Allegheny Power 2014 Annual Report Download - page 111

Download and view the complete annual report

Please find page 111 of the 2014 Allegheny Power annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 159

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159

96
FES
Recurring Fair Value Measurements December 31, 2014 December 31, 2013
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Assets (In millions)
Corporate debt securities $ — $ 655 $ — $ 655 $ — $ 792 $ — $ 792
Derivative assets - commodity contracts 1 171 — 172 7 208 — 215
Derivative assets - FTRs — —27 27 — — 3 3
Equity securities(1) 360 —— 360 207 — — 207
Foreign government debt securities — 57 — 57 — 65 — 65
U.S. government debt securities — 46 — 46 — 27 — 27
U.S. state debt securities — 4 — 4 — — — —
Other(2) — 199 — 199 — 176 — 176
Total assets $ 361 $ 1,132 $ 27 $ 1,520 $ 214 $ 1,268 $ 3 $ 1,485
Liabilities
Derivative liabilities - commodity contracts $ (26) $ (141) $ — $ (167) $ (13) $ (100) $ — $ (113)
Derivative liabilities - FTRs — —(13) (13) — — (11) (11)
Total liabilities $ (26) $ (141) $ (13) $ (180) $ (13) $ (100) $ (11) $ (124)
Net assets (liabilities)(3) $ 335 $ 991 $ 14 $ 1,340 $ 201 $ 1,168 $ (8) $ 1,361
(1) NDT funds hold equity portfolios whose performance is benchmarked against the Alerian MLP Index or the Wells Fargo Hybrid and Preferred
Securities REIT index.
(2) Primarily consists of short-term cash investments.
(3) Excludes $44 million and $9 million as of December 31, 2014 and December 31, 2013, respectively, of receivables, payables, taxes and
accrued income associated with financial instruments reflected within the fair value table.
Rollforward of Level 3 Measurements
The following table provides a reconciliation of changes in the fair value of FTRs held by FES and classified as Level 3 in the fair
value hierarchy for the periods ended December 31, 2014 and December 31, 2013:
Derivative Asset Derivative Liability Net Asset/(Liability)
(In millions)
January 1, 2013 Balance $ 6 $ (6) $ —
Unrealized loss — (2) (2)
Purchases 5 (12) (7)
Settlements (8) 9 1
December 31, 2013 Balance $ 3 $ (11) $ (8)
Unrealized gain (loss) 34 (1) 33
Purchases 15 (16) (1)
Settlements (25) 15 (10)
December 31, 2014 Balance $ 27 $ (13) $ 14
Level 3 Quantitative Information
The following table provides quantitative information for FTRs held by FES that are classified as Level 3 in the fair value hierarchy
for the period ended December 31, 2014:
Fair Value, Net
(In millions) Valuation
Technique Significant Input Range Weighted
Average Units
FTRs $ 14 Model RTO auction clearing prices ($7.20) to $19.30 $1.10 Dollars/MWH