	)	$	(51	)

(PPL)

The following table presents the gains (losses) and related income taxes for reclassifications from AOCI for the periods ended September 30. The defined benefit plan components of AOCI are not reflected in their entirety in the Statement of Income during the periods; rather, they are included in the computation of net periodic defined benefit costs (credits) and subject to capitalization. See Note 9 for additional information.

	Three Months						Nine Months						Affected Line Item on the
Details about AOCI	2016			2015			2016			2015			Statements of Income
Available-for-sale securities	$	—		$	—		$	—		$	4		Other Income (Expense) - net
Total Pre-tax	—			—			—			4
Income Taxes	—			—			—			(2		)
Total After-tax	—			—			—			2
Qualifying derivatives
Interest rate swaps	(2		)	(2		)	(5		)	(9		)	Interest Expense
	—			—			—			(77		)	Discontinued operations
Cross-currency swaps	86			(10		)	80			22			Other Income (Expense) - net
	2			(1		)	2			1			Interest Expense
Commodity contracts	—			—			—			20			Discontinued operations
Total Pre-tax	86			(13		)	77			(43		)
Income Taxes	(17		)	3			(15		)	23
Total After-tax	69			(10		)	62			(20		)

	Three Months						Nine Months						Affected Line Item on the
Details about AOCI	2016			2015			2016			2015			Statements of Income
Equity investees' AOCI	—			—			1			2			Other Income (Expense) - net
Total Pre-tax	—			—			1			2
Income Taxes	—			—			—			(1		)
Total After-tax	—			—			1			1
Defined benefit plans
Prior service costs	(1		)	—			(2		)	—
Net actuarial loss	(41		)	(45		)	(121		)	(146		)
Total Pre-tax	(42		)	(45		)	(123		)	(146		)
Income Taxes	11			10			28			35
Total After-tax	(31		)	(35		)	(95		)	(111		)
Total reclassifications during the period	$	38		$	(45	)	$	(32	)	$	(128	)

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New Accounting Guidance Pending Adoption

9 Months Ended

Sep. 30, 2016

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Description of New Accounting Pronouncements Not yet Adopted [Text Block]

New Accounting Guidance Pending Adoption

(All Registrants)

Accounting for Revenue from Contracts with Customers

In May 2014, the Financial Accounting Standards Board (FASB) issued accounting guidance that establishes a comprehensive new model for the recognition of revenue from contracts with customers. This model is based on the core principle that revenue should be recognized 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.

For public business entities, this guidance can be applied using either a full retrospective or modified retrospective transition method, beginning in annual reporting periods after December 15, 2017 and interim periods within those years. Public business entities may early adopt this guidance in annual reporting periods beginning after December 15, 2016. The Registrants expect to adopt this guidance effective January 1, 2018.

The Registrants continue to assess the impact of adopting this guidance, as well as the transition method they will use, and are monitoring the development of industry specific application guidance which could impact those assessments.

Accounting for Leases

In February 2016, the FASB issued accounting guidance for leases. This new guidance requires lessees to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). For income statement purposes, the FASB retained a dual model for lessees, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line expense (similar to current operating leases) while finance leases will result in a front-loaded expense pattern (similar to current capital leases). Classification will be based on criteria that are largely similar to those applied in current lease accounting, but without explicit bright lines.

Lessor accounting under the new guidance is similar to the current model, but updated to align with certain changes to the lessee model and the new revenue recognition standard. Similar to current practice, lessors will classify leases as operating, direct financing, or sales-type.

The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition, and provides for certain practical expedients. Transition will require application of the new guidance at the beginning of the earliest comparative period presented.

The Registrants are currently assessing the impact of adopting this guidance.

Accounting for Financial Instrument Credit Losses

In June 2016, the FASB issued accounting guidance that requires the use of a current expected credit loss (CECL) model for the measurement of credit losses on financial instruments within the scope of this guidance, which includes accounts receivable. The CECL model requires an entity to measure credit losses using historical information, current information and reasonable and supportable forecasts of future events, rather than the incurred loss impairment model required under current GAAP.

For public business entities, this guidance will be applied using a modified retrospective approach and is effective for fiscal years beginning after December 15, 2019, and interim periods within those years. All entities may early adopt this guidance beginning after December 15, 2018, including interim periods within those years.

The Registrants are currently assessing the impact of adopting this guidance and the period that they will adopt this guidance.

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Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2016

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Receivables, Policy

Accounts Receivable(PPL and PPL Electric)

In accordance with a PUC-approved purchase of accounts receivable program, PPL Electric purchases certain accounts receivable from alternative electricity suppliers at a discount, which reflects a provision for uncollectible accounts. The alternative electricity suppliers have no continuing involvement or interest in the purchased accounts receivable. The purchased accounts receivable are initially recorded at fair value using a market approach based on the purchase price paid and are classified as Level 2 in the fair value hierarchy.

New Accounting Pronouncements, Policy

New Accounting Guidance Adopted(All Registrants)

Accounting for Stock-Based Compensation

Effective January 1, 2016, the Registrants adopted accounting guidance to simplify the accounting for share-based payment transactions. The guidance requires excess tax benefits and tax deficiencies to be recorded as income tax benefit or expense on the statement of income, eliminates the requirement that excess tax benefits be realized before companies can recognize them and changes the threshold for statutory income tax withholding requirements to qualify for equity classification to the maximum statutory tax rates in the applicable jurisdictions. This guidance also changes the classification of excess tax benefits to an operating activity and employee taxes paid when shares are withheld to satisfy the employer's statutory income tax withholding obligation to a financing activity on the statement of cash flows and allows entities to make a policy election to either estimate forfeitures or recognize them when they occur. The adoption of this guidance had the following impacts:

• Using the required prospective method of transition, for the three and nine months ended September 30, 2016, PPL recorded tax benefits of $1 million and $12 million ($0.02 per share), and for the nine months endedSeptember 30, 2016, PPL Electric recorded tax benefits of $7 million, related to excess tax benefits for awards that were exercised and vested for the periods ending September 30, 2016. These amounts were recorded to Income taxes on the Statements of Income and Deferred income taxes on the Balance Sheets. The impact on LKE was not significant.

• PPL elected to use the prospective method of transition for classifying excess tax benefits as an Operating activity on the Statement of Cash Flows. The amounts classified as Financing activities in the prior periods were not significant.

• Upon adoption, using the required modified retrospective method of transition, PPL recorded a cumulative effect adjustment of $7 million to increase Earnings reinvested and decrease Deferred income taxes on the Balance Sheet related to prior period unrecognized excess tax benefits.

• PPL has historically presented employee taxes paid for net settled awards as a Financing activity on the Statement of Cash Flows. Therefore, there is no transition impact for this requirement.

• PPL has elected to recognize forfeitures when they occur. Due to past experience of insignificant forfeitures, there is no transition impact of this policy election.

Fair Value Transfer, Policy

Transfers between levels are recognized at end-of-reporting-period values.

Derivatives, Offsetting Fair Value Amounts, Policy

Net derivative positions on the balance sheets are not offset against the right to reclaim cash collateral (a receivable) or the obligation to return cash collateral (a payable) under master netting arrangements.

Foreign Currency Translation and Transactions [Abstract]

Foreign Currency Transactions and Translations, Policy

Foreign Currency Translation and Transactions (PPL)

WPD's functional currency is the GBP, which is the local currency in the U.K. As such, assets and liabilities are translated to U.S. dollars at the exchange rates on the date of consolidation and related revenues and expenses are generally translated at average exchange rates prevailing during the period included in PPL's results of operations. Adjustments resulting from foreign currency translation are recorded in AOCI.

PPL Electric Utilities Corp [Member]

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Receivables, Policy

Accounts Receivable(PPL and PPL Electric)

In accordance with a PUC-approved purchase of accounts receivable program, PPL Electric purchases certain accounts receivable from alternative electricity suppliers at a discount, which reflects a provision for uncollectible accounts. The alternative electricity suppliers have no continuing involvement or interest in the purchased accounts receivable. The purchased accounts receivable are initially recorded at fair value using a market approach based on the purchase price paid and are classified as Level 2 in the fair value hierarchy.

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Segment and Related Information (Tables)

9 Months Ended

Sep. 30, 2016

Segment Reporting [Abstract]

Segment and Related Information

Financial data for the segments and reconciliation to PPL's consolidated results for the periods ended September 30 are:

	Three Months						Nine Months
	2016			2015			2016			2015
Income Statement Data
Revenues from external customers
U.K. Regulated	$	515		$	552		$	1,673		$	1,836
Kentucky Regulated	835			801			2,382			2,414
Pennsylvania Regulated	539			519			1,619			1,625
Corporate and Other	—			6			11			14
Total	$	1,889		$	1,878		$	5,685		$	5,889
Net Income
U.K. Regulated (a)	$	281		$	249		$	915		$	814
Kentucky Regulated	126			111			314			267
Pennsylvania Regulated	91			55			263			191
Corporate and Other (b)	(25		)	(19		)	(55		)	(74		)
Discontinued Operations (c)	—			(3		)	—			(915		)
Total	$	473		$	393		$	1,437		$	283

	September 30, 2016		December 31, 2015
Balance Sheet Data
Assets
U.K. Regulated (d)	$	15,014	$	16,669
Kentucky Regulated	13,853		13,756
Pennsylvania Regulated	9,070		8,511
Corporate and Other (e)	101		365
Total assets	$	38,038	$	39,301

(a) Includes unrealized gains and losses from hedging foreign-currency related economic activity. See Note 14 for additional information.

(b) The nine months ended September 30, 2015 includes transition costs to prepare the Talen Energy organization for the June 1, 2015 spinoff and reconfigure the remaining PPL Services functions. See Note 8 for additional information.

(c) See Note 8 for additional information.

(d) Includes $11.1 billion and $12.2 billion of net PP&E as of September 30, 2016 and December 31, 2015. WPD is not subject to accounting for the effects of certain types of regulation as prescribed by GAAP.

(e) Primarily consists of unallocated items, including cash, PP&E and the elimination of inter-segment transactions.

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Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Basic and Diluted EPS Computations

Reconciliations of the amounts of income and shares of PPL common stock (in thousands) for the periods ended September 30 used in the EPS calculation are:

	Three Months					Nine Months
	2016		2015			2016		2015
Income (Numerator)
Income from continuing operations after income taxes	$	473	$	396		$	1,437	$	1,198
Less amounts allocated to participating securities	1		2			4		5
Income from continuing operations after income taxes available to PPL common shareowners - Basic and Diluted	$	472	$	394		$	1,433	$	1,193
Income (loss) from discontinued operations (net of income taxes) available to PPL common shareowners - Basic and Diluted	$	—	$	(3	)	$	—	$	(915	)
Net income	$	473	$	393		$	1,437	$	283
Less amounts allocated to participating securities	1		2			4		1
Net income available to PPL common shareowners - Basic and Diluted	$	472	$	391		$	1,433	$	282
Shares of Common Stock (Denominator)
Weighted-average shares - Basic EPS	678,114		670,763			676,905		668,731
Add incremental non-participating securities:
Share-based payment awards	2,234		2,939			3,064		2,523
Weighted-average shares - Diluted EPS	680,348		673,702			679,969		671,254
Basic EPS
Available to PPL common shareowners:
Income from continuing operations after income taxes	$	0.70	$	0.59		$	2.12	$	1.78
Income (loss) from discontinued operations (net of income taxes)	—		(0.01		)	—		(1.36		)
Net Income	$	0.70	$	0.58		$	2.12	$	0.42
Diluted EPS
Available to PPL common shareowners:
Income from continuing operations after income taxes	$	0.69	$	0.59		$	2.11	$	1.78
Income (loss) from discontinued operations (net of income taxes)	—		(0.01		)	—		(1.36		)
Net Income	$	0.69	$	0.58		$	2.11	$	0.42

Common Stock Issuances

For the periods ended September 30, PPL issued common stock related to stock-based compensation plans and the DRIP as follows (in thousands):

	Three Months		Nine Months
	2016	2015	2016	2015
Stock-based compensation plans (a)	248	1,368	3,168	3,805
DRIP	761	475	1,533	1,318

(a) Includes stock options exercised, vesting of performance units, vesting of restricted stock and restricted stock units and conversion of stock units granted to directors.

Antidilutive Securities Excluded From Diluted EPS

For the periods ended September 30, the following shares (in thousands) were excluded from the computations of diluted EPS because the effect would have been antidilutive.

	Three Months		Nine Months
	2016	2015	2016	2015
Stock options	696	1,484	696	1,218
Performance units	316	—	210	49

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Income Taxes (Tables)

9 Months Ended

Sep. 30, 2016

Income Taxes [Line Items]

Schedule of Effective Income Tax Rate Reconciliation

Reconciliations of income taxes for the periods ended September 30 are as follows.

(PPL)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 35%	$	214		$	189		$	681		$	571
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	13			15			37			44
Valuation allowance adjustments	4			—			13			8
Impact of lower U.K. income tax rates	(37		)	(40		)	(136		)	(138		)
Federal and state tax reserve adjustments (a)	—			(9		)	—			(21		)
Enactment of the U.K. Finance Act 2016 (b)	(42		)	—			(42		)	—
Depreciation not normalized	—			—			(6		)	(4		)
Interest benefit on U.K. financing entities	(4		)	(4		)	(13		)	(15		)
Stock-based compensation (c)	(1		)	—			(12		)	—
Other	(8		)	(7		)	(12		)	(13		)
Total increase (decrease)	(75		)	(45		)	(171		)	(139		)
Total income taxes	$	139		$	144		$	510		$	432

(a) During the three and nine months ended September 30, 2015, PPL recorded a $9 million tax benefit related to a planned amendment of a prior period tax return.

During the nine months ended September 30, 2015, PPL recorded a $12 million tax benefit to adjust the settled refund amount approved by the Joint Committee on Taxation for the open audit years 1998 - 2011.

(b) The U.K. Finance Act 2016, enacted in September 2016, reduces the U.K. statutory income tax rate effective April 1, 2020 from 18% to 17%. As a result, PPL reduced its net deferred tax liabilities and recognized a deferred tax benefit during the three and nine months ended September 30, 2016.

(c) During the three and nine months ended September 30, 2016, PPL recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

PPL Electric Utilities Corp [Member]

Income Taxes [Line Items]

Schedule of Effective Income Tax Rate Reconciliation

Reconciliations of income taxes for the periods ended September 30 are as follows.

(PPL Electric)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	52		$	32		$	149		$	112
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	9			7			27			21
Depreciation not normalized	(2		)	(1		)	(5		)	(3		)
Stock-based compensation (a)	—			—			(7		)	—
Other	(1		)	(3		)	(2		)	—
Total increase (decrease)	6			3			13			18
Total income taxes	$	58		$	35		$	162		$	130

(a) During the nine months ended September 30, 2016, PPL Electric recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

LG And E And KU Energy LLC [Member]

Income Taxes [Line Items]

Schedule of Effective Income Tax Rate Reconciliation

Reconciliations of income taxes for the periods ended September 30 are as follows.

(LKE)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	74		$	68		$	189		$	172
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	8			7			20			18
Amortization of investment tax credit	(1		)	(1		)	(2		)	(2		)
Valuation allowance adjustments (a)	—			—			—			8
Stock-based compensation	(1		)	—			(2		)	—
Other	(1		)	(1		)	(3		)	(2		)
Total increase (decrease)	5			5			13			22
Total income taxes	$	79		$	73		$	202		$	194

(a) Represents a valuation allowance against tax credits expiring in 2016 and 2017 that are more likely than not to expire before being utilized.

Louisville Gas And Electric Co [Member]

Income Taxes [Line Items]

Schedule of Effective Income Tax Rate Reconciliation

Reconciliations of income taxes for the periods ended September 30 are as follows.

(LG&E)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	36		$	33		$	90		$	83
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	4			4			10			9
Other	(1		)	(1		)	(2		)	(1		)
Total increase (decrease)	3			3			8			8
Total income taxes	$	39		$	36		$	98		$	91

Kentucky Utilities Co [Member]

Income Taxes [Line Items]

Schedule of Effective Income Tax Rate Reconciliation

Reconciliations of income taxes for the periods ended September 30 are as follows.

(KU)
	Three Months						Nine Months
	2016			2015			2016			2015
Federal income tax on Income Before Income Taxes at statutory tax rate - 35%	$	44		$	41		$	117		$	106
Increase (decrease) due to:
State income taxes, net of federal income tax benefit	5			4			12			11
Other	(1		)	(1		)	(1		)	(2		)
Total increase (decrease)	4			3			11			9
Total income taxes	$	48		$	44		$	128		$	115

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Utility Rate Regulation (Tables)

9 Months Ended

Sep. 30, 2016

Utility Rate Regulation [Line Items]

Regulatory Assets

The following table provides information about the regulatory assets and liabilities of cost-based rate-regulated utility operations.

	PPL				PPL Electric
	September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015
Current Regulatory Assets:
Environmental cost recovery	$	4	$	24	$	—	$	—
Generation formula rate	12		7		—		—
Transmission service charge	8		10		8		10
Other	6		7		4		3
Total current regulatory assets (a)	$	30	$	48	$	12	$	13
Noncurrent Regulatory Assets:
Defined benefit plans	$	791	$	809	$	456	$	469
Taxes recoverable through future rates	333		326		333		326
Storm costs	71		93		19		30
Unamortized loss on debt	62		68		39		42
Interest rate swaps	143		141		—		—
Accumulated cost of removal of utility plant	143		137		143		137
AROs	208		143		—		—
Other	14		16		1		2
Total noncurrent regulatory assets	$	1,765	$	1,733	$	991	$	1,006

Current Regulatory Liabilities:
Generation supply charge	$	22	$	41	$	22	$	41
Demand side management	6		8		—		—
Gas supply clause	—		6		—		—
Universal service rider	10		5		10		5
Transmission formula rate	25		48		25		48
Fuel adjustment clause	14		14		—		—
Act 129 compliance rider	22		—		22		—
Storm damage expense	13		16		13		16
Other	8		7		2		3
Total current regulatory liabilities	$	120	$	145	$	94	$	113
Noncurrent Regulatory Liabilities:
Accumulated cost of removal of utility plant	$	698	$	691	$	—	$	—
Coal contracts (b)	3		17		—		—
Power purchase agreement - OVEC (b)	77		83		—		—
Net deferred tax assets	23		23		—		—
Act 129 compliance rider	—		22		—		22
Defined benefit plans	27		24		—		—
Interest rate swaps	80		82		—		—
Other	3		3		—		—
Total noncurrent regulatory liabilities	$	911	$	945	$	—	$	22

	LKE				LG&E				KU
	September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015
Current Regulatory Assets:
Environmental cost recovery	$	4	$	24	$	4	$	13	$	—	$	11
Generation formula rate	12		7		—		—		12		7
Other	2		4		2		3		—		1

	LKE				LG&E				KU
	September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015		September 30, 2016		December 31, 2015
Total current regulatory assets	$	18	$	35	$	6	$	16	$	12	$	19
Noncurrent Regulatory Assets:
Defined benefit plans	$	335	$	340	$	211	$	215	$	124	$	125
Storm costs	52		63		29		35		23		28
Unamortized loss on debt	23		26		16		17		7		9
Interest rate swaps	143		141		102		98		41		43
AROs	208		143		77		57		131		86
Plant retirement costs	4		6		—		—		4		6
Other	9		8		2		2		7		6
Total noncurrent regulatory assets	$	774	$	727	$	437	$	424	$	337	$	303

Current Regulatory Liabilities:
Demand side management	$	6	$	8	$	4	$	4	$	2	$	4
Gas supply clause	—		6		—		6		—		—
Fuel adjustment clause	14		14		2		2		12		12
Other	6		4		1		1		5		3
Total current regulatory liabilities	$	26	$	32	$	7	$	13	$	19	$	19
Noncurrent Regulatory Liabilities:
Accumulated cost of removal of utility plant	$	698	$	691	$	306	$	301	$	392	$	390
Coal contracts (b)	3		17		1		7		2		10
Power purchase agreement - OVEC (b)	77		83		53		57		24		26
Net deferred tax assets	23		23		23		23		—		—
Defined benefit plans	27		24		—		—		27		24
Interest rate swaps	80		82		40		41		40		41
Other	3		3		1		2		2		1
Total noncurrent regulatory liabilities	$	911	$	923	$	424	$	431	$	487	$	492

(a) These amounts are included in "Other current assets" on the Balance Sheets.

(b) These liabilities were recorded as offsets to certain intangible assets that were recorded at fair value upon the acquisition of LKE by PPL.

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Financing Activities (Tables)

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Schedule Of Stock Offering Program

For the periods ended September 30, PPL issued the following:

	Three Months				Nine Months
	2016		2015		2016		2015
Number of shares (in thousands)	710		436		710		858
Average share price	$	35.23	$	32.95	$	35.23	$	33.33
Net Proceeds	$	25	$	14	$	25	$	28

Schedule of Line of Credit Facilities

The following credit facilities were in place at: 

	September 30, 2016									December 31, 2015
	Expiration Date	Capacity		Borrowed		Letters of Credit and Commercial Paper Issued		Unused Capacity		Borrowed		Letters of Credit and Commercial Paper Issued
PPL
U.K.
WPD plc
Syndicated Credit Facility	Jan 2021	£	210	£	153	£	—	£	57	£	133	£	—
WPD (South West)
Syndicated Credit Facility	July 2021	245		100		—		145		—		—
WPD (East Midlands)
Syndicated Credit Facility	July 2021	300		31		—		269		—		—
WPD (West Midlands)
Syndicated Credit Facility	July 2021	300		—		—		300		—		—
Uncommitted Credit Facilities		40		—		4		36		—		4
Total U.K. Credit Facilities (a)		£	1,095	£	284	£	4	£	807	£	133	£	4
U.S.
PPL Capital Funding
Syndicated Credit Facility	Jan 2021	$	700	$	—	$	—	$	700	$	—	$	151
Syndicated Credit Facility	Nov 2018	300		—		—		300		—		300
Bilateral Credit Facility	Mar 2017	150		—		17		133		—		20
Total PPL Capital Funding Credit Facilities		$	1,150	$	—	$	17	$	1,133	$	—	$	471
PPL Electric
Syndicated Credit Facility	Jan 2021	$	400	$	—	$	131	$	269	$	—	$	1
LKE
Syndicated Credit Facility (b)	Oct 2018	$	75	$	—	$	—	$	75	$	75	$	—
LG&E
Syndicated Credit Facility	Dec 2020	$	500	$	—	$	128	$	372	$	—	$	142
KU
Syndicated Credit Facility	Dec 2020	$	400	$	—	$	7	$	393	$	—	$	48
Letter of Credit Facility	Oct 2017	198		—		198		—		—		198
Total KU Credit Facilities		$	598	$	—	$	205	$	393	$	—	$	246

(a) WPD plc's amounts borrowed at September 30, 2016 and December 31, 2015 were USD-denominated borrowings of $200 million for both periods, which bore interest at 1.35% and 1.83%. The unused capacity reflects the amount borrowed in GBP of £153 million as of the date borrowed. WPD (South West) amount borrowed at September 30, 2016 was a GBP-denominated borrowing which equated to $131 million and bore interest at 0.68%. WPD (East Midlands) amount borrowed at September 30, 2016 was a GBP-denominated borrowing which equated to $40 million and bore interest at 0.66%. At September 30, 2016, the unused capacity under the U.K. credit facilities was approximately $1.1 billion.

(b) LKE's interest rate on outstanding borrowings at December 31, 2015 was 1.68%.

Schedule of Short-term Debt

The following commercial paper programs were in place at: 

	September 30, 2016							December 31, 2015
	Weighted - Average Interest Rate	Capacity		Commercial Paper Issuances		Unused Capacity		Weighted - Average Interest Rate	Commercial Paper Issuances
PPL Capital Funding		$	1,000	$	—	$	1,000	0.78%	$	451
PPL Electric	0.74%	400		130		270			—
LG&E	0.73%	350		128		222		0.71%	142
KU	0.66%	350		7		343		0.72%	48
Total		$	2,100	$	265	$	1,835		$	641

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Acquisitions, Development and Divestitures (Tables)

9 Months Ended

Sep. 30, 2016

Acquisitions Development And Divestitures [Abstract]

Spinoff Transaction, Fair Value Analysis

The following table summarizes PPL's fair value analysis:

Approach	Weighting	Weighted Fair Value (in billions)
Talen Energy Market Value	50%	$	1.4
Income/Discounted Cash Flow	30%	1.1
Alternative Market (Comparable Company)	20%	0.7
Estimated Fair Value		$	3.2

Disposal Groups, Including Discontinued Operations

Following are the components of Discontinued Operations in the Statement of Income for the periods ended September 30, 2015:

	Three Months			Nine Months
Operating revenues	$	—		$	1,427
Operating expenses	—			1,328
Other Income (Expense) - net	—			(22		)
Interest expense (a)	—			150
Income (loss) before income taxes	—			(73		)
Income tax expense (benefit)	3			(37		)
Loss on spinoff	—			(879		)
Income (Loss) from Discontinued Operations (net of income taxes)	$	(3	)	$	(915	)

(a) Includes interest associated with the Supply segment with no additional allocation as the Supply segment was sufficiently capitalized.

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Defined Benefits (Tables)

9 Months Ended

Sep. 30, 2016

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Schedule Of Net Periodic Defined Benefit Costs (Credits)

Following are the net periodic defined benefit costs (credits) of the plans sponsored by PPL and its subsidiaries, LKE and its subsidiaries and LG&E for the periods ended September 30:

	Pension Benefits
	Three Months												Nine Months
	U.S.						U.K.						U.S.						U.K.
	2016			2015			2016 (a)			2015			2016			2015			2016 (a)			2015
PPL
Service cost	$	16		$	20		$	17		$	21		$	49		$	76		$	53		$	60
Interest cost	44			42			58			80			131			152			182			236
Expected return on plan assets	(57		)	(56		)	(124		)	(133		)	(171		)	(201		)	(389		)	(393		)
Amortization of:
Prior service cost	2			1			—			—			6			5			—			—
Actuarial loss	12			18			34			39			37			65			107			118
Net periodic defined benefit costs (credits) before settlements	17			25			(15		)	7			52			97			(47		)	21
Settlements	3			—			—			—			3			—			—			—
Net periodic defined benefit costs (credits) (b)	$	20		$	25		$	(15	)	$	7		$	55		$	97		$	(47	)	$	21

	Pension Benefits
	Three Months								Nine Months
	U.S.						U.K.		U.S.						U.K.
	2016			2015			2016 (a)	2015	2016			2015			2016 (a)	2015
LKE
Service cost	$	6		$	7				$	18		$	20
Interest cost	18			17					53			51
Expected return on plan assets	(23		)	(22		)			(68		)	(66		)
Amortization of:
Prior service cost	2			1					6			5
Actuarial loss	5			9					15			26
Net periodic defined benefit costs	$	8		$	12				$	24		$	36
LG&E
Service cost	$	—		$	—				$	1		$	1
Interest cost	4			3					11			10
Expected return on plan assets	(5		)	(5		)			(15		)	(15		)
Amortization of:
Prior service cost	1			1					3			2
Actuarial loss	2			3					5			9
Net periodic defined benefit costs	$	2		$	2				$	5		$	7

(a) See Note 2 for a discussion of changes to the discount rate used for the U.K. Pension Plans.

(b) For the nine months ended September 30, 2015, the total net periodic defined benefit cost includes $18 million reflected in discontinued operations related to costs allocated from PPL's plans to PPL Energy Supply prior to the spinoff.

	Other Postretirement Benefits
	Three Months						Nine Months
	2016			2015			2016			2015
PPL
Service cost	$	2		$	2		$	6		$	9
Interest cost	6			6			19			20
Expected return on plan assets	(6		)	(6		)	(17		)	(20		)
Amortization of actuarial loss	1			—			1			—
Net periodic defined benefit costs	$	3		$	2		$	9		$	9
LKE
Service cost	$	1		$	1		$	3		$	4
Interest cost	2			2			7			7
Expected return on plan assets	(2		)	(1		)	(5		)	(4		)
Amortization of prior service cost	1			1			2			2
Net periodic defined benefit costs	$	2		$	3		$	7		$	9

PPL Electric Utilities Corp [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Allocation of Net Periodic Benefit Costs

For the periods ended September 30, PPL Services allocated the following net periodic defined benefit costs to PPL Electric, and LKE allocated the following net periodic defined benefit costs to LG&E and KU:

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric	$	6	$	8	$	17	$	24
LG&E	2		3		7		10
KU	2		4		8		13

LG And E And KU Energy LLC [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Schedule Of Net Periodic Defined Benefit Costs (Credits)

Following are the net periodic defined benefit costs (credits) of the plans sponsored by PPL and its subsidiaries, LKE and its subsidiaries and LG&E for the periods ended September 30:

	Pension Benefits
	Three Months												Nine Months
	U.S.						U.K.						U.S.						U.K.
	2016			2015			2016 (a)			2015			2016			2015			2016 (a)			2015
PPL
Service cost	$	16		$	20		$	17		$	21		$	49		$	76		$	53		$	60
Interest cost	44			42			58			80			131			152			182			236
Expected return on plan assets	(57		)	(56		)	(124		)	(133		)	(171		)	(201		)	(389		)	(393		)
Amortization of:
Prior service cost	2			1			—			—			6			5			—			—
Actuarial loss	12			18			34			39			37			65			107			118
Net periodic defined benefit costs (credits) before settlements	17			25			(15		)	7			52			97			(47		)	21
Settlements	3			—			—			—			3			—			—			—
Net periodic defined benefit costs (credits) (b)	$	20		$	25		$	(15	)	$	7		$	55		$	97		$	(47	)	$	21

	Pension Benefits
	Three Months								Nine Months
	U.S.						U.K.		U.S.						U.K.
	2016			2015			2016 (a)	2015	2016			2015			2016 (a)	2015
LKE
Service cost	$	6		$	7				$	18		$	20
Interest cost	18			17					53			51
Expected return on plan assets	(23		)	(22		)			(68		)	(66		)
Amortization of:
Prior service cost	2			1					6			5
Actuarial loss	5			9					15			26
Net periodic defined benefit costs	$	8		$	12				$	24		$	36
LG&E
Service cost	$	—		$	—				$	1		$	1
Interest cost	4			3					11			10
Expected return on plan assets	(5		)	(5		)			(15		)	(15		)
Amortization of:
Prior service cost	1			1					3			2
Actuarial loss	2			3					5			9
Net periodic defined benefit costs	$	2		$	2				$	5		$	7

(a) See Note 2 for a discussion of changes to the discount rate used for the U.K. Pension Plans.

(b) For the nine months ended September 30, 2015, the total net periodic defined benefit cost includes $18 million reflected in discontinued operations related to costs allocated from PPL's plans to PPL Energy Supply prior to the spinoff.

	Other Postretirement Benefits
	Three Months						Nine Months
	2016			2015			2016			2015
PPL
Service cost	$	2		$	2		$	6		$	9
Interest cost	6			6			19			20
Expected return on plan assets	(6		)	(6		)	(17		)	(20		)
Amortization of actuarial loss	1			—			1			—
Net periodic defined benefit costs	$	3		$	2		$	9		$	9
LKE
Service cost	$	1		$	1		$	3		$	4
Interest cost	2			2			7			7
Expected return on plan assets	(2		)	(1		)	(5		)	(4		)
Amortization of prior service cost	1			1			2			2
Net periodic defined benefit costs	$	2		$	3		$	7		$	9

Louisville Gas And Electric Co [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Schedule Of Net Periodic Defined Benefit Costs (Credits)

Following are the net periodic defined benefit costs (credits) of the plans sponsored by PPL and its subsidiaries, LKE and its subsidiaries and LG&E for the periods ended September 30:

	Pension Benefits
	Three Months												Nine Months
	U.S.						U.K.						U.S.						U.K.
	2016			2015			2016 (a)			2015			2016			2015			2016 (a)			2015
PPL
Service cost	$	16		$	20		$	17		$	21		$	49		$	76		$	53		$	60
Interest cost	44			42			58			80			131			152			182			236
Expected return on plan assets	(57		)	(56		)	(124		)	(133		)	(171		)	(201		)	(389		)	(393		)
Amortization of:
Prior service cost	2			1			—			—			6			5			—			—
Actuarial loss	12			18			34			39			37			65			107			118
Net periodic defined benefit costs (credits) before settlements	17			25			(15		)	7			52			97			(47		)	21
Settlements	3			—			—			—			3			—			—			—
Net periodic defined benefit costs (credits) (b)	$	20		$	25		$	(15	)	$	7		$	55		$	97		$	(47	)	$	21

	Pension Benefits
	Three Months								Nine Months
	U.S.						U.K.		U.S.						U.K.
	2016			2015			2016 (a)	2015	2016			2015			2016 (a)	2015
LKE
Service cost	$	6		$	7				$	18		$	20
Interest cost	18			17					53			51
Expected return on plan assets	(23		)	(22		)			(68		)	(66		)
Amortization of:
Prior service cost	2			1					6			5
Actuarial loss	5			9					15			26
Net periodic defined benefit costs	$	8		$	12				$	24		$	36
LG&E
Service cost	$	—		$	—				$	1		$	1
Interest cost	4			3					11			10
Expected return on plan assets	(5		)	(5		)			(15		)	(15		)
Amortization of:
Prior service cost	1			1					3			2
Actuarial loss	2			3					5			9
Net periodic defined benefit costs	$	2		$	2				$	5		$	7

(a) See Note 2 for a discussion of changes to the discount rate used for the U.K. Pension Plans.

(b) For the nine months ended September 30, 2015, the total net periodic defined benefit cost includes $18 million reflected in discontinued operations related to costs allocated from PPL's plans to PPL Energy Supply prior to the spinoff.

Allocation of Net Periodic Benefit Costs

For the periods ended September 30, PPL Services allocated the following net periodic defined benefit costs to PPL Electric, and LKE allocated the following net periodic defined benefit costs to LG&E and KU:

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric	$	6	$	8	$	17	$	24
LG&E	2		3		7		10
KU	2		4		8		13

Kentucky Utilities Co [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Allocation of Net Periodic Benefit Costs

For the periods ended September 30, PPL Services allocated the following net periodic defined benefit costs to PPL Electric, and LKE allocated the following net periodic defined benefit costs to LG&E and KU:

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric	$	6	$	8	$	17	$	24
LG&E	2		3		7		10
KU	2		4		8		13

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Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2016

Commitments and Contingencies Disclosure [Abstract]

Guarantees

The table below details guarantees provided as of September 30, 2016.

	Exposure at September 30, 2016			Expiration Date
PPL
Indemnifications related to the WPD Midlands acquisition			(a)
WPD indemnifications for entities in liquidation and sales of assets	$	10	(b)	2019
WPD guarantee of pension and other obligations of unconsolidated entities	109		(c)
PPL Electric
Guarantee of inventory value	15		(d)	2018
LKE
Indemnification of lease termination and other divestitures	301		(e)	2021 - 2023
LG&E and KU
LG&E and KU guarantee of shortfall related to OVEC			(f)

(a) Indemnifications related to certain liabilities, including a specific unresolved tax issue and those relating to properties and assets owned by the seller that were transferred to WPD Midlands in connection with the acquisition. A cross indemnity has been received from the seller on the tax issue. The maximum exposure and expiration of these indemnifications cannot be estimated because the maximum potential liability is not capped and the expiration date is not specified in the transaction documents.

(b) Indemnification to the liquidators and certain others for existing liabilities or expenses or liabilities arising during the liquidation process. The indemnifications are limited to distributions made from the subsidiary to its parent either prior or subsequent to liquidation or are not explicitly stated in the agreements. The indemnifications generally expire two to seven years subsequent to the date of dissolution of the entities. The exposure noted only includes those cases where the agreements provide for specific limits.

In connection with their sales of various businesses, WPD and its affiliates have provided the purchasers with indemnifications that are standard for such transactions, including indemnifications for certain pre-existing liabilities and environmental and tax matters or have agreed to continue their obligations under existing third-party guarantees, either for a set period of time following the transactions or upon the condition that the purchasers make reasonable efforts to terminate the guarantees. Additionally, WPD and its affiliates remain secondarily responsible for lease payments under certain leases that they have assigned to third parties.

(c) Relates to certain obligations of discontinued or modified electric associations that were guaranteed at the time of privatization by the participating members. Costs are allocated to the members and can be reallocated if an existing member becomes insolvent. At September 30, 2016, WPD has recorded an estimated discounted liability for which the expected payment/performance is probable. Neither the expiration date nor the maximum amount of potential payments for certain obligations is explicitly stated in the related agreements, and as a result, the exposure has been estimated.

(d) A third party logistics firm provides inventory procurement and fulfillment services. The logistics firm has title to the inventory, however, upon termination of the contracts, PPL Electric has guaranteed to purchase any remaining inventory that has not been used or sold.

(e) LKE provides certain indemnifications covering the due and punctual payment, performance and discharge by each party of its respective obligations. The most comprehensive of these guarantees is the LKE guarantee covering operational, regulatory and environmental commitments and indemnifications made by WKE under a 2009 Transaction Termination Agreement. This guarantee has a term of 12 years ending July 2021, and a maximum exposure of $200 million, exclusive of certain items such as government fines and penalties that fall outside the cap. Another WKE-related LKE guarantee covers other indemnifications related to the purchase price of excess power, has a term expiring in 2023, and a maximum exposure of $100 million. In May 2012, LKE's indemnitee received an unfavorable arbitration panel's decision interpreting this matter. In October 2014, LKE's indemnitee filed a motion for discretionary review with the Kentucky Supreme Court seeking to overturn the arbitration decision, and such motion was denied by the court in September 2015. In September 2015, a counterparty issued a demand letter to LKE's indemnitee. In February 2016, the counterparty filed a complaint in Henderson, Kentucky Circuit Court, seeking an award of damages in the matter. The proceeding is currently in the discovery phase. LKE does not believe appropriate contractual, legal or commercial grounds exist for the claim made and has disputed the demands. LKE believes its indemnification obligations in the WKE matter remain subject to various uncertainties, including additional legal and contractual developments, as well as future prices, availability and demand for the subject excess power. Although the parties have also conducted certain settlement discussions, the ultimate outcomes of the WKE termination-related indemnifications cannot be predicted at this time. Additionally, LKE has indemnified various third parties related to historical obligations for other divested subsidiaries and affiliates. The indemnifications vary by entity and the maximum exposures range from being capped at the sale price to no specified maximum, and LKE could be required to perform on these indemnifications in the event of covered losses or liabilities being claimed by an indemnified party. LKE cannot predict the ultimate outcomes of the various indemnification scenarios, but does not expect such outcomes to result in significant losses above the amounts recorded.

(f) Pursuant to the OVEC power purchase contract, LG&E and KU are obligated to pay for their share of OVEC's excess debt service, post-retirement and decommissioning costs, as well as any shortfall from amounts included within a demand charge designed and expected to cover these costs over the term of the contract. LKE's proportionate share of OVEC's outstanding debt was $124 million at September 30, 2016, consisting of LG&E's share of $86 million and KU's share of $38 million. The maximum exposure and the expiration date of these potential obligations are not presently determinable. See "Energy Purchase Commitments" and "Guarantees and Other Assurances" in Note 13 in PPL's, LKE's, LG&E's and KU's 2015 Form 10-K for additional information on the OVEC power purchase contract.

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Related Party Transactions (Tables)

9 Months Ended

Sep. 30, 2016

PPL Electric Utilities Corp [Member]

Related Party Transactions [Line Items]

Intercompany Support Cost Allocations

PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

LG And E And KU Energy LLC [Member]

Related Party Transactions [Line Items]

Intercompany Support Cost Allocations

PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

Louisville Gas And Electric Co [Member]

Related Party Transactions [Line Items]

Intercompany Support Cost Allocations

PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

Kentucky Utilities Co [Member]

Related Party Transactions [Line Items]

Intercompany Support Cost Allocations

PPL Services, PPL EU Services and LKS charged the following amounts for the periods ended September 30, including amounts applied to accounts that are further distributed between capital and expense on the books of the recipients, based on methods that are believed to be reasonable.

	Three Months				Nine Months
	2016		2015		2016		2015
PPL Electric from PPL Services	$	33	$	35	$	98	$	90
LKE from PPL Services	4		4		13		12
PPL Electric from PPL EU Services	17		12		50		44
LG&E from LKS	40		36		128		107
KU from LKS	46		43		151		127

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2016

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The assets and liabilities measured at fair value were:

	September 30, 2016								December 31, 2015
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
PPL
Assets
Cash and cash equivalents	$	416	$	416	$	—	$	—	$	836	$	836	$	—	$	—
Restricted cash and cash equivalents (a)	29		29		—		—		33		33		—		—
Price risk management assets (b):
Foreign currency contracts	110		—		110		—		209		—		209		—
Cross-currency swaps	153		—		153		—		86		—		86		—
Total price risk management assets	263		—		263		—		295		—		295		—
Auction rate securities (c)	—		—		—		—		2		—		—		2
Total assets	$	708	$	445	$	263	$	—	$	1,166	$	869	$	295	$	2
Liabilities
Price risk management liabilities (b):
Interest rate swaps	$	54	$	—	$	54	$	—	$	71	$	—	$	71	$	—
Foreign currency contracts	14		—		14		—		1		—		1		—
Total price risk management liabilities	$	68	$	—	$	68	$	—	$	72	$	—	$	72	$	—
PPL Electric
Assets
Cash and cash equivalents	$	36	$	36	$	—	$	—	$	47	$	47	$	—	$	—
Restricted cash and cash equivalents (a)	2		2		—		—		2		2		—		—
Total assets	$	38	$	38	$	—	$	—	$	49	$	49	$	—	$	—
LKE
Assets
Cash and cash equivalents	$	11	$	11	$	—	$	—	$	30	$	30	$	—	$	—
Cash collateral posted to counterparties (d)	8		8		—		—		9		9		—		—
Total assets	$	19	$	19	$	—	$	—	$	39	$	39	$	—	$	—

	September 30, 2016								December 31, 2015
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Liabilities
Price risk management liabilities:
Interest rate swaps	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
Total price risk management liabilities	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
LG&E
Assets
Cash and cash equivalents	$	4	$	4	$	—	$	—	$	19	$	19	$	—	$	—
Cash collateral posted to counterparties (d)	8		8		—		—		9		9		—		—
Total assets	$	12	$	12	$	—	$	—	$	28	$	28	$	—	$	—
Liabilities
Price risk management liabilities:
Interest rate swaps	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
Total price risk management liabilities	$	54	$	—	$	54	$	—	$	47	$	—	$	47	$	—
KU
Assets
Cash and cash equivalents	$	7	$	7	$	—	$	—	$	11	$	11	$	—	$	—
Total assets	$	7	$	7	$	—	$	—	$	11	$	11	$	—	$	—

(a) Current portion is included in "Other current assets" and long-term portion is included in "Other noncurrent assets" on the Balance Sheets.

(b) Current portion is included in "Price risk management assets" and "Other current liabilities" and noncurrent portion is included in "Price risk management assets" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

(c) Included in "Other noncurrent assets" on the Balance Sheets.

(d) Included in "Other noncurrent assets" on the Balance Sheets. Represents cash collateral posted to offset the exposure with counterparties related to certain interest rate swaps under master netting arrangements that are not offset.

Fair Value, by Balance Sheet Grouping

The carrying amounts of long-term debt on the Balance Sheets and their estimated fair values are set forth below.

	September 30, 2016				December 31, 2015
	Carrying Amount (a)		Fair Value		Carrying Amount (a)		Fair Value
PPL	$	18,512	$	23,180	$	19,048	$	21,218
PPL Electric	2,831		3,372		2,828		3,088
LKE	5,089		5,832		5,088		5,384
LG&E	1,642		1,852		1,642		1,704
KU	2,327		2,701		2,326		2,467

(a) Amounts are net of debt issuance costs.

XML

Derivative Instruments and Hedging Activities (Tables)

9 Months Ended

Sep. 30, 2016

Derivative Instruments And Hedging Activities [Line Items]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following table presents the fair value and location of derivative instruments recorded on the Balance Sheets.

	September 30, 2016								December 31, 2015
	Derivatives designated as hedging instruments				Derivatives not designated as hedging instruments				Derivatives designated as hedging instruments				Derivatives not designated as hedging instruments
	Assets		Liabilities		Assets		Liabilities		Assets		Liabilities		Assets		Liabilities
Current:
Price Risk Management
Assets/Liabilities (a):
Interest rate swaps (b)	$	—	$	—	$	—	$	6	$	—	$	24	$	—	$	5
Cross-currency swaps (b)	6		—		—		—		35		—		—		—
Foreign currency contracts	—		—		72		2		10		—		94		1
Total current	6		—		72		8		45		24		94		6
Noncurrent:
Price Risk Management
Assets/Liabilities (a):
Interest rate swaps (b)	—		—		—		48		—		—		—		42
Cross-currency swaps (b)	147		—		—		—		51		—		—		—
Foreign currency contracts	—		—		38		12		—		—		105		—
Total noncurrent	147		—		38		60		51		—		105		42
Total derivatives	$	153	$	—	$	110	$	68	$	96	$	24	$	199	$	48

(a) Current portion is included in "Price risk management assets" and "Other current liabilities" and noncurrent portion is included in "Price risk management assets" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

(b) Excludes accrued interest, if applicable.

Derivative Instruments, Gain (Loss)

The following tables present the pre-tax effect of derivative instruments recognized in income, OCI or regulatory assets and regulatory liabilities for the periods ended September 30, 2016.

							Three Months					Nine Months
Derivative Relationships	Derivative Gain (Loss) Recognized in OCI (Effective Portion)					Location of Gain (Loss) Recognized in Income on Derivative	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)		Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
	Three Months		Nine Months
Cash Flow Hedges:
Interest rate swaps	$	—	$	(21	)	Interest expense	$	(2	)	$	—	$	(5	)	$	—
Cross-currency swaps	78		87			Interest expense	2			—		2			—
						Other income (expense) - net	86			—		80			—
Total	$	78	$	66			$	86		$	—	$	77		$	—
Net Investment Hedges:
Foreign currency contracts	$	—	$	4

Derivatives Not Designated as	Location of Gain (Loss) Recognized in
Hedging Instruments	Income on Derivative	Three Months			Nine Months
Foreign currency contracts	Other income (expense) - net	$	49		$	280
Interest rate swaps	Interest expense	(2		)	(6		)
	Total	$	47		$	274
Derivatives Not Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	2		$	(7	)

The following tables present the pre-tax effect of derivative instruments recognized in income, OCI or regulatory assets and regulatory liabilities for the periods ended September 30, 2015.

								Three Months					Nine Months
Derivative Relationships	Derivative Gain (Loss) Recognized in OCI (Effective Portion)						Location of Gain (Loss) Recognized in Income on Derivative	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)		Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
	Three Months			Nine Months
Cash Flow Hedges:
Interest rate swaps	$	(27	)	$	(29	)	Interest expense	$	(2	)	$	—	$	(9	)	$	—
							Discontinued operations	—			—		—			(77		)
Cross-currency swaps	(3		)	33			Interest expense	(1		)	—		1			—
							Other income (expense) - net	(10		)	—		22			—
Commodity contracts	—			—			Discontinued operations	—			—		13			7
Total	$	(30	)	$	4			$	(13	)	$	—	$	27		$	(70	)
Net Investment Hedges:
Foreign currency contracts	$	7		$	6

Derivatives Not Designated as	Location of Gain (Loss) Recognized in
Hedging Instruments	Income on Derivative	Three Months			Nine Months
Foreign currency contracts	Other income (expense) - net	$	78		$	64
Interest rate swaps	Interest expense	(2		)	(6		)
	Total	$	76		$	58
Derivatives Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(42	)	$	(22	)
Derivatives Not Designated as	Location of Gain (Loss) Recognized as
Hedging Instruments	Regulatory Liabilities/Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(5	)	$	(2	)

Derivative Positions Eligible for Offset with Related Cash Collateral

The table below summarizes the derivative positions presented in the balance sheets where a right of setoff exists under these arrangements and related cash collateral received or pledged.

	Assets								Liabilities
			Eligible for Offset								Eligible for Offset
	Gross		Derivative Instruments		Cash Collateral Received		Net		Gross		Derivative Instruments		Cash Collateral Pledged		Net
September 30, 2016
Treasury Derivatives
PPL	$	263	$	14	$	—	$	249	$	68	$	14	$	8	$	46
LKE	—		—		—		—		54		—		8		46
LG&E	—		—		—		—		54		—		8		46

December 31, 2015
Treasury Derivatives
PPL	$	295	$	25	$	—	$	270	$	72	$	25	$	9	$	38
LKE	—		—		—		—		47		—		9		38
LG&E	—		—		—		—		47		—		9		38

Credit Risk-Related Contingent Features

At September 30, 2016, derivative contracts in a net liability position that contain credit risk-related contingent features, collateral posted on those positions and the related effect of a decrease in credit ratings below investment grade are summarized as follows:

	PPL		LKE		LG&E
Aggregate fair value of derivative instruments in a net liability position with credit risk-related contingent features	$	29	$	29	$	29
Aggregate fair value of collateral posted on these derivative instruments	7		7		7
Aggregate fair value of additional collateral requirements in the event of  a credit downgrade below investment grade (a)	22		22		22

(a) Includes the effect of net receivables and payables already recorded on the Balance Sheet.

LG And E And KU Energy LLC [Member]

Derivative Instruments And Hedging Activities [Line Items]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following table presents the fair value and the location on the Balance Sheets of derivatives not designated as hedging instruments.

	September 30, 2016				December 31, 2015
	Assets		Liabilities			Assets		Liabilities
Current:
Price Risk Management
Assets/Liabilities:
Interest rate swaps	$	—	$	6		$	—	$	5
Total current	—		6			—		5
Noncurrent:
Price Risk Management
Assets/Liabilities:
Interest rate swaps	—		48			—		42
Total noncurrent	—		48			—		42
Total derivatives	$	—	$	54		$	—	$	47

Derivative Instruments, Gain (Loss)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(42	)	$	(22	)

The following tables present the pre-tax effect of derivatives not designated as cash flow hedges that are recognized in income or regulatory assets for the periods ended September 30, 2016.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Income on Derivatives	Three Months			Nine Months
Interest rate swaps	Interest expense	$	(2	)	$	(6	)
	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	2		$	(7	)

The following tables present the pre-tax effect of derivatives not designated as cash flow hedges that are recognized in income or regulatory assets for the periods ended September 30, 2015.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Income on Derivatives	Three Months			Nine Months
Interest rate swaps	Interest expense	$	(2	)	$	(6	)
	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(5	)	$	(2	)

Derivative Positions Eligible for Offset with Related Cash Collateral

The table below summarizes the derivative positions presented in the balance sheets where a right of setoff exists under these arrangements and related cash collateral received or pledged.

	Assets								Liabilities
			Eligible for Offset								Eligible for Offset
	Gross		Derivative Instruments		Cash Collateral Received		Net		Gross		Derivative Instruments		Cash Collateral Pledged		Net
September 30, 2016
Treasury Derivatives
PPL	$	263	$	14	$	—	$	249	$	68	$	14	$	8	$	46
LKE	—		—		—		—		54		—		8		46
LG&E	—		—		—		—		54		—		8		46

December 31, 2015
Treasury Derivatives
PPL	$	295	$	25	$	—	$	270	$	72	$	25	$	9	$	38
LKE	—		—		—		—		47		—		9		38
LG&E	—		—		—		—		47		—		9		38

Credit Risk-Related Contingent Features

At September 30, 2016, derivative contracts in a net liability position that contain credit risk-related contingent features, collateral posted on those positions and the related effect of a decrease in credit ratings below investment grade are summarized as follows:

	PPL		LKE		LG&E
Aggregate fair value of derivative instruments in a net liability position with credit risk-related contingent features	$	29	$	29	$	29
Aggregate fair value of collateral posted on these derivative instruments	7		7		7
Aggregate fair value of additional collateral requirements in the event of  a credit downgrade below investment grade (a)	22		22		22

(a) Includes the effect of net receivables and payables already recorded on the Balance Sheet.

Louisville Gas And Electric Co [Member]

Derivative Instruments And Hedging Activities [Line Items]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following table presents the fair value and the location on the Balance Sheets of derivatives not designated as hedging instruments.

	September 30, 2016				December 31, 2015
	Assets		Liabilities			Assets		Liabilities
Current:
Price Risk Management
Assets/Liabilities:
Interest rate swaps	$	—	$	6		$	—	$	5
Total current	—		6			—		5
Noncurrent:
Price Risk Management
Assets/Liabilities:
Interest rate swaps	—		48			—		42
Total noncurrent	—		48			—		42
Total derivatives	$	—	$	54		$	—	$	47

Derivative Instruments, Gain (Loss)

The following tables present the pre-tax effect of derivatives not designated as cash flow hedges that are recognized in income or regulatory assets for the periods ended September 30, 2016.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Income on Derivatives	Three Months			Nine Months
Interest rate swaps	Interest expense	$	(2	)	$	(6	)
	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	2		$	(7	)

The following tables present the pre-tax effect of derivatives not designated as cash flow hedges that are recognized in income or regulatory assets for the periods ended September 30, 2015.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Income on Derivatives	Three Months			Nine Months
Interest rate swaps	Interest expense	$	(2	)	$	(6	)
	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(5	)	$	(2	)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(21	)	$	(11	)

Derivative Positions Eligible for Offset with Related Cash Collateral

The table below summarizes the derivative positions presented in the balance sheets where a right of setoff exists under these arrangements and related cash collateral received or pledged.

	Assets								Liabilities
			Eligible for Offset								Eligible for Offset
	Gross		Derivative Instruments		Cash Collateral Received		Net		Gross		Derivative Instruments		Cash Collateral Pledged		Net
September 30, 2016
Treasury Derivatives
PPL	$	263	$	14	$	—	$	249	$	68	$	14	$	8	$	46
LKE	—		—		—		—		54		—		8		46
LG&E	—		—		—		—		54		—		8		46

December 31, 2015
Treasury Derivatives
PPL	$	295	$	25	$	—	$	270	$	72	$	25	$	9	$	38
LKE	—		—		—		—		47		—		9		38
LG&E	—		—		—		—		47		—		9		38

Credit Risk-Related Contingent Features

At September 30, 2016, derivative contracts in a net liability position that contain credit risk-related contingent features, collateral posted on those positions and the related effect of a decrease in credit ratings below investment grade are summarized as follows:

	PPL		LKE		LG&E
Aggregate fair value of derivative instruments in a net liability position with credit risk-related contingent features	$	29	$	29	$	29
Aggregate fair value of collateral posted on these derivative instruments	7		7		7
Aggregate fair value of additional collateral requirements in the event of  a credit downgrade below investment grade (a)	22		22		22

(a) Includes the effect of net receivables and payables already recorded on the Balance Sheet.

Kentucky Utilities Co [Member]

Derivative Instruments And Hedging Activities [Line Items]

Derivative Instruments, Gain (Loss)

The following table presents the pre-tax effect of derivative instruments designated as cash flow hedges that are recognized in regulatory assets for the periods ended September 30, 2015. All derivative instruments designated as cash flow hedges were terminated in 2015 and there is no activity in the current period.

	Location of Gain (Loss) Recognized in
Derivative Instruments	Regulatory Assets	Three Months			Nine Months
Interest rate swaps	Regulatory assets - noncurrent	$	(21	)	$	(11	)

Derivative Positions Eligible for Offset with Related Cash Collateral

The table below summarizes the derivative positions presented in the balance sheets where a right of setoff exists under these arrangements and related cash collateral received or pledged.

	Assets								Liabilities
			Eligible for Offset								Eligible for Offset
	Gross		Derivative Instruments		Cash Collateral Received		Net		Gross		Derivative Instruments		Cash Collateral Pledged		Net
September 30, 2016
Treasury Derivatives
PPL	$	263	$	14	$	—	$	249	$	68	$	14	$	8	$	46
LKE	—		—		—		—		54		—		8		46
LG&E	—		—		—		—		54		—		8		46

December 31, 2015
Treasury Derivatives
PPL	$	295	$	25	$	—	$	270	$	72	$	25	$	9	$	38
LKE	—		—		—		—		47		—		9		38
LG&E	—		—		—		—		47		—		9		38

XML

Asset Retirement Obligations (Tables)

9 Months Ended

Sep. 30, 2016

Asset Retirement Obligation [Line Items]

Asset Retirement Obligation Roll Forward

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

LG And E And KU Energy LLC [Member]

Asset Retirement Obligation [Line Items]

Asset Retirement Obligation Roll Forward

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

Louisville Gas And Electric Co [Member]

Asset Retirement Obligation [Line Items]

Asset Retirement Obligation Roll Forward

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

Kentucky Utilities Co [Member]

Asset Retirement Obligation [Line Items]

Asset Retirement Obligation Roll Forward

The changes in the carrying amounts of AROs were as follows.

	PPL			LKE			LG&E			KU
Balance at December 31, 2015	$	586		$	535		$	175		$	360
Accretion	20			18			6			12
Effect of foreign currency exchange rates	(7		)	—			—			—
Changes in estimated timing or cost	(116		)	(116		)	(24		)	(92		)
Obligations settled	(15		)	(15		)	(11		)	(4		)
Balance at September 30, 2016	$	468		$	422		$	146		$	276

XML

Accumulated Other Comprehensive Income (Loss) (Tables)

9 Months Ended

Sep. 30, 2016

Accumulated Other Comprehensive Income (Loss) [Line Items]

Schedule of Accumulated Other Comprehensive Income (Loss)

The after-tax changes in AOCI by component for the periods ended September 30 were as follows.

	Foreign currency translation adjustments			Unrealized gains (losses)									Defined benefit plans
				Available- for-sale securities			Qualifying derivatives			Equity investees' AOCI			Prior service costs			Actuarial gain (loss)			Total
PPL
June 30, 2016	$	(716	)	$	—		$	(5	)	$	(1	)	$	(5	)	$	(2,130	)	$	(2,857	)
Amounts arising during the period	(641		)	—			62			—			—			(6		)	(585		)
Reclassifications from AOCI	—			—			(69		)	—			—			31			(38		)
Net OCI during the period	(641		)	—			(7		)	—			—			25			(623		)
September 30, 2016	$	(1,357	)	$	—		$	(12	)	$	(1	)	$	(5	)	$	(2,105	)	$	(3,480	)
December 31, 2015	$	(520	)	$	—		$	(7	)	$	—		$	(6	)	$	(2,195	)	$	(2,728	)
Amounts arising during the period	(837		)	—			57			—			—			(4		)	(784		)
Reclassifications from AOCI	—			—			(62		)	(1		)	1			94			32
Net OCI during the period	(837		)	—			(5		)	(1		)	1			90			(752		)
September 30, 2016	$	(1,357	)	$	—		$	(12	)	$	(1	)	$	(5	)	$	(2,105	)	$	(3,480	)
June 30, 2015	$	(435	)	$	—		$	2		$	—		$	(3	)	$	(1,848	)	$	(2,284	)
Amounts arising during the period	52			—			(19		)	—			—			—			33
Reclassifications from AOCI	—			—			10			—			—			35			45
Net OCI during the period	52			—			(9		)	—			—			35			78
September 30, 2015	$	(383	)	$	—		$	(7	)	$	—		$	(3	)	$	(1,813	)	$	(2,206	)
December 31, 2014	$	(286	)	$	202		$	20		$	1		$	3		$	(2,214	)	$	(2,274	)
Amounts arising during the period	(97		)	7			8			—			(6		)	52			(36		)
Reclassifications from AOCI	—			(2		)	20			(1		)	—			111			128
Net OCI during the period	(97		)	5			28			(1		)	(6		)	163			92
Distribution of PPL Energy Supply (Note 8)	—			(207		)	(55		)	—			—			238			(24		)
September 30, 2015	$	(383	)	$	—		$	(7	)	$	—		$	(3	)	$	(1,813	)	$	(2,206	)
LKE
June 30, 2016										$	(1	)	$	(9	)	$	(33	)	$	(43	)
Amounts arising during the period										—			—			—			—
Reclassifications from AOCI										—			—			1			1
Net OCI during the period										—			—			1			1
September 30, 2016										$	(1	)	$	(9	)	$	(32	)	$	(42	)

	Foreign currency translation adjustments	Unrealized gains (losses)					Defined benefit plans
		Available- for-sale securities	Qualifying derivatives	Equity investees' AOCI			Prior service costs			Actuarial gain (loss)			Total
December 31, 2015				$	—		$	(10	)	$	(36	)	$	(46	)
Amounts arising during the period				—			—			1			1
Reclassifications from AOCI				(1		)	1			3			3
Net OCI during the period				(1		)	1			4			4
September 30, 2016				$	(1	)	$	(9	)	$	(32	)	$	(42	)
June 30, 2015				$	(1	)	$	(7	)	$	(44	)	$	(52	)
Amounts arising during the period				—			—			—			—
Reclassifications from AOCI				—			—			1			1
Net OCI during the period				—			—			1			1
September 30, 2015				$	(1	)	$	(7	)	$	(43	)	$	(51	)
December 31, 2014				$	—		$	(8	)	$	(37	)	$	(45	)
Amounts arising during the period				—			—			(8		)	(8		)
Reclassifications from AOCI				(1		)	1			2			2
Net OCI during the period				(1		)	1			(6		)	(6		)
September 30, 2015				$	(1	)	$	(7	)	$	(43	)	$	(51	)

Reclassification out of Other Comprehensive Income (Loss)

The following table presents the gains (losses) and related income taxes for reclassifications from AOCI for the periods ended September 30.

	Three Months						Nine Months						Affected Line Item on the
Details about AOCI	2016			2015			2016			2015			Statements of Income
Available-for-sale securities	$	—		$	—		$	—		$	4		Other Income (Expense) - net
Total Pre-tax	—			—			—			4
Income Taxes	—			—			—			(2		)
Total After-tax	—			—			—			2
Qualifying derivatives
Interest rate swaps	(2		)	(2		)	(5		)	(9		)	Interest Expense
	—			—			—			(77		)	Discontinued operations
Cross-currency swaps	86			(10		)	80			22			Other Income (Expense) - net
	2			(1		)	2			1			Interest Expense
Commodity contracts	—			—			—			20			Discontinued operations
Total Pre-tax	86			(13		)	77			(43		)
Income Taxes	(17		)	3			(15		)	23
Total After-tax	69			(10		)	62			(20		)

	Three Months						Nine Months						Affected Line Item on the
Details about AOCI	2016			2015			2016			2015			Statements of Income
Equity investees' AOCI	—			—			1			2			Other Income (Expense) - net
Total Pre-tax	—			—			1			2
Income Taxes	—			—			—			(1		)
Total After-tax	—			—			1			1
Defined benefit plans
Prior service costs	(1		)	—			(2		)	—
Net actuarial loss	(41		)	(45		)	(121		)	(146		)
Total Pre-tax	(42		)	(45		)	(123		)	(146		)
Income Taxes	11			10			28			35
Total After-tax	(31		)	(35		)	(95		)	(111		)
Total reclassifications during the period	$	38		$	(45	)	$	(32	)	$	(128	)

LG And E And KU Energy LLC [Member]

Accumulated Other Comprehensive Income (Loss) [Line Items]

Schedule of Accumulated Other Comprehensive Income (Loss)

The after-tax changes in AOCI by component for the periods ended September 30 were as follows.

	Foreign currency translation adjustments			Unrealized gains (losses)									Defined benefit plans
				Available- for-sale securities			Qualifying derivatives			Equity investees' AOCI			Prior service costs			Actuarial gain (loss)			Total
PPL
June 30, 2016	$	(716	)	$	—		$	(5	)	$	(1	)	$	(5	)	$	(2,130	)	$	(2,857	)
Amounts arising during the period	(641		)	—			62			—			—			(6		)	(585		)
Reclassifications from AOCI	—			—			(69		)	—			—			31			(38		)
Net OCI during the period	(641		)	—			(7		)	—			—			25			(623		)
September 30, 2016	$	(1,357	)	$	—		$	(12	)	$	(1	)	$	(5	)	$	(2,105	)	$	(3,480	)
December 31, 2015	$	(520	)	$	—		$	(7	)	$	—		$	(6	)	$	(2,195	)	$	(2,728	)
Amounts arising during the period	(837		)	—			57			—			—			(4		)	(784		)
Reclassifications from AOCI	—			—			(62		)	(1		)	1			94			32
Net OCI during the period	(837		)	—			(5		)	(1		)	1			90			(752		)
September 30, 2016	$	(1,357	)	$	—		$	(12	)	$	(1	)	$	(5	)	$	(2,105	)	$	(3,480	)
June 30, 2015	$	(435	)	$	—		$	2		$	—		$	(3	)	$	(1,848	)	$	(2,284	)
Amounts arising during the period	52			—			(19		)	—			—			—			33
Reclassifications from AOCI	—			—			10			—			—			35			45
Net OCI during the period	52			—			(9		)	—			—			35			78
September 30, 2015	$	(383	)	$	—		$	(7	)	$	—		$	(3	)	$	(1,813	)	$	(2,206	)
December 31, 2014	$	(286	)	$	202		$	20		$	1		$	3		$	(2,214	)	$	(2,274	)
Amounts arising during the period	(97		)	7			8			—			(6		)	52			(36		)
Reclassifications from AOCI	—			(2		)	20			(1		)	—			111			128
Net OCI during the period	(97		)	5			28			(1		)	(6		)	163			92
Distribution of PPL Energy Supply (Note 8)	—			(207		)	(55		)	—			—			238			(24		)
September 30, 2015	$	(383	)	$	—		$	(7	)	$	—		$	(3	)	$	(1,813	)	$	(2,206	)
LKE
June 30, 2016										$	(1	)	$	(9	)	$	(33	)	$	(43	)
Amounts arising during the period										—			—			—			—
Reclassifications from AOCI										—			—			1			1
Net OCI during the period										—			—			1			1
September 30, 2016										$	(1	)	$	(9	)	$	(32	)	$	(42	)

	Foreign currency translation adjustments	Unrealized gains (losses)					Defined benefit plans
		Available- for-sale securities	Qualifying derivatives	Equity investees' AOCI			Prior service costs			Actuarial gain (loss)			Total
December 31, 2015				$	—		$	(10	)	$	(36	)	$	(46	)
Amounts arising during the period				—			—			1			1
Reclassifications from AOCI				(1		)	1			3			3
Net OCI during the period				(1		)	1			4			4
September 30, 2016				$	(1	)	$	(9	)	$	(32	)	$	(42	)
June 30, 2015				$	(1	)	$	(7	)	$	(44	)	$	(52	)
Amounts arising during the period				—			—			—			—
Reclassifications from AOCI				—			—			1			1
Net OCI during the period				—			—			1			1
September 30, 2015				$	(1	)	$	(7	)	$	(43	)	$	(51	)
December 31, 2014				$	—		$	(8	)	$	(37	)	$	(45	)
Amounts arising during the period				—			—			(8		)	(8		)
Reclassifications from AOCI				(1		)	1			2			2
Net OCI during the period				(1		)	1			(6		)	(6		)
September 30, 2015				$	(1	)	$	(7	)	$	(43	)	$	(51	)

XML

Summary of Significant Accounting Policies (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Discount Rate Change for U.K. Pension Plans (Numeric) [Abstract]
Decrease in net periodic defined benefit cost from change in the discount rate	$ 10		$ 31
Decrease in net periodic defined benefit cost from change in the discount rate, after-tax	$ 8		$ 25
Decrease in net periodic defined benefit cost from change in the discount rate, per share	$ 0.01		$ 0.04
Accounting for Stock-Based Compensation (Numeric) [Abstract]
Income tax benefit	$ (139)	$ (144)	$ (510)	$ (432)
Per share	$ 0.70	$ 0.58	$ 2.12	$ 0.42
Cumulative effect adjustment to earnings reinvested			$ 7
New Accounting Pronouncement Early Adoption [Member]
Accounting for Stock-Based Compensation (Numeric) [Abstract]
Income tax benefit	$ 1		$ 12
Per share			$ 0.02
Cumulative effect adjustment to earnings reinvested			$ 7
Unaffiliated Third Party Entity [Member]
Accounts Receivable (Numeric) [Abstract]
Purchases of accounts receivable	365	$ 361	1,000	$ 968
PPL Electric Utilities Corp [Member]
Accounting for Stock-Based Compensation (Numeric) [Abstract]
Income tax benefit	(58)	(35)	(162)	(130)
PPL Electric Utilities Corp [Member] | New Accounting Pronouncement Early Adoption [Member]
Accounting for Stock-Based Compensation (Numeric) [Abstract]
Income tax benefit			7
PPL Electric Utilities Corp [Member] | Unaffiliated Third Party Entity [Member]
Accounts Receivable (Numeric) [Abstract]
Purchases of accounts receivable	$ 365	$ 361	$ 1,000	968
PPL Electric Utilities Corp [Member] | PPL EnergyPlus [Member]
Accounts Receivable (Numeric) [Abstract]
Purchases of accounts receivable				$ 146

XML

Segment and Related Information (Details) - USD ($) $ in Millions		3 Months Ended		9 Months Ended
		Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Income Statement Data [Abstract]
Revenues		$ 1,889	$ 1,878	$ 5,685	$ 5,889
Net income		473	393	1,437	283
Balance Sheet Data [Abstract]
Assets		38,038		38,038		$ 39,301
United Kingdom Regulated [Member]
Income Statement Data [Abstract]
Revenues		515	552	1,673	1,836
Net income	[1]	281	249	915	814
Balance Sheet Data [Abstract]
Assets	[2]	15,014		15,014		16,669
Segment (Numeric) [Abstract]
Net property, plant and equipment not subject to accounting for the effects of certain types of regulation		11,100		11,100		12,200
Kentucky Regulated [Member]
Income Statement Data [Abstract]
Revenues		835	801	2,382	2,414
Net income		126	111	314	267
Balance Sheet Data [Abstract]
Assets		13,853		13,853		13,756
Pennsylvania Regulated [Member]
Income Statement Data [Abstract]
Revenues		539	519	1,619	1,625
Net income		91	55	263	191
Balance Sheet Data [Abstract]
Assets		9,070		9,070		8,511
Corporate And Other [Member]
Income Statement Data [Abstract]
Revenues		0	6	11	14
Net income		(25)	(19)	(55)	(74)
Balance Sheet Data [Abstract]
Assets	[3]	101		101		$ 365
Discontinued Operations [Member]
Income Statement Data [Abstract]
Net income	[4]	$ 0	$ (3)	$ 0	$ (915)

[1] Includes unrealized gains and losses from hedging foreign-currency related economic activity. See Note 14 for additional information.

[2] Includes $11.1 billion and $12.2 billion of net PP&E as of September 30, 2016 and December 31, 2015. WPD is not subject to accounting for the effects of certain types of regulation as prescribed by GAAP.

[3] Primarily consists of unallocated items, including cash, PP&E and the elimination of inter-segment transactions.

[4] See Note 8 for additional information.

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Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions		3 Months Ended		9 Months Ended
		Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Income (Numerator) [Abstract]
Income from continuing operations after income taxes		$ 473	$ 396	$ 1,437	$ 1,198
Less amounts allocated to participating securities		1	2	4	5
Income from continuing operations after income taxes available to PPL common shareowners - Basic		472	394	1,433	1,193
Income from continuing operations after income taxes available to PPL common shareowners - Diluted		472	394	1,433	1,193
Income (loss) from discontinued operations (net of income taxes) available to PPL common shareowners - Basic and Diluted		0	(3)	0	(915)
Net income		473	393	1,437	283
Less amounts allocated to participating securities		1	2	4	1
Net income available to PPL common shareowners - Basic		472	391	1,433	282
Net income available to PPL common shareowners - Diluted		$ 472	$ 391	$ 1,433	$ 282
Shares of Common Stock (Denominator) [Abstract]
Weighted-average shares - Basic EPS (in shares)		678,114	670,763	676,905	668,731
Add incremental non-participating securities: [Abstract]
Share-based payment awards (in shares)		2,234	2,939	3,064	2,523
Weighted-average shares - Diluted EPS (in shares)		680,348	673,702	679,969	671,254
Basic EPS - Available to PPL common shareowners: [Abstract]
Income from continuing operations after income taxes (in dollars per share)		$ 0.70	$ 0.59	$ 2.12	$ 1.78
Income (loss) from discontinued operations (net of income taxes) (in dollars per share)		0.00	(0.01)	0.00	(1.36)
Net Income Available to PPL common shareowners (in dollars per share)		0.70	0.58	2.12	0.42
Diluted EPS - Available to PPL common shareowners: [Abstract]
Income from continuing operations after income taxes (in dollars per share)		0.69	0.59	2.11	1.78
Income (loss) from discontinued operations (net of income taxes) (in dollars per share)		0.00	(0.01)	0.00	(1.36)
Net Income Available to PPL common shareowners (in dollars per share)		$ 0.69	$ 0.58	$ 2.11	$ 0.42
Shares Issued (Numeric) [Abstract]
Common stock issued under stock-based compensation plans (in shares)	[1]	248	1,368	3,168	3,805
Common stock issued under dividend reinvestment plan (in shares)		761	475	1,533	1,318
Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares excluded from the computations of diluted EPS		696	1,484	696	1,218
Performance Units [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares excluded from the computations of diluted EPS		316	0	210	49

[1] Includes stock options exercised, vesting of performance units, vesting of restricted stock and restricted stock units and conversion of stock units granted to directors.

XML

Income Taxes (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended					9 Months Ended
	Sep. 30, 2016	Sep. 30, 2016		Jun. 30, 2016	Sep. 30, 2015		Sep. 30, 2016		Sep. 30, 2015
Income Taxes [Line Items]
Benefit related to planned amendment of prior period tax return					$ 9				$ 9
Reconciliation of Income Tax Expense [Abstract]
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 35%		$ 214			$ 189		$ 681		$ 571
Federal statutory tax rate		35.00%			35.00%		35.00%		35.00%
Increase (decrease) due to: [Abstract]
State income taxes, net of federal income tax benefit		$ 13			$ 15		$ 37		$ 44
Valuation allowance adjustments		4			0		13		8
Impact of lower U.K. income tax rates		(37)			(40)		(136)		(138)
Federal and state tax reserve adjustments		0			(9)	[1]	0		(21)	[1]
Enactment of the U.K. Finance Act 2016		(42)	[2]		0		(42)	[2]	0
Depreciation not normalized		0			0		(6)		(4)
Interest benefit on U.K. financing entities		(4)			(4)		(13)		(15)
Stock-based compensation		(1)	[3]		0		(12)	[3]	0
Other		(8)			(7)		(12)		(13)
Total increase (decrease)		(75)			(45)		(171)		(139)
Total income tax		139			144		510		432
Adjustment to settled refund for the years 1998-2011									12
Future U.K. statutory income tax rate revised in current year	18.00%
U.K. statutory income tax rate reduction in year five	17.00%
Income Tax Other Numeric [Abstract]
Tax Adjustments Settlements And Unusual Provisions				$ 3	24
Refund reflected in continuing operations for open audits for the years 1998-2011					12
PPL Electric Utilities Corp [Member]
Reconciliation of Income Tax Expense [Abstract]
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 35%		$ 52			$ 32		$ 149		$ 112
Federal statutory tax rate		35.00%			35.00%		35.00%		35.00%
Increase (decrease) due to: [Abstract]
State income taxes, net of federal income tax benefit		$ 9			$ 7		$ 27		$ 21
Depreciation not normalized		(2)			(1)		(5)		(3)
Stock-based compensation		0			0		(7)	[4]	0
Other		(1)			(3)		(2)		0
Total increase (decrease)		6			3		13		18
Total income tax		58			35		162		130
LG And E And KU Energy LLC [Member]
Reconciliation of Income Tax Expense [Abstract]
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 35%		$ 74			$ 68		$ 189		$ 172
Federal statutory tax rate		35.00%			35.00%		35.00%		35.00%
Increase (decrease) due to: [Abstract]
State income taxes, net of federal income tax benefit		$ 8			$ 7		$ 20		$ 18
Amortization of investment tax credit		(1)			(1)		(2)		(2)
Valuation allowance adjustments		0			0		0		8	[5]
Stock-based compensation		(1)			0		(2)		0
Other		(1)			(1)		(3)		(2)
Total increase (decrease)		5			5		13		22
Total income tax		79			73		202		194
Louisville Gas And Electric Co [Member]
Reconciliation of Income Tax Expense [Abstract]
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 35%		$ 36			$ 33		$ 90		$ 83
Federal statutory tax rate		35.00%			35.00%		35.00%		35.00%
Increase (decrease) due to: [Abstract]
State income taxes, net of federal income tax benefit		$ 4			$ 4		$ 10		$ 9
Other		(1)			(1)		(2)		(1)
Total increase (decrease)		3			3		8		8
Total income tax		39			36		98		91
Kentucky Utilities Co [Member]
Reconciliation of Income Tax Expense [Abstract]
Federal income tax on Income from Continuing Operations Before Income Taxes at statutory tax rate - 35%		$ 44			$ 41		$ 117		$ 106
Federal statutory tax rate		35.00%			35.00%		35.00%		35.00%
Increase (decrease) due to: [Abstract]
State income taxes, net of federal income tax benefit		$ 5			$ 4		$ 12		$ 11
Other		(1)			(1)		(1)		(2)
Total increase (decrease)		4			3		11		9
Total income tax		$ 48			$ 44		$ 128		$ 115

[1] During the three and nine months ended September 30, 2015, PPL recorded a $9 million tax benefit related to a planned amendment of a prior period tax return.During the nine months ended September 30, 2015, PPL recorded a $12 million tax benefit to adjust the settled refund amount approved by the Joint Committee on Taxation for the open audit years 1998 - 2011.

[2] During the three and nine months ended September 30, 2016, PPL recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

[3] During the three and nine months ended September 30, 2016, PPL recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

[4] During the nine months ended September 30, 2016, PPL Electric recorded lower income tax expense related to the application of new stock-based compensation accounting guidance. See Note 2 for additional information.

[5] Represents a valuation allowance against tax credits expiring in 2016 and 2017 that are more likely than not to expire before being utilized.

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Utility Rate Regulation - Regulatory Assets (Details) - USD ($) $ in Millions		Sep. 30, 2016	Dec. 31, 2015
Regulatory Assets [Line Items]
Current regulatory assets	[1]	$ 30	$ 48
Noncurrent regulatory assets		1,765	1,733
Environmental Cost Recovery [Member]
Regulatory Assets [Line Items]
Current regulatory assets		4	24
Generation Formula Rate [Member]
Regulatory Assets [Line Items]
Current regulatory assets		12	7
Transmission Service Charge [Member]
Regulatory Assets [Line Items]
Current regulatory assets		8	10
Defined Benefit Plans [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		791	809
Taxes Recoverable Through Future Rates [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		333	326
Storm Costs [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		71	93
Unamortized Loss On Debt [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		62	68
Interest Rate Swaps [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		143	141
Accumulated Cost Of Removal Of Utility Plant [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		143	137
Asset Retirement Obligations [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		208	143
Other Regulatory Assets [Member]
Regulatory Assets [Line Items]
Current regulatory assets		6	7
Noncurrent regulatory assets		14	16
PPL Electric Utilities Corp [Member]
Regulatory Assets [Line Items]
Current regulatory assets	[1]	12	13
Noncurrent regulatory assets		991	1,006
PPL Electric Utilities Corp [Member] | Environmental Cost Recovery [Member]
Regulatory Assets [Line Items]
Current regulatory assets		0	0
PPL Electric Utilities Corp [Member] | Generation Formula Rate [Member]
Regulatory Assets [Line Items]
Current regulatory assets		0	0
PPL Electric Utilities Corp [Member] | Transmission Service Charge [Member]
Regulatory Assets [Line Items]
Current regulatory assets		8	10
PPL Electric Utilities Corp [Member] | Defined Benefit Plans [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		456	469
PPL Electric Utilities Corp [Member] | Taxes Recoverable Through Future Rates [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		333	326
PPL Electric Utilities Corp [Member] | Storm Costs [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		19	30
PPL Electric Utilities Corp [Member] | Unamortized Loss On Debt [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		39	42
PPL Electric Utilities Corp [Member] | Interest Rate Swaps [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		0	0
PPL Electric Utilities Corp [Member] | Accumulated Cost Of Removal Of Utility Plant [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		143	137
PPL Electric Utilities Corp [Member] | Asset Retirement Obligations [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		0	0
PPL Electric Utilities Corp [Member] | Other Regulatory Assets [Member]
Regulatory Assets [Line Items]
Current regulatory assets		4	3
Noncurrent regulatory assets		1	2
LG And E And KU Energy LLC [Member]
Regulatory Assets [Line Items]
Current regulatory assets		18	35
Noncurrent regulatory assets		774	727
LG And E And KU Energy LLC [Member] | Environmental Cost Recovery [Member]
Regulatory Assets [Line Items]
Current regulatory assets		4	24
LG And E And KU Energy LLC [Member] | Generation Formula Rate [Member]
Regulatory Assets [Line Items]
Current regulatory assets		12	7
LG And E And KU Energy LLC [Member] | Defined Benefit Plans [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		335	340
LG And E And KU Energy LLC [Member] | Storm Costs [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		52	63
LG And E And KU Energy LLC [Member] | Unamortized Loss On Debt [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		23	26
LG And E And KU Energy LLC [Member] | Interest Rate Swaps [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		143	141
LG And E And KU Energy LLC [Member] | Asset Retirement Obligations [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		208	143
LG And E And KU Energy LLC [Member] | Plant Retirement Costs [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		4	6
LG And E And KU Energy LLC [Member] | Other Regulatory Assets [Member]
Regulatory Assets [Line Items]
Current regulatory assets		2	4
Noncurrent regulatory assets		9	8
Louisville Gas And Electric Co [Member]
Regulatory Assets [Line Items]
Current regulatory assets		6	16
Noncurrent regulatory assets		437	424
Louisville Gas And Electric Co [Member] | Environmental Cost Recovery [Member]
Regulatory Assets [Line Items]
Current regulatory assets		4	13
Louisville Gas And Electric Co [Member] | Generation Formula Rate [Member]
Regulatory Assets [Line Items]
Current regulatory assets		0	0
Louisville Gas And Electric Co [Member] | Defined Benefit Plans [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		211	215
Louisville Gas And Electric Co [Member] | Storm Costs [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		29	35
Louisville Gas And Electric Co [Member] | Unamortized Loss On Debt [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		16	17
Louisville Gas And Electric Co [Member] | Interest Rate Swaps [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		102	98
Louisville Gas And Electric Co [Member] | Asset Retirement Obligations [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		77	57
Louisville Gas And Electric Co [Member] | Plant Retirement Costs [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		0	0
Louisville Gas And Electric Co [Member] | Other Regulatory Assets [Member]
Regulatory Assets [Line Items]
Current regulatory assets		2	3
Noncurrent regulatory assets		2	2
Kentucky Utilities Co [Member]
Regulatory Assets [Line Items]
Current regulatory assets		12	19
Noncurrent regulatory assets		337	303
Kentucky Utilities Co [Member] | Environmental Cost Recovery [Member]
Regulatory Assets [Line Items]
Current regulatory assets		0	11
Kentucky Utilities Co [Member] | Generation Formula Rate [Member]
Regulatory Assets [Line Items]
Current regulatory assets		12	7
Kentucky Utilities Co [Member] | Defined Benefit Plans [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		124	125
Kentucky Utilities Co [Member] | Storm Costs [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		23	28
Kentucky Utilities Co [Member] | Unamortized Loss On Debt [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		7	9
Kentucky Utilities Co [Member] | Interest Rate Swaps [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		41	43
Kentucky Utilities Co [Member] | Asset Retirement Obligations [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		131	86
Kentucky Utilities Co [Member] | Plant Retirement Costs [Member]
Regulatory Assets [Line Items]
Noncurrent regulatory assets		4	6
Kentucky Utilities Co [Member] | Other Regulatory Assets [Member]
Regulatory Assets [Line Items]
Current regulatory assets		0	1
Noncurrent regulatory assets		$ 7	$ 6

[1] These amounts are included in "Other current assets" on the Balance Sheets.

XML

Utility Rate Regulation - Regulatory Liabilities (Details) - USD ($) $ in Millions		Sep. 30, 2016	Dec. 31, 2015
Regulatory Liabilities [Line Items]
Current regulatory liabilities		$ 120	$ 145
Noncurrent regulatory liabilities		911	945
Generation Supply Charge [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		22	41
Demand Side Management [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		6	8
Gas Supply Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		0	6
Universal Service Rider [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		10	5
Transmission Formula Rate [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		25	48
Fuel Adjustment Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		14	14
Storm Damage Expense [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		13	16
Accumulated Cost Of Removal Of Utility Plant [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		698	691
Coal Contracts [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities	[1]	3	17
Power Purchase Agreement OVEC [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities	[1]	77	83
Net Deferred Tax Assets [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		23	23
Act 129 Compliance Rider [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		22	0
Noncurrent regulatory liabilities		0	22
Defined Benefit Plans [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		27	24
Interest Rate Swaps [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		80	82
Other Regulatory Liabilities [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		8	7
Noncurrent regulatory liabilities		3	3
PPL Electric Utilities Corp [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		94	113
Noncurrent regulatory liabilities		0	22
PPL Electric Utilities Corp [Member] | Generation Supply Charge [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		22	41
PPL Electric Utilities Corp [Member] | Demand Side Management [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Gas Supply Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Universal Service Rider [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		10	5
PPL Electric Utilities Corp [Member] | Transmission Formula Rate [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		25	48
PPL Electric Utilities Corp [Member] | Fuel Adjustment Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Storm Damage Expense [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		13	16
PPL Electric Utilities Corp [Member] | Accumulated Cost Of Removal Of Utility Plant [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Coal Contracts [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Power Purchase Agreement OVEC [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Net Deferred Tax Assets [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Act 129 Compliance Rider [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		22	0
Noncurrent regulatory liabilities		0	22
PPL Electric Utilities Corp [Member] | Defined Benefit Plans [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Interest Rate Swaps [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		0	0
PPL Electric Utilities Corp [Member] | Other Regulatory Liabilities [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		2	3
Noncurrent regulatory liabilities		0	0
LG And E And KU Energy LLC [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		26	32
Noncurrent regulatory liabilities		911	923
LG And E And KU Energy LLC [Member] | Demand Side Management [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		6	8
LG And E And KU Energy LLC [Member] | Gas Supply Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		0	6
LG And E And KU Energy LLC [Member] | Fuel Adjustment Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		14	14
LG And E And KU Energy LLC [Member] | Accumulated Cost Of Removal Of Utility Plant [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		698	691
LG And E And KU Energy LLC [Member] | Coal Contracts [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities	[1]	3	17
LG And E And KU Energy LLC [Member] | Power Purchase Agreement OVEC [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities	[1]	77	83
LG And E And KU Energy LLC [Member] | Net Deferred Tax Assets [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		23	23
LG And E And KU Energy LLC [Member] | Defined Benefit Plans [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		27	24
LG And E And KU Energy LLC [Member] | Interest Rate Swaps [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		80	82
LG And E And KU Energy LLC [Member] | Other Regulatory Liabilities [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		6	4
Noncurrent regulatory liabilities		3	3
Louisville Gas And Electric Co [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		7	13
Noncurrent regulatory liabilities		424	431
Louisville Gas And Electric Co [Member] | Demand Side Management [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		4	4
Louisville Gas And Electric Co [Member] | Gas Supply Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		0	6
Louisville Gas And Electric Co [Member] | Fuel Adjustment Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		2	2
Louisville Gas And Electric Co [Member] | Accumulated Cost Of Removal Of Utility Plant [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		306	301
Louisville Gas And Electric Co [Member] | Coal Contracts [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities	[1]	1	7
Louisville Gas And Electric Co [Member] | Power Purchase Agreement OVEC [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities	[1]	53	57
Louisville Gas And Electric Co [Member] | Net Deferred Tax Assets [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		23	23
Louisville Gas And Electric Co [Member] | Defined Benefit Plans [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		0	0
Louisville Gas And Electric Co [Member] | Interest Rate Swaps [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		40	41
Louisville Gas And Electric Co [Member] | Other Regulatory Liabilities [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		1	1
Noncurrent regulatory liabilities		1	2
Kentucky Utilities Co [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		19	19
Noncurrent regulatory liabilities		487	492
Kentucky Utilities Co [Member] | Demand Side Management [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		2	4
Kentucky Utilities Co [Member] | Gas Supply Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		0	0
Kentucky Utilities Co [Member] | Fuel Adjustment Clause [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		12	12
Kentucky Utilities Co [Member] | Accumulated Cost Of Removal Of Utility Plant [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		392	390
Kentucky Utilities Co [Member] | Coal Contracts [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities	[1]	2	10
Kentucky Utilities Co [Member] | Power Purchase Agreement OVEC [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities	[1]	24	26
Kentucky Utilities Co [Member] | Net Deferred Tax Assets [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		0	0
Kentucky Utilities Co [Member] | Defined Benefit Plans [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		27	24
Kentucky Utilities Co [Member] | Interest Rate Swaps [Member]
Regulatory Liabilities [Line Items]
Noncurrent regulatory liabilities		40	41
Kentucky Utilities Co [Member] | Other Regulatory Liabilities [Member]
Regulatory Liabilities [Line Items]
Current regulatory liabilities		5	3
Noncurrent regulatory liabilities		$ 2	$ 1

[1] These liabilities were recorded as offsets to certain intangible assets that were recorded at fair value upon the acquisition of LKE by PPL.

XML

Utility Rate Regulation - Regulatory Matters (Details) $ in Millions				9 Months Ended
	Nov. 23, 2016 USD ($)	Oct. 19, 2016 Integer	Aug. 08, 2016	Sep. 30, 2016 USD ($) Integer
Regulatory Matters - U.K. Activities - Ofgem Review of Line Loss Calculation (Numeric) [Abstract]
Liability at period end regarding line loss incentive/penalty				$ 31
Regulatory Matters - Pennsylvania Activities - Act 129 (Numeric) [Abstract]
Maximum amount of costs that can be recovered under the Act 129 Phase III plan				$ 313
Period over which program costs can be recovered (in years)				5 years
Minimum term of long term supply contract under Act 129 (in years)				4 years
Maximum term of long term supply contract under Act 129 (in years)				20 years
Maximum percentage of long-term contracts that can be included in the mix of PLR supply contracts under Act 129				25.00%
Kentucky Public Service Commission [Member] | Environmental Cost Recovery [Member]
Regulatory Matters - Kentucky Activities - CPCN and ECR Filings (Numeric) [Abstract]
Approved return on equity			9.80%
LGE [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Electric Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 94
Percent of increase requested in base rates with anticipated rate case filing	8.50%
LGE [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Gas Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 14
Percent of increase requested in base rates with anticipated rate case filing	4.20%
LGE [Member] | Kentucky Public Service Commission [Member] | Gas Line Tracker [Member] | Subsequent Event [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Requested return on equity	10.23%
KU [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Electric Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 103
Percent of increase requested in base rates with anticipated rate case filing	6.40%
PPL Electric Utilities Corp [Member]
Regulatory Matters - Pennsylvania Activities - Act 129 (Numeric) [Abstract]
Maximum amount of costs that can be recovered under the Act 129 Phase III plan				$ 313
Period over which program costs can be recovered (in years)				5 years
Minimum term of long term supply contract under Act 129 (in years)				4 years
Maximum term of long term supply contract under Act 129 (in years)				20 years
Maximum percentage of long-term contracts that can be included in the mix of PLR supply contracts under Act 129				25.00%
LG And E And KU Energy LLC [Member] | Kentucky Public Service Commission [Member] | Environmental Cost Recovery [Member]
Regulatory Matters - Kentucky Activities - CPCN and ECR Filings (Numeric) [Abstract]
Approved return on equity			9.80%
LG And E And KU Energy LLC [Member] | LGE [Member]
Regulatory Matters - Kentucky Activities - Gas Franchise (Numeric) [Abstract]
Franchise Agreement Term | Integer				5
Days of Notice to Modify Franchise Fee | Integer				60
Franchise Fee Cap				3.00%
LG And E And KU Energy LLC [Member] | LGE [Member] | Subsequent Event [Member]
Regulatory Matters - Kentucky Activities - Gas Franchise (Numeric) [Abstract]
Number of days for Louisville Jefferson County to file amended complaint | Integer		20
LG And E And KU Energy LLC [Member] | LGE [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Electric Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 94
Percent of increase requested in base rates with anticipated rate case filing	8.50%
LG And E And KU Energy LLC [Member] | LGE [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Gas Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 14
Percent of increase requested in base rates with anticipated rate case filing	4.20%
LG And E And KU Energy LLC [Member] | LGE [Member] | Kentucky Public Service Commission [Member] | Gas Line Tracker [Member] | Subsequent Event [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Requested return on equity	10.23%
LG And E And KU Energy LLC [Member] | KU [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Electric Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 103
Percent of increase requested in base rates with anticipated rate case filing	6.40%
Louisville Gas And Electric Co [Member]
Regulatory Matters - Kentucky Activities - Gas Franchise (Numeric) [Abstract]
Franchise Agreement Term | Integer				5
Days of Notice to Modify Franchise Fee | Integer				60
Franchise Fee Cap				3.00%
Louisville Gas And Electric Co [Member] | Subsequent Event [Member]
Regulatory Matters - Kentucky Activities - Gas Franchise (Numeric) [Abstract]
Number of days for Louisville Jefferson County to file amended complaint | Integer		20
Louisville Gas And Electric Co [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Electric Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 94
Percent of increase requested in base rates with anticipated rate case filing	8.50%
Louisville Gas And Electric Co [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Gas Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 14
Percent of increase requested in base rates with anticipated rate case filing	4.20%
Louisville Gas And Electric Co [Member] | Kentucky Public Service Commission [Member] | Environmental Cost Recovery [Member]
Regulatory Matters - Kentucky Activities - CPCN and ECR Filings (Numeric) [Abstract]
Approved return on equity			9.80%
Louisville Gas And Electric Co [Member] | Kentucky Public Service Commission [Member] | Gas Line Tracker [Member] | Subsequent Event [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Requested return on equity	10.23%
Kentucky Utilities Co [Member] | Kentucky Public Service Commission [Member] | Subsequent Event [Member] | Electric Rates [Member]
Regulatory Matters - Kentucky Activities - Rate Case Proceedings (Numeric) [Abstract]
Amount of increase requested in base rates with anticipated rate case filing	$ 103
Percent of increase requested in base rates with anticipated rate case filing	6.40%
Kentucky Utilities Co [Member] | Kentucky Public Service Commission [Member] | Environmental Cost Recovery [Member]
Regulatory Matters - Kentucky Activities - CPCN and ECR Filings (Numeric) [Abstract]
Approved return on equity			9.80%

XML

Financing Activities - Credit Arrangements (Details) £ in Millions, $ in Millions		9 Months Ended
		Sep. 30, 2016 USD ($)	Sep. 30, 2016 GBP (£)	Dec. 31, 2015 USD ($)	Dec. 31, 2015 GBP (£)
WPD PLC [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Jan. 13, 2021
Interest rate on outstanding borrowing		1.35%	1.35%	1.83%	1.83%
WPD South West [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Jul. 29, 2021
Interest rate on outstanding borrowing		0.68%	0.68%
WPD East Midlands [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Jul. 29, 2021
Interest rate on outstanding borrowing		0.66%	0.66%
WPD West Midlands [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Jul. 29, 2021
WPD [Member]
Line of Credit Facility [Line Items]
Unused capacity		$ 1,100
PPL Capital Funding [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Jan. 29, 2021
PPL Capital Funding [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Nov. 12, 2018
PPL Capital Funding [Member] | Bilateral Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Mar. 17, 2017
PPL Electric [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Jan. 29, 2021
LKE [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Oct. 31, 2018
Interest rate on outstanding borrowing				1.68%	1.68%
LGE [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Dec. 31, 2020
KU [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Dec. 31, 2020
KU [Member] | Letter Of Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Oct. 01, 2017
United Kingdom, Pounds [Member]
Line of Credit Facility [Line Items]
Capacity | £	[1]		£ 1,095
Borrowed | £	[1]		284		£ 133
Letters of credit and commercial paper issued | £	[1]		4		4
Unused capacity | £	[1]		807
United Kingdom, Pounds [Member] | WPD PLC [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity | £			210
Borrowed		$ 200	153	$ 200	133
Unused capacity | £			57
United Kingdom, Pounds [Member] | WPD South West [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity | £			245
Borrowed		131	100
Unused capacity | £			145
United Kingdom, Pounds [Member] | WPD East Midlands [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity | £			300
Borrowed		40	31
Unused capacity | £			269
United Kingdom, Pounds [Member] | WPD West Midlands [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity | £			300
Unused capacity | £			300
United Kingdom, Pounds [Member] | WPD [Member] | Uncommitted Credit Facilities [Member]
Line of Credit Facility [Line Items]
Capacity | £			40
Letters of credit and commercial paper issued | £			4		£ 4
Unused capacity | £			£ 36
United States of America, Dollars [Member] | PPL Capital Funding [Member]
Line of Credit Facility [Line Items]
Capacity		1,150
Letters of credit and commercial paper issued		17		471
Unused capacity		1,133
United States of America, Dollars [Member] | PPL Capital Funding [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		700
Letters of credit and commercial paper issued		0		151
Unused capacity		700
United States of America, Dollars [Member] | PPL Capital Funding [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		300
Letters of credit and commercial paper issued				300
Unused capacity		300
United States of America, Dollars [Member] | PPL Capital Funding [Member] | Bilateral Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		150
Letters of credit and commercial paper issued		17		20
Unused capacity		133
United States of America, Dollars [Member] | PPL Electric [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		400
Letters of credit and commercial paper issued		131		1
Unused capacity		269
United States of America, Dollars [Member] | LKE [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		75
Borrowed	[2]			75
Unused capacity		75
United States of America, Dollars [Member] | LGE [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		500
Letters of credit and commercial paper issued		128		142
Unused capacity		372
United States of America, Dollars [Member] | KU [Member]
Line of Credit Facility [Line Items]
Capacity		598
Letters of credit and commercial paper issued		205		246
Unused capacity		393
United States of America, Dollars [Member] | KU [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		400
Letters of credit and commercial paper issued		7		48
Unused capacity		393
United States of America, Dollars [Member] | KU [Member] | Letter Of Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		198
Letters of credit and commercial paper issued		$ 198		198
PPL Electric Utilities Corp [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Jan. 29, 2021
PPL Electric Utilities Corp [Member] | United States of America, Dollars [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		$ 400
Letters of credit and commercial paper issued		131		$ 1
Unused capacity		$ 269
LG And E And KU Energy LLC [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date	[2]	Oct. 31, 2018
Interest rate on outstanding borrowing				1.68%	1.68%
LG And E And KU Energy LLC [Member] | LGE [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Dec. 31, 2020
LG And E And KU Energy LLC [Member] | KU [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Dec. 31, 2020
LG And E And KU Energy LLC [Member] | KU [Member] | Letter Of Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Oct. 01, 2017
LG And E And KU Energy LLC [Member] | United States of America, Dollars [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Borrowed	[2]			$ 75
Unused capacity	[2]	$ 75
LG And E And KU Energy LLC [Member] | United States of America, Dollars [Member] | LGE [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Letters of credit and commercial paper issued				142
Unused capacity		372
LG And E And KU Energy LLC [Member] | United States of America, Dollars [Member] | KU [Member]
Line of Credit Facility [Line Items]
Capacity		598
Letters of credit and commercial paper issued		205		246
Unused capacity		393
LG And E And KU Energy LLC [Member] | United States of America, Dollars [Member] | KU [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Letters of credit and commercial paper issued				48
Unused capacity		$ 393
LG And E And KU Energy LLC [Member] | United States of America, Dollars [Member] | KU [Member] | Letter Of Credit Facility [Member]
Line of Credit Facility [Line Items]
Letters of credit and commercial paper issued				198
Louisville Gas And Electric Co [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Dec. 31, 2020
Louisville Gas And Electric Co [Member] | United States of America, Dollars [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		$ 500
Letters of credit and commercial paper issued		128		142
Unused capacity		$ 372
Kentucky Utilities Co [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Dec. 31, 2020
Kentucky Utilities Co [Member] | Letter Of Credit Facility [Member]
Line of Credit Facility [Line Items]
Expiration date		Oct. 01, 2017
Kentucky Utilities Co [Member] | United States of America, Dollars [Member]
Line of Credit Facility [Line Items]
Capacity		$ 598
Letters of credit and commercial paper issued		205		246
Unused capacity		393
Kentucky Utilities Co [Member] | United States of America, Dollars [Member] | Syndicated Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		400
Letters of credit and commercial paper issued		7		48
Unused capacity		393
Kentucky Utilities Co [Member] | United States of America, Dollars [Member] | Letter Of Credit Facility [Member]
Line of Credit Facility [Line Items]
Capacity		198
Letters of credit and commercial paper issued		$ 198		$ 198

[1] WPD plc's amounts borrowed at September 30, 2016 and December 31, 2015 were USD-denominated borrowings of $200 million for both periods, which bore interest at 1.35% and 1.83%. The unused capacity reflects the amount borrowed in GBP of £153 million as of the date borrowed. WPD (South West) amount borrowed at September 30, 2016 was a GBP-denominated borrowing which equated to $131 million and bore interest at 0.68%. WPD (East Midlands) amount borrowed at September 30, 2016 was a GBP-denominated borrowing which equated to $40 million and bore interest at 0.66%. At September 30, 2016, the unused capacity under the U.K. credit facilities was approximately $1.1 billion.

[2] LKE's interest rate on outstanding borrowings at December 31, 2015 was 1.68%.

XML

Financing Activities - Short-term Debt (Details) - Commercial Paper [Member] - USD ($) $ in Millions	Sep. 30, 2016	Dec. 31, 2015
Short-term Debt [Line Items]
Capacity	$ 2,100
Commercial paper issuances	265	$ 641
Unused capacity	1,835
PPL Capital Funding [Member]
Short-term Debt [Line Items]
Weighted-average interest rate		0.78%
Capacity	1,000
Commercial paper issuances	0	$ 451
Unused capacity	$ 1,000
PPL Electric [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.74%
Capacity	$ 400
Commercial paper issuances	130
Unused capacity	$ 270
LGE [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.73%	0.71%
Capacity	$ 350
Commercial paper issuances	128	$ 142
Unused capacity	$ 222
KU [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.66%	0.72%
Capacity	$ 350
Commercial paper issuances	7	$ 48
Unused capacity	$ 343
PPL Electric Utilities Corp [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.74%
Capacity	$ 400
Commercial paper issuances	130
Unused capacity	$ 270
LG And E And KU Energy LLC [Member] | LGE [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.73%	0.71%
Capacity	$ 350
Commercial paper issuances	128	$ 142
Unused capacity	$ 222
LG And E And KU Energy LLC [Member] | KU [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.66%	0.72%
Capacity	$ 350
Commercial paper issuances	7	$ 48
Unused capacity	$ 343
Louisville Gas And Electric Co [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.73%	0.71%
Capacity	$ 350
Commercial paper issuances	128	$ 142
Unused capacity	$ 222
Kentucky Utilities Co [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.66%	0.72%
Capacity	$ 350
Commercial paper issuances	7	$ 48
Unused capacity	$ 343

XML

Financing Activities - Long-term Debt and ATM Program (Details) $ / shares in Units, shares in Thousands, £ in Millions, $ in Millions	1 Months Ended							3 Months Ended		9 Months Ended
	Oct. 31, 2016 USD ($)	Sep. 30, 2016 USD ($)	Aug. 31, 2016	May 31, 2016 USD ($)	May 31, 2016 GBP (£)	Mar. 31, 2016 USD ($)	Feb. 26, 2015 USD ($) Integer	Sep. 30, 2016 USD ($) $ / shares shares	Sep. 30, 2015 USD ($) $ / shares shares	Sep. 30, 2016 USD ($) $ / shares shares	Sep. 30, 2015 USD ($) $ / shares shares	May 31, 2016 GBP (£)
At-the-Market Stock Offering Program (Numeric) [Abstract]
Net proceeds from issuance of common stock										$ 133	$ 145
PPL Capital Funding [Member] | Senior Notes [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount				$ 650
Stated interest rate				3.10%								3.10%
Proceeds from debt, net of issuance costs				$ 645
Maturity date				May 15, 2026	May 15, 2026
WPD East Midlands [Member] | Index Linked Term Loan [Member]
Long-term Debt (Numeric) [Abstract]
Stated interest rate				0.4975%								0.4975%
Debt instrument term (in years)				10 years	10 years
WPD PLC [Member] | Senior Notes [Member]
Long-term Debt (Numeric) [Abstract]
Stated interest rate				3.90%								3.90%
Repayments of senior debt				$ 460
PPL Electric [Member] | Senior Debt Obligations [Member] | Lehigh County Industrial Development Authority Pollution Control Revenue Refunding Bonds Series 2016A [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount						$ 116
Maturity date						Mar. 09, 2029
Interest rate at an initial term rate						0.90%
Repurchase date of debt instruments						Sep. 01, 2017
PPL Electric [Member] | Senior Debt Obligations [Member] | Lehigh County Industrial Development Authority Pollution Control Revenue Refunding Bonds Series 2016B [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount						$ 108
Maturity date						Mar. 09, 2027
Interest rate at an initial term rate						0.90%
Repurchase date of debt instruments						Aug. 15, 2017
PPL Electric [Member] | Senior Debt Obligations [Member] | Lehigh County Industrial Development Authority Pollution Control Revenue Refunding Bonds 2005 Series A [Member]
Long-term Debt (Numeric) [Abstract]
Stated interest rate						4.70%
Maturity date						Mar. 09, 2029
Repurchased face amount						$ 116
PPL Electric [Member] | Senior Debt Obligations [Member] | Lehigh County Industrial Development Authority Pollution Control Revenue Refunding Bonds 2005 Series B [Member]
Long-term Debt (Numeric) [Abstract]
Stated interest rate						4.75%
Maturity date						Mar. 09, 2027
Repurchased face amount						$ 108
PPL Electric [Member] | First Mortgage Bond [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount						224
Louisville Gas And Electric Company [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds Series 2016a [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount		$ 125						$ 125		125
Maturity date		Sep. 01, 2044
Louisville Gas And Electric Company [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds, Series 2000A [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date		Aug. 01, 2030
Repurchased face amount		$ 83						83		83
Louisville Gas And Electric Company [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds Series 2002A [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date		Oct. 01, 2032
Repurchased face amount		$ 42						42		42
Kentucky Utilities Co [Member] | Senior Debt Obligations [Member] | Carroll County Pollution Control Revenue Refunding Bonds Series 2016a [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount		$ 96						$ 96		$ 96
Stated interest rate		1.05%						1.05%		1.05%
Maturity date			Sep. 01, 2042
Repurchase date of debt instruments			Sep. 01, 2019
Kentucky Utilities Co [Member] | Senior Debt Obligations [Member] | Carroll County Pollution Control Revenue Refunding Bonds Series 2002C [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date			Oct. 01, 2032
Repurchased face amount		$ 96						$ 96		$ 96
United Kingdom, Pounds [Member] | WPD East Midlands [Member] | Index Linked Term Loan [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount | £												£ 100
Proceeds from debt, net of issuance costs | £					£ 100
PPL Electric Utilities Corp [Member] | Senior Debt Obligations [Member] | Lehigh County Industrial Development Authority Pollution Control Revenue Refunding Bonds Series 2016A [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount						$ 116
Maturity date						Mar. 09, 2029
Interest rate at an initial term rate						0.90%
Repurchase date of debt instruments						Sep. 01, 2017
PPL Electric Utilities Corp [Member] | Senior Debt Obligations [Member] | Lehigh County Industrial Development Authority Pollution Control Revenue Refunding Bonds Series 2016B [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount						$ 108
Maturity date						Mar. 09, 2027
Interest rate at an initial term rate						0.90%
Repurchase date of debt instruments						Aug. 15, 2017
PPL Electric Utilities Corp [Member] | Senior Debt Obligations [Member] | Lehigh County Industrial Development Authority Pollution Control Revenue Refunding Bonds 2005 Series A [Member]
Long-term Debt (Numeric) [Abstract]
Stated interest rate						4.70%
Maturity date						Mar. 09, 2029
Repurchased face amount						$ 116
PPL Electric Utilities Corp [Member] | Senior Debt Obligations [Member] | Lehigh County Industrial Development Authority Pollution Control Revenue Refunding Bonds 2005 Series B [Member]
Long-term Debt (Numeric) [Abstract]
Stated interest rate						4.75%
Maturity date						Mar. 09, 2027
Repurchased face amount						$ 108
PPL Electric Utilities Corp [Member] | First Mortgage Bond [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount						$ 224
LG And E And KU Energy LLC [Member] | Louisville Gas And Electric Company [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds Series 2016a [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount		$ 125						125		125
Maturity date		Sep. 01, 2044
LG And E And KU Energy LLC [Member] | Louisville Gas And Electric Company [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds, Series 2000A [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date		Aug. 01, 2030
Repurchased face amount		$ 83						83		83
LG And E And KU Energy LLC [Member] | Louisville Gas And Electric Company [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds Series 2002A [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date		Oct. 01, 2032
Repurchased face amount		$ 42						42		42
LG And E And KU Energy LLC [Member] | Kentucky Utilities Co [Member] | Senior Debt Obligations [Member] | Carroll County Pollution Control Revenue Refunding Bonds Series 2016a [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount		$ 96						$ 96		$ 96
Stated interest rate		1.05%						1.05%		1.05%
Maturity date			Sep. 01, 2042
Repurchase date of debt instruments			Sep. 01, 2019
LG And E And KU Energy LLC [Member] | Kentucky Utilities Co [Member] | Senior Debt Obligations [Member] | Carroll County Pollution Control Revenue Refunding Bonds Series 2002C [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date			Oct. 01, 2032
Repurchased face amount		$ 96						$ 96		$ 96
Louisville Gas And Electric Co [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds Series 2016a [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount		$ 125						125		125
Maturity date		Sep. 01, 2044
Louisville Gas And Electric Co [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds, Series 2000A [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date		Aug. 01, 2030
Repurchased face amount		$ 83						83		83
Louisville Gas And Electric Co [Member] | Senior Debt Obligations [Member] | Trimble County Pollution Control Revenue Refunding Bonds Series 2002A [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date		Oct. 01, 2032
Repurchased face amount		$ 42						42		42
Kentucky Utilities Co [Member] | Senior Debt Obligations [Member] | Carroll County Pollution Control Revenue Refunding Bonds Series 2016a [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount		$ 96						$ 96		$ 96
Stated interest rate		1.05%						1.05%		1.05%
Maturity date			Sep. 01, 2042
Repurchase date of debt instruments			Sep. 01, 2019
Kentucky Utilities Co [Member] | Senior Debt Obligations [Member] | Carroll County Pollution Control Revenue Refunding Bonds Series 2002C [Member]
Long-term Debt (Numeric) [Abstract]
Maturity date			Oct. 01, 2032
Repurchased face amount		$ 96						$ 96		$ 96
Subsequent Event [Member] | WPD East Midlands [Member] | Index Linked Senior Unsecured Notes [Member]
Long-term Debt (Numeric) [Abstract]
Stated interest rate	2.671%
Maturity date	Jun. 01, 2043
Proceeds from debt, including premium net of debt issuance costs	$ 101
Subsequent Event [Member] | United Kingdom, Pounds [Member] | WPD East Midlands [Member] | Index Linked Senior Unsecured Notes [Member]
Long-term Debt (Numeric) [Abstract]
Principal amount	40
Proceeds from debt, net of issuance costs	$ 83
At The Market Stock Offering Program [Member]
Equity Programs [Line Items]
Stock Issued During Period, Shares, New Issues | shares								710	436	710	858
At-the-Market Stock Offering Program (Numeric) [Abstract]
Number of distribution agreements | Integer							2
Aggregate sales price of common stock based on two separate equity distribution agreements							$ 500
Average share price | $ / shares								$ 35.23	$ 32.95	$ 35.23	$ 33.33
Net proceeds from issuance of common stock								$ 25	$ 14	$ 25	$ 28

XML

Financing Activities - Distributions (Details) - $ / shares	1 Months Ended	3 Months Ended		9 Months Ended
	Aug. 31, 2016	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Distributions (Numeric) [Abstract]
Quarterly common stock dividend declaration date	2016-08
Dividend payable date of quarterly common stock dividend	Oct. 03, 2016
Current quarterly common stock dividend (in dollars per share)	$ 0.38	$ 0.38	$ 0.3775	$ 1.14	$ 1.1225
Annualized current quarterly common stock dividend (in dollars per share)	$ 1.52

XML

Acquisitions, Development and Divestitures - Discontinued Operations (Details)
$ in Millions

1 Months Ended

3 Months Ended

9 Months Ended

Jun. 01, 2015

USD ($)

approach

Jun. 30, 2015

Sep. 30, 2016

USD ($)

Sep. 30, 2015

USD ($)

Sep. 30, 2016

USD ($)

Sep. 30, 2015

USD ($)

Discontinued Operations - Spinoff of PPL Energy Supply - Continuing Involvement (Numeric) [Abstract]

Energy purchases

$ 151

$ 177

$ 531

$ 676

Discontinued Operations - Spinoff of PPL Energy Supply - Summarized Results of Discontinued Operations (Details) [Abstract]

Income (Loss) from Discontinued Operations (net of income taxes)

0

(3)

$ 0

(915)

PPL Energy Supply Spinoff [Member]

Discontinued Operations - Spinoff of PPL Energy Supply (Numeric) [Abstract]

Effective date of spinoff

Jun. 01, 2015

Certain details of spinoff transaction

In June 2015, PPL completed the spinoff of PPL Energy Supply, which combined its competitive power generation businesses with those of Riverstone to form a new, stand-alone, publicly traded company named Talen Energy.

Initial percent ownership in new company, Talen Energy, by PPL shareowners

65.00%

Initial percent ownership in new company, Talen Energy, by Riverstone Holdings, LLC

35.00%

Discontinued Operations - Spinoff of PPL Energy Supply - Loss on Spinoff (Numeric) [Abstract]

Number of approaches | approach

3

Weighted fair value

$ 3,200

Control premium

25.00%

Number of market approaches | approach

2

Review period used in determining the control premium (in years)

5 years

Minimum transaction value reviewed in determining the control premium

$ 1,000

Carrying value of the Supply segment

4,100

Loss on spinoff

879

0

(879)

Discontinued Operations - Spinoff of PPL Energy Supply - Costs of Spinoff (Numeric) [Abstract]

Employee related costs incurred at the spinoff closing date reflected in discontinued operations

24

Third-party costs

44

Bank advisory, legal and accounting fees

31

Consulting and other costs

13

Loss on interest rate swaps recognized in discontinued operations on the statement of income

72

Loss after-tax, on interest rate swaps recognized in discontinued operations on the statement of income

42

Discontinued Operations - Spinoff of PPL Energy Supply - Continuing Involvement (Numeric) [Abstract]

Maximum period for Transition Service Agreement (in years)

2 years

Amount for services billed to spinoff

9

11

$ 29

14

Discontinued Operations - Spinoff of PPL Energy Supply - Summarized Results of Discontinued Operations (Details) [Abstract]

Operating revenues

0

1,427

Operating expenses

0

1,328

Other Income (Expense) - net

0

(22)

Interest expense

0

150

^[1]

Income (loss) before income taxes

0

(73)

Income tax expense (benefit)

3

(37)

Loss on spinoff

879

0

(879)

Income (Loss) from Discontinued Operations (net of income taxes)

(3)

(915)

PPL Energy Supply Spinoff [Member] | Talen Energy Marketing [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Continuing Involvement (Numeric) [Abstract]

Energy purchases

15

98

PPL Energy Supply Spinoff [Member] | Talen Energy Market Value [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Loss on Spinoff (Numeric) [Abstract]

Weighting

50.00%

Weighted fair value

$ 1,400

Control premium

25.00%

Midpoint of premiums received in market sales transactions reviewed

25.00%

PPL Energy Supply Spinoff [Member] | Talen Energy Market Value [Member] | Minimum [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Loss on Spinoff (Numeric) [Abstract]

Control premium

5.00%

PPL Energy Supply Spinoff [Member] | Talen Energy Market Value [Member] | Maximum [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Loss on Spinoff (Numeric) [Abstract]

Control premium

42.00%

PPL Energy Supply Spinoff [Member] | Income Discounted Cash Flow [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Loss on Spinoff (Numeric) [Abstract]

Weighting

30.00%

Weighted fair value

$ 1,100

PPL Energy Supply Spinoff [Member] | Alternative Market Comparable Company [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Loss on Spinoff (Numeric) [Abstract]

Weighting

20.00%

Weighted fair value

$ 700

Control premium

25.00%

Midpoint of premiums received in market sales transactions reviewed

25.00%

PPL Energy Supply Spinoff [Member] | Alternative Market Comparable Company [Member] | Minimum [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Loss on Spinoff (Numeric) [Abstract]

Control premium

5.00%

PPL Energy Supply Spinoff [Member] | Alternative Market Comparable Company [Member] | Maximum [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Loss on Spinoff (Numeric) [Abstract]

Control premium

42.00%

PPL Electric Utilities Corp [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Continuing Involvement (Numeric) [Abstract]

Energy purchases

129

$ 154

414

$ 519

PPL Electric Utilities Corp [Member] | PPL Energy Supply Spinoff [Member] | Talen Energy Marketing [Member]

Discontinued Operations - Spinoff of PPL Energy Supply - Continuing Involvement (Numeric) [Abstract]

Energy purchases

$ 15

$ 98

[1] Includes interest associated with the Supply segment with no additional allocation as the Supply segment was sufficiently capitalized.

XML

Acquisitions, Development and Divestitures - Development (Details) - Northeast Pocono Reliability Project [Member] $ in Millions	9 Months Ended
	Sep. 30, 2016 USD ($) kV Substation mi
Development Projects [Line Items]
Total length of the expansion project (in miles) | mi	58
Capacity of a transmission line (in kilovolts) | kV	230
Substations included in request | Substation	3
Adder to the return on equity incentive denied in ratemaking request (in basis points)	100
Project costs capitalized | $	$ 350
PPL Electric Utilities Corp [Member]
Development Projects [Line Items]
Total length of the expansion project (in miles) | mi	58
Capacity of a transmission line (in kilovolts) | kV	230
Substations included in request | Substation	3
Adder to the return on equity incentive denied in ratemaking request (in basis points)	100
Project costs capitalized | $	$ 350

XML

Defined Benefits (Details) - USD ($) $ in Millions		3 Months Ended			9 Months Ended
		Sep. 30, 2016		Sep. 30, 2015	Sep. 30, 2016		Sep. 30, 2015
Pension Benefits United States [Member]
Net Periodic Defined Benefit Costs (Credits) (Details) [Abstract]
Service cost		$ 16		$ 20	$ 49		$ 76
Interest cost		44		42	131		152
Expected return on plan assets		(57)		(56)	(171)		(201)
Amortization of: [Abstract]
Prior service cost		2		1	6		5
Actuarial loss		12		18	37		65
Net periodic defined benefit costs (credits) before settlements		17		25	52		97
Settlements		3		0	3		0
Net periodic defined benefit costs (credits)	[1]	20		25	55		97
Net period defined benefit costs reflected in discontinued operations allocated from PPL's plans to PPL Energy Supply prior to the spinoff							18
Pension Benefits United States [Member] | LKE [Member]
Defined Benefits [Line Items]
Defined Contribution Plan, Employer Discretionary Contribution Amount					66
Pension Benefits United States [Member] | LGE [Member]
Defined Benefits [Line Items]
Defined Contribution Plan, Employer Discretionary Contribution Amount					35
Pension Benefits United Kingdom [Member]
Net Periodic Defined Benefit Costs (Credits) (Details) [Abstract]
Service cost		17	[2]	21	53	[2]	60
Interest cost		58	[2]	80	182	[2]	236
Expected return on plan assets		(124)	[2]	(133)	(389)	[2]	(393)
Amortization of: [Abstract]
Prior service cost		0		0	0		0
Actuarial loss		34	[2]	39	107	[2]	118
Net periodic defined benefit costs (credits) before settlements		(15)	[2]	7	(47)	[2]	21
Settlements		0		0	0		0
Net periodic defined benefit costs (credits)	[1]	(15)	[2]	7	(47)	[2]	21
Other Postretirement Benefits United States [Member]
Net Periodic Defined Benefit Costs (Credits) (Details) [Abstract]
Service cost		2		2	6		9
Interest cost		6		6	19		20
Expected return on plan assets		(6)		(6)	(17)		(20)
Amortization of: [Abstract]
Actuarial loss		1		0	1		0
Net periodic defined benefit costs (credits)		3		2	9		9
PPL Electric Utilities Corp [Member] | PPL Services [Member]
Net Periodic Defined Benefit Costs Allocated to Subsidiary by Sponsor (Numeric) [Abstract]
Costs allocated to subsidiary by plan sponsors		6		8	17		24
LG And E And KU Energy LLC [Member] | Pension Benefits United States [Member]
Defined Benefits [Line Items]
Defined Contribution Plan, Employer Discretionary Contribution Amount					66
Net Periodic Defined Benefit Costs (Credits) (Details) [Abstract]
Service cost		6		7	18		20
Interest cost		18		17	53		51
Expected return on plan assets		(23)		(22)	(68)		(66)
Amortization of: [Abstract]
Prior service cost		2		1	6		5
Actuarial loss		5		9	15		26
Net periodic defined benefit costs (credits)		8		12	24		36
LG And E And KU Energy LLC [Member] | Pension Benefits United States [Member] | LGE [Member]
Defined Benefits [Line Items]
Defined Contribution Plan, Employer Discretionary Contribution Amount					35
LG And E And KU Energy LLC [Member] | Other Postretirement Benefits United States [Member]
Net Periodic Defined Benefit Costs (Credits) (Details) [Abstract]
Service cost		1		1	3		4
Interest cost		2		2	7		7
Expected return on plan assets		(2)		(1)	(5)		(4)
Amortization of: [Abstract]
Prior service cost		1		1	2		2
Net periodic defined benefit costs (credits)		2		3	7		9
Louisville Gas And Electric Co [Member] | LKE [Member]
Net Periodic Defined Benefit Costs Allocated to Subsidiary by Sponsor (Numeric) [Abstract]
Costs allocated to subsidiary by plan sponsors		2		3	7		10
Louisville Gas And Electric Co [Member] | Pension Benefits United States [Member]
Defined Benefits [Line Items]
Defined Contribution Plan, Employer Discretionary Contribution Amount					35
Net Periodic Defined Benefit Costs (Credits) (Details) [Abstract]
Service cost		0		0	1		1
Interest cost		4		3	11		10
Expected return on plan assets		(5)		(5)	(15)		(15)
Amortization of: [Abstract]
Prior service cost		1		1	3		2
Actuarial loss		2		3	5		9
Net periodic defined benefit costs (credits)		2		2	5		7
Kentucky Utilities Co [Member] | LKE [Member]
Net Periodic Defined Benefit Costs Allocated to Subsidiary by Sponsor (Numeric) [Abstract]
Costs allocated to subsidiary by plan sponsors		$ 2		$ 4	$ 8		$ 13

[1] For the nine months ended September 30, 2015, the total net periodic defined benefit cost includes $18 million reflected in discontinued operations related to costs allocated from PPL's plans to PPL Energy Supply prior to the spinoff.

[2] See Note 2 for a discussion of changes to the discount rate used for the U.K. Pension Plans.

XML

Commitments and Contingencies - Legal Matters and Regulatory Issues (Details) $ in Millions	9 Months Ended
	Sep. 30, 2016 USD ($) Integer claim resident coal-fired_unit mi
LGE [Member]
Legal Matters - Cane Run Environmental Claims (Numeric) [Abstract]
Number of residents that filed class action suit | resident	6
Number of miles within plant that would include a class of residents | mi	4
Number of remaining unresolved Clean Air Act violation claims after July 2014 court ruling | claim	1
Generating units retired at the Cane Run plant | coal-fired_unit	1
Additional generating units retired at the Cane Run plant | coal-fired_unit	2
Legal Matters - Mill Creek Environmental Claims (Numeric) [Abstract]
Amount agreed to fund in environmental enhancement projects | $	$ 1
LG And E And KU Energy LLC [Member] | LGE [Member]
Legal Matters - Cane Run Environmental Claims (Numeric) [Abstract]
Number of residents that filed class action suit	6
Number of miles within plant that would include a class of residents | mi	4
Number of remaining unresolved Clean Air Act violation claims after July 2014 court ruling	1
Generating units retired at the Cane Run plant	1
Additional generating units retired at the Cane Run plant	2
Legal Matters - Mill Creek Environmental Claims (Numeric) [Abstract]
Amount agreed to fund in environmental enhancement projects | $	$ 1
Louisville Gas And Electric Co [Member]
Legal Matters - Cane Run Environmental Claims (Numeric) [Abstract]
Number of residents that filed class action suit	6
Number of miles within plant that would include a class of residents | mi	4
Number of remaining unresolved Clean Air Act violation claims after July 2014 court ruling	1
Generating units retired at the Cane Run plant	1
Additional generating units retired at the Cane Run plant	2
Legal Matters - Mill Creek Environmental Claims (Numeric) [Abstract]
Amount agreed to fund in environmental enhancement projects | $	$ 1

XML

Commitments and Contingencies - Environmental Matters (Details) wood_poles in Millions, $ in Millions	9 Months Ended
	Sep. 30, 2016 USD ($) Integer wood_poles pollutant fuel_sources	Dec. 31, 2015 USD ($)
Environmental Matters - Air (Numeric) [Abstract]
Number of criteria pollutants | pollutant	6
Number of fuel sources no longer subject to reporting and emission allowance requirements | fuel_sources	18
Environmental Matters - European Union Creosote Ban (Numeric) [Abstract]
Number of poles to be replaced | wood_poles	1.4
PPL Electric Additional Sites [Member]
Environmental Matters - Superfund and Other Remediation (Numeric) [Abstract]
Environmental site accrual	$ 10	$ 10
Potential costs for remediation and other liabilities in excess of accrual	30
PPL Electric Utilities Corp [Member] | PPL Electric Additional Sites [Member]
Environmental Matters - Superfund and Other Remediation (Numeric) [Abstract]
Environmental site accrual	10	$ 10
Potential costs for remediation and other liabilities in excess of accrual	$ 30
LG And E And KU Energy LLC [Member]
Environmental Matters - Air (Numeric) [Abstract]
Number of criteria pollutants | Integer	6
Louisville Gas And Electric Co [Member]
Environmental Matters - Air (Numeric) [Abstract]
Number of criteria pollutants | Integer	6
Kentucky Utilities Co [Member]
Environmental Matters - Air (Numeric) [Abstract]
Number of criteria pollutants | Integer	6

XML

Commitments and Contingencies - Guarantees and Other Assurances (Details) - USD ($)
$ in Millions

9 Months Ended

Sep. 30, 2016

Dec. 31, 2015

Guarantor Obligations [Line Items]

Recorded liability for all guarantees

$ 22

$ 25

Other Guarantee (Numeric) [Abstract]

Maximum aggregate coverage bodily injury and property damage

$ 225

PPL Guarantee [Member] | Indemnification Guarantee [Member] | Indemnifications Related To WPD Midlands Acquisition [Member]

Guarantor Obligations [Line Items]

Maximum exposure inestimable

The maximum exposure and expiration of these indemnifications cannot be estimated because the maximum potential liability is not capped and the expiration date is not specified in the transaction documents.

PPL Guarantee [Member] | Indemnification Guarantee [Member] | Indemnifications For Entities In Liquidation Sales Of Assets [Member]

Guarantor Obligations [Line Items]

Maximum exposure

^[1]

$ 10

Expiration date

2019

PPL Guarantee [Member] | Indemnification Guarantee [Member] | Indemnifications For Entities In Liquidation Sales Of Assets [Member] | Minimum [Member]

Guarantor Obligations [Line Items]

Period that indemnifications generally expire (in years)

2 years

PPL Guarantee [Member] | Indemnification Guarantee [Member] | Indemnifications For Entities In Liquidation Sales Of Assets [Member] | Maximum [Member]

Guarantor Obligations [Line Items]

Period that indemnifications generally expire (in years)

7 years

PPL Guarantee [Member] | Financial Guarantee [Member] | WPD Guarantee Of Pension And Other Obligations Of Unconsolidated Entities [Member]

Guarantor Obligations [Line Items]

Maximum exposure

^[2]

$ 109

PPL Electric Guarantee [Member] | Indemnification Guarantee [Member] | Guarantee Of Inventory Value [Member]

Guarantor Obligations [Line Items]

Maximum exposure

^[3]

$ 15

Expiration date

2018

LKE Guarantee [Member] | Indemnification Guarantee [Member] | Indemnification Of Lease Termination And Other Divestitures [Member]

Guarantor Obligations [Line Items]

Maximum exposure

^[4]

$ 301

Term of guarantee (in years)

12

Maximum exposure of guarantee related to terminated lease specific to operational, regulatory and environmental issues

$ 200

Maximum exposure of other guarantees expiring related to a terminated lease

$ 100

LKE Guarantee [Member] | Indemnification Guarantee [Member] | Indemnification Of Lease Termination And Other Divestitures [Member] | Minimum [Member]

Guarantor Obligations [Line Items]

Expiration date

2021

LKE Guarantee [Member] | Indemnification Guarantee [Member] | Indemnification Of Lease Termination And Other Divestitures [Member] | Maximum [Member]

Guarantor Obligations [Line Items]

Expiration date

2023

LGE And KU Guarantee [Member] | Financial Guarantee [Member] | LGE And KU Guarantee Of Shortfall Related To OVEC [Member]

Guarantor Obligations [Line Items]

Maximum exposure inestimable

The maximum exposure and the expiration date of these potential obligations are not presently determinable. See "Energy Purchase Commitments" and "Guarantees and Other Assurances" in Note 13 in PPL's, LKE's, LG&E's and KU's 2015 Form 10-K for additional information on the OVEC power purchase contract.

Contingent proportionate share of OVEC's outstanding debt

$ 124

PPL Electric Utilities Corp [Member] | Indemnification Guarantee [Member] | Guarantee Of Inventory Value [Member]

Guarantor Obligations [Line Items]

Maximum exposure

$ 15

Expiration date

2018

LG And E And KU Energy LLC [Member]

Guarantor Obligations [Line Items]

Recorded liability for all guarantees

$ 17

$ 18

LG And E And KU Energy LLC [Member] | Indemnification Guarantee [Member] | Indemnification Of Lease Termination And Other Divestitures [Member]

Guarantor Obligations [Line Items]

Maximum exposure

^[4]

$ 301

Term of guarantee (in years)

12

Maximum exposure of guarantee related to terminated lease specific to operational, regulatory and environmental issues

$ 200

Maximum exposure of other guarantees expiring related to a terminated lease

$ 100

LG And E And KU Energy LLC [Member] | Indemnification Guarantee [Member] | Indemnification Of Lease Termination And Other Divestitures [Member] | Minimum [Member]

Guarantor Obligations [Line Items]

Expiration date

2021

LG And E And KU Energy LLC [Member] | Indemnification Guarantee [Member] | Indemnification Of Lease Termination And Other Divestitures [Member] | Maximum [Member]

Guarantor Obligations [Line Items]

Expiration date

2023

LG And E And KU Energy LLC [Member] | Financial Guarantee [Member] | LGE And KU Guarantee Of Shortfall Related To OVEC [Member]

Guarantor Obligations [Line Items]

Maximum exposure inestimable

The maximum exposure and the expiration date of these potential obligations are not presently determinable.

Contingent proportionate share of OVEC's outstanding debt

$ 124

Louisville Gas And Electric Co [Member] | Financial Guarantee [Member] | LGE And KU Guarantee Of Shortfall Related To OVEC [Member]

Guarantor Obligations [Line Items]

Maximum exposure inestimable

The maximum exposure and the expiration date of these potential obligations are not presently determinable.

Contingent proportionate share of OVEC's outstanding debt

$ 86

Kentucky Utilities Co [Member] | Financial Guarantee [Member] | LGE And KU Guarantee Of Shortfall Related To OVEC [Member]

Guarantor Obligations [Line Items]

Maximum exposure inestimable

The maximum exposure and the expiration date of these potential obligations are not presently determinable.

Contingent proportionate share of OVEC's outstanding debt

$ 38

[1] Indemnification to the liquidators and certain others for existing liabilities or expenses or liabilities arising during the liquidation process. The indemnifications are limited to distributions made from the subsidiary to its parent either prior or subsequent to liquidation or are not explicitly stated in the agreements. The indemnifications generally expire two to seven years subsequent to the date of dissolution of the entities. The exposure noted only includes those cases where the agreements provide for specific limits.In connection with their sales of various businesses, WPD and its affiliates have provided the purchasers with indemnifications that are standard for such transactions, including indemnifications for certain pre-existing liabilities and environmental and tax matters or have agreed to continue their obligations under existing third-party guarantees, either for a set period of time following the transactions or upon the condition that the purchasers make reasonable efforts to terminate the guarantees. Additionally, WPD and its affiliates remain secondarily responsible for lease payments under certain leases that they have assigned to third parties.

[2] Relates to certain obligations of discontinued or modified electric associations that were guaranteed at the time of privatization by the participating members. Costs are allocated to the members and can be reallocated if an existing member becomes insolvent. At September 30, 2016, WPD has recorded an estimated discounted liability for which the expected payment/performance is probable. Neither the expiration date nor the maximum amount of potential payments for certain obligations is explicitly stated in the related agreements, and as a result, the exposure has been estimated.

[3] A third party logistics firm provides inventory procurement and fulfillment services. The logistics firm has title to the inventory, however, upon termination of the contracts, PPL Electric has guaranteed to purchase any remaining inventory that has not been used or sold.

[4] LKE provides certain indemnifications covering the due and punctual payment, performance and discharge by each party of its respective obligations. The most comprehensive of these guarantees is the LKE guarantee covering operational, regulatory and environmental commitments and indemnifications made by WKE under a 2009 Transaction Termination Agreement. This guarantee has a term of 12 years ending July 2021, and a maximum exposure of $200 million, exclusive of certain items such as government fines and penalties that fall outside the cap. Another WKE-related LKE guarantee covers other indemnifications related to the purchase price of excess power, has a term expiring in 2023, and a maximum exposure of $100 million. In May 2012, LKE's indemnitee received an unfavorable arbitration panel's decision interpreting this matter. In October 2014, LKE's indemnitee filed a motion for discretionary review with the Kentucky Supreme Court seeking to overturn the arbitration decision, and such motion was denied by the court in September 2015. In September 2015, a counterparty issued a demand letter to LKE's indemnitee. In February 2016, the counterparty filed a complaint in Henderson, Kentucky Circuit Court, seeking an award of damages in the matter. The proceeding is currently in the discovery phase. LKE does not believe appropriate contractual, legal or commercial grounds exist for the claim made and has disputed the demands. LKE believes its indemnification obligations in the WKE matter remain subject to various uncertainties, including additional legal and contractual developments, as well as future prices, availability and demand for the subject excess power. Although the parties have also conducted certain settlement discussions, the ultimate outcomes of the WKE termination-related indemnifications cannot be predicted at this time. Additionally, LKE has indemnified various third parties related to historical obligations for other divested subsidiaries and affiliates. The indemnifications vary by entity and the maximum exposures range from being capped at the sale price to no specified maximum, and LKE could be required to perform on these indemnifications in the event of covered losses or liabilities being claimed by an indemnified party. LKE cannot predict the ultimate outcomes of the various indemnification scenarios, but does not expect such outcomes to result in significant losses above the amounts recorded.

XML

Related Party Transactions (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
PPL Electric Utilities Corp [Member] | PPL Services [Member]
Support Costs (Details) [Abstract]
Support cost allocations from subsidiary of parent to registrant	$ 33	$ 35	$ 98	$ 90
PPL Electric Utilities Corp [Member] | PPL EU Services [Member]
Support Costs (Details) [Abstract]
Support cost allocations from subsidiary of parent to registrant	17	12	50	44
LG And E And KU Energy LLC [Member]
Intercompany Borrowings (Numeric) [Abstract]
Notes payable to affiliates	138		138		$ 54
Long-term debt to affiliate	400		400		$ 400
LG And E And KU Energy LLC [Member] | PPL Services [Member]
Support Costs (Details) [Abstract]
Support cost allocations from subsidiary of parent to registrant	4	4	13	12
LG And E And KU Energy LLC [Member] | PPL Energy Funding [Member]
Intercompany Borrowings (Numeric) [Abstract]
Intercompany note with affiliate maximum borrowing capacity	225		$ 225
Intercompany borrowings demand note rate on outstanding borrowing			2.02%		1.74%
LG And E And KU Energy LLC [Member] | PPL Affiliate [Member]
Intercompany Borrowings (Numeric) [Abstract]
Debt instrument term (in years)			10 years		10 years
Long-term debt to affiliate	$ 400		$ 400		$ 400
Interest rate on ten-year note	3.50%		3.50%		3.50%
Louisville Gas And Electric Co [Member] | LKS [Member]
Intercompany Billings by LKS (Details) [Abstract]
Intercompany billings between affiliates	$ 40	36	$ 128	107
Kentucky Utilities Co [Member] | LKS [Member]
Intercompany Billings by LKS (Details) [Abstract]
Intercompany billings between affiliates	$ 46	$ 43	$ 151	$ 127

XML

Fair Value Measurements - Assets and Liabilities Measured on Recurring Basis Table (Details) - Recurring Fair Value Measurements [Member] - USD ($) $ in Millions		Sep. 30, 2016	Dec. 31, 2015
Assets
Cash and cash equivalents		$ 416	$ 836
Restricted cash and cash equivalents	[1]	29	33
Price risk management assets:
Foreign currency contracts assets	[2]	110	209
Cross-currency swaps assets	[2]	153	86
Total price risk management assets	[2]	263	295
Auction rate securities		0	2	[3]
Total assets		708	1,166
Price risk management liabilities:
Interest rate swaps liabilities	[2]	54	71
Foreign currency contracts liabilities	[2]	14	1
Total price risk management liabilities	[2]	68	72
Level 1 [Member]
Assets
Cash and cash equivalents		416	836
Restricted cash and cash equivalents	[1]	29	33
Price risk management assets:
Foreign currency contracts assets		0	0
Cross-currency swaps assets		0	0
Total price risk management assets		0	0
Auction rate securities		0	0
Total assets		445	869
Price risk management liabilities:
Interest rate swaps liabilities		0	0
Foreign currency contracts liabilities		0	0
Total price risk management liabilities		0	0
Level 2 [Member]
Assets
Cash and cash equivalents		0	0
Restricted cash and cash equivalents		0	0
Price risk management assets:
Foreign currency contracts assets	[2]	110	209
Cross-currency swaps assets	[2]	153	86
Total price risk management assets	[2]	263	295
Auction rate securities		0	0
Total assets		263	295
Price risk management liabilities:
Interest rate swaps liabilities	[2]	54	71
Foreign currency contracts liabilities	[2]	14	1
Total price risk management liabilities	[2]	68	72
Level 3 [Member]
Assets
Cash and cash equivalents		0	0
Restricted cash and cash equivalents		0	0
Price risk management assets:
Foreign currency contracts assets		0	0
Cross-currency swaps assets		0	0
Total price risk management assets		0	0
Auction rate securities		0	2	[3]
Total assets		0	2
Price risk management liabilities:
Interest rate swaps liabilities		0	0
Foreign currency contracts liabilities		0	0
Total price risk management liabilities		0	0
PPL Electric Utilities Corp [Member]
Assets
Cash and cash equivalents		36	47
Restricted cash and cash equivalents	[1]	2	2
Price risk management assets:
Total assets		38	49
PPL Electric Utilities Corp [Member] | Level 1 [Member]
Assets
Cash and cash equivalents		36	47
Restricted cash and cash equivalents	[1]	2	2
Price risk management assets:
Total assets		38	49
PPL Electric Utilities Corp [Member] | Level 2 [Member]
Assets
Cash and cash equivalents		0	0
Restricted cash and cash equivalents		0	0
Price risk management assets:
Total assets		0	0
PPL Electric Utilities Corp [Member] | Level 3 [Member]
Assets
Cash and cash equivalents		0	0
Restricted cash and cash equivalents		0	0
Price risk management assets:
Total assets		0	0
LG And E And KU Energy LLC [Member]
Assets
Cash and cash equivalents		11	30
Cash collateral posted to counterparties	[4]	8	9
Price risk management assets:
Total assets		19	39
Price risk management liabilities:
Interest rate swaps liabilities		54	47
Total price risk management liabilities		54	47
LG And E And KU Energy LLC [Member] | Level 1 [Member]
Assets
Cash and cash equivalents		11	30
Cash collateral posted to counterparties	[4]	8	9
Price risk management assets:
Total assets		19	39
Price risk management liabilities:
Interest rate swaps liabilities		0	0
Total price risk management liabilities		0	0
LG And E And KU Energy LLC [Member] | Level 2 [Member]
Assets
Cash and cash equivalents		0	0
Cash collateral posted to counterparties		0	0
Price risk management assets:
Total assets		0	0
Price risk management liabilities:
Interest rate swaps liabilities		54	47
Total price risk management liabilities		54	47
LG And E And KU Energy LLC [Member] | Level 3 [Member]
Assets
Cash and cash equivalents		0	0
Cash collateral posted to counterparties		0	0
Price risk management assets:
Total assets		0	0
Price risk management liabilities:
Interest rate swaps liabilities		0	0
Total price risk management liabilities		0	0
Louisville Gas And Electric Co [Member]
Assets
Cash and cash equivalents		4	19
Cash collateral posted to counterparties	[4]	8	9
Price risk management assets:
Total assets		12	28
Price risk management liabilities:
Interest rate swaps liabilities		54	47
Total price risk management liabilities		54	47
Louisville Gas And Electric Co [Member] | Level 1 [Member]
Assets
Cash and cash equivalents		4	19
Cash collateral posted to counterparties	[4]	8	9
Price risk management assets:
Total assets		12	28
Price risk management liabilities:
Interest rate swaps liabilities		0	0
Total price risk management liabilities		0	0
Louisville Gas And Electric Co [Member] | Level 2 [Member]
Assets
Cash and cash equivalents		0	0
Cash collateral posted to counterparties		0	0
Price risk management assets:
Total assets		0	0
Price risk management liabilities:
Interest rate swaps liabilities		54	47
Total price risk management liabilities		54	47
Louisville Gas And Electric Co [Member] | Level 3 [Member]
Assets
Cash and cash equivalents		0	0
Cash collateral posted to counterparties		0	0
Price risk management assets:
Total assets		0	0
Price risk management liabilities:
Interest rate swaps liabilities		0	0
Total price risk management liabilities		0	0
Kentucky Utilities Co [Member]
Assets
Cash and cash equivalents		7	11
Price risk management assets:
Total assets		7	11
Kentucky Utilities Co [Member] | Level 1 [Member]
Assets
Cash and cash equivalents		7	11
Price risk management assets:
Total assets		7	11
Kentucky Utilities Co [Member] | Level 2 [Member]
Assets
Cash and cash equivalents		0	0
Price risk management assets:
Total assets		0	0
Kentucky Utilities Co [Member] | Level 3 [Member]
Assets
Cash and cash equivalents		0	0
Price risk management assets:
Total assets		$ 0	$ 0

[1] Current portion is included in "Other current assets" and long-term portion is included in "Other noncurrent assets" on the Balance Sheets.

[2] Current portion is included in "Price risk management assets" and "Other current liabilities" and noncurrent portion is included in "Price risk management assets" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

[3] Included in "Other noncurrent assets" on the Balance Sheets.

[4] Included in "Other noncurrent assets" on the Balance Sheets. Represents cash collateral posted to offset the exposure with counterparties related to certain interest rate swaps under master netting arrangements that are not offset.

XML

Fair Value Measurements - Financial Instruments Not Recorded at Fair Value (Details) - USD ($) $ in Millions		Sep. 30, 2016	Dec. 31, 2015
Carrying Amount [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt	[1]	$ 18,512	$ 19,048
Fair Value [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt		23,180	21,218
PPL Electric Utilities Corp [Member] | Carrying Amount [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt	[1]	2,831	2,828
PPL Electric Utilities Corp [Member] | Fair Value [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt		3,372	3,088
LG And E And KU Energy LLC [Member] | Carrying Amount [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt	[1]	5,089	5,088
LG And E And KU Energy LLC [Member] | Fair Value [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt		5,832	5,384
Louisville Gas And Electric Co [Member] | Carrying Amount [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt	[1]	1,642	1,642
Louisville Gas And Electric Co [Member] | Fair Value [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt		1,852	1,704
Kentucky Utilities Co [Member] | Carrying Amount [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt	[1]	2,327	2,326
Kentucky Utilities Co [Member] | Fair Value [Member]
Fair Value of Financial Instruments Not Recorded at Fair Value - Other
Long-term debt		$ 2,701	$ 2,467

[1] Amounts are net of debt issuance costs.

XML

Derivative Instruments and Hedging Activities - Intro (Details) - USD ($) $ in Millions	Sep. 30, 2016	Dec. 31, 2015
Master Netting Arrangements (Numeric) [Line Items]
Cash collateral posted under master netting arrangements	$ 8	$ 9
LG And E And KU Energy LLC [Member]
Master Netting Arrangements (Numeric) [Line Items]
Cash collateral posted under master netting arrangements	8	9
Louisville Gas And Electric Co [Member]
Master Netting Arrangements (Numeric) [Line Items]
Cash collateral posted under master netting arrangements	$ 8	$ 9

XML

Derivative Instruments and Hedging Activities - Risk Disclosures (Details)
$ in Millions, £ in Billions

1 Months Ended

3 Months Ended

9 Months Ended

12 Months Ended

May 31, 2016

USD ($)

Sep. 30, 2016

USD ($)

Sep. 30, 2016

USD ($)

Dec. 31, 2015

USD ($)

Sep. 30, 2016

GBP (£)

Interest Rate Risk - Cash Flow Hedges (Numeric) [Abstract]

Repayment of senior notes

$ 460

Cash Flow Hedges [Member] | Cross Currency Interest Rate Swap Contracts [Member]

Interest Rate Risk And Foreign Currency Risk [Line Items]

Notional amount

$ 802

$ 802

Interest Rate Risk - Cash Flow Hedges (Numeric) [Abstract]

Earliest maturity date of cross-currency cash flow hedge contracts

2017

Latest maturity date of cross-currency cash flow hedge contracts

2028

Notional amount matured

460

$ 460

Gain (loss) recognized in income upon settlement of cross-currency interest rate swap contracts

$ 46

Cash Flow Hedges [Member] | Interest Rate Swap Contracts [Member]

Interest Rate Risk - Cash Flow Hedges (Numeric) [Abstract]

Insignificant or no hedge ineffectiveness associated with interest rate cash flow hedges

For the three months ended September 30, 2016, PPL had no hedge ineffectiveness associated with interest rate derivatives and an insignificant amount of hedge ineffectiveness for the three months ended September 30, 2015. For the nine months ended September 30, 2016 and 2015, PPL had an insignificant amount of ineffectiveness associated with interest rate derivatives.

No or insignificant after-tax gains (losses) previously recorded in AOCI reclassified to earnings related to interest rate cash flow hedge contracts

PPL had no cash flow hedges reclassified into earnings associated with discontinued cash flow hedges for the three and nine months ended September 30, 2016.

No or insignificant unrealized after-tax gains (losses) on interest rate cash flow hedge contracts expected to be reclassified into earnings during next 12 months

At September 30, 2016, the accumulated net unrecognized after-tax gains (losses) on qualifying derivatives that are expected to be reclassified into earnings during the next 12 months were insignificant.

Economic Hedges [Member] | Interest Rate Swap Contracts [Member]

Interest Rate Risk And Foreign Currency Risk [Line Items]

Notional amount

179

$ 179

Interest Rate Risk - Economic Activity (Numeric) [Abstract]

Year of expiration of the maximum maturity date of interest rate economic activity contracts

2033

Economic Hedges [Member] | Foreign Currency Contracts [Member]

Foreign Currency Risk - Economic Activity (Numeric) [Abstract]

Total exposure hedged related to foreign currency contracts for anticipated earnings hedges classified as economic activity

2,400

$ 2,400

£ 1.8

Earliest termination date of foreign currency contracts for anticipated earnings hedges classified as economic activity

October 2016

Latest termination date of foreign currency contracts for anticipated earnings hedges classified as economic activity

December 2018

Cash received on hedge settlement

310

Economic Hedges [Member] | Foreign Currency Contracts [Member] | 2017 And 2018 Hedges [Member]

Interest Rate Risk And Foreign Currency Risk [Line Items]

Notional amount

2,000

$ 2,000

£ 1.3

Foreign Currency Risk - Economic Activity (Numeric) [Abstract]

Earliest termination date of foreign currency contracts for anticipated earnings hedges classified as economic activity

January 2017

Latest termination date of foreign currency contracts for anticipated earnings hedges classified as economic activity

November 2018

Net Investment Hedges [Member] | Combined Foreign Currency Contracts And Intercompany Loans [Member]

Foreign Currency Risk - Net Investment Hedges (Numeric) [Abstract]

Net after tax gains (losses) on net investment hedges recognized in the foreign currency translation adjustment component of AOCI

$ 22

$ 19

LG And E And KU Energy LLC [Member] | Economic Hedges [Member] | Interest Rate Swap Contracts [Member]

Interest Rate Risk And Foreign Currency Risk [Line Items]

Notional amount

179

$ 179

Interest Rate Risk - Economic Activity (Numeric) [Abstract]

Year of expiration of the maximum maturity date of interest rate economic activity contracts

2033

Louisville Gas And Electric Co [Member] | Economic Hedges [Member] | Interest Rate Swap Contracts [Member]

Interest Rate Risk And Foreign Currency Risk [Line Items]

Notional amount

$ 179

$ 179

Interest Rate Risk - Economic Activity (Numeric) [Abstract]

Year of expiration of the maximum maturity date of interest rate economic activity contracts

2033

XML

Derivative Instruments and Hedging Activities - Fair Values (Details) - USD ($) $ in Millions		Sep. 30, 2016		Dec. 31, 2015
Designated As Hedging Instruments [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		$ 153		$ 96
Liability value		0		24
Designated As Hedging Instruments [Member] | Current Assets [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value	[1]	6		45
Designated As Hedging Instruments [Member] | Current Assets [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Designated As Hedging Instruments [Member] | Current Assets [Member] | Cross Currency Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value	[1],[2]	6		35
Designated As Hedging Instruments [Member] | Current Assets [Member] | Foreign Currency Contracts [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		10	[1]
Designated As Hedging Instruments [Member] | Noncurrent Assets [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value	[1]	147		51
Designated As Hedging Instruments [Member] | Noncurrent Assets [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Designated As Hedging Instruments [Member] | Noncurrent Assets [Member] | Cross Currency Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value	[1],[2]	147		51
Designated As Hedging Instruments [Member] | Noncurrent Assets [Member] | Foreign Currency Contracts [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Designated As Hedging Instruments [Member] | Current Liabilities [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		24	[1]
Designated As Hedging Instruments [Member] | Current Liabilities [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		24	[1],[2]
Designated As Hedging Instruments [Member] | Current Liabilities [Member] | Cross Currency Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		0
Designated As Hedging Instruments [Member] | Current Liabilities [Member] | Foreign Currency Contracts [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		0
Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		0
Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		0
Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member] | Cross Currency Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		0
Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member] | Foreign Currency Contracts [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		0
Not Designated As Hedging Instruments [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		110		199
Liability value		68		48
Not Designated As Hedging Instruments [Member] | Current Assets [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value	[1]	72		94
Not Designated As Hedging Instruments [Member] | Current Assets [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Not Designated As Hedging Instruments [Member] | Current Assets [Member] | Cross Currency Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Not Designated As Hedging Instruments [Member] | Current Assets [Member] | Foreign Currency Contracts [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value	[1]	72		94
Not Designated As Hedging Instruments [Member] | Noncurrent Assets [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value	[1]	38		105
Not Designated As Hedging Instruments [Member] | Noncurrent Assets [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Not Designated As Hedging Instruments [Member] | Noncurrent Assets [Member] | Cross Currency Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Not Designated As Hedging Instruments [Member] | Noncurrent Assets [Member] | Foreign Currency Contracts [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value	[1]	38		105
Not Designated As Hedging Instruments [Member] | Current Liabilities [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value	[1]	8		6
Not Designated As Hedging Instruments [Member] | Current Liabilities [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value	[1],[2]	6		5
Not Designated As Hedging Instruments [Member] | Current Liabilities [Member] | Cross Currency Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		0
Not Designated As Hedging Instruments [Member] | Current Liabilities [Member] | Foreign Currency Contracts [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value	[1]	2		1
Not Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value	[1]	60		42
Not Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value	[1],[2]	48		42
Not Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member] | Cross Currency Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		0		0
Not Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member] | Foreign Currency Contracts [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		12	[1]	0
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Liability value		54		47
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Current Assets [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Current Assets [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Noncurrent Assets [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Noncurrent Assets [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Current Liabilities [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		6		5
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Current Liabilities [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		6		5
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		48		42
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		48		42
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Liability value		54		47
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Current Assets [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Current Assets [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Noncurrent Assets [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Noncurrent Assets [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Asset value		0		0
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Current Liabilities [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		6		5
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Current Liabilities [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		6		5
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		48		42
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Noncurrent Liabilities [Member] | Interest Rate Swaps [Member]
Fair Values by Balance Sheet Location [Abstract]
Liability value		$ 48		$ 42

[1] Current portion is included in "Price risk management assets" and "Other current liabilities" and noncurrent portion is included in "Price risk management assets" and "Other deferred credits and noncurrent liabilities" on the Balance Sheets.

[2] Excludes accrued interest, if applicable.

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Derivative Instruments and Hedging Activities - Gains and Losses (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Cash Flow Hedges [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) reclassified from AOCI into income (effective portion)	$ 86	$ (13)	$ 77	$ 27
Gain (loss) recognized in income on derivative (ineffective portion and amount excluded from effectiveness testing)	0	0	0	(70)
Cash Flow Hedges [Member] | Other Comprehensive Income (Loss) [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Derivative gain (loss) recognized in OCI (effective portion)	78	(30)	66	4
Cash Flow Hedges [Member] | Interest Rate Swaps [Member] | Other Comprehensive Income (Loss) [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Derivative gain (loss) recognized in OCI (effective portion)	0	(27)	(21)	(29)
Cash Flow Hedges [Member] | Interest Rate Swaps [Member] | Interest Expense [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) reclassified from AOCI into income (effective portion)	(2)	(2)	(5)	(9)
Gain (loss) recognized in income on derivative (ineffective portion and amount excluded from effectiveness testing)	0	0	0	0
Cash Flow Hedges [Member] | Interest Rate Swaps [Member] | Discontinued Operations [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) reclassified from AOCI into income (effective portion)		0		0
Gain (loss) recognized in income on derivative (ineffective portion and amount excluded from effectiveness testing)		0		(77)
Cash Flow Hedges [Member] | Cross Currency Swaps [Member] | Other Comprehensive Income (Loss) [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Derivative gain (loss) recognized in OCI (effective portion)	78	(3)	87	33
Cash Flow Hedges [Member] | Cross Currency Swaps [Member] | Interest Expense [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) reclassified from AOCI into income (effective portion)	2	(1)	2	1
Gain (loss) recognized in income on derivative (ineffective portion and amount excluded from effectiveness testing)	0	0	0	0
Cash Flow Hedges [Member] | Cross Currency Swaps [Member] | Other Income (Expense) Net [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) reclassified from AOCI into income (effective portion)	86	(10)	80	22
Gain (loss) recognized in income on derivative (ineffective portion and amount excluded from effectiveness testing)	0	0	0	0
Cash Flow Hedges [Member] | Commodity Contracts [Member] | Other Comprehensive Income (Loss) [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Derivative gain (loss) recognized in OCI (effective portion)		0		0
Cash Flow Hedges [Member] | Commodity Contracts [Member] | Discontinued Operations [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) reclassified from AOCI into income (effective portion)		0		13
Gain (loss) recognized in income on derivative (ineffective portion and amount excluded from effectiveness testing)		0		7
Net Investment Hedges [Member] | Foreign Currency Contracts [Member] | Other Comprehensive Income (Loss) [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Derivative gain (loss) recognized in OCI (effective portion)	0	7	4	6
Not Designated As Hedging Instruments [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized in income on derivative	47	76	274	58
Not Designated As Hedging Instruments [Member] | Foreign Currency Contracts [Member] | Other Income (Expense) Net [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized in income on derivative	49	78	280	64
Not Designated As Hedging Instruments [Member] | Interest Rate Swaps [Member] | Regulatory Assets Noncurrent [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized as regulatory liabilities/assets	2	(5)	(7)	(2)
Not Designated As Hedging Instruments [Member] | Interest Rate Swaps [Member] | Interest Expense [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized in income on derivative	(2)	(2)	(6)	(6)
Designated As Hedging Instruments [Member] | Interest Rate Swaps [Member] | Regulatory Assets Noncurrent [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized as regulatory liabilities/assets		(42)		(22)
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Interest Rate Swaps [Member] | Regulatory Assets Noncurrent [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized as regulatory liabilities/assets	2	(5)	(7)	(2)
LG And E And KU Energy LLC [Member] | Not Designated As Hedging Instruments [Member] | Interest Rate Swaps [Member] | Interest Expense [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized in income on derivative	(2)	(2)	(6)	(6)
LG And E And KU Energy LLC [Member] | Designated As Hedging Instruments [Member] | Cash Flow Hedges [Member] | Interest Rate Swaps [Member] | Regulatory Assets Noncurrent [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized as regulatory liabilities/assets		(42)		(22)
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Interest Rate Swaps [Member] | Regulatory Assets Noncurrent [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized as regulatory liabilities/assets	2	(5)	(7)	(2)
Louisville Gas And Electric Co [Member] | Not Designated As Hedging Instruments [Member] | Interest Rate Swaps [Member] | Interest Expense [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized in income on derivative	$ (2)	(2)	$ (6)	(6)
Louisville Gas And Electric Co [Member] | Designated As Hedging Instruments [Member] | Cash Flow Hedges [Member] | Interest Rate Swaps [Member] | Regulatory Assets Noncurrent [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized as regulatory liabilities/assets		(21)		(11)
Kentucky Utilities Co [Member] | Designated As Hedging Instruments [Member] | Cash Flow Hedges [Member] | Interest Rate Swaps [Member] | Regulatory Assets Noncurrent [Member]
Amounts Included in Income, OCI or Regulatory Liabilities/Assets [Abstract]
Gain (loss) recognized as regulatory liabilities/assets		$ (21)		$ (11)

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Derivative Instruments and Hedging Activities - Offsetting Derivative Instruments and Credit Risk-Related Features (Details) - USD ($) $ in Millions		Sep. 30, 2016	Dec. 31, 2015
Credit Risk-Related Contingent Features [Abstract]
Aggregate fair value of derivative instruments in a net liability position with credit risk-related contingent features		$ 29
Aggregate fair value of collateral posted on these derivative instruments		7
Aggregate fair value of additional collateral requirements in the event of a credit downgrade below investment grade	[1]	22
Treasury Derivatives [Member]
Assets [Abstract]
Gross		263	$ 295
Derivative instruments - eligible for offset		14	25
Cash collateral received - eligible for offset		0	0
Net		249	270
Liabilities [Abstract]
Gross		68	72
Derivative instruments - eligible for offset		14	25
Cash collateral pledged - eligible for offset		8	9
Net		46	38
LG And E And KU Energy LLC [Member]
Credit Risk-Related Contingent Features [Abstract]
Aggregate fair value of derivative instruments in a net liability position with credit risk-related contingent features		29
Aggregate fair value of collateral posted on these derivative instruments		7
Aggregate fair value of additional collateral requirements in the event of a credit downgrade below investment grade	[1]	22
LG And E And KU Energy LLC [Member] | Treasury Derivatives [Member]
Liabilities [Abstract]
Gross		54	47
Cash collateral pledged - eligible for offset		8	9
Net		46	38
Louisville Gas And Electric Co [Member]
Credit Risk-Related Contingent Features [Abstract]
Aggregate fair value of derivative instruments in a net liability position with credit risk-related contingent features		29
Aggregate fair value of collateral posted on these derivative instruments		7
Aggregate fair value of additional collateral requirements in the event of a credit downgrade below investment grade	[1]	22
Louisville Gas And Electric Co [Member] | Treasury Derivatives [Member]
Liabilities [Abstract]
Gross		54	47
Cash collateral pledged - eligible for offset		8	9
Net		$ 46	$ 38

[1] Includes the effect of net receivables and payables already recorded on the Balance Sheet.

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Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets (Details) $ in Millions	9 Months Ended
	Sep. 30, 2016 USD ($)
Easements [Member]
Indefinite-Lived Intangible Assets [Line Items]
Change in other intangible assets during the period	$ 73

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Asset Retirement Obligations (Details) $ in Millions	9 Months Ended
	Sep. 30, 2016 USD ($)
Asset Retirement Obligation [Roll Forward]
Balance at Beginning of Period	$ 586
Accretion	20
Effect of foreign currency exchange rates	(7)
Changes in estimated timing or cost	(116)
Obligations settled	(15)
Balance at End of Period	468
LG And E And KU Energy LLC [Member]
Asset Retirement Obligation [Roll Forward]
Balance at Beginning of Period	535
Accretion	18
Changes in estimated timing or cost	(116)
Obligations settled	(15)
Balance at End of Period	422
Decrease to the asset retirement obligation due to revisions in the amounts and timing of future expected cash flows related to the closure of CCR impoundments	118
Louisville Gas And Electric Co [Member]
Asset Retirement Obligation [Roll Forward]
Balance at Beginning of Period	175
Accretion	6
Changes in estimated timing or cost	(24)
Obligations settled	(11)
Balance at End of Period	146
Decrease to the asset retirement obligation due to revisions in the amounts and timing of future expected cash flows related to the closure of CCR impoundments	24
Kentucky Utilities Co [Member]
Asset Retirement Obligation [Roll Forward]
Balance at Beginning of Period	360
Accretion	12
Changes in estimated timing or cost	(92)
Obligations settled	(4)
Balance at End of Period	276
Decrease to the asset retirement obligation due to revisions in the amounts and timing of future expected cash flows related to the closure of CCR impoundments	$ 94

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Accumulated Other Comprehensive Income (Loss) - After-tax Changes by Component (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	$ (2,857)	$ (2,284)	$ (2,728)	$ (2,274)
Amounts arising during the period	(585)	33	(784)	(36)
Reclassifications from accumulated other comprehensive income	(38)	45	32	128
Net other comprehensive income during the period	(623)	78	(752)	92
Distribution of PPL Energy Supply				(24)
Balance at end of period	(3,480)	(2,206)	(3,480)	(2,206)
Foreign Currency Translation Adjustments [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(716)	(435)	(520)	(286)
Amounts arising during the period	(641)	52	(837)	(97)
Reclassifications from accumulated other comprehensive income	0	0	0	0
Net other comprehensive income during the period	(641)	52	(837)	(97)
Distribution of PPL Energy Supply				0
Balance at end of period	(1,357)	(383)	(1,357)	(383)
Available For Sale Securities Unrealized Gains (Losses) [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	0	0	0	202
Amounts arising during the period	0	0	0	7
Reclassifications from accumulated other comprehensive income	0	0	0	(2)
Net other comprehensive income during the period	0	0	0	5
Distribution of PPL Energy Supply				(207)
Balance at end of period	0	0	0	0
Qualifying Derivatives Unrealized Gains (Losses) [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(5)	2	(7)	20
Amounts arising during the period	62	(19)	57	8
Reclassifications from accumulated other comprehensive income	(69)	10	(62)	20
Net other comprehensive income during the period	(7)	(9)	(5)	28
Distribution of PPL Energy Supply				(55)
Balance at end of period	(12)	(7)	(12)	(7)
Equity Investees Accumulated Other Comprehensive Income [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(1)	0	0	1
Amounts arising during the period	0	0	0	0
Reclassifications from accumulated other comprehensive income	0	0	(1)	(1)
Net other comprehensive income during the period	0	0	(1)	(1)
Distribution of PPL Energy Supply				0
Balance at end of period	(1)	0	(1)	0
Defined Benefit Plans Prior Service Costs [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(5)	(3)	(6)	3
Amounts arising during the period	0	0	0	(6)
Reclassifications from accumulated other comprehensive income	0	0	1	0
Net other comprehensive income during the period	0	0	1	(6)
Distribution of PPL Energy Supply				0
Balance at end of period	(5)	(3)	(5)	(3)
Defined Benefit Plans Actuarial Gain (Loss) [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(2,130)	(1,848)	(2,195)	(2,214)
Amounts arising during the period	(6)	0	(4)	52
Reclassifications from accumulated other comprehensive income	31	35	94	111
Net other comprehensive income during the period	25	35	90	163
Distribution of PPL Energy Supply				238
Balance at end of period	(2,105)	(1,813)	(2,105)	(1,813)
LG And E And KU Energy LLC [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(43)	(52)	(46)	(45)
Amounts arising during the period	0	0	1	(8)
Reclassifications from accumulated other comprehensive income	1	1	3	2
Net other comprehensive income during the period	1	1	4	(6)
Balance at end of period	(42)	(51)	(42)	(51)
LG And E And KU Energy LLC [Member] | Equity Investees Accumulated Other Comprehensive Income [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(1)	(1)	0	0
Amounts arising during the period	0	0	0	0
Reclassifications from accumulated other comprehensive income	0	0	(1)	(1)
Net other comprehensive income during the period	0	0	(1)	(1)
Balance at end of period	(1)	(1)	(1)	(1)
LG And E And KU Energy LLC [Member] | Defined Benefit Plans Prior Service Costs [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(9)	(7)	(10)	(8)
Amounts arising during the period	0	0	0	0
Reclassifications from accumulated other comprehensive income	0	0	1	1
Net other comprehensive income during the period	0	0	1	1
Balance at end of period	(9)	(7)	(9)	(7)
LG And E And KU Energy LLC [Member] | Defined Benefit Plans Actuarial Gain (Loss) [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of period	(33)	(44)	(36)	(37)
Amounts arising during the period	0	0	1	(8)
Reclassifications from accumulated other comprehensive income	1	1	3	2
Net other comprehensive income during the period	1	1	4	(6)
Balance at end of period	$ (32)	$ (43)	$ (32)	$ (43)

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Accumulated Other Comprehensive Income (Loss) - Income (Expense) Effect of Reclassifications (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Affected Line Item on the Statements of Income [Line Items]
Other Income (Expense) - net	$ 49	$ 75	$ 284	$ 61
Interest Expense	(223)	(221)	(671)	(645)
Total Pre-tax	612	540	1,947	1,630
Income Taxes	(139)	(144)	(510)	(432)
Total After-tax	473	396	1,437	1,198
Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Total After-tax	38	(45)	(32)	(128)
Available For Sale Securities [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Other Income (Expense) - net	0	0	0	4
Total Pre-tax	0	0	0	4
Income Taxes	0	0	0	(2)
Total After-tax	0	0	0	2
Qualifying Derivatives [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Total Pre-tax	86	(13)	77	(43)
Income Taxes	(17)	3	(15)	23
Total After-tax	69	(10)	62	(20)
Qualifying Derivatives [Member] | Interest Rate Swaps [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Interest Expense	(2)	(2)	(5)	(9)
Discontinued operations	0	0	0	(77)
Qualifying Derivatives [Member] | Cross Currency Swaps [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Other Income (Expense) - net	86	(10)	80	22
Interest Expense	2	(1)	2	1
Qualifying Derivatives [Member] | Commodity Contracts [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Discontinued operations	0	0	0	20
Equity Investees Accumulated Other Comprehensive Income [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Other Income (Expense) - net	0	0	1	2
Total Pre-tax	0	0	1	2
Income Taxes	0	0	0	(1)
Total After-tax	0	0	1	1
Defined Benefit Plans [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Total Pre-tax	(42)	(45)	(123)	(146)
Income Taxes	11	10	28	35
Total After-tax	(31)	(35)	(95)	(111)
Defined Benefit Plans [Member] | Prior Service Costs [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Total Pre-tax	(1)	0	(2)	0
Defined Benefit Plans [Member] | Net Actuarial Loss [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]
Affected Line Item on the Statements of Income [Line Items]
Total Pre-tax	$ (41)	$ (45)	$ (121)	$ (146)