Property, Plant and Equipment

12 Months Ended

Dec. 31, 2019

Entity Information [Line Items]

Utility Plant In Service

The original cost of property, plant and equipment segregated by functional classifications follows:

	As of December 31,
	2019		2018
	(In Thousands)
Production	$	4,154,919	$	3,927,847
Transmission	398,903		394,621
Distribution	1,594,208		1,533,828
General plant	250,582		344,782
Total property, plant and equipment	$	6,398,612	$	6,201,078

Substantially all of IPL’s property is subject to a $1,713.8 million direct first mortgage lien, as of December 31, 2019, securing IPL’s first mortgage bonds. Total non-contractually or legally required removal costs of utility plant in service at December 31, 2019 and 2018 were $788.3 million and $761.1 million, respectively; and total contractually or legally required removal costs of property, plant and equipment at December 31, 2019 and 2018 were $204.2 million and $129.5 million, respectively. Please see “ARO” below for further information.

ARO

ASC 410 “Asset Retirement and Environmental Obligations” addresses financial accounting and reporting for legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or normal operation. A legal obligation for purposes of ASC 410 is an obligation that a party is required to settle as a result of an existing law, statute, ordinance, written or oral contract or the doctrine of promissory estoppel. 

IPL’s ARO relates primarily to environmental issues involving asbestos-containing materials, ash ponds, landfills and miscellaneous contaminants associated with its generating plants, transmission system and distribution system. The following is a roll forward of the ARO legal liability year end balances:

	2019			2018
	(In Thousands)
Balance as of January 1	$	129,451		$	79,535
Liabilities settled	(9,891		)	(8,932		)
Revisions to cash flow and timing estimates	78,153			54,811
Accretion expense	6,506			4,037
Balance as of December 31	$	204,219		$	129,451

In 2019, IPL recorded adjustments to its ARO liabilities of $78.2 million primarily to reflect an increase to estimated ash pond closure costs, including groundwater remediation. In 2018, IPL recorded additional ARO liabilities of $54.8 million to reflect revisions to cash flow and timing estimates due to accelerated ash pond closure dates, revised estimated closure costs after review of updates to the CCR rule and revised estimated costs associated with our coal storage areas, landfills, and asbestos remediation. As of December 31, 2019 and 2018, IPL did not have any assets that are legally restricted for settling its ARO liability.

Indianapolis Power And Light Company

Entity Information [Line Items]

Utility Plant In Service

. PROPERTY, PLANT AND EQUIPMENT

The original cost of property, plant and equipment segregated by functional classifications follows:

	As of December 31,
	2019		2018
	(In Thousands)
Production	$	4,154,919	$	3,927,847
Transmission	398,903		394,621
Distribution	1,594,208		1,533,828
General plant	250,582		344,782
Total property, plant and equipment	$	6,398,612	$	6,201,078

Substantially all of IPL’s property is subject to a $1,713.8 million direct first mortgage lien, as of December 31, 2019, securing IPL’s first mortgage bonds. Total non-contractually or legally required removal costs of utility plant in service at December 31, 2019 and 2018 were $788.3 million and $761.1 million, respectively; and total contractually or legally required removal costs of property, plant and equipment at December 31, 2019 and 2018 were $204.2 million and $129.5 million, respectively. Please see “ARO” below for further information.

ARO

ASC 410 “Asset Retirement and Environmental Obligations” addresses financial accounting and reporting for legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or normal operation. A legal obligation for purposes of ASC 410 is an obligation that a party is required to settle as a result of an existing law, statute, ordinance, written or oral contract or the doctrine of promissory estoppel.

IPL’s ARO relates primarily to environmental issues involving asbestos-containing materials, ash ponds, landfills and miscellaneous contaminants associated with its generating plants, transmission system and distribution system. The following is a roll forward of the ARO legal liability year end balances:

	2019			2018
	(In Thousands)
Balance as of January 1	$	129,451		$	79,535
Liabilities settled	(9,891		)	(8,932		)
Revisions to cash flow and timing estimates	78,153			54,811
Accretion expense	6,506			4,037
Balance as of December 31	$	204,219		$	129,451

In 2019, IPL recorded adjustments to its ARO liabilities of $78.2 million primarily to reflect an increase to estimated ash pond closure costs, including groundwater remediation. In 2018, IPL recorded additional ARO liabilities of $54.8 million to reflect revisions to cash flow and timing estimates due to accelerated ash pond closure dates, revised estimated closure costs after review of updates to the CCR rule and revised estimated costs associated with our coal storage areas, landfills, and asbestos remediation. As of December 31, 2019 and 2018, IPL did not have any assets that are legally restricted for settling its ARO liability.