Trust Investments
 3 Months Ended
Mar. 31, 2018
Schedule of Trust Investments [Line Items]  
Trust Investments
NDT Fund
Power maintains an external master NDT to fund its share of decommissioning costs for its five nuclear facilities upon their respective termination of operation. The trust contains two separate funds: a qualified fund and a non-qualified fund. Section 468A of the Internal Revenue Code limits the amount of money that can be contributed into a qualified fund. The funds are managed by third-party investment managers who operate under investment guidelines developed by Power.
The following tables show the fair values and gross unrealized gains and losses for the securities held in the NDT Fund.
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
Domestic
$
463

 
$
226

 
$
(7
)
 
$
682

 
 
   International
318

 
93

 
(7
)
 
404

 
 
Total Equity Securities
781

 
319

 
(14
)
 
1,086

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
518

 
1

 
(11
)
 
508

 
 
Corporate
464

 
1

 
(9
)
 
456

 
 
Total Available-for-Sale Debt Securities
982

 
2

 
(20
)
 
964

 
 
Other
1

 
—

 
—

 
1

 
 
Total NDT Fund Investments (A)
$
1,764

 
$
321

 
$
(34
)
 
$
2,051

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2017
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
Domestic
$
497

 
$
245

 
$
(2
)
 
$
740

 
 
   International
311

 
99

 
(3
)
 
407

 
 
Total Equity Securities
808

 
344

 
(5
)
 
1,147

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
586

 
2

 
(4
)
 
584

 
 
Corporate
400

 
4

 
(2
)
 
402

 
 
Total Available-for-Sale Debt Securities
986

 
6

 
(6
)
 
986

 
 
Total NDT Fund Investments
$
1,794

 
$
350

 
$
(11
)
 
$
2,133

 
 
 
 
 
 
 
 
 
 
 

Net unrealized gains (losses) on debt securities of $(10) million (after-tax) were included in Accumulated Other Comprehensive Loss on PSEG’s and Power’s Condensed Consolidated Balance Sheets as of March 31, 2018. The portion of net unrealized gains (losses) recognized during the first quarter of 2018 related to equity securities still held at the end of March 31, 2018 was $(10) million.
The amounts in the preceding tables do not include receivables and payables for NDT Fund transactions which have not settled at the end of each period. Such amounts are included in Accounts Receivable and Accounts Payable on the Condensed Consolidated Balance Sheets as shown in the following table.
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
Accounts Receivable
$
13

 
$
24

 
 
Accounts Payable
$
9

 
$
74

 
 
 
 
 
 
 

The following table shows the value of securities in the NDT Fund that have been in an unrealized loss position for less than and greater than 12 months.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
As of December 31, 2017
 
 
 
Less Than 12
Months
 
Greater Than 12
Months
 
Less Than 12
Months
 
Greater Than 12
Months
 
 
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
 
 
Millions
 
 
Equity Securities (A)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Domestic
$
117

 
$
(7
)
 
$
—

 
$
—

 
$
40

 
$
(2
)
 
$
—

 
$
—

 
 
   International
65

 
(7
)
 
1

 
—

 
29

 
(3
)
 
2

 
—

 
 
Total Equity Securities
182

 
(14
)
 
1

 
—

 
69

 
(5
)
 
2

 
—

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government (B)
364

 
(7
)
 
80

 
(4
)
 
343

 
(2
)
 
91

 
(2
)
 
 
Corporate (C)
339

 
(8
)
 
25

 
(1
)
 
191

 
(1
)
 
27

 
(1
)
 
 
Total Available-for-Sale Debt Securities
703

 
(15
)
 
105

 
(5
)
 
534

 
(3
)
 
118

 
(3
)
 
 
NDT Trust Investments
$
885

 
$
(29
)
 
$
106

 
$
(5
)
 
$
603

 
$
(8
)
 
$
120

 
$
(3
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A)
Equity Securities—Investments in marketable equity securities within the NDT Fund are primarily in common stocks within a broad range of industries and sectors. Effective January 1, 2018, unrealized gains and losses on these securities are recorded in Net Income.
(B)
Debt Securities (Government)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). The unrealized losses on Power’s NDT investments in U.S. Treasury obligations and Federal Agency mortgage-backed securities were caused by interest rate changes. These investments are guaranteed by the U.S. government or an agency of the U.S. government. Power also has investments in municipal bonds that are primarily in investment grade securities. It is not expected that these securities will settle for less than their amortized cost. Since Power does not intend to sell these securities nor will it be more-likely-than-not required to sell, Power does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
(C)
Debt Securities (Corporate)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). Power’s investments in corporate bonds are primarily in investment grade securities. It is not expected that these securities would settle for less than their amortized cost. Since Power does not intend to sell these securities nor will it be more-likely-than-not required to sell, Power does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
The proceeds from the sales of and the net gains (losses) on securities in the NDT Fund were:
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
March 31,
 
 
 
 
2018
 
2017
 
 
 
Millions
 
 
Proceeds from NDT Fund Sales (A)
 
$
372

 
$
247

 
 
Net Realized Gains (Losses) on NDT Fund
 
 
 
 
 
 
Gross Realized Gains
 
$
24

 
$
21

 
 
Gross Realized Losses
 
(12
)
 
(4
)
 
 
Net Realized Gains (Losses) on NDT Fund (B)
 
12

 
17

 
 
Unrealized Gains (Losses) on Equity Securities in NDT Fund (C)
 
(34
)
 
N/A

 
 
Other-Than-Temporary-Impairments
 
—

 
(1
)
 
 
Net Gains (Losses) on NDT Fund Investments
 
$
(22
)
 
$
16

 
 
 
 
 
 
 
 

(A)Includes activity in accounts related to the liquidation of funds being transitioned to new managers.
(B)The cost of these securities was determined on the basis of specific identification.
(C)
Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded in Net Income instead of Other Comprehensive Income (Loss).
The NDT Fund debt securities held as of March 31, 2018 had the following maturities:
 
 
 
 
 
 
Time Frame
 
Fair Value
 
 
 
 
Millions
 
 
Less than one year
 
$
15

 
 
1 - 5 years
 
300

 
 
6 - 10 years
 
201

 
 
11 - 15 years
 
40

 
 
16 - 20 years
 
73

 
 
Over 20 years
 
335

 
 
Total NDT Available-for-Sale Debt Securities
$
964

 
 
 
 
 
 

Power periodically assesses individual debt securities whose fair value is less than amortized cost to determine whether the investments are considered to be other-than-temporarily impaired. For these securities, management considers its intent to sell or requirement to sell a security prior to expected recovery. In those cases where a sale is expected, any impairment would be recorded through earnings. For fixed income securities where there is no intent to sell or likely requirement to sell, management evaluates whether credit loss is a component of the impairment. If so, that portion is recorded through earnings while the noncredit loss component is recorded through Accumulated Other Comprehensive Income (Loss). Any subsequent recoveries in the value of these securities would be recognized in Accumulated Other Comprehensive Income (Loss) unless the securities are sold, in which case, any gain would be recognized in income. The assessment of fair market value compared to cost is applied on a weighted average basis taking into account various purchase dates and initial cost of the securities.
Rabbi Trust
PSEG maintains certain unfunded nonqualified benefit plans to provide supplemental retirement and deferred compensation benefits to certain key employees. Certain assets related to these plans have been set aside in a grantor trust commonly known as a “Rabbi Trust.”
The following tables show the fair values, gross unrealized gains and losses and amortized cost basis for the securities held in the Rabbi Trust.
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
   Domestic
$
21

 
$
2

 
$
—

 
$
23

 
 
   International
—

 
—

 
—

 
—

 
 
Total Equity Securities
21

 
2

 
—

 
23

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
91

 
—

 
(2
)
 
89

 
 
Corporate
114

 
1

 
(2
)
 
113

 
 
Total Available-for-Sale Debt Securities
205

 
1

 
(4
)
 
202

 
 
Total Rabbi Trust Investments
$
226

 
$
3

 
$
(4
)
 
$
225

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2017
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
   Domestic
$
24

 
$
3

 
$
—

 
$
27

 
 
   International
—

 
—

 
—

 
—

 
 
Total Equity Securities
24

 
3

 
—

 
27

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
85

 
1

 
(1
)
 
85

 
 
Corporate
118

 
2

 
(1
)
 
119

 
 
Total Available-for-Sale Debt Securities
203

 
3

 
(2
)
 
204

 
 
Total Rabbi Trust Investments
$
227

 
$
6

 
$
(2
)
 
$
231

 
 
 
 
 
 
 
 
 
 
 

Net unrealized gains (losses) on debt securities of $(3) million (after-tax) were included in Accumulated Other Comprehensive Loss on PSEG’s Condensed Consolidated Balance Sheet as of March 31, 2018. The portion of net unrealized gains (losses) recognized during the first quarter of 2018 related to equity securities still held at the end of March 31, 2018 was less than $(1) million.
The amounts in the preceding tables do not include receivables and payables for Rabbi Trust Fund transactions which have not settled at the end of each period. Such amounts are included in Accounts Receivable and Accounts Payable on the Condensed Consolidated Balance Sheets as shown in the following table.
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
Accounts Receivable
$
2

 
$
2

 
 
Accounts Payable
$
—

 
$
1

 
 
 
 
 
 
 

The following table shows the value of securities in the Rabbi Trust Fund that have been in an unrealized loss position for less than 12 months and greater than 12 months.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
As of December 31, 2017
 
 
 
Less Than 12
Months
 
Greater Than 12
Months
 
Less Than 12
Months
 
Greater Than 12
Months
 
 
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
 
 
Millions
 
 
Equity Securities (A)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Domestic
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
 
   International
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
 
Total Equity Securities
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government (B)
48

 
(1
)
 
23

 
(1
)
 
28

 
—

 
25

 
(1
)
 
 
Corporate (C)
73

 
(2
)
 
8

 
—

 
39

 
(1
)
 
9

 
—

 
 
Total Available-for-Sale Debt Securities
121

 
(3
)
 
31

 
(1
)
 
67

 
(1
)
 
34

 
(1
)
 
 
Rabbi Trust Investments
$
121

 
$
(3
)
 
$
31

 
$
(1
)
 
$
67

 
$
(1
)
 
$
34

 
$
(1
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A)
Equity Securities—Investments in marketable equity securities within the Rabbi Trust Fund are through a mutual fund which invests primarily in common stocks within a broad range of industries and sectors. Effective January 1, 2018, unrealized gains and losses on these securities are recorded in Net Income.
(B)
Debt Securities (Government)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). The unrealized losses on PSEG’s Rabbi Trust investments in U.S. Treasury obligations and Federal Agency mortgage-backed securities were caused by interest rate changes. These investments are guaranteed by the U.S. government or an agency of the U.S. government. PSEG also has investments in municipal bonds that are primarily in investment grade securities. It is not expected that these securities will settle for less than their amortized cost. Since PSEG does not intend to sell these securities nor will it be more-likely-than-not required to sell, PSEG does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
(C)
Debt Securities (Corporate)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). PSEG’s investments in corporate bonds are primarily in investment grade securities. It is not expected that these securities would settle for less than their amortized cost. Since PSEG does not intend to sell these securities nor will it be more-likely-than-not required to sell, PSEG does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
The proceeds from the sales of and the net gains (losses) on securities in the Rabbi Trust Fund were:
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
March 31,
 
 
 
 
2018
 
2017
 
 
 
Millions
 
 
Proceeds from Rabbi Trust Sales (A)
 
$
25

 
$
51

 
 
Net Realized Gains (Losses) on Rabbi Trust:
 
 
 
 
 
 
Gross Realized Gains
 
$
2

 
$
15

 
 
Gross Realized Losses
 
(2
)
 
(3
)
 
 
Net Realized Gains (Losses) on Rabbi Trust (B)
 
—

 
12

 
 
Unrealized Gains (Losses) on Equity Securities in Rabbi Trust (C)
 
—

 
N/A

 
 
Other-Than-Temporary-Impairments
 
—

 
—

 
 
Net Gains (Losses) on Rabbi Trust Investments
 
$
—

 
$
12

 
 
 
 
 
 
 
 

(A)Includes activity in accounts related to the liquidation of funds being transitioned to new managers.
(B)The cost of these securities was determined on the basis of specific identification.
(C)
Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded in Net Income instead of Other Comprehensive Income (Loss).
The Rabbi Trust debt securities held as of March 31, 2018 had the following maturities:
 
 
 
 
 
 
Time Frame
 
Fair Value
 
 
 
 
Millions
 
 
Less than one year
 
$
1

 
 
1 - 5 years
 
36

 
 
6 - 10 years
 
29

 
 
11 - 15 years
 
6

 
 
16 - 20 years
 
17

 
 
Over 20 years
 
113

 
 
Total Rabbi Trust Available-for-Sale Debt Securities
$
202

 
 
 
 
 
 

PSEG periodically assesses individual debt securities whose fair value is less than amortized cost to determine whether the investments are considered to be other-than-temporarily impaired. For these securities, management considers its intent to sell or requirement to sell a security prior to expected recovery. In those cases where a sale is expected, any impairment would be recorded through earnings. For fixed income securities where there is no intent to sell or likely requirement to sell, management evaluates whether credit loss is a component of the impairment. If so, that portion is recorded through earnings while the noncredit loss component is recorded through Accumulated Other Comprehensive Income (Loss). The assessment of fair market value compared to cost is applied on a weighted average basis taking into account various purchase dates and initial cost of the securities.
The fair value of the Rabbi Trust related to PSEG, PSE&G and Power are detailed as follows:
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
PSE&G
$
45

 
$
46

 
 
Power
56

 
57

 
 
Other
124

 
128

 
 
Total Rabbi Trust Investments
$
225

 
$
231

 
 
 
 
 
 
 
PSE And G [Member]  
Schedule of Trust Investments [Line Items]  
Trust Investments
NDT Fund
Power maintains an external master NDT to fund its share of decommissioning costs for its five nuclear facilities upon their respective termination of operation. The trust contains two separate funds: a qualified fund and a non-qualified fund. Section 468A of the Internal Revenue Code limits the amount of money that can be contributed into a qualified fund. The funds are managed by third-party investment managers who operate under investment guidelines developed by Power.
The following tables show the fair values and gross unrealized gains and losses for the securities held in the NDT Fund.
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
Domestic
$
463

 
$
226

 
$
(7
)
 
$
682

 
 
   International
318

 
93

 
(7
)
 
404

 
 
Total Equity Securities
781

 
319

 
(14
)
 
1,086

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
518

 
1

 
(11
)
 
508

 
 
Corporate
464

 
1

 
(9
)
 
456

 
 
Total Available-for-Sale Debt Securities
982

 
2

 
(20
)
 
964

 
 
Other
1

 
—

 
—

 
1

 
 
Total NDT Fund Investments (A)
$
1,764

 
$
321

 
$
(34
)
 
$
2,051

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2017
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
Domestic
$
497

 
$
245

 
$
(2
)
 
$
740

 
 
   International
311

 
99

 
(3
)
 
407

 
 
Total Equity Securities
808

 
344

 
(5
)
 
1,147

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
586

 
2

 
(4
)
 
584

 
 
Corporate
400

 
4

 
(2
)
 
402

 
 
Total Available-for-Sale Debt Securities
986

 
6

 
(6
)
 
986

 
 
Total NDT Fund Investments
$
1,794

 
$
350

 
$
(11
)
 
$
2,133

 
 
 
 
 
 
 
 
 
 
 

Net unrealized gains (losses) on debt securities of $(10) million (after-tax) were included in Accumulated Other Comprehensive Loss on PSEG’s and Power’s Condensed Consolidated Balance Sheets as of March 31, 2018. The portion of net unrealized gains (losses) recognized during the first quarter of 2018 related to equity securities still held at the end of March 31, 2018 was $(10) million.
The amounts in the preceding tables do not include receivables and payables for NDT Fund transactions which have not settled at the end of each period. Such amounts are included in Accounts Receivable and Accounts Payable on the Condensed Consolidated Balance Sheets as shown in the following table.
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
Accounts Receivable
$
13

 
$
24

 
 
Accounts Payable
$
9

 
$
74

 
 
 
 
 
 
 

The following table shows the value of securities in the NDT Fund that have been in an unrealized loss position for less than and greater than 12 months.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
As of December 31, 2017
 
 
 
Less Than 12
Months
 
Greater Than 12
Months
 
Less Than 12
Months
 
Greater Than 12
Months
 
 
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
 
 
Millions
 
 
Equity Securities (A)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Domestic
$
117

 
$
(7
)
 
$
—

 
$
—

 
$
40

 
$
(2
)
 
$
—

 
$
—

 
 
   International
65

 
(7
)
 
1

 
—

 
29

 
(3
)
 
2

 
—

 
 
Total Equity Securities
182

 
(14
)
 
1

 
—

 
69

 
(5
)
 
2

 
—

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government (B)
364

 
(7
)
 
80

 
(4
)
 
343

 
(2
)
 
91

 
(2
)
 
 
Corporate (C)
339

 
(8
)
 
25

 
(1
)
 
191

 
(1
)
 
27

 
(1
)
 
 
Total Available-for-Sale Debt Securities
703

 
(15
)
 
105

 
(5
)
 
534

 
(3
)
 
118

 
(3
)
 
 
NDT Trust Investments
$
885

 
$
(29
)
 
$
106

 
$
(5
)
 
$
603

 
$
(8
)
 
$
120

 
$
(3
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A)
Equity Securities—Investments in marketable equity securities within the NDT Fund are primarily in common stocks within a broad range of industries and sectors. Effective January 1, 2018, unrealized gains and losses on these securities are recorded in Net Income.
(B)
Debt Securities (Government)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). The unrealized losses on Power’s NDT investments in U.S. Treasury obligations and Federal Agency mortgage-backed securities were caused by interest rate changes. These investments are guaranteed by the U.S. government or an agency of the U.S. government. Power also has investments in municipal bonds that are primarily in investment grade securities. It is not expected that these securities will settle for less than their amortized cost. Since Power does not intend to sell these securities nor will it be more-likely-than-not required to sell, Power does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
(C)
Debt Securities (Corporate)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). Power’s investments in corporate bonds are primarily in investment grade securities. It is not expected that these securities would settle for less than their amortized cost. Since Power does not intend to sell these securities nor will it be more-likely-than-not required to sell, Power does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
The proceeds from the sales of and the net gains (losses) on securities in the NDT Fund were:
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
March 31,
 
 
 
 
2018
 
2017
 
 
 
Millions
 
 
Proceeds from NDT Fund Sales (A)
 
$
372

 
$
247

 
 
Net Realized Gains (Losses) on NDT Fund
 
 
 
 
 
 
Gross Realized Gains
 
$
24

 
$
21

 
 
Gross Realized Losses
 
(12
)
 
(4
)
 
 
Net Realized Gains (Losses) on NDT Fund (B)
 
12

 
17

 
 
Unrealized Gains (Losses) on Equity Securities in NDT Fund (C)
 
(34
)
 
N/A

 
 
Other-Than-Temporary-Impairments
 
—

 
(1
)
 
 
Net Gains (Losses) on NDT Fund Investments
 
$
(22
)
 
$
16

 
 
 
 
 
 
 
 

(A)Includes activity in accounts related to the liquidation of funds being transitioned to new managers.
(B)The cost of these securities was determined on the basis of specific identification.
(C)
Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded in Net Income instead of Other Comprehensive Income (Loss).
The NDT Fund debt securities held as of March 31, 2018 had the following maturities:
 
 
 
 
 
 
Time Frame
 
Fair Value
 
 
 
 
Millions
 
 
Less than one year
 
$
15

 
 
1 - 5 years
 
300

 
 
6 - 10 years
 
201

 
 
11 - 15 years
 
40

 
 
16 - 20 years
 
73

 
 
Over 20 years
 
335

 
 
Total NDT Available-for-Sale Debt Securities
$
964

 
 
 
 
 
 

Power periodically assesses individual debt securities whose fair value is less than amortized cost to determine whether the investments are considered to be other-than-temporarily impaired. For these securities, management considers its intent to sell or requirement to sell a security prior to expected recovery. In those cases where a sale is expected, any impairment would be recorded through earnings. For fixed income securities where there is no intent to sell or likely requirement to sell, management evaluates whether credit loss is a component of the impairment. If so, that portion is recorded through earnings while the noncredit loss component is recorded through Accumulated Other Comprehensive Income (Loss). Any subsequent recoveries in the value of these securities would be recognized in Accumulated Other Comprehensive Income (Loss) unless the securities are sold, in which case, any gain would be recognized in income. The assessment of fair market value compared to cost is applied on a weighted average basis taking into account various purchase dates and initial cost of the securities.
Rabbi Trust
PSEG maintains certain unfunded nonqualified benefit plans to provide supplemental retirement and deferred compensation benefits to certain key employees. Certain assets related to these plans have been set aside in a grantor trust commonly known as a “Rabbi Trust.”
The following tables show the fair values, gross unrealized gains and losses and amortized cost basis for the securities held in the Rabbi Trust.
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
   Domestic
$
21

 
$
2

 
$
—

 
$
23

 
 
   International
—

 
—

 
—

 
—

 
 
Total Equity Securities
21

 
2

 
—

 
23

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
91

 
—

 
(2
)
 
89

 
 
Corporate
114

 
1

 
(2
)
 
113

 
 
Total Available-for-Sale Debt Securities
205

 
1

 
(4
)
 
202

 
 
Total Rabbi Trust Investments
$
226

 
$
3

 
$
(4
)
 
$
225

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2017
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
   Domestic
$
24

 
$
3

 
$
—

 
$
27

 
 
   International
—

 
—

 
—

 
—

 
 
Total Equity Securities
24

 
3

 
—

 
27

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
85

 
1

 
(1
)
 
85

 
 
Corporate
118

 
2

 
(1
)
 
119

 
 
Total Available-for-Sale Debt Securities
203

 
3

 
(2
)
 
204

 
 
Total Rabbi Trust Investments
$
227

 
$
6

 
$
(2
)
 
$
231

 
 
 
 
 
 
 
 
 
 
 

Net unrealized gains (losses) on debt securities of $(3) million (after-tax) were included in Accumulated Other Comprehensive Loss on PSEG’s Condensed Consolidated Balance Sheet as of March 31, 2018. The portion of net unrealized gains (losses) recognized during the first quarter of 2018 related to equity securities still held at the end of March 31, 2018 was less than $(1) million.
The amounts in the preceding tables do not include receivables and payables for Rabbi Trust Fund transactions which have not settled at the end of each period. Such amounts are included in Accounts Receivable and Accounts Payable on the Condensed Consolidated Balance Sheets as shown in the following table.
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
Accounts Receivable
$
2

 
$
2

 
 
Accounts Payable
$
—

 
$
1

 
 
 
 
 
 
 

The following table shows the value of securities in the Rabbi Trust Fund that have been in an unrealized loss position for less than 12 months and greater than 12 months.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
As of December 31, 2017
 
 
 
Less Than 12
Months
 
Greater Than 12
Months
 
Less Than 12
Months
 
Greater Than 12
Months
 
 
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
 
 
Millions
 
 
Equity Securities (A)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Domestic
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
 
   International
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
 
Total Equity Securities
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government (B)
48

 
(1
)
 
23

 
(1
)
 
28

 
—

 
25

 
(1
)
 
 
Corporate (C)
73

 
(2
)
 
8

 
—

 
39

 
(1
)
 
9

 
—

 
 
Total Available-for-Sale Debt Securities
121

 
(3
)
 
31

 
(1
)
 
67

 
(1
)
 
34

 
(1
)
 
 
Rabbi Trust Investments
$
121

 
$
(3
)
 
$
31

 
$
(1
)
 
$
67

 
$
(1
)
 
$
34

 
$
(1
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A)
Equity Securities—Investments in marketable equity securities within the Rabbi Trust Fund are through a mutual fund which invests primarily in common stocks within a broad range of industries and sectors. Effective January 1, 2018, unrealized gains and losses on these securities are recorded in Net Income.
(B)
Debt Securities (Government)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). The unrealized losses on PSEG’s Rabbi Trust investments in U.S. Treasury obligations and Federal Agency mortgage-backed securities were caused by interest rate changes. These investments are guaranteed by the U.S. government or an agency of the U.S. government. PSEG also has investments in municipal bonds that are primarily in investment grade securities. It is not expected that these securities will settle for less than their amortized cost. Since PSEG does not intend to sell these securities nor will it be more-likely-than-not required to sell, PSEG does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
(C)
Debt Securities (Corporate)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). PSEG’s investments in corporate bonds are primarily in investment grade securities. It is not expected that these securities would settle for less than their amortized cost. Since PSEG does not intend to sell these securities nor will it be more-likely-than-not required to sell, PSEG does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
The proceeds from the sales of and the net gains (losses) on securities in the Rabbi Trust Fund were:
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
March 31,
 
 
 
 
2018
 
2017
 
 
 
Millions
 
 
Proceeds from Rabbi Trust Sales (A)
 
$
25

 
$
51

 
 
Net Realized Gains (Losses) on Rabbi Trust:
 
 
 
 
 
 
Gross Realized Gains
 
$
2

 
$
15

 
 
Gross Realized Losses
 
(2
)
 
(3
)
 
 
Net Realized Gains (Losses) on Rabbi Trust (B)
 
—

 
12

 
 
Unrealized Gains (Losses) on Equity Securities in Rabbi Trust (C)
 
—

 
N/A

 
 
Other-Than-Temporary-Impairments
 
—

 
—

 
 
Net Gains (Losses) on Rabbi Trust Investments
 
$
—

 
$
12

 
 
 
 
 
 
 
 

(A)Includes activity in accounts related to the liquidation of funds being transitioned to new managers.
(B)The cost of these securities was determined on the basis of specific identification.
(C)
Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded in Net Income instead of Other Comprehensive Income (Loss).
The Rabbi Trust debt securities held as of March 31, 2018 had the following maturities:
 
 
 
 
 
 
Time Frame
 
Fair Value
 
 
 
 
Millions
 
 
Less than one year
 
$
1

 
 
1 - 5 years
 
36

 
 
6 - 10 years
 
29

 
 
11 - 15 years
 
6

 
 
16 - 20 years
 
17

 
 
Over 20 years
 
113

 
 
Total Rabbi Trust Available-for-Sale Debt Securities
$
202

 
 
 
 
 
 

PSEG periodically assesses individual debt securities whose fair value is less than amortized cost to determine whether the investments are considered to be other-than-temporarily impaired. For these securities, management considers its intent to sell or requirement to sell a security prior to expected recovery. In those cases where a sale is expected, any impairment would be recorded through earnings. For fixed income securities where there is no intent to sell or likely requirement to sell, management evaluates whether credit loss is a component of the impairment. If so, that portion is recorded through earnings while the noncredit loss component is recorded through Accumulated Other Comprehensive Income (Loss). The assessment of fair market value compared to cost is applied on a weighted average basis taking into account various purchase dates and initial cost of the securities.
The fair value of the Rabbi Trust related to PSEG, PSE&G and Power are detailed as follows:
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
PSE&G
$
45

 
$
46

 
 
Power
56

 
57

 
 
Other
124

 
128

 
 
Total Rabbi Trust Investments
$
225

 
$
231

 
 
 
 
 
 
 
Power [Member]  
Schedule of Trust Investments [Line Items]  
Trust Investments
NDT Fund
Power maintains an external master NDT to fund its share of decommissioning costs for its five nuclear facilities upon their respective termination of operation. The trust contains two separate funds: a qualified fund and a non-qualified fund. Section 468A of the Internal Revenue Code limits the amount of money that can be contributed into a qualified fund. The funds are managed by third-party investment managers who operate under investment guidelines developed by Power.
The following tables show the fair values and gross unrealized gains and losses for the securities held in the NDT Fund.
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
Domestic
$
463

 
$
226

 
$
(7
)
 
$
682

 
 
   International
318

 
93

 
(7
)
 
404

 
 
Total Equity Securities
781

 
319

 
(14
)
 
1,086

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
518

 
1

 
(11
)
 
508

 
 
Corporate
464

 
1

 
(9
)
 
456

 
 
Total Available-for-Sale Debt Securities
982

 
2

 
(20
)
 
964

 
 
Other
1

 
—

 
—

 
1

 
 
Total NDT Fund Investments (A)
$
1,764

 
$
321

 
$
(34
)
 
$
2,051

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2017
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
Domestic
$
497

 
$
245

 
$
(2
)
 
$
740

 
 
   International
311

 
99

 
(3
)
 
407

 
 
Total Equity Securities
808

 
344

 
(5
)
 
1,147

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
586

 
2

 
(4
)
 
584

 
 
Corporate
400

 
4

 
(2
)
 
402

 
 
Total Available-for-Sale Debt Securities
986

 
6

 
(6
)
 
986

 
 
Total NDT Fund Investments
$
1,794

 
$
350

 
$
(11
)
 
$
2,133

 
 
 
 
 
 
 
 
 
 
 

Net unrealized gains (losses) on debt securities of $(10) million (after-tax) were included in Accumulated Other Comprehensive Loss on PSEG’s and Power’s Condensed Consolidated Balance Sheets as of March 31, 2018. The portion of net unrealized gains (losses) recognized during the first quarter of 2018 related to equity securities still held at the end of March 31, 2018 was $(10) million.
The amounts in the preceding tables do not include receivables and payables for NDT Fund transactions which have not settled at the end of each period. Such amounts are included in Accounts Receivable and Accounts Payable on the Condensed Consolidated Balance Sheets as shown in the following table.
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
Accounts Receivable
$
13

 
$
24

 
 
Accounts Payable
$
9

 
$
74

 
 
 
 
 
 
 

The following table shows the value of securities in the NDT Fund that have been in an unrealized loss position for less than and greater than 12 months.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
As of December 31, 2017
 
 
 
Less Than 12
Months
 
Greater Than 12
Months
 
Less Than 12
Months
 
Greater Than 12
Months
 
 
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
 
 
Millions
 
 
Equity Securities (A)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Domestic
$
117

 
$
(7
)
 
$
—

 
$
—

 
$
40

 
$
(2
)
 
$
—

 
$
—

 
 
   International
65

 
(7
)
 
1

 
—

 
29

 
(3
)
 
2

 
—

 
 
Total Equity Securities
182

 
(14
)
 
1

 
—

 
69

 
(5
)
 
2

 
—

 
 
Available-for Sale Debt Securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government (B)
364

 
(7
)
 
80

 
(4
)
 
343

 
(2
)
 
91

 
(2
)
 
 
Corporate (C)
339

 
(8
)
 
25

 
(1
)
 
191

 
(1
)
 
27

 
(1
)
 
 
Total Available-for-Sale Debt Securities
703

 
(15
)
 
105

 
(5
)
 
534

 
(3
)
 
118

 
(3
)
 
 
NDT Trust Investments
$
885

 
$
(29
)
 
$
106

 
$
(5
)
 
$
603

 
$
(8
)
 
$
120

 
$
(3
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A)
Equity Securities—Investments in marketable equity securities within the NDT Fund are primarily in common stocks within a broad range of industries and sectors. Effective January 1, 2018, unrealized gains and losses on these securities are recorded in Net Income.
(B)
Debt Securities (Government)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). The unrealized losses on Power’s NDT investments in U.S. Treasury obligations and Federal Agency mortgage-backed securities were caused by interest rate changes. These investments are guaranteed by the U.S. government or an agency of the U.S. government. Power also has investments in municipal bonds that are primarily in investment grade securities. It is not expected that these securities will settle for less than their amortized cost. Since Power does not intend to sell these securities nor will it be more-likely-than-not required to sell, Power does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
(C)
Debt Securities (Corporate)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). Power’s investments in corporate bonds are primarily in investment grade securities. It is not expected that these securities would settle for less than their amortized cost. Since Power does not intend to sell these securities nor will it be more-likely-than-not required to sell, Power does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
The proceeds from the sales of and the net gains (losses) on securities in the NDT Fund were:
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
March 31,
 
 
 
 
2018
 
2017
 
 
 
Millions
 
 
Proceeds from NDT Fund Sales (A)
 
$
372

 
$
247

 
 
Net Realized Gains (Losses) on NDT Fund
 
 
 
 
 
 
Gross Realized Gains
 
$
24

 
$
21

 
 
Gross Realized Losses
 
(12
)
 
(4
)
 
 
Net Realized Gains (Losses) on NDT Fund (B)
 
12

 
17

 
 
Unrealized Gains (Losses) on Equity Securities in NDT Fund (C)
 
(34
)
 
N/A

 
 
Other-Than-Temporary-Impairments
 
—

 
(1
)
 
 
Net Gains (Losses) on NDT Fund Investments
 
$
(22
)
 
$
16

 
 
 
 
 
 
 
 

(A)Includes activity in accounts related to the liquidation of funds being transitioned to new managers.
(B)The cost of these securities was determined on the basis of specific identification.
(C)
Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded in Net Income instead of Other Comprehensive Income (Loss).
The NDT Fund debt securities held as of March 31, 2018 had the following maturities:
 
 
 
 
 
 
Time Frame
 
Fair Value
 
 
 
 
Millions
 
 
Less than one year
 
$
15

 
 
1 - 5 years
 
300

 
 
6 - 10 years
 
201

 
 
11 - 15 years
 
40

 
 
16 - 20 years
 
73

 
 
Over 20 years
 
335

 
 
Total NDT Available-for-Sale Debt Securities
$
964

 
 
 
 
 
 

Power periodically assesses individual debt securities whose fair value is less than amortized cost to determine whether the investments are considered to be other-than-temporarily impaired. For these securities, management considers its intent to sell or requirement to sell a security prior to expected recovery. In those cases where a sale is expected, any impairment would be recorded through earnings. For fixed income securities where there is no intent to sell or likely requirement to sell, management evaluates whether credit loss is a component of the impairment. If so, that portion is recorded through earnings while the noncredit loss component is recorded through Accumulated Other Comprehensive Income (Loss). Any subsequent recoveries in the value of these securities would be recognized in Accumulated Other Comprehensive Income (Loss) unless the securities are sold, in which case, any gain would be recognized in income. The assessment of fair market value compared to cost is applied on a weighted average basis taking into account various purchase dates and initial cost of the securities.
Rabbi Trust
PSEG maintains certain unfunded nonqualified benefit plans to provide supplemental retirement and deferred compensation benefits to certain key employees. Certain assets related to these plans have been set aside in a grantor trust commonly known as a “Rabbi Trust.”
The following tables show the fair values, gross unrealized gains and losses and amortized cost basis for the securities held in the Rabbi Trust.
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
   Domestic
$
21

 
$
2

 
$
—

 
$
23

 
 
   International
—

 
—

 
—

 
—

 
 
Total Equity Securities
21

 
2

 
—

 
23

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
91

 
—

 
(2
)
 
89

 
 
Corporate
114

 
1

 
(2
)
 
113

 
 
Total Available-for-Sale Debt Securities
205

 
1

 
(4
)
 
202

 
 
Total Rabbi Trust Investments
$
226

 
$
3

 
$
(4
)
 
$
225

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2017
 
 
 
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
 
 
Millions
 
 
Equity Securities
 
 
 
 
 
 
 
 
 
   Domestic
$
24

 
$
3

 
$
—

 
$
27

 
 
   International
—

 
—

 
—

 
—

 
 
Total Equity Securities
24

 
3

 
—

 
27

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
Government
85

 
1

 
(1
)
 
85

 
 
Corporate
118

 
2

 
(1
)
 
119

 
 
Total Available-for-Sale Debt Securities
203

 
3

 
(2
)
 
204

 
 
Total Rabbi Trust Investments
$
227

 
$
6

 
$
(2
)
 
$
231

 
 
 
 
 
 
 
 
 
 
 

Net unrealized gains (losses) on debt securities of $(3) million (after-tax) were included in Accumulated Other Comprehensive Loss on PSEG’s Condensed Consolidated Balance Sheet as of March 31, 2018. The portion of net unrealized gains (losses) recognized during the first quarter of 2018 related to equity securities still held at the end of March 31, 2018 was less than $(1) million.
The amounts in the preceding tables do not include receivables and payables for Rabbi Trust Fund transactions which have not settled at the end of each period. Such amounts are included in Accounts Receivable and Accounts Payable on the Condensed Consolidated Balance Sheets as shown in the following table.
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
Accounts Receivable
$
2

 
$
2

 
 
Accounts Payable
$
—

 
$
1

 
 
 
 
 
 
 

The following table shows the value of securities in the Rabbi Trust Fund that have been in an unrealized loss position for less than 12 months and greater than 12 months.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of March 31, 2018
 
As of December 31, 2017
 
 
 
Less Than 12
Months
 
Greater Than 12
Months
 
Less Than 12
Months
 
Greater Than 12
Months
 
 
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
Fair
Value
 
Gross
Unrealized
Losses
 
 
 
Millions
 
 
Equity Securities (A)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Domestic
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
 
   International
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
 
Total Equity Securities
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
 
Available-for-Sale Debt Securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government (B)
48

 
(1
)
 
23

 
(1
)
 
28

 
—

 
25

 
(1
)
 
 
Corporate (C)
73

 
(2
)
 
8

 
—

 
39

 
(1
)
 
9

 
—

 
 
Total Available-for-Sale Debt Securities
121

 
(3
)
 
31

 
(1
)
 
67

 
(1
)
 
34

 
(1
)
 
 
Rabbi Trust Investments
$
121

 
$
(3
)
 
$
31

 
$
(1
)
 
$
67

 
$
(1
)
 
$
34

 
$
(1
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(A)
Equity Securities—Investments in marketable equity securities within the Rabbi Trust Fund are through a mutual fund which invests primarily in common stocks within a broad range of industries and sectors. Effective January 1, 2018, unrealized gains and losses on these securities are recorded in Net Income.
(B)
Debt Securities (Government)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). The unrealized losses on PSEG’s Rabbi Trust investments in U.S. Treasury obligations and Federal Agency mortgage-backed securities were caused by interest rate changes. These investments are guaranteed by the U.S. government or an agency of the U.S. government. PSEG also has investments in municipal bonds that are primarily in investment grade securities. It is not expected that these securities will settle for less than their amortized cost. Since PSEG does not intend to sell these securities nor will it be more-likely-than-not required to sell, PSEG does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
(C)
Debt Securities (Corporate)—Unrealized gains and losses on these securities are recorded in Accumulated Other Comprehensive Income (Loss). PSEG’s investments in corporate bonds are primarily in investment grade securities. It is not expected that these securities would settle for less than their amortized cost. Since PSEG does not intend to sell these securities nor will it be more-likely-than-not required to sell, PSEG does not consider these debt securities to be other-than-temporarily impaired as of March 31, 2018.
The proceeds from the sales of and the net gains (losses) on securities in the Rabbi Trust Fund were:
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
March 31,
 
 
 
 
2018
 
2017
 
 
 
Millions
 
 
Proceeds from Rabbi Trust Sales (A)
 
$
25

 
$
51

 
 
Net Realized Gains (Losses) on Rabbi Trust:
 
 
 
 
 
 
Gross Realized Gains
 
$
2

 
$
15

 
 
Gross Realized Losses
 
(2
)
 
(3
)
 
 
Net Realized Gains (Losses) on Rabbi Trust (B)
 
—

 
12

 
 
Unrealized Gains (Losses) on Equity Securities in Rabbi Trust (C)
 
—

 
N/A

 
 
Other-Than-Temporary-Impairments
 
—

 
—

 
 
Net Gains (Losses) on Rabbi Trust Investments
 
$
—

 
$
12

 
 
 
 
 
 
 
 

(A)Includes activity in accounts related to the liquidation of funds being transitioned to new managers.
(B)The cost of these securities was determined on the basis of specific identification.
(C)
Effective January 1, 2018, unrealized gains (losses) on equity securities are recorded in Net Income instead of Other Comprehensive Income (Loss).
The Rabbi Trust debt securities held as of March 31, 2018 had the following maturities:
 
 
 
 
 
 
Time Frame
 
Fair Value
 
 
 
 
Millions
 
 
Less than one year
 
$
1

 
 
1 - 5 years
 
36

 
 
6 - 10 years
 
29

 
 
11 - 15 years
 
6

 
 
16 - 20 years
 
17

 
 
Over 20 years
 
113

 
 
Total Rabbi Trust Available-for-Sale Debt Securities
$
202

 
 
 
 
 
 

PSEG periodically assesses individual debt securities whose fair value is less than amortized cost to determine whether the investments are considered to be other-than-temporarily impaired. For these securities, management considers its intent to sell or requirement to sell a security prior to expected recovery. In those cases where a sale is expected, any impairment would be recorded through earnings. For fixed income securities where there is no intent to sell or likely requirement to sell, management evaluates whether credit loss is a component of the impairment. If so, that portion is recorded through earnings while the noncredit loss component is recorded through Accumulated Other Comprehensive Income (Loss). The assessment of fair market value compared to cost is applied on a weighted average basis taking into account various purchase dates and initial cost of the securities.
The fair value of the Rabbi Trust related to PSEG, PSE&G and Power are detailed as follows:
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
March 31,
2018
 
December 31,
2017
 
 
 
Millions
 
 
PSE&G
$
45

 
$
46

 
 
Power
56

 
57

 
 
Other
124

 
128

 
 
Total Rabbi Trust Investments
$
225

 
$
231