Regulatory Assets, Liabilities, And Balancing Accounts

3 Months Ended

Mar. 31, 2013

Regulatory Assets, Liabilities, And Balancing Accounts

NOTE 3: REGULATORY ASSETS, LIABILITIES, AND BALANCING ACCOUNTS

Regulatory Assets

Long-Term Regulatory Assets

Long-term regulatory assets are composed of the following:

	Balance at
	March 31,		December 31,
(in millions)	2013		2012
Pension benefits	$	3,299	$	3,275
Deferred income taxes		1,668		1,627
Utility retained generation		539		552
Environmental compliance costs		596		604
Price risk management		185		210
Electromechanical meters		179		194
Unamortized loss, net of gain, on reacquired debt		136		141
Other		176		206
Total long-term regulatory assets	$	6,778	$	6,809

Regulatory Liabilities

Long-Term Regulatory Liabilities

Long-term regulatory liabilities are composed of the following:

	Balance at
	March 31,		December 31,
(in millions)	2013		2012
Cost of removal obligations	$	3,709	$	3,625
Recoveries in excess of AROs		673		620
Public purpose programs		539		590
Other		266		253
Total long-term regulatory liabilities	$	5,187	$	5,088

Regulatory Balancing Accounts

      The Utility's recovery of a significant portion of revenue requirements and costs is decoupled from the volume of sales.  The Utility records differences between actual customer billings and the Utility's authorized revenue requirement as well as differences between incurred costs and customer billings or authorized revenue.  To the extent these differences are probable of recovery or refund, the Utility records a regulatory balancing account receivable or payable.  Regulatory balancing accounts receivable and payable will fluctuate during the year based on seasonal electric and gas usage and timing of cost and collections.

Current Regulatory Balancing Accounts, Net

	Receivable (Payable)
	Balance at
	March 31,			December 31,
(in millions)	2013			2012
Distribution revenue adjustment mechanism	$	359		$	219
Utility generation		321			117
Hazardous substance		76			56
Public purpose programs		(69	)		(83	)
Gas fixed cost		(81	)		44
Energy recovery bonds		(192	)		(43	)
Energy procurement		(31	)		77
U.S. Department of Energy Settlement		(250	)		(250	)
Greenhouse gas allowance auction proceeds (1)		(141	)		-
Other		147			165
Total regulatory balancing accounts, net	$	139		$	302

⁽¹⁾ The CARB has adopted regulations that established a state-wide, “cap-and-trade” program (effective January 1, 2013) that sets a gradually declining limit on the amount of GHGs that may be emitted each year. This balancing account is used to record proceeds collected by the Utility for GHG emission allowances associated with the cap-and-trade program.  These amounts will be refunded to customers in future periods.