Employee Postretirement Benefits

6 Months Ended

Jun. 30, 2021

Compensation And Retirement Disclosure [Abstract]

Employee Postretirement Benefits

5. Employee Postretirement Benefits

TEC is a participant in the comprehensive retirement plans of TECO Energy. The following table presents detail related to TECO Energy’s periodic benefit cost for pension and other postretirement benefits. Amounts disclosed for TECO Energy’s pension benefits include the amounts related to its qualified pension plan and non-qualified, non-contributory SERP and Restoration Plan.

TECO Energy Benefit Cost
(millions)	Pension Benefits						Other Postretirement Benefits
Three months ended June 30,	2021			2020			2021			2020
Components of net periodic benefit cost
Service cost	$	6		$	5		$	1		$	0
Interest cost		6			6			2			2
Expected return on assets		(13	)		(12	)		0			0
Amortization of:
Actuarial loss (gain)		5			5			(1	)		0
Net periodic benefit cost	$	4		$	4		$	2		$	2
Six months ended June 30,
Components of net periodic benefit cost
Service cost	$	11		$	10		$	1		$	0
Interest cost		11			13			3			3
Expected return on assets		(26	)		(25	)		0			0
Amortization of:
Actuarial loss (gain)		11			10			0			0
Settlement cost		0			0			0			0
Net periodic benefit cost	$	7		$	8		$	4		$	3

TEC’s portion of the net periodic benefit cost for the three months ended June 30, 2021 and 2020, respectively, was $2 million and $3 million for pension benefits, and $3 million and $1 million for other postretirement benefits. TEC’s portion of the net periodic benefit cost for the six months ended June 30, 2021 and 2020, respectively, was $5 million and $6 million for pension benefits, and $5 million and $3 million for other postretirement benefits. TEC’s portion of net periodic benefit costs for pension and other benefits is included as an expense on the Consolidated Condensed Statements of Income in “Operations & maintenance”.   

TECO Energy assumed a long-term EROA of 6.70% and a discount rate of 2.38% for pension benefits under its qualified pension plan for 2021. For TECO Energy’s other postretirement benefits, TECO Energy used a discount rate of 2.47% for 2021.

TECO Energy made contributions of $11 million and $10 million to its qualified pension plan in each of the six months ended June 30, 2021 and 2020, respectively. TEC’s portion of these contributions was $9 million and $8 million, respectively. TECO Energy expects to make contributions to the pension plan of $10 million for the remainder of 2021. TEC estimates its portion of the remaining 2021 contribution to be $8 million.        

Included in the benefit cost discussed above, for the three and six months ended June 30, 2021, $5 million and $11 million, respectively, of unamortized prior service benefits and costs and actuarial gains and losses were reclassified by TEC from regulatory assets to the Consolidated Condensed Statement of Income, compared with $4 million and $9 million for the three and six months ended June 30, 2020, respectively.