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Goodwill and Other Intangible Assets | 12 Months Ended
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Dec. 31, 2011
GOODWILL AND OTHER INTANGIBLE ASSETS | 9. GOODWILL AND OTHER INTANGIBLE ASSETS The following table summarizes the changes in the carrying amou nt of goodwill, by segment for the years ended December 31, 2011 and 2010.
|  |  |  | Latin |  | Latin |  | North |  | North |  |  |  |  |  |  |  |  |  |  |
|  |  |  | America - |  | America - |  | America - |  | America - |  | Europe - |  | Asia - |  | Corporate |  |  |
|  |  |  | Generation |  | Utilities |  | Generation |  | Utilities |  | Generation |  | Generation |  | and Other |  | Total
Balance as of December 31, 2009 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Goodwill |  | $ | 926 |  | $ | 140 |  | $ | 111 |  | $ | - |  | $ | 137 |  | $ | 78 |  | $ | 101 |  | $ | 1,493
| Accumulated impairment losses |  |  | (24) |  |  | (7) |  |  | (20) |  |  | - |  |  | (137) |  |  | - |  |  | (6) |  |  | (194)
|  | Net balance |  |  | 902 |  |  | 133 |  |  | 91 |  |  | - |  |  | - |  |  | 78 |  |  | 95 |  |  | 1,299
| Impairment losses |  |  | - |  |  | - |  |  | (18) |  |  | - |  |  | - |  |  | - |  |  | (3) |  |  | (21)
| Foreign currency translation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | and other |  |  | - |  |  | - |  |  | (10) |  |  | - |  |  | - |  |  | 3 |  |  | - |  |  | (7)
Balance as of December 31, 2010 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Goodwill |  |  | 926 |  |  | 140 |  |  | 101 |  |  | - |  |  | 137 |  |  | 81 |  |  | 101 |  |  | 1,486
| Accumulated impairment losses |  |  | (24) |  |  | (7) |  |  | (38) |  |  | - |  |  | (137) |  |  | - |  |  | (9) |  |  | (215)
|  | Net balance |  |  | 902 |  |  | 133 |  |  | 63 |  |  | - |  |  | - |  |  | 81 |  |  | 92 |  |  | 1,271
| Impairment losses |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | (17) |  |  | - |  |  | (17)
| Goodwill acquired during the year(1) |  |  | - |  |  | - |  |  | - |  |  | 2,489 |  |  | - |  |  | - |  |  | - |  |  | 2,489
| Foreign currency translation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | and other |  |  | - |  |  | - |  |  | (10) |  |  | - |  |  | - |  |  | - |  |  | - |  |  | (10)
Balance as of December 31, 2011 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Goodwill |  |  | 926 |  |  | 140 |  |  | 91 |  |  | 2,489 |  |  | 137 |  |  | 81 |  |  | 101 |  |  | 3,965
| Accumulated impairment losses |  |  | (24) |  |  | (7) |  |  | (38) |  |  | - |  |  | (137) |  |  | (17) |  |  | (9) |  |  | (232)
|  | Net balance |  | $ | 902 |  | $ | 133 |  | $ | 53 |  | $ | 2,489 |  | $ | - |  | $ | 64 |  | $ | 92 |  | $ | 3,733
(1) Represents goodwill resulting from the acquisition of DPL, which was allocated to the two newly established reporting units identified within DPL. See Note 23―Acquisitions and Dispositions for further information. During the third quarter of 2011, the Company identified higher coal prices and the resulting reduced operating margins in China as an impairment indicator for the goodwill at Chigen, our wholly-owned subsidiary that holds equity interests in Chinese ventures and reported in the Asia Generation segment. A significant downward revision of cash flow forecasts indicated that the fair value of Chigen reporting unit was lower than its carrying amount. As of September 30, 2011, Chigen had goodwill of $17 million. The Company performed an interim impairment evaluation of Chigen's goodwill and determined that goodwill had no implied fair value. As a result, the entire carrying amount of $17 million was recognized as goodwill impairment in the third quarter. During the third quarter of 2010, Deepwater, our petcoke-fired merchant generation facility in Texas, reported in the North America Generation segment, incurred a goodwill impairment of $18 million. The Company determined the adverse market condit ions as an impairment indicator, performed the two-step goodwill impairment test and recognized the entire $18 million carrying amount of goodwill as goodwill impairment in the third quarter. In 2009, Kilroot, our coal fired power plant in the United Kingdom, reported in the Europe Generation segment, incurred a goodwill impairment of $118 million. Factors contributi ng to the impairment included: reduced profit expectations based on latest estimates of future commodity prices and reduced expectations on the recovery of cash flows on the existing plant following the Company's decision to forgo capital expenditures to meet emission allowance requirements taking effect in 2024. Additionally, one of our subsidiaries located in the Ukraine and reported within “Corporate and Other” incurred a goodwill impairment loss of $4 million. The following tables summarize the balan ces comprising other intangible assets in the accompanying Consolidated Balance Sheets as of December 31, 2011 and 2010:
|  |  | December 31, 2011 |  | December 31, 2010
|  |  | Gross |  | Accumulated |  | Net |  | Gross |  | Accumulated |  | Net
|  |  | Balance |  | Amortization |  | Balance |  | Balance |  | Amortization |  | Balance
|  |  |  | (in millions) |  | (in millions)
Subject to Amortization |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Project development rights(1) |  | $ | 102 |  | $ | - |  | $ | 102 |  | $ | 117 |  | $ | - |  | $ | 117
Sales concessions |  |  | 156 |  |  | (92) |  |  | 64 |  |  | 162 |  |  | (89) |  |  | 73
Contractual payment rights(2) |  |  | 69 |  |  | (13) |  |  | 56 |  |  | 65 |  |  | (4) |  |  | 61
Land use rights |  |  | 49 |  |  | (4) |  |  | 45 |  |  | 50 |  |  | (2) |  |  | 48
Management rights |  |  | 39 |  |  | (13) |  |  | 26 |  |  | 66 |  |  | (30) |  |  | 36
Emission allowances(3) |  |  | 18 |  |  | - |  |  | 18 |  |  | 8 |  |  | - |  |  | 8
Electric security plan |  |  | 88 |  |  | (9) |  |  | 79 |  |  | - |  |  | - |  |  | -
Customer contracts |  |  | 45 |  |  | (3) |  |  | 42 |  |  | - |  |  | - |  |  | -
Customer relationships |  |  | 30 |  |  | - |  |  | 30 |  |  | - |  |  | - |  |  | -
Other(4) |  |  | 71 |  |  | (30) |  |  | 41 |  |  | 70 |  |  | (26) |  |  | 44
| Subtotal |  |  | 667 |  |  | (164) |  |  | 503 |  |  | 538 |  |  | (151) |  |  | 387
Indefinite-Lived Intangible Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Land use rights |  |  | 52 |  |  | - |  |  | 52 |  |  | 51 |  |  | - |  |  | 51
Emission allowances(5) |  |  | 4 |  |  | - |  |  | 4 |  |  | 8 |  |  | - |  |  | 8
Trademark/Trade name |  |  | 5 |  |  | - |  |  | 5 |  |  | - |  |  | - |  |  | -
Other |  |  | 2 |  |  | - |  |  | 2 |  |  | 2 |  |  | - |  |  | 2
| Subtotal |  |  | 63 |  |  | - |  |  | 63 |  |  | 61 |  |  | - |  |  | 61
Total |  | $ | 730 |  | $ | (164) |  | $ | 566 |  | $ | 599 |  | $ | (151) |  | $ | 448
Represent development rights, including but not limited to, land control, various permits and right to acquire equity interests in development projects resulting from asset acquisitions by our Wind group. A portion of these development rights was recognized as a loss on disposal of discontinued operations when certain development projects were abandoned during the fourth quarter of 2011. See Note 22― Discontinued Operations and Held for Sale Businesses for further information. Represent legal right s to receive system reliability payments from the regulator. Acquired or purchased emission allowances are expensed when utilized and included in net income for the year. Consists of various intangible assets including PPAs and transmission rights, none of which is individually significant. Represent perpetual emission allowances without an expiration date. The following table summarizes, by category, intangible assets acquired during the year s ended December 31, 2011 and 2010:
|  |  | December 31, 2011
|  |  |  |  | Subject to |  |  |  |
|  |  |  |  |  | Amortization/ |  | Weighted Average |  | Amortization
|  |  | Amount |  | Indefinite-Lived |  | Amortization Period |  | Method
|  |  | (in millions) |  |  |  | (in years) |  |  |
Electric security plan(2) |  | $ | 88 |  | Subject to amortization |  |  | 1 |  |  | Straight line
Customer relationship(1) (3) |  |  | 30 |  | Subject to amortization |  |  | 12 |  |  | Straight line
Customer contracts(1) (4) |  |  | 45 |  | Subject to amortization |  |  | 3 |  |  | Other
Trademark/Trade name(1) (5) |  |  | 5 |  | Indefinite-lived |  |  | N/A |  |  | N/A
Other |  |  | 4 |  | Subject to amortization |  |  | Various |  |  | As utilized
Total |  | $ | 172 |  |  |  |  |  |  |  |
|  |  | December 31, 2010
|  |  |  |  | Subject to |  |  |  |
|  |  |  |  |  | Amortization/ |  | Weighted Average |  | Amortization
|  |  | Amount |  | Indefinite-Lived |  | Amortization Period |  | Method
|  |  | (in millions) |  |  |  | (in years) |  |  |
Project development rights |  | $ | 141 |  | Subject to amortization |  |  | Various |  |  | Straight line
Contractual payment rights |  |  | 65 |  | Subject to amortization |  |  | 10 |  |  | Straight line
Emission allowances |  |  | 14 |  | Subject to amortization |  |  | Various |  |  | As utilized
Land use rights |  |  | 7 |  | Indefinite-lived |  |  | N/A |  |  | N/A
Total |  | $ | 227 |  |  |  |  |  |  |  |
Represents intangible assets arising from the acquisition of DPL. See Note 23―Acquisitions and Dispositions for further information. Electric Security Plan is a rate plan for the supply and pricing of electric generation service applicable to Ohio's electric utilities under state law. It provides a level of price stability to consumers of electricity as compared to market-based electricity prices. The plan was recognized as an intangible asset since the prices under the plan are higher than market prices charged by competitive retailers or CRES. Customer relationships represent the value assigned to customer information possessed by DPL in the preliminary purchase price allocation, where DPL has regular contact with the customer, and the customer has the ability to make direct contact with DPL. See Note 23―Acquisitions and Dispositions for further information. The amortization method used reflects the pattern in which the economic benefits of the intangible asset are consumed. Trademarks/Trade name represent the value assigned to trade name of DPLER, DPL's subsidiary engaged in competitive retail business in Ohio. The following table summarizes the estimated amortization expense, broken down by intangible asset category, for 2012 through 2016:
|  |  | Estimated amortization expense
|  |  | 2012 |  | 2013 |  | 2014 |  | 2015 |  | 2016
|  |  |  | (in millions)
| Contractual payment rights |  | $ | 9 |  | $ | 9 |  | $ | 9 |  | $ | 9 |  | $ | 3
| Sales concessions |  |  | 6 |  |  | 6 |  |  | 6 |  |  | 6 |  |  | 5
| Customer relationships & contracts |  |  | 35 |  |  | 11 |  |  | 4 |  |  | 3 |  |  | 3
| Electric security plan |  |  | 79 |  |  | - |  |  | - |  |  | - |  |  | -
| All other |  |  | 9 |  |  | 6 |  |  | 4 |  |  | 4 |  |  | 4
| Total |  | $ | 138 |  | $ | 32 |  | $ | 23 |  | $ | 22 |  | $ | 15
Intangible asset amortization expense was $36 million, $14 million and $16 million for the years ended December 31, 2011, 2010 and 2009, respectively.

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- Definition The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6905597&loc=d3e13816-109267 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 30 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6905858&loc=d3e16265-109275 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 142 -Paragraph 42, 43, 44, 45, 46, 47 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 30 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6905858&loc=d3e16373-109275 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6905858&loc=d3e16323-109275 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 20 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6905597&loc=d3e13854-109267 + Details
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