BALANCE SHEET COMPONENTS

Inventories

PGE’s inventories, which are recorded at average cost, consist primarily of materials and supplies for use in operations, maintenance, and capital activities, as well as fuel, which includes natural gas, coal, and oil, for use in its generating plants. Periodically, the Company assesses inventory for purposes of determining that inventory is recorded at the lower of average cost or net realizable value.

Other Current Assets

Other current assets consist of the following (in millions):



	March 31, 2017		December 31, 2016
Prepaid expenses	$	58	$	48
Margin deposits	20		8
Assets from price risk management activities	9		18
Other	—		3
Other current assets	$	87	$	77

Electric Utility Plant, Net

Electric utility plant, net consists of the following (in millions):



	March 31, 2017			December 31, 2016
Electric utility plant	$	9,605		$	9,534
Construction work-in-progress	242			213
Total cost	9,847			9,747
Less: accumulated depreciation and amortization	(3,381		)	(3,313		)
Electric utility plant, net	$	6,466		$	6,434

Accumulated depreciation and amortization in the table above includes accumulated amortization related to intangible assets of $265 million and $257 million as of March 31, 2017 and December 31, 2016, respectively. Amortization expense related to intangible assets was $11 million for the three months ended March 31, 2017 and 2016. The Company’s intangible assets primarily consist of computer software development and hydro licensing costs.

Regulatory Assets and Liabilities

Regulatory assets and liabilities consist of the following (in millions):



	March 31, 2017					December 31, 2016
	Current			Noncurrent		Current			Noncurrent
Regulatory assets:
Price risk management	$	50		$	154	$	26		$	120
Pension and other postretirement plans	—			232		—			235
Deferred income taxes	—			83		—			86
Debt issuance costs	—			21		—			22
Other	7			42		10			35
Total regulatory assets	$	57		$	532	$	36		$	498
Regulatory liabilities:
Asset retirement removal costs	$	—		$	898	$	—		$	887
Trojan decommissioning activities	12			—		18			—
Asset retirement obligations	—			50		—			49
Other	30			25		33			22
Total regulatory liabilities	$	42	^*	$	973	$	51	^*	$	958


*	Included in Accrued expenses and other current liabilities in the condensed consolidated balance sheets.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following (in millions):



	March 31, 2017		December 31, 2016
Regulatory liabilities—current	$	42	$	51
Accrued employee compensation and benefits	41		52
Accrued interest payable	40		25
Accrued dividends payable	30		30
Accrued taxes payable	34		25
Other	60		71
Total accrued expenses and other current liabilities	$	247	$	254

Credit Facilities

As of March 31, 2017, PGE had a $500 million revolving credit facility scheduled to expire in November 2020.

Pursuant to the terms of the agreement, the revolving credit facility may be used for general corporate purposes, as backup for commercial paper borrowings, and to permit the issuance of standby letters of credit. PGE may borrow for one, two, three, or six months at a fixed interest rate established at the time of the borrowing, or at a variable interest rate for any period up to the then remaining term of the applicable credit facility. The revolving credit facility contains a provision that allows for two, one-year extensions, subject to approval by the banks. During the first quarter of 2017, PGE exercised one of the two extensions available under the terms of the credit facility. Such action resulted in an updated expiration date for the agreement of November 2020. The facility also contains a provision that requires annual fees based on PGE’s unsecured credit ratings, and contains customary covenants and default provisions, including a requirement that limits consolidated indebtedness, as defined in the agreement, to 65% of total capitalization. As of March 31, 2017, PGE was in compliance with this covenant with a 50.6% debt-to-total capital ratio.

The Company has a commercial paper program under which it may issue commercial paper for terms of up to 270 days, limited to the unused amount of credit under the revolving credit facility.

PGE classifies any borrowings under the revolving credit facility and outstanding commercial paper as Short-term debt on the condensed consolidated balance sheets.

Under the revolving credit facility, as of March 31, 2017, since PGE had no borrowings outstanding, and no commercial paper or letters of credit issued, the aggregate unused available credit capacity under the facility was $500 million.

In addition, PGE has four letter of credit facilities under which the Company can request letters of credit for original terms not to exceed one year. These facilities provide a total capacity of $160 million. The issuance of such letters of credit is subject to the approval of the issuing institution. Under these facilities, letters of credit for a total of $56 million were outstanding as of March 31, 2017. Letters of credit issued are not reflected on the Company’s condensed consolidated balance sheets.

Pursuant to an order issued by the Federal Energy Regulatory Commission (FERC), the Company is authorized to issue short-term debt in an aggregate amount of up to $900 million through February 6, 2018.

Long-term Debt

During the three months ended March 31, 2017, PGE did not enter into any new First Mortgage Bond (FMB) long-term debt transactions.

In May 2016, PGE entered into an unsecured credit agreement with certain financial institutions, under which the Company had the opportunity to obtain three separate term loans in an aggregate principal amount of up to $200 million by October 31, 2016. Under the agreement, PGE obtained the following term loans:


•	$50 million on May 4, 2016;


•	$75 million on June 15, 2016; and


•	$25 million on October 31, 2016.

The term loan interest rates are set at the beginning of the interest period for periods of 1-month, 3-months, or 6-months, as selected by PGE, and are based on the London Interbank Offered Rate (LIBOR) plus 63 basis points, and was 1.6% as of March 31, 2017, with no other fees.

The credit agreement expires November 30, 2017, at which time any amounts outstanding under the term loans become due and payable. Upon the occurrence of certain events of default, the Company’s obligations under the credit agreement may be accelerated. Such events of default include payment defaults to lenders under the credit agreement, covenant defaults, and other customary defaults for financings of this type.

Defined Benefit Pension Plan Costs

Components of net periodic benefit cost under the defined benefit pension plan are as follows (in millions):



	Three Months Ended March 31,
	2017			2016
Service cost	$	4		$	4
Interest cost	8			8
Expected return on plan assets	(10		)	(10		)
Amortization of net actuarial loss	3			4
Net periodic benefit cost	$	5		$	6