Employee Benefit Plans

Defined Benefit Plans

The following table shows the components of net periodic benefit cost (including amounts capitalized to our balance sheets) for our benefit plans:



	Pension Benefits												Other Postretirement Benefits
	Three Months Ended September 30						Nine Months Ended September 30						Three Months Ended September 30						Nine Months Ended September 30
(Millions)	2014			2013			2014			2013			2014			2013			2014			2013
Service cost	$	6.2		$	7.5		$	18.7		$	22.6		$	5.2		$	6.3		$	15.9		$	18.7
Interest cost	19.0			17.8			58.0			53.4			5.7			6.2			18.0			18.6
Expected return on plan assets	(28.0		)	(26.4		)	(85.4		)	(79.1		)	(8.3		)	(7.7		)	(25.0		)	(23.0		)
Loss on plan settlement	—			—			0.9			—			—			—			—			—
Amortization of prior service cost (credit)	0.1			1.0			0.4			3.0			(2.7		)	(0.7		)	(6.8		)	(1.9		)
Amortization of net actuarial losses	8.3			14.2			25.3			42.5			0.9			2.1			2.4			6.3
Net periodic benefit cost	$	5.6		$	14.1		$	17.9		$	42.4		$	0.8		$	6.2		$	4.5		$	18.7

Prior service costs (credits) and net actuarial losses that have not yet been recognized as a component of net periodic benefit cost are recorded in accumulated other comprehensive income for our nonregulated entities and as net regulatory assets or liabilities for our regulated utilities.

In August 2014, we closed on the sale of UPPCO. The funded status of pension and other postretirement-related assets and liabilities transferred with the sale was a net asset of approximately $26 million. See Note 4, Dispositions, for more information. This net asset consisted of approximately $150 million of pension and other postretirement benefit plan assets, and approximately $124 million of benefit obligations.

In March 2014, we remeasured the obligations of certain other postretirement benefit plans. The remeasurement was necessary because we will replace the current retiree medical plans for participants age 65 and older with a Medicare Advantage plan starting in 2015.

Our funding policy is to contribute at least the minimum amounts that are required to be funded under the Employee Retirement Income Security Act, but not more than the maximum amounts that are currently deductible for income tax purposes. During the nine months ended September 30, 2014, we contributed $95.2 million to our pension plans and $0.2 million to our other postretirement benefit plans. We expect to contribute an additional $5.0 million to our pension plans and $10.6 million to our other postretirement benefit plans during the remainder of 2014, dependent upon various factors affecting us, including our liquidity position and possible tax law changes. Of the remaining contributions for 2014, contributions of $2.0 million will be funded through a transfer of assets from the rabbi trust for certain nonqualified pension plans. See the discussion below in regard to the triggering of the full funding of the rabbi trust.

Rabbi Trust Funding Requirement

Historically, our deferred compensation programs were partially funded through shares of common stock held in a rabbi trust. The Agreement and Plan of Merger entered into with Wisconsin Energy Corporation in June 2014 triggered the potential change in control provisions in the rabbi trust agreement. These provisions required the full funding of the present value of each participant's total benefit under the deferred compensation program and certain nonqualified pension plans. As a result, $65.0 million was moved to the rabbi trust in June 2014, and an additional $64.8 million, consisting of cash and exchange-traded funds, was moved to the rabbi trust in July 2014. These amounts were included in other long-term assets on the balance sheet as of September 30, 2014. See Note 2, Proposed Merger with Wisconsin Energy Corporation, for more information on the merger.