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Income and Other Taxes (Tables) | 12 Months Ended
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Dec. 31, 2020
Income Taxes [Line Items] |
Tax Reform | The final amounts reported in PPL's 2017 federal income tax return, provisional amounts for the year ended December 31, 2017, the related measurement period adjustments, and the resulting tax impact for the year ended December 31, 2018 were as follows.
| Taxable Income (Loss) (a)
| Adjustments per 2017 Tax Return |  | Adjustments per 2017 Tax Provision |  | 2018 Adjustments
PPL |  |  |  |  |
Deemed Dividend | $ | 397 |  |  | $ | 462 |  |  | $ | (65) |
Bonus Depreciation (b) | (67) |  |  | — |  |  | (67) |
Consolidated Federal Net Operating Loss due to the TCJA (c) | (330) |  |  | (462) |  |  | 132 |
Total | $ | — |  |  | $ | — |  |  | $ | — |
PPL Electric |  |  |  |  |
Bonus Depreciation (b) | $ | (39) |  |  | $ | — |  |  | $ | (39) |
Consolidated Federal Net Operating Loss reallocated due to the TCJA (c) | (68) |  |  | (105) |  |  | 37 |
Total | $ | (107) |  |  | $ | (105) |  |  | $ | (2) |
LKE |  |  |  |  |
Bonus Depreciation (b) | $ | (28) |  |  | $ | — |  |  | $ | (28) |
Consolidated Federal Net Operating Loss reallocated due to the TCJA (c) | (32) |  |  | (45) |  |  | 13 |
Total | $ | (60) |  |  | $ | (45) |  |  | $ | (15) |
LG&E |  |  |  |  |
Bonus Depreciation (b) | $ | (17) |  |  | $ | — |  |  | $ | (17) |
Consolidated Federal Net Operating Loss reallocated due to the TCJA (c) | 17 |  |  | — |  |  | 17 |
Total | $ | — |  |  | $ | — |  |  | $ | — |
KU |  |  |  |  |
Bonus Depreciation (b) | $ | (11) |  |  | $ | — |  |  | $ | (11) |
Consolidated Federal Net Operating Loss reallocated due to the TCJA (c) | 11 |  |  | — |  |  | 11 |
Total | $ | — |  |  | $ | — |  |  | $ | — |
(a)The above table reflects, for each item, the amount subject to change as a result of the TCJA and does not reflect the total amount of each item included in the return and the provision. (b)The TCJA increased the bonus depreciation percentage from 50% to 100% for qualified property acquired and placed in service after September 27, 2017 and before January 1, 2018. Increases in tax depreciation reduce the Registrants' taxes payable and increase net deferred tax liabilities with no impact to “Income Taxes” on the Statements of Income. (c)An increase in the consolidated federal net operating loss reduces net deferred tax liabilities with the opposite effect if there is a decrease in the consolidated federal net operating loss. These increases or decreases have no impact to “Income Taxes” on the Statements of Income.
| Income Tax Expense (Benefit)
| Adjustments per 2017 Tax Return |  | Adjustments per 2017 Tax Provision |  | 2018 Adjustments
PPL |  |  |  |  |
Deemed Dividend | $ | 139 |  |  | $ | 161 |  |  | $ | (22) |
Foreign Tax Credits | (157) |  |  | (205) |  |  | 48 |
Valuation of Foreign Tax Credit Carryforward | 110 |  |  | 145 |  |  | (35) |
Reduction in U.S. federal income tax rate | 229 |  |  | 220 |  |  | 9 |
Total | $ | 321 |  |  | $ | 321 |  |  | $ | — |
PPL Electric |  |  |  |  |
Reduction in U.S. federal income tax rate | $ | (13) |  |  | $ | (13) |  |  | $ | — |
LKE |  |  |  |  |
Reduction in U.S. federal income tax rate | $ | 110 |  |  | $ | 112 |  |  | $ | (2) |
Components of Income (Loss) Before Income Taxes | "Income Before Income Taxes" included the following:
| 2020 |  | 2019 |  | 2018
Domestic income | $ | 902 |  |  | $ | 964 |  |  | $ | 1,127 |
Foreign income | 1,069 |  |  | 1,191 |  |  | 1,158 |
Total | $ | 1,971 |  |  | $ | 2,155 |  |  | $ | 2,285 |
Components of Deferred Tax Assets and Liabilities | Significant components of PPL's deferred income tax assets and liabilities were as follows:
| 2020 |  | 2019
Deferred Tax Assets |  |  |
Deferred investment tax credits | $ | 30 |  |  | $ | 31 |
Regulatory liabilities | 68 |  |  | 75 |
Income taxes due to customers | 444 |  |  | 462 |
Accrued pension and postretirement costs | 106 |  |  | 211 |
Federal loss carryforwards | 234 |  |  | 324 |
State loss carryforwards | 448 |  |  | 432 |
Federal and state tax credit carryforwards | 401 |  |  | 402 |
Foreign capital loss carryforwards | 370 |  |  | 320 |
Foreign - other | 6 |  |  | 8 |
Contributions in aid of construction | 115 |  |  | 112 |
Domestic - other | 136 |  |  | 99 |
Valuation allowances | (906) |  |  | (834) |
Total deferred tax assets | 1,452 |  |  | 1,642 |
Deferred Tax Liabilities |  |  |
Domestic plant - net | 3,700 |  |  | 3,546 |
Regulatory assets | 195 |  |  | 262 |
Foreign plant - net | 911 |  |  | 765 |
Foreign - pensions | 127 |  |  | 72 |
Domestic - other | 70 |  |  | 61 |
Total deferred tax liabilities | 5,003 |  |  | 4,706 |
Net deferred tax liability | $ | 3,551 |  |  | $ | 3,064 |
Summary of Operating Loss Carryforwards and Tax Credit Carryforwards | At December 31, 2020, PPL had the following loss and tax credit carryforwards, related deferred tax assets and valuation allowances recorded against the deferred tax assets:
| Gross |  | Deferred Tax Asset |  | Valuation Allowance |  | Expiration
Loss and other carryforwards |  |  |  |  |  |  |
Federal net operating losses | $ | 1,111 |  |  | $ | 234 |  |  | $ | — |  |  | 2035-2037
State net operating losses | 6,032 |  |  | 448 |  |  | (419) |  |  | 2021-2040
Foreign capital losses (a) | 1,945 |  |  | 370 |  |  | (370) |  |  | Indefinite
Federal - Other | 13 |  |  | 2 |  |  | — |  |  | Indefinite
State - Other | 2 |  |  | — |  |  | — |  |  | Indefinite
Credit carryforwards |  |  |  |  |  |  |
Federal investment tax credit |  |  | 134 |  |  | — |  |  | 2025-2040
Federal foreign tax credits (b) |  |  | 218 |  |  | (113) |  |  | 2024-2027
Federal - other |  |  | 32 |  |  | (4) |  |  | 2021-2040
State Recycling Credit |  |  | 16 |  |  | — |  |  | 2028
State - other |  |  | 1 |  |  | — |  |  | Indefinite
(a)In 2020, the U.K. Finance Act 2020 cancelled the tax rate reduction from 19% to 17%. The primary impact of the cancellation of the corporation tax rate reduction was an increase in deferred tax liabilities and a corresponding deferred tax expense of $106 million. (b)Includes $62 million of foreign tax credits carried forward from 2016 and $156 million of additional foreign tax credits from 2017 related to the taxable deemed dividend associated with the TCJA.
Schedule of Valuation and Qualifying Accounts of Deferred Tax Assets | The changes in deferred tax valuation allowances were as follows:
|  |  | Additions |  |  |  |
| Balance at Beginning of Period |  | Charged to Income |  | Charged to Other Accounts |  | Deductions |  | Balance at End of Period
2020 | $ | 834 |  |  | $ | 69 |  | (a) | $ | 7 |  |  | $ | 4 |  |  | $ | 906 |
2019 | 808 |  |  | 31 |  |  | — |  |  | 5 |  |  | 834 |
2018 | 838 |  |  | 26 |  |  | — |  |  | 56 |  | (b) | 808 |
(a)The cancellation of the reduction of the U.K. statutory income tax rate in 2020 resulted in a $38 million increase in deferred tax assets and corresponding valuation allowances. See "Reconciliation of Income Tax Expense" below for additional information on the impact of the U.K. Finance Act 2020. In addition, deferred tax assets and corresponding valuation allowances were increased in 2020 by approximately $11 million due to the effect of foreign currency exchange rates. (b)Decrease in the valuation allowance of approximately $35 million due to the change in the total foreign tax credits available after finalization of the deemed dividend calculation required by the TCJA in 2017. In addition, the deferred tax assets and corresponding valuation allowances were reduced in 2018 by approximately $19 million due to the effect of foreign currency exchange rates.
Components of Income Tax Expense (Benefit) | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were as follows:
| 2020 |  | 2019 |  | 2018
Income Tax Expense (Benefit) |  |  |  |  |
Current - Federal | $ | (9) |  |  | $ | (10) |  |  | $ | (19) |
Current - State | 24 |  |  | 19 |  |  | 17 |
Current - Foreign | 85 |  |  | 91 |  |  | 104 |
Total Current Expense (Benefit) | 100 |  |  | 100 |  |  | 102 |
Deferred - Federal | 123 |  |  | 139 |  |  | 203 |
Deferred - State | 94 |  |  | 76 |  |  | 100 |
Deferred - Foreign (a) | 215 |  |  | 123 |  |  | 107 |
Total Deferred Expense (Benefit), excluding operating loss carryforwards | 432 |  |  | 338 |  |  | 410 |
Amortization of investment tax credit | (3) |  |  | (3) |  |  | (3) |
Tax expense (benefit) of operating loss carryforwards |  |  |  |  |
Deferred - Federal | 6 |  |  | 7 |  |  | (20) |
Deferred - State | (33) |  |  | (33) |  |  | (31) |
Total Tax Expense (Benefit) of Operating Loss Carryforwards | (27) |  |  | (26) |  |  | (51) |
Total income tax expense (benefit) | $ | 502 |  |  | $ | 409 |  |  | $ | 458 |
Total income tax expense (benefit) - Federal | $ | 117 |  |  | $ | 133 |  |  | $ | 161 |
Total income tax expense (benefit) - State | 85 |  |  | 62 |  |  | 86 |
Total income tax expense (benefit) - Foreign | 300 |  |  | 214 |  |  | 211 |
Total income tax expense (benefit) | $ | 502 |  |  | $ | 409 |  |  | $ | 458 |
(a)In 2020, the U.K. Finance Act 2020 cancelled the tax rate reduction from 19% to 17%. The primary impact of the cancellation of the corporation tax rate reduction was an increase in deferred tax liabilities and a corresponding deferred tax expense of $106 million. In the table above, the following income tax expense (benefit) are excluded from income taxes:
| 2020 |  | 2019 |  | 2018
Other comprehensive income | $ | (19) |  |  | $ | (93) |  |  | $ | (6) |
Total | $ | (19) |  |  | $ | (93) |  |  | $ | (6) |
Reconciliation of Income Tax Expense Derived From Statutory Tax Rate | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were as follows:
| 2020 |  | 2019 |  | 2018
Reconciliation of Income Tax Expense (Benefit) |  |  |  |  |
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 414 |  | $ | 453 |  | $ | 480
Increase (decrease) due to: |  |  |  |  |
State income taxes, net of federal income tax benefit | 48 |  | 45 |  | 40
Valuation allowance adjustments (a) | 26 |  | 22 |  | 21
Impact of lower U.K. income tax rates | (26) |  | (25) |  | (25)
U.S. income tax on foreign earnings - net of foreign tax credit | 11 |  | 2 |  | 3
Federal and state income tax return adjustments | (9) |  | 1 |  | —
Impact of the U.K. Finance Acts on deferred tax balances (b) | 101 |  | (14) |  | (13)
Depreciation and other items not normalized | (5) |  | (10) |  | (11)
Amortization of excess deferred federal and state income taxes | (43) |  | (40) |  | (37)
Interest benefit on U.K. financing activities | (12) |  | (12) |  | (17)
Deferred tax impact of Kentucky tax reform (c) | — |  | — |  | 9
Kentucky recycling credit, net of federal income tax expense (d) | — |  | (18) |  | —
Other | (3) |  | 5 |  | 8
Total increase (decrease) | 88 |  | (44) |  | (22)
Total income tax expense (benefit) | $ | 502 |  | $ | 409 |  | $ | 458
Effective income tax rate | 25.5% |  | 19.0% |  | 20.0%
(a)In 2020, 2019 and 2018, PPL recorded deferred income tax expense of $24 million, $25 million and $24 million for valuation allowances primarily related to increased Pennsylvania net operating loss carryforwards expected to be unutilized. (b)In 2018 and 2019, PPL reduced its net deferred tax liabilities as a result of the U.K. Finance Act 2016 that was enacted in September 2016 and reduced the U.K. statutory income tax rate effective April, 2020 to 17%. In 2020, the U.K. Finance Act 2020 cancelled the tax rate reduction to 17%. The primary impact of the cancellation of the corporation tax rate reduction was an increase in deferred tax liabilities and a corresponding deferred tax expense of $106 million. (c)In 2018, PPL recorded deferred income tax expense, primarily associated with LKE’s non-regulated entities, due to the Kentucky corporate income tax rate reduction from 6% to 5%, as enacted by HB 487, effective January 1, 2018. (d)In 2019, LKE recorded a deferred income tax benefit associated with two projects placed into service that prepare a generation waste material for reuse and, as a result, qualify for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky.
Details of Taxes Other Than Income | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were as follows:
| 2020 |  | 2019 |  | 2018
Taxes, other than income |  |  |  |  |
State gross receipts | $ | 100 |  |  | $ | 107 |  |  | $ | 103 |
Foreign property | 127 |  |  | 127 |  |  | 134 |
Domestic - other | 80 |  |  | 79 |  |  | 75 |
Total | $ | 307 |  |  | $ | 313 |  |  | $ | 312 |
Summary of Income Tax Examinations | With few exceptions, at December 31, 2020, these jurisdictions, as well as the tax years that are no longer subject to examination, were as follows.
| PPL |  | PPL Electric |  | LKE |  | LG&E |  | KU
U.S. (federal) | 2016 and prior |  | 2016 and prior |  | 2016 and prior |  | 2016 and prior |  | 2016 and prior
Pennsylvania (state) | 2016 and prior |  | 2016 and prior |  |  |  |  |  |
Kentucky (state) | 2014 and prior |  |  |  | 2014 and prior |  | 2014 and prior |  | 2014 and prior
U.K. (foreign) | 2016 and prior |  |  |  |  |  |  |  |
PPL Electric Utilities Corp [Member] |
Income Taxes [Line Items] |
Components of Deferred Tax Assets and Liabilities | Significant components of PPL Electric's deferred income tax assets and liabilities were as follows:
| 2020 |  | 2019
Deferred Tax Assets |  |  |
Accrued pension and postretirement costs | $ | 25 |  |  | $ | 81 |
Contributions in aid of construction | 91 |  |  | 88 |
Regulatory liabilities | 24 |  |  | 31 |
Income taxes due to customers | 162 |  |  | 170 |
State loss carryforwards | — |  |  | 6 |
Federal loss carryforwards | 52 |  |  | 78 |
Other | 29 |  |  | 23 |
Total deferred tax assets | 383 |  |  | 477 |
Deferred Tax Liabilities |  |  |
Electric utility plant - net | 1,826 |  |  | 1,761 |
Regulatory assets | 86 |  |  | 139 |
Other | 30 |  |  | 24 |
Total deferred tax liabilities | 1,942 |  |  | 1,924 |
Net deferred tax liability | $ | 1,559 |  |  | $ | 1,447 |
Summary of Operating Loss Carryforwards and Tax Credit Carryforwards | At December 31, 2020, PPL Electric had the following loss and tax credit carryforwards and related deferred tax assets:
| Gross |  | Deferred Tax Asset |  | Expiration
Loss carryforwards |  |  |  |  |
Federal net operating losses | $ | 248 |  |  | $ | 52 |  |  | 2035-2037
Credit carryforwards |  |  |  |  |  |  |
Federal - other |  |  |  |  | 5 |  |  | 2031-2040
Components of Income Tax Expense (Benefit) | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were as follows:
| 2020 |  | 2019 |  | 2018
Income Tax Expense (Benefit) |  |  |  |  |
Current - Federal | $ | 61 |  |  | $ | 44 |  |  | $ | 2 |
Current - State | 23 |  |  | 15 |  |  | 9 |
Total Current Expense (Benefit) | 84 |  |  | 59 |  |  | 11 |
Deferred - Federal | 45 |  |  | 51 |  |  | 96 |
Deferred - State | 38 |  |  | 39 |  |  | 37 |
Total Deferred Expense (Benefit), excluding operating loss carryforwards | 83 |  |  | 90 |  |  | 133 |
Tax expense (benefit) of operating loss carryforwards |  |  |  |  |
Deferred - Federal | — |  |  | — |  |  | (8) |
Total Tax Expense (Benefit) of Operating Loss Carryforwards | — |  |  | — |  |  | (8) |
Total income tax expense (benefit) | $ | 167 |  |  | $ | 149 |  |  | $ | 136 |
Total income tax expense (benefit) - Federal | $ | 106 |  |  | $ | 95 |  |  | $ | 90 |
Total income tax expense (benefit) - State | 61 |  |  | 54 |  |  | 46 |
Total income tax expense (benefit) | $ | 167 |  |  | $ | 149 |  |  | $ | 136 |
Reconciliation of Income Tax Expense Derived From Statutory Tax Rate | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were as follows:
| 2020 |  | 2019 |  | 2018
Reconciliation of Income Tax Expense (Benefit) |  |  |  |  |
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 139 |  | $ | 127 |  | $ | 119
Increase (decrease) due to: |  |  |  |  |
State income taxes, net of federal income tax benefit | 52 |  | 47 |  | 43
Federal and state income tax return adjustments | (4) |  | 1 |  | —
Depreciation and other items not normalized | (5) |  | (10) |  | (11)
Amortization of excess deferred federal income taxes (a) | (16) |  | (18) |  | (17)
Other | 1 |  | 2 |  | 2
Total increase (decrease) | 28 |  | 22 |  | 17
Total income tax expense (benefit) | $ | 167 |  | $ | 149 |  | $ | 136
Effective income tax rate | 25.2% |  | 24.6% |  | 24.0%
(a)In 2020, 2019 and 2018, PPL Electric recorded lower income tax expense for the amortization of excess deferred taxes that primarily resulted from the U.S. federal corporate income tax rate reduction from 35% to 21% enacted by the TCJA. This amortization represents each year's refund amount, prior to a tax gross-up, to be paid to customers for previously collected deferred taxes at higher income tax rates.
Details of Taxes Other Than Income | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were as follows:
| 2020 |  | 2019 |  | 2018
Taxes, other than income |  |  |  |  |
State gross receipts | $ | 100 |  |  | $ | 107 |  |  | $ | 103 |
Property and other | 7 |  |  | 5 |  |  | 6 |
Total | $ | 107 |  |  | $ | 112 |  |  | $ | 109 |
LG And E And KU Energy LLC [Member] |
Income Taxes [Line Items] |
Components of Deferred Tax Assets and Liabilities | Significant components of LKE's deferred income tax assets and liabilities were as follows:
| 2020 |  | 2019
Deferred Tax Assets |  |  |
Federal loss carryforwards | $ | 107 |  |  | $ | 140 |
State loss carryforwards | 28 |  |  | 31 |
Federal tax credit carryforwards | 159 |  |  | 162 |
Contributions in aid of construction | 23 |  |  | 23 |
Regulatory liabilities | 43 |  |  | 44 |
Accrued pension and postretirement costs | 57 |  |  | 71 |
State tax credit carryforwards | 17 |  |  | 19 |
Income taxes due to customers | 282 |  |  | 292 |
Deferred investment tax credits | 30 |  |  | 31 |
Lease liabilities | 13 |  |  | 14 |
Valuation allowances | (4) |  |  | (6) |
Other | 29 |  |  | 28 |
Total deferred tax assets | 784 |  |  | 849 |
Deferred Tax Liabilities |  |  |
Plant - net | 1,831 |  |  | 1,778 |
Regulatory assets | 109 |  |  | 122 |
Lease right-of-use assets | 11 |  |  | 12 |
Other | 8 |  |  | 6 |
Total deferred tax liabilities | 1,959 |  |  | 1,918 |
Net deferred tax liability | $ | 1,175 |  |  | $ | 1,069 |
Summary of Operating Loss Carryforwards and Tax Credit Carryforwards | At December 31, 2020, LKE had the following loss and tax credit carryforwards, related deferred tax assets, and valuation allowances recorded against the deferred tax assets:
| Gross |  | Deferred Tax Asset |  | Valuation Allowance |  | Expiration
Loss carryforwards |  |  |  |  |  |  |
Federal net operating losses | $ | 511 |  |  | $ | 107 |  |  | $ | — |  |  | 2035 - 2037
Federal charitable contributions | 1 |  |  | — |  |  | — |  |  | 2024
State net operating losses | 710 |  |  | 28 |  |  | — |  |  | 2029 - 2038
| Gross |  | Deferred Tax Asset |  | Valuation Allowance |  | Expiration
Credit carryforwards |  |  |  |  |  |  |
Federal investment tax credit |  |  | 134 |  |  | — |  |  | 2025 - 2028, 2036 - 2040
Federal - other |  |  | 25 |  |  | (4) |  |  | 2021-2040
State - recycling credit |  |  | 16 |  |  | — |  |  | 2028
State - other |  |  | 1 |  |  | — |  |  | Indefinite
Schedule of Valuation and Qualifying Accounts of Deferred Tax Assets | Changes in deferred tax valuation allowances were:
| Balance at Beginning of Period |  | Additions |  | Deductions |  | Balance at End of Period
2020 | $ | 6 |  |  | $ | — |  |  | $ | 2 |  | (a) | $ | 4 |
2019 | 8 |  |  | 3 |  |  | 5 |  | (a) | 6 |
2018 | 8 |  |  | — |  |  | — |  |  | 8 |
(a)Tax credits expiring.
Components of Income Tax Expense (Benefit) | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Income Tax Expense (Benefit) |  |  |  |  |
Current - Federal | $ | 41 |  |  | $ | 20 |  |  | $ | 31 |
Current - State | 1 |  |  | — |  |  | 4 |
Total Current Expense (Benefit) | 42 |  |  | 20 |  |  | 35 |
Deferred - Federal | 43 |  |  | 81 |  |  | 65 |
Deferred - State (a) | 24 |  |  | 5 |  |  | 34 |
Total Deferred Expense (Benefit), excluding benefits of operating loss carryforwards | 67 |  |  | 86 |  |  | 99 |
Amortization of investment tax credit - Federal | (3) |  |  | (3) |  |  | (3) |
Tax expense (benefit) of operating loss carryforwards |  |  |  |  |
Deferred - Federal | — |  |  | — |  |  | (2) |
Total Tax Expense (Benefit) of Operating Loss Carryforwards | — |  |  | — |  |  | (2) |
Total income tax expense (benefit) (b) | $ | 106 |  |  | $ | 103 |  |  | $ | 129 |
Total income tax expense (benefit) - Federal | $ | 81 |  |  | $ | 98 |  |  | $ | 91 |
Total income tax expense (benefit) - State | 25 |  |  | 5 |  |  | 38 |
Total income tax expense (benefit) (b) | $ | 106 |  |  | $ | 103 |  |  | $ | 129 |
(a)In 2019, LKE recorded a deferred income tax benefit associated with two projects placed into service that prepare a generation waste material for reuse and, as a result, qualify for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky. (b)Excludes deferred federal and state tax expense (benefit) recorded to OCI of $2 million in 2020, $(1) million in 2019 and $5 million in 2018.
Reconciliation of Income Tax Expense Derived From Statutory Tax Rate | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Reconciliation of Income Tax Expense (Benefit) |  |  |  |  |
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 117 |  | $ | 120 |  | $ | 121
Increase (decrease) due to: |  |  |  |  |
State income taxes, net of federal income tax benefit | 22 |  | 23 |  | 22
Amortization of investment tax credit | (3) |  | (3) |  | (3)
Amortization of excess deferred federal and state income taxes | (28) |  | (23) |  | (20)
Deferred tax impact of state tax reform (a) | — |  | — |  | 9
Kentucky Recycling Credit, net of federal income tax expense (b) | — |  | (18) |  | —
Other | (2) |  | 4 |  | —
Total increase (decrease) | (11) |  | (17) |  | 8
Total income tax expense (benefit) | $ | 106 |  | $ | 103 |  | $ | 129
Effective income tax rate | 19.1% |  | 18.0% |  | 22.5%
(a)In 2018, LKE recorded deferred income tax expense, primarily associated with LKE's non-regulated entities, due to the Kentucky corporate income tax rate reduction from 6% to 5%, as enacted by HB 487, effective January 1, 2018. (b)In 2019, LKE recorded a deferred income tax benefit associated with two projects placed into service that prepare a generation waste material for reuse and, as a result, qualify for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky.
Details of Taxes Other Than Income | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Taxes, other than income |  |  |  |  |
Property and other | $ | 77 |  |  | $ | 74 |  |  | $ | 70 |
Total | $ | 77 |  |  | $ | 74 |  |  | $ | 70 |
Louisville Gas And Electric Co [Member] |
Income Taxes [Line Items] |
Components of Deferred Tax Assets and Liabilities | Significant components of LG&E's deferred income tax assets and liabilities were as follows:
| 2020 |  | 2019
Deferred Tax Assets |  |  |
Contributions in aid of construction | $ | 15 |  |  | $ | 15 |
Regulatory liabilities | 20 |  |  | 19 |
Accrued pension and postretirement costs | — |  |  | 6 |
Deferred investment tax credits | 8 |  |  | 8 |
Income taxes due to customers | 132 |  |  | 136 |
State tax credit carryforwards | 12 |  |  | 14 |
Lease liabilities | 5 |  |  | 5 |
Valuation allowances | (12) |  |  | (14) |
Other | 11 |  |  | 10 |
Total deferred tax assets | 191 |  |  | 199 |
Deferred Tax Liabilities |  |  |
Plant - net | 833 |  |  | 811 |
Regulatory assets | 66 |  |  | 77 |
Lease right-of-use assets | 4 |  |  | 4 |
Other | 4 |  |  | 4 |
Total deferred tax liabilities | 907 |  |  | 896 |
Net deferred tax liability | $ | 716 |  |  | $ | 697 |
Components of Income Tax Expense (Benefit) | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Income Tax Expense (Benefit) |  |  |  |  |
Current - Federal | $ | 53 |  |  | $ | 4 |  |  | $ | — |
Current - State | 7 |  |  | 4 |  |  | 4 |
Total Current Expense (Benefit) | 60 |  |  | 8 |  |  | 4 |
Deferred - Federal | (4) |  |  | 46 |  |  | 51 |
Deferred - State | 7 |  |  | 10 |  |  | 10 |
Total Deferred Expense (Benefit) | 3 |  |  | 56 |  |  | 61 |
Amortization of investment tax credit - Federal | (1) |  |  | (1) |  |  | (1) |
Total income tax expense (benefit) | $ | 62 |  |  | $ | 63 |  |  | $ | 64 |
Total income tax expense (benefit) - Federal | $ | 48 |  |  | $ | 49 |  |  | $ | 50 |
Total income tax expense (benefit) - State | 14 |  |  | 14 |  |  | 14 |
Total income tax expense (benefit) | $ | 62 |  |  | $ | 63 |  |  | $ | 64 |
Reconciliation of Income Tax Expense Derived From Statutory Tax Rate | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Reconciliation of Income Tax Expense (Benefit) |  |  |  |  |
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 64 |  | $ | 62 |  | $ | 62
Increase (decrease) due to: |  |  |  |  |
State income taxes, net of federal income tax benefit | 12 |  | 12 |  | 11
Amortization of excess deferred federal and state income taxes | (11) |  | (10) |  | (8)
Kentucky recycling credit, net of federal income tax expense (a) | — |  | (14) |  | —
Valuation allowance adjustments (a) | — |  | 14 |  | —
Other | (3) |  | (1) |  | (1)
Total increase (decrease) | (2) |  | 1 |  | 2
Total income tax expense (benefit) | $ | 62 |  | $ | 63 |  | $ | 64
Effective income tax rate | 20.3% |  | 21.4% |  | 21.5%
(a)In 2019, LG&E recorded a deferred income tax benefit associated with two projects placed into service that prepare a generation waste material for reuse and, as a result, qualify for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky. This amount has been reserved due to insufficient Kentucky taxable income projected at LG&E.
Details of Taxes Other Than Income | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Taxes, other than income |  |  |  |  |
Property and other | $ | 40 |  |  | $ | 39 |  |  | $ | 36 |
Total | $ | 40 |  |  | $ | 39 |  |  | $ | 36 |
Kentucky Utilities Co [Member] |
Income Taxes [Line Items] |
Components of Deferred Tax Assets and Liabilities | Significant components of KU's deferred income tax assets and liabilities were as follows:
| 2020 |  | 2019
Deferred Tax Assets |  |  |
Contributions in aid of construction | $ | 8 |  |  | $ | 8 |
Regulatory liabilities | 23 |  |  | 25 |
Deferred investment tax credits | 22 |  |  | 23 |
Income taxes due to customers | 150 |  |  | 156 |
State tax credit carryforwards | 5 |  |  | 5 |
Lease liabilities | 8 |  |  | 8 |
Valuation allowances | (4) |  |  | (4) |
Other | 4 |  |  | 3 |
Total deferred tax assets | 216 |  |  | 224 |
Deferred Tax Liabilities |  |  |
Plant - net | 992 |  |  | 959 |
Regulatory assets | 43 |  |  | 45 |
Accrued pension and postretirement costs | 8 |  |  | 2 |
Lease right-of-use assets | 7 |  |  | 7 |
Other | 1 |  |  | 3 |
Total deferred tax liabilities | 1,051 |  |  | 1,016 |
Net deferred tax liability | $ | 835 |  |  | $ | 792 |
Components of Income Tax Expense (Benefit) | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Income Tax Expense (Benefit) |  |  |  |  |
Current - Federal | $ | 40 |  |  | $ | 35 |  |  | $ | 22 |
Current - State | 3 |  |  | 5 |  |  | 6 |
Total Current Expense (Benefit) | 43 |  |  | 40 |  |  | 28 |
Deferred - Federal | 11 |  |  | 28 |  |  | 40 |
Deferred - State | 11 |  |  | 13 |  |  | 10 |
Total Deferred Expense (Benefit) | 22 |  |  | 41 |  |  | 50 |
Amortization of investment tax credit - Federal | (2) |  |  | (2) |  |  | (2) |
Total income tax expense (benefit) | $ | 63 |  |  | $ | 79 |  |  | $ | 76 |
Total income tax expense (benefit) - Federal | $ | 49 |  |  | $ | 61 |  |  | $ | 60 |
Total income tax expense (benefit) - State | 14 |  |  | 18 |  |  | 16 |
Total income tax expense (benefit) | $ | 63 |  |  | $ | 79 |  |  | $ | 76 |
Reconciliation of Income Tax Expense Derived From Statutory Tax Rate | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Reconciliation of Income Tax Expense (Benefit) |  |  |  |  |
Federal income tax on Income Before Income Taxes at statutory tax rate - 21% | $ | 72 |  | $ | 78 |  | $ | 76
Increase (decrease) due to: |  |  |  |  |
State income taxes, net of federal income tax benefit | 14 |  | 15 |  | 13
Amortization of investment tax credit | (2) |  | (2) |  | (2)
Amortization of excess deferred federal and state income taxes | (17) |  | (13) |  | (12)
Kentucky recycling credit, net of federal income tax expense (a) | — |  | (4) |  | —
Valuation allowance adjustments (a) | — |  | 4 |  | —
Other | (4) |  | 1 |  | 1
Total increase (decrease) | (9) |  | 1 |  | —
Total income tax expense (benefit) | $ | 63 |  | $ | 79 |  | $ | 76
Effective income tax rate | 18.4% |  | 21.2% |  | 21.0%
(a)In 2019, KU recorded a deferred income tax benefit associated with a project placed into service that prepare a generation waste material for reuse and, as a result, qualify for a Kentucky recycling credit. The applicable credit provides tax benefits for a portion of the equipment costs for major recycling projects in Kentucky. This amount has been reserved due to insufficient Kentucky taxable income projected at KU.
Details of Taxes Other Than Income | Details of the components of income tax expense, a reconciliation of federal income taxes derived from statutory tax rates applied to "Income Before Income Taxes" to income taxes for reporting purposes, and details of "Taxes, other than income" were:
| 2020 |  | 2019 |  | 2018
Taxes, other than income |  |  |  |  |
Property and other | $ | 37 |  |  | $ | 35 |  |  | $ | 34 |
Total | $ | 37 |  |  | $ | 35 |  |  | $ | 34 |

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