REGULATORY ASSETS, LIABILITIES, AND BALANCING ACCOUNTS

6 Months Ended

Jun. 30, 2020

REGULATORY ASSETS, LIABILITIES, AND BALANCING ACCOUNTS

Regulatory Assets and Liabilities

Regulatory Assets

Long-term regulatory assets are comprised of the following:


	Balance at
(in millions)	June 30, 2020		December 31, 2019
Pension benefits⁽¹⁾	$	1,757	$	1,823
Environmental compliance costs	1,082		1,062
Utility retained generation⁽²⁾	205		228
Price risk management	183		124
Unamortized loss, net of gain, on reacquired debt	56		63
Catastrophic event memorandum account ⁽³⁾	646		656
Wildfire expense memorandum account ⁽⁴⁾	423		423
Fire hazard prevention memorandum account ⁽⁵⁾	261		259
Fire risk mitigation memorandum account⁽⁶⁾	98		95
Wildfire mitigation plan memorandum account ⁽⁷⁾	993		558
Deferred income taxes ⁽⁸⁾	583		252
Insurance premium costs ⁽⁹⁾	481		—
Other	739		523
Total long-term regulatory assets	$	7,507	$	6,066

⁽¹⁾Payments into the pension and other benefits plans are based on annual contribution requirements. As these annual requirements continue indefinitely into the future, the Utility expects to continuously recover pension benefits.

⁽²⁾In connection with the settlement agreement entered into among PG&E Corporation, the Utility, and the CPUC in 2003 to resolve the Utility’s 2001 proceeding under Chapter 11, the CPUC authorized the Utility to recover $1.2 billion of costs related to the Utility’s retained generation assets. The individual components of these regulatory assets are being amortized over the respective lives of the underlying generation facilities, consistent with the period over which the related revenues are recognized.

⁽³⁾Includes costs of responding to catastrophic events that have been declared a disaster or state of emergency by competent federal or state authorities. Recovery of CEMA costs are subject to CPUC review and approval.

⁽⁴⁾Includes incremental wildfire liability insurance premium costs the CPUC approved for tracking in June 2018 for the period July 26, 2017 through December 31, 2019. Recovery of WEMA costs are subject to CPUC review and approval.

⁽⁵⁾Includes costs associated with the implementation of regulations and requirements adopted to protect the public from potential fire hazards associated with overhead power line facilities and nearby aerial communication facilities that have not been previously authorized in another proceeding. Recovery of FHPMA costs are subject to CPUC review and approval.

⁽⁶⁾Includes costs associated with the 2019 Wildfire Mitigation Plan for the period January 1, 2019 through June 4, 2019. Recovery of FRMMA costs are subject to CPUC review and approval.

⁽⁷⁾ Includes costs associated with the 2019 Wildfire Mitigation Plan for the period June 5, 2019 through December 31, 2019 and the 2020 Wildfire Mitigation Plan for the period of January 1, 2020 through June 30, 2020. Recovery of WMPMA costs are subject to CPUC review and approval.

⁽⁸⁾ Represents cumulative differences between amounts recognized for ratemaking purposes and expense recognized in accordance with GAAP.

⁽⁹⁾Represents incremental liability insurance premium costs for the period January 1, 2020 through June 30, 2020. Approval of costs is pending final 2020 GRC decision.

Regulatory Liabilities

Long-term regulatory liabilities are comprised of the following:


	Balance at
(in millions)	June 30, 2020		December 31, 2019
Cost of removal obligations⁽¹⁾	$	6,747	$	6,456
Recoveries in excess of AROs⁽²⁾	290		393
Public purpose programs⁽³⁾	917		817
Employee benefit plans⁽⁴⁾	770		750
Other	917		854
Total long-term regulatory liabilities	$	9,641	$	9,270

⁽¹⁾Represents the cumulative differences between the recorded costs to remove assets and amounts collected in rates for expected costs to remove assets.

⁽²⁾Represents the cumulative differences between ARO expenses and amounts collected in rates. Decommissioning costs related to the Utility’s nuclear facilities are recovered through rates and are placed in nuclear decommissioning trusts. This regulatory liability also represents the deferral of realized and unrealized gains and losses on these nuclear decommissioning trust investments. (See Note 9 below.)

⁽³⁾ Represents amounts received from customers designated for public purpose program costs expected to be incurred beyond the next 12 months, primarily related to energy efficiency programs.

⁽⁴⁾ Represents cumulative differences between incurred costs and amounts collected in rates for Post-Retirement Medical, Post-Retirement Life and Long-Term Disability Plans.

Regulatory Balancing Accounts

Current regulatory balancing accounts receivable and payable are comprised of the following:


	Receivable Balance at
(in millions)	June 30, 2020		December 31, 2019
Electric distribution	$	255	$	—
Electric transmission	—		9
Gas distribution and transmission	119		363
Energy procurement	1,300		901
Public purpose programs	216		209
Other	748		632
Total regulatory balancing accounts receivable	$	2,638	$	2,114


	Payable Balance at
(in millions)	June 30, 2020		December 31, 2019
Electric distribution	$	—	$	31
Electric transmission	197		119
Gas distribution and transmission	33		45
Energy procurement	731		649
Public purpose programs	547		559
Other	407		394
Total regulatory balancing accounts payable	$	1,915	$	1,797

For more information, see Note 4 of the Notes to the Consolidated Financial Statements in Item 8 of the 2019 Form 10-K.