100 - CONDENSED CONSOLIDATED ST
100 - CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD $) | ||||
In Millions, except Share data in Thousands | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Operating Revenues | ||||
Utility | $881 | $981 | $1,946 | $2,101 |
Unregulated retail electric and gas | 32 | 33 | 74 | 67 |
Wholesale energy marketing | ||||
Realized | 760 | 434 | 1,565 | 862 |
Unrealized economic activity (Note 14) | (112) | (616) | 240 | (796) |
Net energy trading margins | 7 | 52 | (5) | 50 |
Energy-related businesses | 105 | 130 | 204 | 246 |
Total Operating Revenues | 1,673 | 1,014 | 4,024 | 2,530 |
Operation | ||||
Fuel | 186 | 189 | 444 | 429 |
Energy purchases | ||||
Realized | 615 | 309 | 1,299 | 626 |
Unrealized economic activity (Note 14) | 65 | (604) | 334 | (863) |
Other operation and maintenance | 354 | 358 | 726 | 734 |
Amortization of recoverable transition costs | 70 | 68 | 154 | 144 |
Depreciation | 114 | 117 | 223 | 228 |
Taxes, other than income | 67 | 72 | 139 | 147 |
Energy-related businesses | 98 | 120 | 189 | 227 |
Total Operating Expenses | 1,569 | 629 | 3,508 | 1,672 |
Operating Income | 104 | 385 | 516 | 858 |
Other Income (Expense) - net | (6) | 13 | 29 | 24 |
Other-Than-Temporary Impairments | 1 | 7 | 18 | 10 |
Interest Expense | 99 | 108 | 188 | 216 |
Income (Loss) from Continuing Operations Before Income Taxes | (2) | 283 | 339 | 656 |
Income Taxes | (31) | 94 | 67 | 220 |
Income from Continuing Operations After Income Taxes | 29 | 189 | 272 | 436 |
Income (Loss) from Discontinued Operations (net of income taxes) (Note 8) | (32) | 6 | (29) | 24 |
Net Income (Loss) | (3) | 195 | 243 | 460 |
Net Income Attributable to Noncontrolling Interests | 4 | 5 | 9 | 10 |
Net Income (Loss) Attributable to PPL Corporation | (7) | 190 | 234 | 450 |
Amounts Attributable to PPL Corporation: | ||||
Income from Continuing Operations After Income Taxes | 25 | 184 | 263 | 426 |
Income (Loss) from Discontinued Operations (net of income taxes) | (32) | 6 | (29) | 24 |
Net Income (Loss) | ($7) | $190 | $234 | $450 |
Income from Continuing Operations After Income Taxes Available to PPL Corporation Common Shareowners: | ||||
Basic | 0.07 | 0.49 | 0.7 | 1.14 |
Diluted | 0.07 | 0.49 | 0.7 | 1.13 |
Net Income (Loss) Available to PPL Corporation Common Shareowners: | ||||
Basic | -0.02 | 0.5 | 0.62 | 1.2 |
Diluted | -0.02 | 0.5 | 0.62 | 1.19 |
Dividends Declared Per Share of Common Stock | 0.345 | 0.335 | 0.69 | 0.67 |
Weighted-Average Shares of Common Stock Outstanding (in thousands) | ||||
Basic | 375,881 | 373,158 | 375,493 | 373,009 |
Diluted | 376,206 | 374,902 | 375,805 | 374,990 |
200 - CONDENSED CONSOLIDATED ST
200 - CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | ||
In Millions | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Cash Flows from Operating Activities | ||
Net income | $243 | $460 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation | 225 | 230 |
Amortization of recoverable transition costs and other | 182 | 178 |
Deferred income taxes and investment tax credits | (86) | (38) |
Gains related to the extinguishment of notes | (29) | 0 |
Impairment of assets | 104 | 11 |
Unrealized (gains) losses on derivatives and other hedging activities | 40 | (84) |
Other | 19 | 18 |
Change in current assets and current liabilities | ||
Accounts receivable | 71 | 53 |
Accounts payable | (184) | 114 |
Unbilled revenue | 94 | (174) |
Fuel, materials and supplies | (45) | (3) |
Prepayments | (85) | (68) |
Taxes | (15) | 6 |
Counterparty collateral deposits | 201 | 304 |
Price risk management assets and liabilities | (192) | (26) |
Other | 21 | (42) |
Other operating activities | ||
Other assets | (5) | 17 |
Other liabilities | 9 | (23) |
Net cash provided by operating activities | 568 | 933 |
Cash Flows from Investing Activities | ||
Expenditures for property, plant and equipment | (524) | (661) |
Expenditures for intangible assets | (48) | (258) |
Proceeds from the sale of intangible assets | 8 | 2 |
Purchases of nuclear plant decommissioning trust investments | (153) | (95) |
Proceeds from the sale of nuclear plant decommissioning trust investments | 141 | 82 |
Purchases of other investments | 0 | (50) |
Proceeds from the sale of other investments | 150 | 36 |
Net (increase) decrease in restricted cash and cash equivalents | 189 | (281) |
Other investing activities | (3) | 9 |
Net cash used in investing activities | (240) | (1,216) |
Cash Flows from Financing Activities | ||
Issuance of long-term debt | 298 | 399 |
Retirement of long-term debt | (430) | (217) |
Issuance of common stock | 30 | 17 |
Repurchase of common stock due to the repurchase program | 0 | (38) |
Payment of common stock dividends | (256) | (239) |
Net increase (decrease) in short-term debt | (77) | 400 |
Other financing activities | (20) | 1 |
Net cash provided by (used in) financing activities | (455) | 323 |
Effect of Exchange Rates on Cash and Cash Equivalents | 0 | (2) |
Net Increase (Decrease) in Cash and Cash Equivalents | (127) | 38 |
Cash and Cash Equivalents at Beginning of Period | 1,100 | 430 |
Cash and Cash Equivalents included in Assets Held for Sale | 0 | (2) |
Cash and Cash Equivalents at End of Period | $973 | $466 |
300 - CONDENSED CONSOLIDATED BA
300 - CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | |||||||||||||||||||
In Millions | Jun. 30, 2009
| Dec. 31, 2008
| |||||||||||||||||
Current Assets | |||||||||||||||||||
Cash and cash equivalents | $973 | $1,100 | |||||||||||||||||
Short-term investments | 0 | 150 | |||||||||||||||||
Restricted cash and cash equivalents | 131 | 320 | |||||||||||||||||
Accounts receivable (less reserve: 2009, $38; 2008, $36) | |||||||||||||||||||
Customer | 411 | 456 | |||||||||||||||||
Other | 39 | 77 | |||||||||||||||||
Unbilled revenues | 507 | 599 | |||||||||||||||||
Fuel, materials and supplies | 382 | 337 | |||||||||||||||||
Prepayments | 169 | 84 | |||||||||||||||||
Price risk management assets | 1,966 | 1,224 | |||||||||||||||||
Other intangibles | 27 | 17 | |||||||||||||||||
Assets held for sale | 182 | 0 | |||||||||||||||||
Other | 8 | 19 | |||||||||||||||||
Total Current Assets | 4,795 | 4,383 | |||||||||||||||||
Investments | |||||||||||||||||||
Equity method investments | 32 | 47 | |||||||||||||||||
Nuclear plant decommissioning trust funds | 468 | 446 | |||||||||||||||||
Other | 22 | 29 | |||||||||||||||||
Total Investments | 522 | 522 | |||||||||||||||||
Electric plant | |||||||||||||||||||
Transmission and distribution | 8,394 | 8,046 | |||||||||||||||||
Generation | 10,134 | 9,588 | |||||||||||||||||
General | 872 | 840 | |||||||||||||||||
Electric plant in service | 19,400 | 18,474 | |||||||||||||||||
Construction work in progress | 647 | 1,131 | |||||||||||||||||
Nuclear fuel | 397 | 428 | |||||||||||||||||
Electric plant | 20,444 | 20,033 | |||||||||||||||||
Gas and oil plant | 68 | 68 | |||||||||||||||||
Other property | 161 | 156 | |||||||||||||||||
Property, plant and equipment, gross | 20,673 | 20,257 | |||||||||||||||||
Less: accumulated depreciation | 7,991 | 7,882 | |||||||||||||||||
Property, Plant and Equipment, net | 12,682 | 12,375 | |||||||||||||||||
Regulatory and Other Noncurrent Assets | |||||||||||||||||||
Regulatory assets | 571 | 737 | |||||||||||||||||
Goodwill | 796 | 763 | |||||||||||||||||
Other intangibles | 617 | 637 | |||||||||||||||||
Price risk management assets | 1,986 | 1,392 | |||||||||||||||||
Other | 441 | 596 | |||||||||||||||||
Total Regulatory and Other Noncurrent Assets | 4,411 | 4,125 | |||||||||||||||||
Total Assets | 22,410 | 21,405 | |||||||||||||||||
Current Liabilities | |||||||||||||||||||
Short-term debt | 611 | 679 | |||||||||||||||||
Long-term debt | 486 | 696 | |||||||||||||||||
Accounts payable | 585 | 766 | |||||||||||||||||
Taxes | 62 | 77 | |||||||||||||||||
Interest | 116 | 130 | |||||||||||||||||
Dividends | 135 | 131 | |||||||||||||||||
Price risk management liabilities | 1,768 | 1,324 | |||||||||||||||||
Other | 753 | 499 | |||||||||||||||||
Total Current Liabilities | 4,516 | 4,302 | |||||||||||||||||
Long-term Debt | 7,224 | 7,142 | |||||||||||||||||
Deferred Credits and Other Noncurrent Liabilities | |||||||||||||||||||
Deferred income taxes and investment tax credits | 1,940 | 1,764 | |||||||||||||||||
Price risk management liabilities | 1,072 | 836 | |||||||||||||||||
Accrued pension obligations | 873 | 899 | |||||||||||||||||
Asset retirement obligations | 394 | 389 | |||||||||||||||||
Other | 553 | 677 | |||||||||||||||||
Total Deferred Credits and Other Noncurrent Liabilities | 4,832 | 4,565 | |||||||||||||||||
PPL Corporation Shareowners' Common Equity | |||||||||||||||||||
Common stock - $0.01 par value (a) | 4 | [1] | 4 | [1] | |||||||||||||||
Capital in excess of par value | 2,246 | 2,196 | |||||||||||||||||
Earnings reinvested | 3,837 | 3,862 | |||||||||||||||||
Accumulated other comprehensive loss | (568) | (985) | |||||||||||||||||
Total PPL Corporation Shareowners' Common Equity | 5,519 | 5,077 | |||||||||||||||||
Noncontrolling Interests | 319 | 319 | |||||||||||||||||
Total Equity | 5,838 | 5,396 | |||||||||||||||||
Total Liabilities and Equity | $22,410 | $21,405 | |||||||||||||||||
[1](a) 780 million shares authorized; 376 million and 375 million shares issued and outstanding at June 30, 2009 and December 31, 2008. |
310 - CONDENSED CONSOLIDATED BA
310 - CONDENSED CONSOLIDATED BALANCE SHEETS PARENTHETICAL INFORMATION (USD $) | ||
In Millions, except Share data in Thousands | Jun. 30, 2009
| Dec. 31, 2008
|
Parenthetical Information Balance Sheet | ||
Accounts receivable reserve for uncollectible accounts | $38 | $36 |
Common stock par value | 0.01 | 0.01 |
Common stock shares authorized | 780,000 | 780,000 |
Common stock shares issued | 376,144 | 374,581 |
Common stock shares outstanding | 376,144 | 374,581 |
400 - CONDENSED CONSOLIDATED ST
400 - CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (USD $) | |||||||||||||||||||
In Millions, except Share data in Thousands | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 | |||||||||||||||
Balance at beginning of period - shares | 374,581 | ||||||||||||||||||
Balance at beginning of period (a) | $5,556 | $5,904 | $5,396 | $5,876 | |||||||||||||||
Common stock issued (b) | 15 | [2] | 18 | [2] | 49 | [2] | 25 | [2] | |||||||||||
Common stock repurchased | (1) | (39) | |||||||||||||||||
Stock-based compensation | 3 | 5 | 2 | 22 | |||||||||||||||
Net income | (3) | 195 | 243 | 460 | |||||||||||||||
Dividends, dividend equivalents and distributions (c) | (134) | (131) | (269) | (261) | |||||||||||||||
Other comprehensive income (loss) | 401 | (488) | 418 | (580) | |||||||||||||||
Cumulative effect adjustment (d) | 0 | [4] | 0 | [4] | |||||||||||||||
Balance at end of period - shares | 376,144 | 376,144 | |||||||||||||||||
Balance at end of period | 5,838 | 5,503 | 5,838 | 5,503 | |||||||||||||||
Common stock | |||||||||||||||||||
Balance at beginning of period - shares | 375,597 | 372,981 | 374,581 | 373,271 | |||||||||||||||
Balance at beginning of period (a) | 4 | 4 | 4 | 4 | |||||||||||||||
Common stock issued (b) | 0 | 0 | 0 | 0 | |||||||||||||||
Common stock shares issued (b) | 547 | [2] | 1,538 | [2] | 1,597 | [2] | 2,072 | [2] | |||||||||||
Common stock shares repurchased | (34) | (824) | |||||||||||||||||
Balance at end of period - shares | 376,144 | 374,519 | 376,144 | 374,519 | |||||||||||||||
Balance at end of period | 4 | 4 | 4 | 4 | |||||||||||||||
Capital in excess of par value | |||||||||||||||||||
Balance at beginning of period (a) | 2,228 | 2,170 | [1] | 2,196 | [1] | 2,185 | [1] | ||||||||||||
Common stock issued (b) | 15 | [2] | 18 | [2] | 49 | [2] | 25 | [2] | |||||||||||
Common stock repurchased | (1) | (39) | |||||||||||||||||
Stock-based compensation | 3 | 5 | 2 | 22 | |||||||||||||||
Balance at end of period | 2,246 | 2,193 | 2,246 | 2,193 | |||||||||||||||
Earnings reinvested | |||||||||||||||||||
Balance at beginning of period (a) | 3,973 | 3,570 | [1] | 3,862 | [1] | 3,435 | [1] | ||||||||||||
Net income | (7) | 190 | 234 | 450 | |||||||||||||||
Dividends, dividend equivalents and distributions (c) | (130) | [3] | (126) | [3] | (260) | [3] | (251) | [3] | |||||||||||
Cumulative effect adjustment (d) | 1 | [4] | 1 | [4] | |||||||||||||||
Balance at end of period | 3,837 | 3,634 | 3,837 | 3,634 | |||||||||||||||
Accumulated other comprehensive loss | |||||||||||||||||||
Balance at beginning of period (a) | (968) | (160) | (985) | (68) | |||||||||||||||
Other comprehensive income (loss) | 401 | (488) | 418 | (580) | |||||||||||||||
Cumulative effect adjustment (d) | (1) | [4] | (1) | [4] | |||||||||||||||
Balance at end of period | (568) | (648) | (568) | (648) | |||||||||||||||
Non-controlling interests | |||||||||||||||||||
Balance at beginning of period (a) | 319 | 320 | 319 | 320 | |||||||||||||||
Net income | 4 | 5 | 9 | 10 | |||||||||||||||
Dividends, dividend equivalents and distributions (c) | (4) | [3] | (5) | [3] | (9) | [3] | (10) | [3] | |||||||||||
Balance at end of period | $319 | $320 | $319 | $320 | |||||||||||||||
[1](a) "Capital in excess of par value" and "Earnings reinvested" have been adjusted by $13 million in accordance with FSP APB 14-1. See Note 2 for additional information. | |||||||||||||||||||
[2](b) The three months ended June 30, 2009, includes common stock shares issued through the ICP, ICPKE, and DRIP. The six months ended June 30, 2009, includes common stock shares issued through the ICP, ICPKE, DRIP, ESOP and DDCP. The three months ended June 30, 2008, includes common stock shares issued through the ICP, ICPKE, and the 2-5/8% Convertible Senior Notes. The six months ended June 30, 2008, includes common stock shares issued through the ICP, ICPKE and the 2-5/8% Convertible Senior Notes. "Capital in excess of par value" for the six months ended June 30, 2009, includes $7 million for a company contribution to the ESOP. | |||||||||||||||||||
[3](c) "Earnings reinvested" includes dividends and dividend equivalents on PPL Corporation common stock and restricted stock units. "Noncontrolling interests" includes dividends and distributions to noncontrolling interests. | |||||||||||||||||||
[4](d) Adjustment made in accordance with FSP FAS 115-2 and FAS 124-2. See Note 2 for additional information. |
500 - CONDENSED CONSOLIDATED ST
500 - CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | ||||
In Millions | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Net income (loss) | ($3) | $195 | $243 | $460 |
Amounts arising during the period - gains (losses), net of tax (expense) benefit: | ||||
Foreign currency translation adjustments, net of tax of $4, $1, $4, $0 | 162 | (13) | 70 | (72) |
Available-for-sale securities, net of tax of $(17), $7, $(11), $22 | 16 | (7) | 10 | (21) |
Qualifying derivatives, net of tax of $(49), $315, $(172), $348 | 50 | (456) | 232 | (499) |
Equity investee's other comprehensive loss | 0 | (1) | 0 | (1) |
Reclassifications to net income - (gains) losses, net of tax expense (benefit): | ||||
Available-for-sale securities, net of tax of $1, $1 | (1) | (1) | 0 | 0 |
Qualifying derivatives, net of tax of $(110), $12, $(67), $(2) | 170 | (18) | 97 | (1) |
Defined benefit plans: | ||||
Prior service costs, net of tax of $(2), $(3), $(4), $(5) | 2 | 3 | 6 | 7 |
Net actuarial loss, net of tax of $(1), $(1), $(2), $(3) | 1 | 4 | 2 | 6 |
Transition obligation | 1 | 1 | 1 | 1 |
Total other comprehensive income (loss) attributable to PPL Corporation | 401 | (488) | 418 | (580) |
Comprehensive income (loss) | 398 | (293) | 661 | (120) |
Comprehensive income attributable to noncontrolling interests | 4 | 5 | 9 | 10 |
Comprehensive income (loss) attributable to PPL Corporation | $394 | ($298) | $652 | ($130) |
510 - CONDENSED CONSOLIDATED ST
510 - CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME PARENTHETICAL INFORMATION (USD $) | ||||
In Millions | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Statement of Comprehensive Income (Parenthetical) | ||||
Tax effect of foreign currency translation adjustments arising during the period | $4 | $1 | $4 | $0 |
Tax effect of available-for-sale securities arising during the period | (17) | 7 | (11) | 22 |
Tax effect of qualifying derivatives arising during the period | (49) | 315 | (172) | 348 |
Tax effect of available-for-sale securities reclassified to net income | 1 | 1 | 0 | 0 |
Tax effect of qualifying derivatives reclassified to net income | (110) | 12 | (67) | (2) |
Tax effect of prior service costs reclassified to net income | (2) | (3) | (4) | (5) |
Tax effect of net actuarial loss reclassified to net income | ($1) | ($1) | ($2) | ($3) |
600 - INTERIM FINANCIAL STATEME
600 - INTERIM FINANCIAL STATEMENTS | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Interim Financial Statements | |
Interim Financial Statements | 1. Interim Financial Statements (PPL, PPL Energy Supply and PPL Electric) The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. for interim financial information and with the instructions to Form 10-Q and Article10 of Regulation S-X and, therefore, do not include all of the information and footnotes required by accounting principles generally accepted in the U.S. for complete financial statements.In the opinion of management, all adjustments considered necessary for a fair presentation in accordance with accounting principles generally accepted in the U.S. are reflected in the condensed consolidated financial statements.All adjustments are of a normal recurring nature, except as otherwise disclosed.Each Registrant's Balance Sheet as of December31, 2008 is derived from that Registrant's 2008 audited Balance Sheet.The financial statements and notes thereto should be read in conjunction with the financial statements and notes contained in each Registrant's 2008 Form 10-K.The results of operations for the six months ended June30, 2009 are not necessarily indicative of the results to be expected for the full year ending December31, 2009, or other future periods, because results for interim periods can be disproportionately influenced by various factors and developments and seasonal variations. The classification of certain prior period amounts has been changed to conform to the presentation in the June30, 2009 financial statements.For PPL and PPL Energy Supply, these changes include the impact of new accounting standards adopted.See Note 2 for additional information. (PPL) Discontinued Operations for the three and six months ended June30, 2008, includes the operating activity of PPL's natural gas distribution and propane businesses that were sold in October 2008.See Note 8 for additional information.The Statements of Cash Flows do not separately report the cash flows of the Discontinued Operations. (PPL and PPL Energy Supply) Discontinued Operations for the six months ended June30, 2008 includes activity related to the Latin American businesses that were dissolved in 2008. In May 2009, PPL Generation signed a definitive agreement to sell its Long Island generation business and related tolling agreements.In July 2009, PPL Maine signed a definitive agreement to sell the majority of its hydroelectric generation business.PPL expects both sales to close in 2009.The results of operations for the three and six months ended June30, 2009 and 2008 are classified as Discontinued Operations.The assets and liabilities of the Long Island generation business and the majority of the Maine hydroelectric generation business expected to be sold are classified as held for sale on the Balance Sheet at June30, 2009. See Note 8 for additional information on the Discontinued Operations and the anticipated sales.The Statements of Cash Flows do not separately report the cash flows of the Discontinued Operations. |
601 - SUMMARY OF SIGNIFICANT AC
601 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies The following accounting policy disclosures represent updates to the "Summary of Significant Accounting Policies" Note in each Registrant's 2008 Form 10-K and should be read in conjunction with that discussion. Revenue (PPL and PPL Electric) Revenue Recognition Beginning November 1, 2008, PPL Electric's transmission revenues are billed in accordance with a tariff pending FERC-approval that utilizes a formula rate recovery mechanism.The tariff allows for recovery of actual transmission costs incurred, a return on transmission plant placed in service and an incentive return on construction work in progress for FERC-approved regional transmission expansion projects.The tariff utilizes estimated costs for the current year billing to customers and requires a true-up to adjust for actual costs in the subsequent year's rate.Once PPL Electric's formula rate recovery mechanism is approved by the FERC, the annual update of the rate is implemented automatically without specific approval by the FERC required before going into effect. During the three months ended June 30, 2009, a true-up was recorded for the FERC formula-based transmission revenues that had been billed for the period November 1, 2008 through May31, 2009 based on a calculation of the amounts that will be returned to customers in future rates for the required true-up to actual costs.This amount is reflected on the Statement of Income in "Utility" revenue for PPL and in "Retail electric" for PPL Electric, and reduced revenue by $11 million and net income by $7 million for the three and six months ended June30, 2009.The overcollected revenue and an insignificant amount of interest will be returned to customers in monthly rates between June 1, 2009 and May 31, 2010. The $7 million after-tax true-up recorded in the three months ended June 30, 2009 includes $5 million related to prior periods ($2 million related to 2008 and $3 million related to the three months ended March31, 2009).The true-up, reflected in the Pennsylvania Delivery segment for PPL, is not considered by management as material to the financial statements of PPL and PPL Electric for the year ended December 31, 2008 or the quarter ended March31, 2009 and it is not expected to be material to the financial statements for the full year 2009. Investments in Debt and Equity Securities (PPL, PPL Energy Supply and PPL Electric) Investments in debt securities are classified as held-to-maturity and measured at amortized cost, when there is an intent and ability to hold the securities to maturity.Debt securities and equity securities that are acquired and held principally for the purpose of selling them in the near-term are classified as trading.Trading securities are generally held to capitalize on fluctuations in their value.All other investments in debt and equity securities are classified as available-for-sale.Both trading and available-for-sale securities are carried at fair value.The specific identification method is used to calculate realized gains and losses on debt and equity securities.Any unrealized gains and losses on trading securities are includ |
602 - SEGMENT AND RELATED INFOR
602 - SEGMENT AND RELATED INFORMATION | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Segment and Related Information | |
Segment and Related Information | 3. Segment and Related Information (PPL and PPL Energy Supply) See the "Segment and Related Information" Note in each Registrant's 2008 Form 10-K for a discussion of reportable segments.The Supply segment of PPL and PPL Energy Supply includes the elimination of intersegment transactions. Financial data for the segments are: Three Months Ended June30, Six Months Ended June30, PPL 2009 2008 2009 2008 Income Statement Data Revenues from external customers Supply (a) $ 783 $ 24 $ 2,061 $ 410 International Delivery 163 220 346 470 Pennsylvania Delivery (b) 727 770 1,617 1,650 $ 1,673 $ 1,014 $ 4,024 $ 2,530 Intersegment revenues Supply $ 411 $ 428 $ 908 $ 917 Pennsylvania Delivery 20 30 40 58 Net Income (Loss) Attributable to PPL Supply (c) $ (86 ) $ 97 $ 19 $ 199 International Delivery (d) 62 62 149 160 Pennsylvania Delivery (b)(e) 17 31 66 91 $ (7 ) $ 190 $ 234 $ 450 June30, 2009 December31, 2008 Balance Sheet Data Total assets Supply $ 12,841 $ 11,790 International Delivery 4,377 4,199 Pennsylvania Delivery 5,192 5,416 $ 22,410 $ 21,405 Three Months Ended June30, Six Months Ended June30, PPLEnergy Supply 2009 2008 2009 2008 Income Statement Data Revenues from external customers Supply (a) $ 1,193 $ 451 $ 2,966 $ 1,325 International Delivery 163 220 346 470 $ 1,356 $ 671 $ 3,312 $ 1,795 Net Income (Loss) Attributable to PPL Energy Supply Supply (c) $ (93 ) $ 95 $ 11 $ 201 International Delivery (d) 62 62 149 160 $ (31 ) $ 157 $ 160 $ 361 June30, 2009 December31, 2008 Balance Sheet Data Total assets Supply $ 13,015 $ 12,270 International Delivery 4,377 4,199 $ 17,392 $ 16,469 (a) Includes unrealized gains and losses from economic activity.See "Commodity Price Risk (Non-trading) - Economic Activity" in Note 14 for additional information. (b) 2009 includes an unfavorable |
603 - EARNINGS PER SHARE
603 - EARNINGS PER SHARE | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Earnings Per Share | |
Earnings Per Share | 4. Earnings Per Share (PPL) EPS is computed using the two-class method, which is an earnings allocation method for computing EPS that treats a participating security as having rights to earnings that would otherwise have been available to common shareowners.Share-based payment awards that provide recipients a non-forfeitable right to dividends or dividend equivalents are considered participating securities. Basic EPS is computed by dividing income available to common shareowners by the weighted-average number of common shares outstanding during the period.Diluted EPS is computed by dividing income available to common shareowners by the weighted-average number of shares outstanding that are increased for additional shares that would be outstanding if potentially dilutive non-participating securities were converted to common shares.In 2009 and 2008, these securities consisted of stock options and performance units granted under the incentive compensation plans.In 2008, these securities also included PPL Energy Supply's 2-5/8% Convertible Senior Notes (Convertible Senior Notes). The basic and diluted EPS computations and reconciliations of the amounts of income and shares (in thousands) of common stock used in the calculations are: Three Months Ended June30, Six Months Ended June30, 2009 2008 2009 2008 Income (Numerator) Income from continuing operations after income taxes attributable to PPL $ 25 $ 184 $ 263 $ 426 Less amounts allocated to participating securities 1 1 2 Income from continuing operations after income taxes available to PPL common shareowners $ 25 $ 183 $ 262 $ 424 Income (loss) from discontinued operations (net of income taxes) available to PPL common shareowners $ (32 ) $ 6 $ (29 ) $ 24 Net income (loss) attributable to PPL $ (7 ) $ 190 $ 234 $ 450 Less amounts allocated to participating securities 1 1 2 Net income (loss) available to PPL common shareowners $ (7 ) $ 189 $ 233 $ 448 Shares of Common Stock (Denominator) Weighted-average shares - Basic EPS 375,881 373,158 375,493 373,009 Addincremental non-participating securities: Stock options and performance units 325 1,073 312 1,104 Convertible Senior Notes 671 877 Weighted-average shares - Diluted EPS 376,206 374,902 375,805 374,990 Basic EPS Available to PPL common shareowners: Income from continuing operations after income ta |
604 - INCOME TAXES
604 - INCOME TAXES | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Income Taxes | |
Income Taxes | 5. Income Taxes (PPL, PPL Energy Supply and PPL Electric) Reconciliations of effective income tax rates are: Three Months Ended June30, Six Months Ended June30, PPL 2009 2008 2009 2008 Reconciliation of Income Taxes Federal income tax on Income (Loss) from Continuing Operations Before Income Taxesat statutory tax rate - 35% $ 99 $ 119 $ 230 Increase (decrease) due to: State income taxes (a) $ (7 ) $ 8 $ 16 Amortization of investment tax credit (3 ) (2 ) $ (5 ) (5 ) Difference related to income recognition of foreign affiliates (net of foreign income taxes) (8 ) (9 ) (19 ) (17 ) Change in foreign tax reserves (a) (15 ) 17 (29 ) 5 Foreign income tax return adjustments (b) (17 ) 1 (17 ) Change in federal tax reserves (a) 3 10 6 Stranded cost securitization (a) (2 ) (2 ) (3 ) (3 ) Domestic manufacturing deduction (4 ) (3 ) (7 ) (7 ) Federal income tax credits (c) 13 Other 8 (1 ) (31 ) (5 ) (52 ) (10 ) Total income taxes from continuing operations $ (31 ) $ 94 $ 67 $ 220 (a) For the three months ended June 30, 2009, PPL recorded a $17 million benefit related to federal, state and foreign income tax reserves, which consisted primarily of a $15 million benefit reflected in "Change in foreign tax reserves," and a $2 million benefit reflected in "Stranded cost securitization." For the three months ended June 30, 2008, PPL recorded an $18 million tax expense related to federal, state and foreign income tax reserves, which consisted primarily of a $17 million expense reflected in "Change in foreign tax reserves" and a $3 million expense reflected in "Change in federal tax reserves," offset by a $2 million benefit reflected in "Stranded cost securitization." For the six months ended June 30, 2009, PPL recorded a $23 million benefit related to federal, state and foreign income tax reserves, which consisted primarily of a $29 million benefit reflected in "Change in foreign tax reserves," a $3 million benefit reflected in "Stranded cost securitization" and a $1 million benefit reflected in "Other," offset by a $10 million expense reflected in "Change in federal tax reserves." For the six months ended June 30, 2008, PPL recorded an $8 million expense related to federal, state and foreign income tax reserves, which consisted primarily of a $5 million expense reflected in "Change in foreign tax reserves" and a $6 million expense reflected in "Change in federal tax reserves, |
605 - WORKFORCE REDUCTION
605 - WORKFORCE REDUCTION | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Workforce Reduction | |
Workforce Reduction | 6. Workforce Reduction (PPL, PPL Energy Supply and PPL Electric) In February 2009, PPL announced workforce reductionsthat resulted in the elimination of approximately 200 management and staff positions across PPL's domestic operations, or approximately 6% of PPL's non-union, domestic workforce.The majority of the affected employees were separated during the first quarter of 2009. The chargesnoted below consisted primarily of enhanced pension and severance benefits under PPL's Pension Plan and Separation Policy and were recorded to "Other operation and maintenance" expense on the Statement of Income. As a result of the workforce reductions, PPLrecorded a one-time charge of $22 million ($13 million aftertax)in the first quarter of 2009. PPL Energy Supply eliminated approximately 50management and staff positions and recorded a one-time charge of $13 million ($8 million after tax) in the first quarter of 2009. Included in this charge was $8 million ($4 million after tax) of allocated costs associated with the elimination of employees of PPL Services. PPL Electric eliminated approximately 50management and staff positions and recorded a one-time charge of $9 million ($5 million after tax) in the first quarter of 2009. Included in this charge was $3 million ($1 million after tax) of allocated costs associated with the elimination of employees of PPL Services. |
606 - CREDIT ARRANGEMENTS AND F
606 - CREDIT ARRANGEMENTS AND FINANCING ACTIVITIES | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Credit Arrangements and Financing Activities | |
Credit Arrangements and Financing Activities | 7. Credit Arrangements and Financing Activities Credit Arrangements (PPL and PPL Energy Supply) PPL Energy Supply had the following credit facilities in place at June30, 2009: Expiration Date Capacity Borrowed Letters of Credit Issued Unused Capacity PPL Energy Supply Domestic Credit Facilities 364-day Syndicated Credit Facility (a) Sept-09 $ 385 $ 385 364-day Bilateral Credit Facility (b) Mar-10 200 n/a $ 2 198 5-year Structured Credit Facility (c) Mar-11 300 n/a 236 64 5-year Syndicated Credit Facility (d) June-12 3,225 $ 285 588 2,352 Total PPL Energy Supply Domestic Credit Facilities $ 4,110 $ 285 $ 826 $ 2,999 WPD Credit Facilities WPDH Limited 5-year Syndicated Credit Facility(e) Jan-13 150 145 n/a 5 WPD (South West) 5-year Syndicated Credit Facility(f) Oct-09 150 65 n/a 85 WPD (South West) Uncommitted Credit Facilities(g) 65 5 n/a 60 WPD (South West) Letter of Credit Facility Mar-10 3 n/a 3 Total WPD Credit Facilities(h) 368 215 3 150 (a) Under this facility, PPL Energy Supply has the ability to make cash borrowings and to cause the lenders to issue letters of credit.Borrowings generally bear interest at LIBOR-based rates plus a spread, depending upon the company's public debt rating. (b) In March 2009, PPL Energy Supply's 364-day bilateral credit facility was amended.The amendment included extending the expiration date from March 2009 to March 2010 and reducing the capacity from $300 million to $200 million.Under this facility, PPL Energy Supply can cause the bank to issue letters of credit but cannot make cash borrowings. (c) Under this facility, PPL Energy Supply has the ability to cause the lenders to issue letters of credit but cannot make cash borrowings.PPL Energy Supply's obligations under this facility are supported by a $300 million letter of credit issued on PPL Energy Supply's behalf under a separate, but related, $300 million five-year credit agreement, also expiring in March 2011. (d) Under this facility, PPL Energy Supply has the ability to make cash borrowings and to cause the lenders to issue letters of credit.Borrowings generally bear interest at LIBOR-based rates plus a spread, depending upon the company's public debt rating.The borrowing outstanding at June30, 2009 bears interest at 2.14%. (e) Borrowings under this facility bear interest at LIBOR-based rates plus a spread, depending on the company's public debt rating.The cash borrowings outstanding at June30, 2009 were comp |
607 - ACQUISITIONS, DEVELOPMENT
607 - ACQUISITIONS, DEVELOPMENT AND DIVESTITURES | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Acquisitions, Development and Divestitures | |
Acquisitions, Development and Divestitures | 8. Acquisitions, Development and Divestitures (PPL, PPL Energy Supply and PPL Electric) PPL and its subsidiaries continuously evaluate strategic options and, from time to time, PPL and its subsidiaries are involved in negotiations with third parties regarding acquisitions and dispositions of businesses and assets, joint ventures and development projects, which may or may not result in definitive agreements.Any such transactions may impact future financial results. Domestic (PPL and PPL Energy Supply) License Renewals In 2006, PPL Susquehanna applied to the NRC for 20-year license renewals for each of the Susquehanna units to extend their expiration dates to 2042 for Unit 1 and to 2044 for Unit 2.A final decision on the license renewal is expected to be issued in December 2009.Through June30, 2009, PPL and PPL Energy Supply capitalized $16 million of license renewal costs, which are included in "Other intangibles" within "Other Noncurrent Assets" on the Balance Sheets. Development In April 2009, PPL announced that it filed a new application with the FERC for approval to expand the capacity of its Holtwood hydroelectric plant by 125 MW.The previous application had been withdrawn in December 2008 due to economic conditions at the time.PPL reconsidered this project in light of the availability of tax incentives and potential federal loan guarantees under the Economic Stimulus Package.The expansion project has an expected capital cost of approximately $440 million.PPL could begin construction in 2010, with generation operations scheduled to start in 2013.PPL's ability and decision whether to proceed with the Holtwood facility expansion is subject to government approvals in addition to the FERC license amendment, the availability of certain federal economic stimulus incentives, as well as negotiation of acceptable construction and other related contracts.PPL cannot predict whether the Holtwood facility expansion will ultimately proceed to completion.In July 2009, a PPL subsidiary submitted an application to the DOE for a federal loan guarantee for the Holtwood expansion project. In March 2009, PPL Montana received FERC approval for its request to redevelop the Rainbow hydroelectric facility, near Great Falls, Montana, for a total plant capacity of 60 MW (representing an increase of 28 MW).The redevelopment project has an expected capital cost of $230 million.In July 2009, a PPL subsidiary submitted an application to the DOE for a federal loan guarantee for the Rainbow redevelopment project. In January 2008, PPL Susquehanna received NRC approval for its request to increase the generation capacity of the Susquehanna nuclear plant.The total expected capacity increase is 159MW, of which PPL Susquehanna's 90% ownership share is 143MW.The first uprate for Unit 1 totaling 50MW was completed in May 2008.The second uprate for Unit 1 will be completed in 2010.The first uprate for Unit 2 totaling 60MW was completed in 2009 and the second uprate will be completed in 2011.PPL Susquehanna's share of the remaining total increase is 44MW.PPL Susquehanna's share of the expected capital cost for all these uprates is $345 mil |
608 - DEFINED BENEFITS
608 - DEFINED BENEFITS | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Defined Benefits | |
Defined Benefits | 9. Defined Benefits (PPL and PPL Energy Supply) Net periodic defined benefit costs (credits) were: Pension Benefits Three Months Ended June30, Six Months Ended June30, Domestic WPD Domestic WPD 2009 2008 2009 2008 2009 2008 2009 2008 PPL Service cost $ 15 $ 15 $ 2 $ 4 $ 30 $ 30 $ 4 $ 8 Interest cost 36 34 37 49 72 69 74 98 Expected return on plan assets (42 ) (44 ) (45 ) (60 ) (84 ) (89 ) (90 ) (120 ) Amortization of: Transition asset (1 ) (1 ) (2 ) (2 ) Prior service cost 5 5 1 1 10 10 2 2 Actuarial (gain) loss 1 (2 ) 1 5 2 (4 ) 2 10 Net periodic defined benefit costs (credits) prior to special termination benefits 14 7 (4 ) (1 ) 28 14 (8 ) (2 ) Special termination benefits (a) 9 Net periodic defined benefit costs (credits) $ 14 $ 7 $ (4 ) $ (1 ) $ 37 $ 14 $ (8 ) $ (2 ) PPLEnergy Supply Service cost $ 1 $ 1 $ 2 $ 4 $ 2 $ 2 $ 4 $ 8 Interest cost 1 1 37 49 3 3 74 98 Expected return on plan assets (1 ) (2 ) (45 ) (60 ) (3 ) (4 ) (90 ) (120 ) Amortization of: Prior service cost 1 1 2 2 Actuarial loss 1 5 1 2 10 Net periodic defined benefit costs (credits) $ 1 $ $ (4 ) $ (1 ) $ 3 $ 1 $ (8 ) $ (2 ) (a) Relates to the 2009 workforce reduction.See Note 6 for additional information. Other Postretirement Benefits Three Months Ended June30, Six Months Ended June30, 2009 2008 2009 2008 PPL Service cost $ 2 $ 2 $ 3 $ 4 Interest cost 7 8 |
609 - COMMITMENTS AND CONTINGEN
609 - COMMITMENTS AND CONTINGENCIES | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Commitments and Contingencies | |
Commitments and Contingencies | 10. Commitments and Contingencies Energy Purchases, Energy Sales and Other Commitments Energy Purchase Commitments (PPL and PPL Energy Supply) PPL and PPL Energy Supply enter into long-term purchase contracts to supply the fuel requirements for generation facilities.These contracts include commitments to purchase coal, emission allowances, limestone, natural gas, oil and nuclear fuel and extend through 2019.PPL and PPL Energy Supply also enter into long-term contracts for the storage and transportation of natural gas.The long-term natural gas storage contracts extend through 2012, and the long-term natural gas transportation contracts extend through 2032.Additionally, PPL and PPL Energy Supply have entered into long-term contracts to purchase power that extend through 2017, excluding long-term power purchase agreements for the full output of two wind farms.These wind farm contracts extend through 2027. (PPL and PPL Electric) In 2007, PPL Electric began to conduct competitive solicitations to purchase electricity generation supply in 2010, after its existing PLR contract expires, for customers who do not choose a competitive supplier.A total of six auctions were planned.Each solicitation is for 850 MW of expected generation supply.Average generation supply prices (per MWh), including Pennsylvania gross receipts tax and an adjustment for line losses, for the first five solicitations are as follows: Residential Small Commercialand Small Industrial July 2007 $ 101.77 $ 105.11 October 2007 105.08 105.75 March 2008 108.80 108.76 October 2008 112.51 111.94 April 2009 86.74 87.59 Average 102.98 103.84 The fifth competitive solicitation occurred in March 2009 and was approved by the PUC in April 2009.The sixth competitive solicitation is scheduled for October 2009. In August 2008, PPL Electric filed a request with the PUC to approve its plan to purchase the PLR electricity supply that PPL Electric will need for January 2011 through May 2014.Under the plan, PPL Electric proposed to buy this electricity four times a year, beginning in the third quarter of 2009, for 12- and 24- month periods.PPL Electric also would seek bids from other companies to manage its hourly purchases in the competitive electricity market.For residential and small-business customers, 90% of the supply would be acquired through fixed-price contracts of 12 or 24 months, and 10% through hourly purchases in the open market.All of the power for large commercial and industrial customers would be purchased on an hourly basis in the open market.An independent third party would administer the process of securing power supply contracts and, with PUC oversight, select the suppliers that would provide generation supply at the lowest cost to PPL Electric's customers. In November 2008, PPL Electric proposed several amendments to its plan to reflect passage of Pennsylvania Act 129 (Act 129).Act 129, among other things, adopts new PLR electricity supply p |
610 - RELATED PARTY TRANSACTION
610 - RELATED PARTY TRANSACTIONS | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Related Party Transactions | |
Related Party Transactions | 11. Related Party Transactions PLR Contracts (PPL Energy Supply and PPL Electric) PPL Electric has power purchase agreements with PPL EnergyPlus, effective July 2000 and January 2002, under which PPL EnergyPlus will supply PPL Electric's entire PLR load through December31, 2009.Under these contracts, PPL EnergyPlus provides electricity at the predetermined capped prices that PPL Electric is authorized to charge its PLR customers.For the three months ended June30, 2009 and 2008, these purchases totaled $411 million and $428 million.For the six months ended June30, 2009 and 2008, these purchases totaled $908 million and $917 million.These purchases include nuclear decommissioning recovery and amortization of an up-front contract payment and are included in the Statements of Income as "Wholesale energy marketing to affiliate" by PPL Energy Supply, and as "Energy purchases from affiliate" by PPL Electric. Under one of the PLR contracts, PPL Electric is required to make performance assurance deposits with PPL EnergyPlus when the market price of electricity is less than the contract price by more than its contract collateral threshold.Conversely, PPL EnergyPlus is required to make performance assurance deposits with PPL Electric when the market price of electricity is greater than the contract price by more than its contract collateral threshold.PPL Electric estimated that at June30, 2009 and December 31, 2008, the fair value of the contract was approximately $312 million and $917 million.Accordingly, at June30, 2009 and December 31, 2008, PPL Energy Supply was required to provide PPL Electric with performance assurance of $79 million and $300 million.These deposits are shown on the Balance Sheets as "Collateral on PLR energy supply to/from affiliate," a current asset of PPL Energy Supply and a current liability of PPL Electric.PPL Electric pays interest equal to the one-month LIBOR plus 0.5% on this deposit, which is included in "Interest Expense with Affiliate" on the Statements of Income.PPL Energy Supply records the receipt of the interest as affiliated interest income, which is included in "Interest Income from Affiliates" on the Statements of Income.For the three months ended June30, 2009 and 2008, interest related to these deposits was insignificant and $2 million.For the six months ended June30, 2009 and 2008, interest related to these deposits was $1 million and $5 million. In 2001, PPL Electric made a $90 million up-front payment to PPL EnergyPlus in connection with the PLR contracts.The up-front payment is being amortized by both parties over the term of the PLR contracts.The unamortized balance of this payment and other payments under the contracts was $6 million and $12 million at June30, 2009 and December31, 2008.These balances are reflected on the Balance Sheets as "Deferred revenue on PLR energy supply to affiliate" by PPL Energy Supply, and as "Prepayment on PLR energy supply from affiliate" by PPL Electric.The prepayment will be fully amortized during 2009. Under Pennsylvania law and PUC regulations, PPL Electric is required to buy electricity generation supply for customers who do not choose a competiti |
611 - OTHER INCOME
611 - OTHER INCOME (EXPENSE) NET | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Other Income - Net | |
Other Income (Expense) - Net | 12. Other Income (Expense) - net (PPL, PPL Energy Supply and PPL Electric) The breakdown of "Other Income (Expense)- net" was: Three Months Ended June30, Six Months Ended June30, 2009 2008 2009 2008 PPL Other Income Gains related to the extinguishment of notes (Note 7) $ 29 Interest income $ 1 $ 7 8 $ 17 Earnings on securities in the NDT funds 5 3 6 5 Equity earnings 1 1 1 1 Hyder liquidation distributions 1 3 Gain on sale of PPE 2 2 Miscellaneous - Domestic 1 2 3 3 Miscellaneous - International 1 1 1 1 Total 9 17 48 32 Other Expense Economic foreign currency hedges 11 1 11 1 Charitable contributions 1 2 1 Miscellaneous - Domestic 2 1 5 3 Miscellaneous - International 1 2 1 3 Other Income (Expense)-net $ (6 ) $ 13 $ 29 $ 24 PPLEnergy Supply Other Income Gains related to the extinguishment of notes (Note 7) $ 25 Earnings on securities in the NDT funds $ 5 $ 3 6 $ 5 Interest income 1 6 5 13 Equity earnings 1 1 1 1 Hyder liquidation distributions 1 3 Gain on sale of PPE 2 2 Miscellaneous - Domestic 2 1 Miscellaneous - International 1 1 1 1 Total 8 14 40 26 Other Expense Economic foreign currency hedges 11 2 11 2 Miscellaneous - Domestic 2 5 2 Miscellaneous - International 1 2 1 3 Other Income (Expense)-net $ (6 ) $ 10 $ 23 $ 19 PPLElectric Other Income Interest income $ 1 $ 2 $ 3 $ 4 Other Expense 1 1 Other Income (Expense)-net $ $ 2 $ 2 $ 4 |
612 - FAIR VALUE MEASUREMENTS A
612 - FAIR VALUE MEASUREMENTS AND CREDIT CONCENTRATION | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Fair Value Measurements And Credit Concentration | |
Fair Value Measurements and Credit Concentration | 13. Fair Value Measurements and Credit Concentration (PPL, PPL Energy Supply and PPL Electric) Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price).PPL and its subsidiaries use, as appropriate, a market approach (generally, data from market transactions), an income approach (generally, present value techniques and option-pricing models), and/or a cost approach (generally, replacement cost) to measure the fair value of an asset or liability.These valuation approaches incorporate inputs such as observable, independent market data and/or unobservable data that management believes are predicated on the assumptions market participants would use to price an asset or liability.These inputs may incorporate, as applicable, certain risks such as nonperformance risk, which includes credit risk. Recurring Fair Value Measurements June30, 2009 December31, 2008 Fair Value Measurements Using Fair Value Measurements Using Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 PPL Assets Cash and cash equivalents $ 973 $ 973 $ 1,100 $ 1,100 Short-term investments- municipal debt securities 150 150 Restricted cash and cash equivalents 159 159 347 347 Price risk management assets: Energy commodities 3,878 15 $ 3,685 $ 178 2,460 19 $ 2,143 $ 298 Interest rate/foreign exchange 74 72 2 156 152 4 3,952 15 3,757 180 2,616 19 2,295 302 NDT funds: Cash and cash equivalents 5 5 7 7 Equity securities: (a) U.S. large-cap 216 148 68 182 116 66 U.S. mid/small-cap 84 63 21 69 50 19 Debt securities: U.S. Treasury 59 59 77 77 U.S. government agency 11 11 14 14 Municipality 64 64 61 61 Investment-grade corporate 27 27 33 |
613 - DERIVATIVE INSTRUMENTS AN
613 - DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Derivatives Instruments and Hedging Activities | |
Derivative Instruments and Hedging Activities | 14. Derivative Instruments and Hedging Activities Risk Management Objectives (PPL, PPL Energy Supply and PPL Electric) PPL has a risk management policy approved by the Board of Directors to manage market risk and counterparty credit risk.The RMC, comprised of senior management and chaired by the Vice President-Risk Management, oversees the risk management function.Key risk control activities designed to ensure compliance with the risk policy and detailed programs include, but are not limited to, credit review and approval, validation of transactions and market prices, verification of risk and transaction limits, VaR analyses, sensitivity analyses, and daily portfolio reporting, including open positions, determinations of fair value, and other risk management metrics. Market risk is the potential loss PPL and its subsidiaries may incur as a result of price changes associated with a particular financial or commodity instrument. PPL and PPL Energy Supply are exposed to market risk from: commodity price risk for energy and energy-related products associated with the sale of electricity from its generating assets and other electricity marketing activities and the purchase of fuel and fuel-related commodities for generating assets, as well as for proprietary trading activities; interest rate and price risk associated with debt used to finance operations, as well as debt and equity securities in NDT funds and defined benefit plans; and foreign currency exchange rate risk associated with investments in U.K. affiliates, as well as purchases of equipment in currencies other than U.S. dollars. PPL and PPL Energy Supply utilize forward contracts, futures contracts, options, swaps and structured deals such as tolling agreements as part of the risk management strategy to minimize unanticipated fluctuations in earnings caused by changes in commodity prices, interest rates and foreign currency exchange rates.All derivatives are recognized on the balance sheet at their fair value, unless they qualify for NPNS. PPL Electric is exposed to market risk from its obligation as the PLR to its customers.It has mitigated that risk with the fixed-price PLR agreement with PPL EnergyPlus, which expires at the end of 2009, and by entering into fixed-price load-following supply agreements for its customersfor 2010. Credit risk is the potential loss PPL and its subsidiaries may incur due to a counterparty's non-performance, including defaults on payments and energy commodity deliveries. PPL and PPL Energy Supply are exposed to credit risk from: commodity derivatives with its energy trading partners, which include other energy companies, fuel suppliers, and financial institutions; interest rate derivatives with financial institutions; and foreign currency derivatives with financial institutions. PPL Electric is exposed to credit risk from its load-following supply agreements for its customers in 2010. The majority of the credit risk stems from PPL Energy Supply's and PPL Electric's commodity derivatives for multi-year contracts for energy sales and purchases.If the counterparties fail to perf |
614 - GOODWILL
614 - GOODWILL | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Goodwill | |
Goodwill | 15. Goodwill (PPL and PPL Energy Supply) The changes in the carrying amounts of goodwill by segment were: Supply International Delivery Total Balance at December31, 2008 $ 94 $ 669 $ 763 Effect of foreign currency exchange rates 33 33 Balance at June30,2009 $ 94 $ 702 $ 796 |
615 - ASSET RETIREMENT OBLIGATI
615 - ASSET RETIREMENT OBLIGATIONS | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Asset Retirement Obligations | |
Asset Retirement Obligations | 16. Asset Retirement Obligations (PPL and PPL Energy Supply) The change in the carrying amounts of the AROs was: AROs at December31, 2008 $ 389 Accretion expense 15 Revisions to estimates 1 Obligations settled (11 ) AROs at June30, 2009 $ 394 The most significant ARO recorded by PPL and PPL Energy Supply relates to the decommissioning of the Susquehanna nuclear station.The accrued nuclear decommissioning obligation was $335 million and $322 million at June30, 2009 and December31, 2008. Assets in the NDT funds are legally restricted for purposes of settling PPL's and PPL Energy Supply's ARO related to the decommissioning of the Susquehanna station.The aggregate fair value of these assets was $468 million and $446 million at June30, 2009 and December31, 2008.See Notes 13 and 18 for additional information on the fair value of these assets. |
616 - RESTRICTED CASH AND CASH
616 - RESTRICTED CASH AND CASH EQUIVALENTS | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Restricted cash and cash equivalents | |
Restricted cash and cash equivalents | 17. Restricted Cash and Cash Equivalents (PPL, PPL Energy Supply and PPL Electric) The following table details the components of restricted cash and cash equivalents by reporting entity and by type. June30, 2009 PPL PPL Energy Supply PPL Electric Current: Funds deposited with trustee to defease First Mortgage Bonds(a) $ 1 $ 1 Deposits for trading purposes (b) 31 $ 31 Counterparty collateral 92 92 Client deposits 4 Miscellaneous 3 3 Total current 131 126 1 Noncurrent: Required deposits of WPD (c) 14 14 Funds deposited with Trustee to defease First Mortgage Bonds(a) 13 13 Other 1 1 Total noncurrent 28 14 14 $ 159 $ 140 $ 15 December31, 2008 PPL PPL Energy Supply PPL Electric Current: Funds deposited with Trustee to defease First Mortgage Bonds(a) $ 1 $ 1 Deposits for trading purposes (b) 301 $ 301 Counterparty collateral 12 12 Client deposits 4 Miscellaneous 2 2 Total current 320 315 1 Noncurrent: Required deposits of WPD (c) 13 13 Funds deposited with Trustee to defease First Mortgage Bonds(a) 14 14 Total noncurrent 27 13 14 $ 347 $ 328 $ 15 (a) The carrying amount of related First Mortgage Bonds was $10 million at June30, 2009 and December31, 2008. (b) Represents margin posted by PPL Energy Supply in connection with trading activities.The decrease from December31, 2008 relates primarily to decreases in market prices and the realization of certain transactions. (c) Primarily consists of insurance reserves. |
617 - AVAILABLE FOR SALE SECURI
617 - AVAILABLE FOR SALE SECURITIES | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Available-for-Sale Securities | |
Available-for-Sale Securities | 18. Available-for-Sale Securities (PPL and PPL Energy Supply) The following table shows the amortized cost of available-for-sale securities and the gross unrealized gains and losses recorded in AOCI.See Note 13 for information regarding the fair value of these securities. June30, 2009 December 31, 2008 Amortized Cost Gross Unrealized Gains Gross UnrealizedLosses Amortized Cost Gross Unrealized Gains Gross UnrealizedLosses(a) PPL Short-term investments municipal debt securities $ 150 NDT funds: Cash and cash equivalents $ 5 7 Equity securities: U.S. large-cap 171 $ 45 160 $ 22 U.S. mid/small-cap 65 19 60 9 Debt securities: U.S. Treasury 55 4 67 10 U.S. government agency 11 13 1 Municipality 63 3 $ (2 ) 59 2 Investment-grade corporate 26 2 (1 ) 31 2 Residential mortgage-backed securities 1 2 Other 1 1 398 73 (3 ) 400 46 Auction rate securities 29 (11 ) 29 $ (5 ) TotalPPL $ 427 $ 73 $ (14 ) $ 579 $ 46 $ (5 ) PPLEnergy Supply Short-term investments municipal debt securities $ 150 NDT funds: Cash and cash equivalents $ 5 7 Equity securities: U.S. large-cap 171 $ 45 160 $ 22 U.S. mid/small-cap 65 19 60 9 Debt securities: U.S. Treasury 55 4 67 10 U.S. government agency 11 13 1 Municipality 63 3 $ (2 ) 59 2 Investment-grade corporate 26 2 (1 ) 31 2 Residential mortgage-backed securities 1 2 Other 1 1 398 |
618 - LEASES
618 - LEASES | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Leases | |
Leases | 19. Leases Lessor Transactions (PPL and PPL Energy Supply) A PPL Energy Supply subsidiary is the lessor, for accounting purposes, of each of the Shoreham and Edgewood plants (collectively with related tolling agreements, the Long Island generation business).In May 2009, PPL Generation signed a definitive agreement to sell the Long Island generation business.The tolling agreements related to these plants, accounted for as containing leases, will be transferred to the new owner upon completion of the sale.The lease related to the Shoreham plant is classified as a direct-financing lease.Future minimum lease payments on this lease are estimated to be $16 million per year for 2009 through 2013.The lease related to the Edgewood plant is classified as an operating lease.Minimum future lease rentals are estimated to be $3 million per year for 2009 through 2013.At December31, 2008, total minimum future rentals under this lease were estimated to be $28 million.PPL Energy Supply no longer expects to receive these payments subsequent to completion of the anticipated sale.See Note 8 for additional information on the anticipated sale. |
619 - NEW ACCOUNTING STANDARDS
619 - NEW ACCOUNTING STANDARDS PENDING ADOPTION | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
New Accounting Standards Pending Adoption | |
New Accounting Standards Pending Adoption | 20. New Accounting Standards Pending Adoption (PPL, PPL Energy Supply and PPL Electric) FSP FAS 132(R)-1 FSP FAS 132(R)-1 amends SFAS 132(R) to provide guidance on an employer's disclosures about plan assets of defined benefit plans.The objectives of the disclosures are to provide users of financial statements with an understanding of: how investment allocation decisions are made, including the factors that are pertinent to an understanding of investment policies and strategies; the major categories of plan assets; the inputs and valuation techniques used to measure the fair value of plan assets; the effect of fair value measurements using significant unobservable inputs (Level 3) on changes in plan assets for the period; and significant concentrations of risk within plan assets. PPL and its subsidiaries will adopt FSP FAS 132(R)-1, prospectively, effective December 31, 2009.FSP FAS 132(R)-1 was issued to provide greater transparency within disclosures; therefore, the adoption is not expected to have a material impact on PPL and its subsidiaries' financial statements. SFAS 166 SFAS 166 was issued to revise the accounting for transfers of financial assets.SFAS 166 eliminates the concept of a qualifying special-purpose entity (QSPE); therefore, QSPEs will be subject to consolidation guidance.Further, SFAS 166 changes the requirements for the derecognition of financial assets, establishes new criteria for reporting the transfer of a portion of a financial asset as a sale and requires transferors to initially recognize, at fair value, assets obtained and liabilities incurred as a result of a transfer accounted for as a sale.Additionally, SFAS 166 requires enhanced disclosures to improve the transparency around transfers of financial assets and a transferor's continuing involvement. PPL and its subsidiaries will adopt SFAS 166 effective January1, 2010.Early adoption is prohibited.SFAS 166 will be applied prospectively to new transfers of financial assets.Disclosures will be required for all transfers, including those entered into before the effective date.Comparative disclosures are encouraged, but not required, for periods in which these disclosures were not previously required.The potential impact of adoption to the financial statements is not yet determinable but could be material. SFAS 167 SFAS 167 amends FIN 46(R) to replace the quantitative-based risks and rewards calculation for determining which entity, if any, has a controlling financial interest in a variable interest entity (VIE) and is the primary beneficiary.SFAS 167 prescribes a qualitative approach focused on identifying which entity has the power to direct the activities of a VIE that most significantly impact the VIE's economic performance and the obligation to absorb losses of or the right to receive benefits from the VIE that could potentially be significant to the VIE.SFAS 167 requires ongoing assessments of whether an entity is the primary beneficiary of a VIE and requires enhanced disclosures to improve the transparency about an entity's involvement in a VIE. Upon adoption of SFAS 167, all previous cons |
620 - SUBSEQUENT EVENTS
620 - SUBSEQUENT EVENTS | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Subsequent Events | |
Subsequent Events | 21. Subsequent Events (PPL, PPL Energy Supply and PPL Electric) Subsequent events have been evaluated through the time of issuance of these financial statements on August 4, 2009, and are included in the relevant note disclosures. |
Document Information
Document Information | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Document Information [Line Items] | |
Document Type | 10-Q |
Document Period End Date | 2009-06-30 |
Amendment Flag | false |
Entity Information
Entity Information (USD $) | |||
6 Months Ended
Jun. 30, 2009 | Jul. 24, 2009
| Jun. 30, 2008
| |
Entity Information [Line Items] | |||
Entity Registrant Name | PPL Corporation | ||
Entity Central Index Key | 0000922224 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $19,576,123,706 | ||
Entity Common Stock, Shares Outstanding | 376,580,347 |