
(4)	Regulatory Matters

Regulatory Assets and Liabilities

Regulatory assets represent costs that are expected to be recovered in future regulated rates. MidAmerican Energy's regulatory assets reflected on the Consolidated Balance Sheets consist of the following as of December 31 (in millions):



	Average
	Remaining Life	2011		2010

Deferred income taxes, net⁽¹⁾	26 years	$	581	$	491
Employee benefit plans⁽²⁾	12 years	101		14
Unrealized loss on regulated derivative contracts	1 year	94		29
Other	Various	55		44
Total		$	831	$	578


(1)	Amounts primarily represent income tax benefits related to state accelerated tax depreciation and certain property-related basis differences that were previously flowed through to customers and will be included in regulated rates when the temporary differences reverse.


(2)	Substantially represents amounts not yet recognized as a component of net periodic benefit cost that are expected to be included in regulated rates when recognized.

MidAmerican Energy had regulatory assets not earning a return on investment of $826 million and $572 million as of December 31, 2011 and 2010, respectively.

Regulatory liabilities represent income to be recognized or amounts to be returned to customers in future periods. MidAmerican Energy's regulatory liabilities reflected on the Consolidated Balance Sheets consist of the following as of December 31 (in millions):



	Average
	Remaining Life	2011		2010

Cost of removal accrual⁽¹⁾	26 years	$	603	$	578
Asset retirement obligations⁽²⁾	28 years	76		117
Employee benefit plans⁽³⁾	NA	—		9
Unrealized gain on regulated derivative contracts	1 year	21		2
Other	Various	19		15
Total		$	719	$	721


(1)	Amounts represent estimated costs, as accrued through depreciation rates and exclusive of ARO liabilities, of removing utility plant in accordance with accepted regulatory practices. Amounts are deducted from rate base or otherwise accrue a carrying cost.


(2)	Amount predominately represents the excess of nuclear decommission trust assets over the related asset retirement obligation. Refer to Note 11 for a discussion of asset retirement obligations.


(3)	Represents amounts not yet recognized as a component of net periodic benefit cost that are to be returned to customers in future periods when recognized.