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Price Risk Management (Notes) | 6 Months Ended
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Jun. 30, 2011
Price Risk Management Note [Abstract] |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | PRICE RISK MANAGEMENT PGE participates in the wholesale marketplace in order to balance its supply of power, which consists of its own generating resources combined with wholesale market transactions, to meet the needs of its retail customers, manage risk, and administer its existing long-term wholesale contracts. Such activities include power purchases and sales resulting from economic dispatch decisions for Company-owned generation. As a result of this ongoing business activity, PGE is exposed to commodity price risk and foreign currency exchange rate risk, where adverse changes in prices and/or rates may affect the Company’s financial position, results of operations, or cash flow. PGE utilizes derivative instruments in its wholesale electric utility activities to manage its exposure to commodity price risk and foreign currency exchange rate risk, mitigate the effects of market fluctuations, and minimize net power costs for service to its retail customers. These derivative instruments may include forward, swap, and option contracts for electricity, natural gas, oil, and foreign currency, and futures contracts for natural gas and oil. All derivative instruments are recorded at fair value on the balance sheet, with changes in fair value recorded in the statement of income. However, as a regulated entity, PGE recognizes a regulatory asset or liability in order to defer gains and losses from derivative activity until realized, in accordance with the ratemaking and cost recovery process authorized by the OPUC. This accounting treatment defers the mark-to-market gains and losses on derivative activities until settlement. PGE may designate certain derivative instruments as cash flow hedges or may use derivative instruments as purely economic hedges. PGE does not engage in trading activities for non-retail purposes. PGE has elected to report gross on the balance sheet the positive and negative exposures resulting from derivative instruments entered into with counterparties where a master netting arrangement exists. As of June 30, 2011 and December 31, 2010, the Company had $17 million and $31 million, respectively, in collateral posted with these counterparties, consisting entirely of letters of credit. PGE’s net volumes related to its Assets and Liabilities from price risk management activities resulting from its derivative transactions were as follows (in millions):
| June 30, 2011 |  | December 31, 2010
Commodity contracts: |  |  |  |  |
Electricity | 12 |  | MWh |  | 9 |  | MWh
Natural gas | 82 |  | Decatherms |  | 93 |  | Decatherms
Foreign currency | $ | 11 |  | Canadian |  | $ | 7 |  | Canadian
The fair value of PGE’s Assets and Liabilities from price risk management activities consists of the following (in millions):
| June 30, 2011 |  | December 31, 2010 |
Current assets: |  |  |  |
Commodity contracts: |  |  |  |
Electricity | $ | 6 |  |  | $ | 4 |  |
Natural gas | 3 |  |  | 9 |  |
Total current derivative assets | 9 |  | (1) | 13 |  | (1)
Noncurrent assets: |  |  |  |
Commodity contracts: |  |  |  |
Electricity | 1 |  |  | 1 |  |
Natural gas | — |  |  | 2 |  |
Total noncurrent derivative assets | 1 |  | (2) | 3 |  | (2)
Total derivative assets not designated as hedging instruments | $ | 10 |  |  | $ | 16 |  |
Total derivative assets | $ | 10 |  |  | $ | 16 |  |
Current liabilities: |  |  |  |
Commodity contracts: |  |  |  |
Electricity | $ | 56 |  |  | $ | 77 |  |
Natural gas | 107 |  |  | 111 |  |
Total current derivative liabilities | 163 |  |  | 188 |  |
Noncurrent liabilities: |  |  |  |
Commodity contracts: |  |  |  |
Electricity | 37 |  |  | 42 |  |
Natural gas | 106 |  |  | 146 |  |
Total noncurrent derivative liabilities | 143 |  |  | 188 |  |
Total derivative liabilities not designated as hedging instruments | $ | 306 |  |  | $ | 376 |  |
Total derivative liabilities | $ | 306 |  |  | $ | 376 |  |
(1) | Included in Other current assets on the condensed consolidated balance sheets.
(2) | Included in Other noncurrent assets on the condensed consolidated balance sheets.
Net realized and unrealized gains (losses) on derivative transactions not designated as hedging instruments are classified in Purchased power and fuel, net of deferrals related to regulatory accounting, in the condensed consolidated statements of income and were as follows (in millions):
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2011 |  | 2010 |  | 2011 |  | 2010
Commodity contracts: |  |  |  |  |  |  |
Electricity | $ | 1 |  |  | $ | (6 | ) |  | $ | (31 | ) |  | $ | (59 | )
Natural Gas | (17 | ) |  | (18 | ) |  | (11 | ) |  | (109 | )
Unrealized gains and losses and certain realized gains and losses presented in the table above are offset within the statements of income by the effects of regulatory accounting. Of the net gain (loss) recognized in net income for the three months ended June 30, 2011 and 2010, net losses of $10 million and $25 million, respectively, have been offset, with $35 million and $159 million offset for the six months ended June 30, 2011 and 2010, respectively. Assuming no changes in market prices and interest rates, the following table indicates the year in which the net unrealized loss recorded as of June 30, 2011 related to PGE’s derivative activities would become realized as a result of the settlement of the underlying derivative instrument (in millions):
| 2011 |  | 2012 |  | 2013 |  | 2014 |  | 2015 |  | Total
Commodity contracts: |  |  |  |  |  |  |  |  |  |  |
Electricity | $ | 22 |  |  | $ | 39 |  |  | $ | 18 |  |  | $ | 7 |  |  | $ | — |  |  | $ | 86 |
Natural gas | 56 |  |  | 97 |  |  | 46 |  |  | 10 |  |  | 1 |  |  | 210 |
Net unrealized loss | $ | 78 |  |  | $ | 136 |  |  | $ | 64 |  |  | $ | 17 |  |  | $ | 1 |  |  | $ | 296 |
The Company’s secured and unsecured debt is currently rated at investment grade by Moody’s Investors Service (Moody’s) and Standard and Poor’s Ratings Services (S&P). Should Moody’s and/or S&P reduce their rating on the Company’s unsecured debt to below investment grade, PGE could be subject to requests by certain wholesale counterparties to post additional performance assurance collateral, in the form of cash or letters of credit, based on total portfolio positions with each of those counterparties and certain other counterparties would have the right to terminate their agreements with the Company. The aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a liability position as of June 30, 2011 was $255 million, for which the Company has $106 million in posted collateral, consisting entirely of letters of credit. If the credit-risk-related contingent features underlying these agreements were triggered at June 30, 2011, the cash requirement to either post as collateral or settle the instruments immediately would have been $249 million. Counterparties representing 10% or more of Assets and Liabilities from price risk management activities as of June 30, 2011 or December 31, 2010 were as follows:
| June 30, 2011 |  | December 31, 2010
Assets from price risk management activities: |  |  |
Counterparty A | 24 | % |  | 22 | %
Counterparty B | 13 |  |  | 11 |
Counterparty C | 12 |  |  | 23 |
Counterparty D | 10 |  |  | 1 |
Counterparty E | — |  |  | 10 |
| 59 | % |  | 67 | %
Liabilities from price risk management activities: |  |  |
Counterparty C | 25 | % |  | 24 | %
Counterparty F | 10 |  |  | 9 |
Counterparty G | 9 |  |  | 12 |
| 44 | % |  | 45 | %
See Note 3 for additional information concerning the determination of fair value for the Company’s Assets and Liabilities from price risk management activities.

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- Definition The entire disclosure for the entity's entire derivative instruments and hedging activities. Describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising therefrom, and the amounts of and methodologies and assumptions used in determining the amounts of such items. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 133 -Paragraph 44 -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. 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