Texas
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74-0694415
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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1111 Louisiana
Houston, Texas 77002
(Address and zip code of principal executive offices)
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(713) 207-1111
(Registrant’s telephone number, including area code)
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Title of each class
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Name of each exchange on which registered
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Common Stock, $0.01 par value and associated
rights to purchase preferred stock
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New York Stock Exchange
Chicago Stock Exchange
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
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PART I
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Page
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Item 1.
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Business
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1
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Item 1A.
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Risk Factors
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25
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Item 1B.
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Unresolved Staff Comments
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35
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Item 2.
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Properties
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35
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Item 3.
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Legal Proceedings
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36
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Item 4.
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Removed and Reserved
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36
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PART II
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||||
Item 5.
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Market for Registrants’ Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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37
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Item 6.
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Selected Financial Data
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38
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Item 7.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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39
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Item 7A.
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Quantitative and Qualitative Disclosures About Market Risk
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63
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Item 8.
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Financial Statements and Supplementary Data
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66
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Item 9.
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
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116
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Item 9A.
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Controls and Procedures
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116
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Item 9B.
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Other Information
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117
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PART III
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||||
Item 10.
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Directors, Executive Officers and Corporate Governance
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117
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Item 11.
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Executive Compensation
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117
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Item 12.
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
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117
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Item 13.
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Certain Relationships and Related Transactions, and Director Independence
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117
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Item 14.
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Principal Accounting Fees and Services
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117
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PART IV
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||||
Item 15.
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Exhibits and Financial Statement Schedules
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118
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•
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CenterPoint Energy Houston Electric, LLC (CenterPoint Houston), which engages in the electric transmission and distribution business in a 5,000-square mile area of the Texas Gulf Coast that includes the city of Houston; and
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•
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CenterPoint Energy Resources Corp. (CERC Corp. and, together with its subsidiaries, CERC), which owns and operates natural gas distribution systems in six states. Subsidiaries of CERC Corp. own interstate natural gas pipelines and gas gathering systems and provide various ancillary services. A wholly owned subsidiary of CERC Corp. offers variable and fixed-price physical natural gas supplies primarily to commercial and industrial customers and electric and gas utilities.
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•
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our Code of Ethics for our Chief Executive Officer and Senior Financial Officers;
|
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•
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our Ethics and Compliance Code;
|
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•
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our Corporate Governance Guidelines; and
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•
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the charters of the audit, compensation, finance, governance and strategic planning committees of our Board of Directors.
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•
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reversed the Texas Utility Commission’s ruling that had denied CenterPoint Houston recovery of a portion of the capacity auction true-up amounts;
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•
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reversed the Texas Utility Commission’s ruling that precluded CenterPoint Houston from recovering the interest component of the EMCs paid to REPs; and
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•
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affirmed the True-Up Order in all other respects.
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•
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reversed the district court’s judgment to the extent it restored the capacity auction true-up amounts;
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•
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reversed the district court’s judgment to the extent it upheld the Texas Utility Commission’s decision to allow CenterPoint Houston to recover EMCs paid to its former affiliate Reliant Energy, Inc. (Reliant Energy, Inc., formerly known as Reliant Resources, Inc., changed its name in 2009 to “RRI Energy, Inc.” in connection with the sale of its Texas retail electric business, and again in December 2010 to “GenOn Energy, Inc.” in connection with the merger of one of its wholly owned subsidiaries with Mirant Corporation. For convenience, we refer to this company as “RRI” in the context of discussing transactions relating to our formation, our pending true-up appeal and other historical matters, and as “GenOn” in the present and future context, unless stated otherwise.);
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•
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ordered that the tax normalization issue described below be remanded to the Texas Utility Commission as requested by the Texas Utility Commission; and
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•
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affirmed the district court’s judgment in all other respects.
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•
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the lien of a Mortgage and Deed of Trust (the Mortgage) dated November 1, 1944, as supplemented; and
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•
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the lien of a General Mortgage (the General Mortgage) dated October 10, 2002, as supplemented, which is junior to the lien of the Mortgage.
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Residential
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Commercial/
Industrial
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Total Customers
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||||||||||
Arkansas
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390,668 | 48,033 | 438,701 | |||||||||
Louisiana
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232,135 | 17,347 | 249,482 | |||||||||
Minnesota
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738,868 | 67,489 | 806,357 | |||||||||
Mississippi
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109,608 | 12,683 | 122,291 | |||||||||
Oklahoma
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93,388 | 10,620 | 104,008 | |||||||||
Texas
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1,451,666 | 90,719 | 1,542,385 | |||||||||
Total Gas Operations
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3,016,333 | 246,891 | 3,263,224 |
|
•
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CenterPoint Energy Gas Transmission Company, LLC (CEGT) is an interstate pipeline that provides natural gas transportation, natural gas storage and pipeline services to customers principally in Arkansas, Louisiana, Oklahoma and Texas; and
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|
•
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CenterPoint Energy-Mississippi River Transmission, LLC (MRT) is an interstate pipeline that provides natural gas transportation, natural gas storage and pipeline services to customers principally in Arkansas and Missouri.
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•
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restricting the way we can handle or dispose of wastes;
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•
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limiting or prohibiting construction activities in sensitive areas such as wetlands, coastal regions or areas inhabited by endangered species;
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•
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requiring remedial action to mitigate environmental conditions caused by our operations or attributable to former operations;
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•
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enjoining the operations of facilities deemed in non-compliance with permits issued pursuant to such environmental laws and regulations; and
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•
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impacting the demand for our services by directly or indirectly affecting the use or price of natural gas, or the ability to extract natural gas in areas we serve in our interstate pipelines and field services businesses.
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•
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construct or acquire new equipment;
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•
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acquire permits for facility operations;
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•
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modify or replace existing and proposed equipment; and
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•
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clean up or decommission waste disposal areas, fuel storage and management facilities and other locations and facilities.
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Business Segment
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Number
|
Number
Represented
by Unions or
Other Collective
Bargaining Groups
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||||||
Electric Transmission & Distribution
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2,813 | 1,270 | ||||||
Natural Gas Distribution
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3,586 | 1,362 | ||||||
Competitive Natural Gas Sales and Services
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133 | — | ||||||
Interstate Pipelines
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728 | — | ||||||
Field Services
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278 | — | ||||||
Other Operations
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1,305 | — | ||||||
Total
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8,843 | 2,632 |
Name
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Age
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Title
|
||
David M. McClanahan
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61
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President and Chief Executive Officer and Director
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||
Scott E. Rozzell
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61
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Executive Vice President, General Counsel and Corporate
Secretary
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||
Gary L. Whitlock
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61
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Executive Vice President and Chief Financial Officer
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C. Gregory Harper
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46
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Senior Vice President and Group President, CenterPoint
Energy Pipelines and Field Services
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||
Thomas R. Standish
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61
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Senior Vice President and Group President — Regulated Operations
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•
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reversed the Texas Utility Commission’s ruling that had denied CenterPoint Houston recovery of a portion of the capacity auction true-up amounts;
|
|
•
|
reversed the Texas Utility Commission’s ruling that precluded CenterPoint Houston from recovering the interest component of the EMCs paid to REPs; and
|
|
•
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affirmed the True-Up Order in all other respects.
|
|
•
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reversed the district court’s judgment to the extent it restored the capacity auction true-up amounts;
|
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•
|
reversed the district court’s judgment to the extent it upheld the Texas Utility Commission’s decision to allow CenterPoint Houston to recover EMCs paid to RRI;
|
|
•
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ordered that the tax normalization issue described below be remanded to the Texas Utility Commission as requested by the Texas Utility Commission; and
|
|
•
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affirmed the district court’s judgment in all other respects.
|
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•
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the resolution of the true-up proceedings, including, in particular, the results of appeals to the Texas Supreme Court regarding rulings obtained to date;
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•
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general economic and capital market conditions;
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•
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credit availability from financial institutions and other lenders;
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•
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investor confidence in us and the markets in which we operate;
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•
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maintenance of acceptable credit ratings;
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•
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market expectations regarding our future earnings and cash flows;
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•
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market perceptions of our ability to access capital markets on reasonable terms;
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•
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our exposure to GenOn in connection with its indemnification obligations arising in connection with its separation from us;
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•
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provisions of relevant tax and securities laws.
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•
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restricting the way we can handle or dispose of wastes;
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|
•
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limiting or prohibiting construction activities in sensitive areas such as wetlands, coastal regions, or areas inhabited by endangered species;
|
|
•
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requiring remedial action to mitigate environmental conditions caused by our operations, or attributable to former operations;
|
|
•
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enjoining the operations of facilities deemed in non-compliance with permits issued pursuant to such environmental laws and regulations; and
|
|
•
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impacting the demand for our services by directly or indirectly affecting the use or price of natural gas, or the ability to extract natural gas in areas we serve in our interstate pipelines and field services businesses.
|
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•
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construct or acquire new equipment;
|
|
•
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acquire permits for facility operations;
|
|
•
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modify or replace existing and proposed equipment; and
|
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•
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clean up or decommission waste disposal areas, fuel storage and management facilities and other locations and facilities.
|
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•
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merchant energy, energy trading and REP businesses transferred to RRI or its subsidiaries in connection with the organization and capitalization of RRI prior to its initial public offering in 2001; and
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•
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Texas electric generating facilities transferred to Texas Genco Holdings, Inc. (Texas Genco) in 2004 and early 2005.
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Dividend
|
|||||||||||
Market Price |
Declared
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|||||||||||
High
|
Low
|
Per Share
|
||||||||||
2009
|
||||||||||||
First Quarter
|
$ | 0.19 | ||||||||||
February 6
|
$ | 14.39 | ||||||||||
March 6
|
$ | 8.88 | ||||||||||
Second Quarter
|
$ | 0.19 | ||||||||||
May 27
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$ | 9.77 | ||||||||||
June 29
|
$ | 11.24 | ||||||||||
Third Quarter
|
$ | 0.19 | ||||||||||
July 9
|
$ | 10.78 | ||||||||||
August 26
|
$ | 12.83 | ||||||||||
Fourth Quarter
|
$ | 0.19 | ||||||||||
October 2
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$ | 12.22 | ||||||||||
December 28
|
$ | 14.81 | ||||||||||
2010
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||||||||||||
First Quarter
|
$ | 0.195 | ||||||||||
January 20
|
$ | 14.86 | ||||||||||
February 26
|
$ | 13.38 | ||||||||||
Second Quarter
|
$ | 0.195 | ||||||||||
April 6
|
$ | 14.74 | ||||||||||
June 9
|
$ | 12.90 | ||||||||||
Third Quarter
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$ | 0.195 | ||||||||||
July 2
|
$ | 13.03 | ||||||||||
September 28
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$ | 15.84 | ||||||||||
Fourth Quarter
|
$ | 0.195 | ||||||||||
November 4
|
$ | 16.92 | ||||||||||
November 29
|
$ | 15.60 |
Year Ended December 31,
|
||||||||||||||||||||
2006(1)
|
2007(1)
|
2008(1)
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2009
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2010
|
||||||||||||||||
(in millions, except per share amounts)
|
||||||||||||||||||||
Revenues
|
$ | 9,319 | $ | 9,623 | $ | 11,322 | $ | 8,281 | $ | 8,785 | ||||||||||
Net income
|
$ | 427 | $ | 395 | $ | 446 | $ | 372 | $ | 442 | ||||||||||
Basic earnings per common share
|
$ | 1.37 | $ | 1.23 | $ | 1.32 | $ | 1.02 | $ | 1.08 | ||||||||||
Diluted earnings per common share
|
$ | 1.31 | $ | 1.15 | $ | 1.30 | $ | 1.01 | $ | 1.07 | ||||||||||
Cash dividends declared per common share
|
$ | 0.60 | $ | 0.68 | $ | 0.73 | $ | 0.76 | $ | 0.78 | ||||||||||
Dividend payout ratio
|
44 | % | 55 | % | 55 | % | 75 | % | 72 | % | ||||||||||
Return on average common equity
|
29.8 | % | 23.4 | % | 23.3 | % | 16.0 | % | 15.1 | % | ||||||||||
Ratio of earnings to fixed charges
|
1.74 | 1.83 | 2.05 | 1.82 | 2.08 | |||||||||||||||
At year-end:
|
||||||||||||||||||||
Book value per common share
|
$ | 4.98 | $ | 5.61 | $ | 5.84 | $ | 6.74 | $ | 7.53 | ||||||||||
Market price per common share
|
16.58 | 17.13 | 12.62 | 14.51 | 15.72 | |||||||||||||||
Market price as a percent of book value
|
333 | % | 305 | % | 216 | % | 215 | % | 209 | % | ||||||||||
Total assets
|
$ | 17,633 | $ | 17,872 | $ | 19,676 | $ | 19,773 | $ | 20,111 | ||||||||||
Short-term borrowings
|
187 | 232 | 153 | 55 | 53 | |||||||||||||||
Transition and system restoration bonds, including current maturities
|
2,407 | 2,260 | 2,589 | 3,046 | 2,805 | |||||||||||||||
Other long-term debt, including current maturities
|
6,586 | 7,417 | 7,925 | 6,976 | 6,624 | |||||||||||||||
Capitalization:
|
||||||||||||||||||||
Common stock equity
|
15 | % | 16 | % | 16 | % | 21 | % | 25 | % | ||||||||||
Long-term debt, including current maturities
|
85 | % | 84 | % | 84 | % | 79 | % | 75 | % | ||||||||||
Capitalization, excluding transition and system restoration bonds:
|
||||||||||||||||||||
Common stock equity
|
19 | % | 20 | % | 20 | % | 27 | % | 33 | % | ||||||||||
Long-term debt, excluding transition and system restoration bonds, including current maturities
|
81 | % | 80 | % | 80 | % | 73 | % | 67 | % | ||||||||||
Capital expenditures
|
$ | 1,121 | $ | 1,011 | $ | 1,053 | $ | 1,148 | $ | 1,462 |
|
(1)
|
Net income has been retrospectively adjusted by $5 million, $4 million and $1 million for the years ended 2006, 2007 and 2008, respectively, to reflect the adoption of new accounting guidance as of January 1, 2009 for convertible debt instruments that may be settled in cash upon conversion.
|
|
•
|
CenterPoint Energy Houston Electric, LLC (CenterPoint Houston), which engages in the electric transmission and distribution business in a 5,000-square mile area of the Texas Gulf Coast that includes the city of Houston; and
|
|
•
|
CenterPoint Energy Resources Corp. (CERC Corp. and, together with its subsidiaries, CERC), which owns and operates natural gas distribution systems in six states. Subsidiaries of CERC Corp. own interstate natural gas pipelines and gas gathering systems and provide various ancillary services. A wholly owned subsidiary of CERC Corp. offers variable and fixed-price physical natural gas supplies primarily to commercial and industrial customers and electric and gas utilities.
|
|
•
|
the resolution of the true-up proceedings, including, in particular, the results of appeals to the Texas Supreme Court regarding rulings obtained to date;
|
|
•
|
state and federal legislative and regulatory actions or developments relating to the environment, including those related to global climate change;
|
|
•
|
other state and federal legislative and regulatory actions or developments affecting various aspects of our business, including, among others, energy deregulation or re-regulation, pipeline safety, health care reform, financial reform and tax legislation;
|
|
•
|
timely and appropriate rate actions and increases, allowing recovery of costs and a reasonable return on investment;
|
|
•
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the timing and outcome of any audits, disputes and other proceedings related to taxes;
|
|
•
|
problems with construction, implementation of necessary technology or other issues with respect to major capital projects that result in delays or in cost overruns that cannot be recouped in rates;
|
|
•
|
industrial, commercial and residential growth in our service territory and changes in market demand, including the effects of energy efficiency measures and demographic patterns;
|
|
•
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the timing and extent of changes in commodity prices, particularly natural gas and natural gas liquids, and the effects of geographic and seasonal commodity price differentials;
|
|
•
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the timing and extent of changes in the supply of natural gas, including supplies available for gathering by our field services business and transporting by our interstate pipelines;
|
|
•
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weather variations and other natural phenomena;
|
|
•
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the impact of unplanned facility outages;
|
|
•
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timely and appropriate regulatory actions allowing securitization or other recovery of costs associated with any future hurricanes or natural disasters;
|
|
•
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changes in interest rates or rates of inflation;
|
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•
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commercial bank and financial market conditions, our access to capital, the cost of such capital, and the results of our financing and refinancing efforts, including availability of funds in the debt capital markets;
|
|
•
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actions by rating agencies;
|
|
•
|
effectiveness of our risk management activities;
|
|
•
|
inability of various counterparties to meet their obligations to us;
|
|
•
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non-payment for our services due to financial distress of our customers;
|
|
•
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the ability of GenOn Energy, Inc. (GenOn) (formerly known as RRI Energy, Inc., Reliant Energy, Inc. and Reliant Resources, Inc.) and its subsidiaries to satisfy their obligations to us, including indemnity obligations, or in connection with the contractual arrangements pursuant to which we are their guarantor;
|
|
•
|
the ability of REPs, including REP subsidiaries of NRG Retail LLC and REP subsidiaries of TXU Energy Retail Company LLC, which are CenterPoint Houston’s two largest customers, to satisfy their obligations to us and our subsidiaries;
|
|
•
|
the outcome of litigation brought by or against us;
|
|
•
|
our ability to control costs;
|
|
•
|
the investment performance of our pension and postretirement benefit plans;
|
|
•
|
our potential business strategies, including restructurings, acquisitions or dispositions of assets or businesses, which we cannot assure will be completed or will have the anticipated benefits to us;
|
|
•
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acquisition and merger activities involving us or our competitors; and
|
|
•
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other factors we discuss under “Risk Factors” in Item 1A of this report and in other reports we file from time to time with the Securities and Exchange Commission.
|
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Revenues
|
$ | 11,322 | $ | 8,281 | $ | 8,785 | ||||||
Expenses
|
10,049 | 7,157 | 7,536 | |||||||||
Operating Income
|
1,273 | 1,124 | 1,249 | |||||||||
Gain (Loss) on Marketable Securities
|
(139 | ) | 82 | 67 | ||||||||
Gain (Loss) on Indexed Debt Securities
|
128 | (68 | ) | (31 | ) | |||||||
Interest and Other Finance Charges
|
(468 | ) | (513 | ) | (481 | ) | ||||||
Interest on Transition and System Restoration Bonds
|
(136 | ) | (131 | ) | (140 | ) | ||||||
Equity in Earnings of Unconsolidated Affiliates
|
51 | 15 | 29 | |||||||||
Other Income, net
|
14 | 39 | 12 | |||||||||
Income Before Income Taxes
|
723 | 548 | 705 | |||||||||
Income Tax Expense
|
(277 | ) | (176 | ) | (263 | ) | ||||||
Net Income
|
$ | 446 | $ | 372 | $ | 442 | ||||||
Basic Earnings Per Share
|
$ | 1.32 | $ | 1.02 | $ | 1.08 | ||||||
Diluted Earnings Per Share
|
$ | 1.30 | $ | 1.01 | $ | 1.07 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Electric Transmission & Distribution
|
$ | 545 | $ | 545 | $ | 567 | ||||||
Natural Gas Distribution
|
215 | 204 | 231 | |||||||||
Competitive Natural Gas Sales and Services
|
62 | 21 | 16 | |||||||||
Interstate Pipelines
|
293 | 256 | 270 | |||||||||
Field Services
|
147 | 94 | 151 | |||||||||
Other Operations
|
11 | 4 | 14 | |||||||||
Total Consolidated Operating Income
|
$ | 1,273 | $ | 1,124 | $ | 1,249 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Revenues:
|
||||||||||||
Electric transmission and distribution utility
|
$ | 1,593 | $ | 1,673 | $ | 1,768 | ||||||
Transition and system restoration bond companies
|
323 | 340 | 437 | |||||||||
Total revenues
|
1,916 | 2,013 | 2,205 | |||||||||
Expenses:
|
||||||||||||
Operation and maintenance, excluding transition and system restoration bond companies
|
703 | 774 | 841 | |||||||||
Depreciation and amortization, excluding transition and system restoration bond companies
|
277 | 277 | 293 | |||||||||
Taxes other than income taxes
|
201 | 208 | 207 | |||||||||
Transition and system restoration bond companies
|
190 | 209 | 297 | |||||||||
Total expenses
|
1,371 | 1,468 | 1,638 | |||||||||
Operating Income
|
$ | 545 | $ | 545 | $ | 567 | ||||||
Operating Income:
|
||||||||||||
Electric transmission and distribution operations
|
$ | 407 | $ | 414 | $ | 427 | ||||||
Competition transition charge
|
5 | — | — | |||||||||
Transition and system restoration bond companies
(1)
|
133 | 131 | 140 | |||||||||
Total segment operating income
|
$ | 545 | $ | 545 | $ | 567 | ||||||
Throughput (in gigawatt-hours (GWh)):
|
||||||||||||
Residential
|
24,258 | 24,815 | 26,554 | |||||||||
Total
|
74,840 | 74,579 | 76,973 | |||||||||
Number of metered customers at end of period:
|
||||||||||||
Residential
|
1,821,267 | 1,849,019 | 1,874,508 | |||||||||
Total
|
2,064,854 | 2,094,210 | 2,122,135 |
|
(1)
|
Represents the amount necessary to pay interest on the transition and system restoration bonds.
|
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Revenues
|
$ | 4,226 | $ | 3,384 | $ | 3,213 | ||||||
Expenses:
|
||||||||||||
Natural gas
|
3,124 | 2,251 | 2,049 | |||||||||
Operation and maintenance
|
589 | 639 | 639 | |||||||||
Depreciation and amortization
|
157 | 161 | 166 | |||||||||
Taxes other than income taxes
|
141 | 129 | 128 | |||||||||
Total expenses
|
4,011 | 3,180 | 2,982 | |||||||||
Operating Income
|
$ | 215 | $ | 204 | $ | 231 | ||||||
Throughput (in Bcf):
|
||||||||||||
Residential
|
175 | 173 | 177 | |||||||||
Commercial and industrial
|
236 | 233 | 249 | |||||||||
Total Throughput
|
411 | 406 | 426 | |||||||||
Number of customers at end of period:
|
||||||||||||
Residential
|
2,987,222 | 3,002,114 | 3,016,333 | |||||||||
Commercial and industrial
|
248,476 | 244,101 | 246,891 | |||||||||
Total
|
3,235,698 | 3,246,215 | 3,263,224 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Revenues
|
$ | 4,528 | $ | 2,230 | $ | 2,651 | ||||||
Expenses:
|
||||||||||||
Natural gas
|
4,423 | 2,165 | 2,591 | |||||||||
Operation and maintenance
|
39 | 39 | 38 | |||||||||
Depreciation and amortization
|
3 | 4 | 4 | |||||||||
Taxes other than income taxes
|
1 | 1 | 2 | |||||||||
Total expenses
|
4,466 | 2,209 | 2,635 | |||||||||
Operating Income
|
$ | 62 | $ | 21 | $ | 16 | ||||||
Throughput (in Bcf)
|
528 | 504 | 548 | |||||||||
Number of customers at end of period
|
9,771 | 11,168 | 12,193 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Revenues
|
$ | 650 | $ | 598 | $ | 601 | ||||||
Expenses:
|
||||||||||||
Natural gas
|
155 | 97 | 93 | |||||||||
Operation and maintenance
|
133 | 166 | 153 | |||||||||
Depreciation and amortization
|
46 | 48 | 52 | |||||||||
Taxes other than income taxes
|
23 | 31 | 33 | |||||||||
Total expenses
|
357 | 342 | 331 | |||||||||
Operating Income
|
$ | 293 | $ | 256 | $ | 270 | ||||||
Equity in earnings of unconsolidated affiliates
|
$ | 36 | $ | 7 | $ | 19 | ||||||
Transportation throughput (in Bcf)
|
1,538 | 1,592 | 1,693 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Revenues
|
$ | 252 | $ | 241 | $ | 338 | ||||||
Expenses:
|
||||||||||||
Natural gas
|
21 | 51 | 72 | |||||||||
Operation and maintenance
|
69 | 77 | 85 | |||||||||
Depreciation and amortization
|
12 | 15 | 25 | |||||||||
Taxes other than income taxes
|
3 | 4 | 5 | |||||||||
Total expenses
|
105 | 147 | 187 | |||||||||
Operating Income
|
$ | 147 | $ | 94 | $ | 151 | ||||||
Equity in earnings of unconsolidated affiliates
|
$ | 15 | $ | 8 | $ | 10 | ||||||
Gathering throughput (in Bcf)
|
421 | 426 | 650 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Revenues
|
$ | 11 | $ | 11 | $ | 11 | ||||||
Expenses
|
– | 7 | (3 | ) | ||||||||
Operating Income
|
$ | 11 | $ | 4 | $ | 14 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Cash provided by (used in):
|
||||||||||||
Operating activities
|
$ | 851 | $ | 1,841 | $ | 1,386 | ||||||
Investing activities
|
(1,368 | ) | (896 | ) | (1,420 | ) | ||||||
Financing activities
|
555 | (372 | ) | (507 | ) |
|
•
|
approximately $1.3 billion of capital expenditures;
|
|
•
|
maturing long-term debt aggregating approximately $19 million, excluding $550 million aggregate principal amount of CERC Corp. debt that was retired at its maturity in February 2011 with proceeds from debt issued by CERC Corp. in January 2011;
|
|
•
|
$283 million of scheduled principal payments on transition and system restoration bonds; and
|
|
•
|
dividend payments on CenterPoint Energy common stock and interest payments on debt.
|
2010
|
2011
|
2012
|
2013
|
2014
|
2015
|
|||||||||||||||||||
Electric Transmission & Distribution (1)
|
$ | 463 | $ | 605 | $ | 468 | $ | 469 | $ | 506 | $ | 372 | ||||||||||||
Natural Gas Distribution
|
202 | 263 | 274 | 285 | 285 | 285 | ||||||||||||||||||
Competitive Natural Gas Sales and Services
|
2 | 10 | 12 | 12 | 6 | 6 | ||||||||||||||||||
Interstate Pipelines
|
102 | 157 | 133 | 131 | 119 | 95 | ||||||||||||||||||
Field Services
|
668 | 262 | 135 | 125 | 59 | 60 | ||||||||||||||||||
Other Operations
|
25 | 40 | 31 | 25 | 25 | 27 | ||||||||||||||||||
Total
|
$ | 1,462 | $ | 1,337 | $ | 1,053 | $ | 1,047 | $ | 1,000 | $ | 845 |
|
(1)
|
Includes capital expenditures of $119 million in 2010 and estimated capital expenditures of $225 million, $64 million and $10 million in 2011, 2012 and 2013, respectively, related to AMS and IG, net of a $200 million grant by the DOE.
|
Contractual Obligations
|
Total
|
2011
|
2012-2013 | 2014-2015 |
2016 and
thereafter
|
|||||||||||||||
Transition and system restoration bond debt
|
$ | 2,805 | $ | 283 | $ | 637 | $ | 484 | $ | 1,401 | ||||||||||
Other long-term debt(1)
|
7,303 | 19 | 1,044 | 1,380 | 4,860 | |||||||||||||||
Interest payments — transition and system restoration bond debt(2)
|
699 | 129 | 217 | 162 | 191 | |||||||||||||||
Interest payments — other long-term debt(2)
|
4,195 | 426 | 790 | 562 | 2,417 | |||||||||||||||
Short-term borrowings
|
53 | 53 | — | — | — | |||||||||||||||
Capital leases
|
1 | — | — | — | 1 | |||||||||||||||
Operating leases(3)
|
59 | 15 | 19 | 10 | 15 | |||||||||||||||
Benefit obligations(4)
|
— | — | — | — | — | |||||||||||||||
Purchase obligations(5)
|
1 | 1 | — | — | — | |||||||||||||||
Non-trading derivative liabilities
|
85 | 69 | 16 | — | — | |||||||||||||||
Other commodity commitments(6)
|
2,393 | 502 | 933 | 505 | 453 | |||||||||||||||
Income taxes(7)
|
— | — | — | — | — | |||||||||||||||
Other
|
18 | 6 | 12 | — | — | |||||||||||||||
Total contractual cash obligations
|
$ | 17,612 | $ | 1,503 | $ | 3,668 | $ | 3,103 | $ | 9,338 |
|
(1)
|
2.0% Zero-Premium Exchangeable Subordinated Notes due 2029 (ZENS) obligations are included in the 2016 and thereafter column at their contingent principal amount payable in 2029 of $805 million. These obligations are exchangeable for cash at any time at the option of the holders for 95% of the current value of the reference shares attributable to each ZENS ($367 million at December 31, 2010), as discussed in Note 9 to our consolidated financial statements. Maturities in 2011 exclude $550 million of 7.75% senior notes of CERC Corp. and maturities in 2013 exclude $397 million of 7.875% senior notes of CERC Corp. discussed in Note 11(b) to our consolidated financial statements and below under “ –Debt Financing Transactions.”
|
|
(2)
|
We calculated estimated interest payments for long-term debt as follows: for fixed-rate debt and term debt, we calculated interest based on the applicable rates and payment dates; for variable-rate debt and/or non-term debt, we used interest rates in place as of December 31, 2010. We typically expect to settle such interest payments with cash flows from operations and short-term borrowings.
|
|
(3)
|
For a discussion of operating leases, please read Note 13(c) to our consolidated financial statements.
|
|
(4)
|
We expect to make a minimum required contribution of $35 million in 2011 to our qualified pension plan. We expect to contribute approximately $9 million and $18 million, respectively, to our non-qualified pension and postretirement benefits plans in 2011.
|
|
(5)
|
Represents capital commitments for material in connection with our Interstate Pipelines business segment.
|
|
(6)
|
For a discussion of other commodity commitments, please read Note 13(a) to our consolidated financial statements.
|
|
(7)
|
As of December 31, 2010, the liability for uncertain income tax positions was $252 million. However, due to the high degree of uncertainty regarding the timing of potential future cash flows associated with these liabilities, we are unable to make a reasonably reliable estimate of the amount and period in which any such liabilities might be paid.
|
Date Executed
|
Company
|
Type of
Facility
|
Size of
Facility
|
Amount
Utilized at
February 15, 2011 (1)
|
Termination Date
|
||||||||
June 29, 2007
|
CenterPoint Energy
|
Revolver
|
$ | 1,156 | $ | 20 | (2) |
June 29, 2012
|
|||||
June 29, 2007
|
CenterPoint Houston
|
Revolver
|
289 | 4 | (2) |
June 29, 2012
|
|||||||
June 29, 2007
|
CERC Corp.
|
Revolver
|
915 | 248 | (3) |
June 29, 2012
|
|||||||
September 15, 2010
|
CERC
|
Receivables
|
375 | — |
September 14, 2011
|
|
(1)
|
Based on the debt (excluding transition and system restoration bonds) to earnings before interest, taxes, depreciation and amortization (EBITDA) covenant contained in our $1.2 billion credit facility, we would have been permitted to utilize the full capacity of our credit facilities of $2.4 billion at December 31, 2010. Amounts advanced under CERC’s receivables facility are not treated as outstanding indebtedness in the debt to EBITDA covenant calculation.
|
|
(2)
|
Represents outstanding letters of credit.
|
|
(3)
|
Represents commercial paper that is backstopped by CERC Corp.’s revolving credit facility.
|
Moody’s
|
S&P
|
Fitch
|
||||||||||
Company/Instrument
|
Rating
|
Outlook (1)
|
Rating
|
Outlook(2)
|
Rating
|
Outlook(3)
|
||||||
CenterPoint Energy Senior
Unsecured Debt
|
Ba1
|
Positive
|
BBB-
|
Stable
|
BBB-
|
Stable
|
||||||
CenterPoint Houston Senior
Secured Debt
|
A3
|
Stable
|
BBB+
|
Stable
|
A-
|
Stable
|
||||||
CERC Corp. Senior Unsecured
Debt
|
Baa3
|
Positive
|
BBB
|
Stable
|
BBB
|
Stable
|
|
(1)
|
A Moody’s rating outlook is an opinion regarding the likely direction of a rating over the medium term.
|
|
(2)
|
An S&P rating outlook assesses the potential direction of a long-term credit rating over the intermediate to longer term.
|
|
(3)
|
A "stable" outlook from Fitch encompasses a one- to two-year horizon as to the likely ratings direction.
|
|
•
|
cash collateral requirements that could exist in connection with certain contracts, including our weather hedging arrangements, and gas purchases, gas price and gas storage activities of our Natural Gas Distribution and Competitive Natural Gas Sales and Services business segments;
|
|
•
|
acceleration of payment dates on certain gas supply contracts under certain circumstances, as a result of increased gas prices and concentration of natural gas suppliers;
|
|
•
|
increased costs related to the acquisition of natural gas;
|
|
•
|
increases in interest expense in connection with debt refinancings and borrowings under credit facilities;
|
|
•
|
various legislative or regulatory actions;
|
|
•
|
incremental collateral, if any, that may be required due to regulation of derivatives;
|
|
•
|
the ability of GenOn and its subsidiaries to satisfy their obligations in respect of GenOn’s indemnity obligations to us and our subsidiaries or in connection with the contractual obligations to a third party pursuant to which CERC is a guarantor;
|
|
•
|
the ability of REPs, including REP subsidiaries of NRG Retail LLC and REP subsidiaries of TXU Energy Retail Company LLC, which are CenterPoint Houston’s two largest customers, to satisfy their obligations to us and our subsidiaries;
|
|
•
|
slower customer payments and increased write-offs of receivables due to higher gas prices or changing economic conditions;
|
|
•
|
the outcome of litigation brought by and against us;
|
|
•
|
contributions to pension and postretirement benefit plans;
|
|
•
|
restoration costs and revenue losses resulting from future natural disasters such as hurricanes and the timing of recovery of such restoration costs; and
|
|
•
|
various other risks identified in “Risk Factors” in Item 1A of this report.
|
|
•
|
Commodity price risk results from exposures to changes in spot prices, forward prices and price volatilities of commodities, such as natural gas, natural gas liquids and other energy commodities.
|
|
•
|
Interest rate risk primarily results from exposures to changes in the level of borrowings and changes in interest rates.
|
|
•
|
Equity price risk results from exposures to changes in prices of individual equity securities.
|
|
•
|
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;
|
|
•
|
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and
|
|
•
|
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.
|
/s/
DAVID M. MCCLANAHAN
|
|
President and Chief Executive Officer
|
|
|
|
/s/
GARY L. WHITLOCK
|
|
Executive Vice President and Chief
|
|
Financial Officer
|
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions,
|
||||||||||||
except per share amounts)
|
||||||||||||
Revenues
|
$ | 11,322 | $ | 8,281 | $ | 8,785 | ||||||
Expenses:
|
||||||||||||
Natural gas
|
7,466 | 4,371 | 4,574 | |||||||||
Operation and maintenance
|
1,502 | 1,664 | 1,719 | |||||||||
Depreciation and amortization
|
708 | 743 | 864 | |||||||||
Taxes other than income taxes
|
373 | 379 | 379 | |||||||||
Total
|
10,049 | 7,157 | 7,536 | |||||||||
Operating Income
|
1,273 | 1,124 | 1,249 | |||||||||
Other Income (Expense):
|
||||||||||||
Gain (loss) on marketable securities
|
(139 | ) | 82 | 67 | ||||||||
Gain (loss) on indexed debt securities
|
128 | (68 | ) | (31 | ) | |||||||
Interest and other finance charges
|
(468 | ) | (513 | ) | (481 | ) | ||||||
Interest on transition and system restoration bonds
|
(136 | ) | (131 | ) | (140 | ) | ||||||
Equity in earnings of unconsolidated affiliates
|
51 | 15 | 29 | |||||||||
Other, net
|
14 | 39 | 12 | |||||||||
Total
|
(550 | ) | (576 | ) | (544 | ) | ||||||
Income Before Income Taxes
|
723 | 548 | 705 | |||||||||
Income tax expense
|
(277 | ) | (176 | ) | (263 | ) | ||||||
Net Income
|
$ | 446 | $ | 372 | $ | 442 | ||||||
Basic Earnings Per Share
|
$ | 1.32 | $ | 1.02 | $ | 1.08 | ||||||
Diluted Earnings Per Share
|
$ | 1.30 | $ | 1.01 | $ | 1.07 | ||||||
Dividends Declared Per Share
|
$ | 0.73 | $ | 0.76 | $ | 0.78 | ||||||
Weighted Average Shares Outstanding, Basic
|
336 | 365 | 410 | |||||||||
Weighted Average Shares Outstanding, Diluted
|
344 | 368 | 413 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Net income
|
$ | 446 | $ | 372 | $ | 442 | ||||||
Other comprehensive income (loss):
|
||||||||||||
Adjustment to pension and other postretirement plans (net of tax of $32, $2 and $5)
|
(79 | ) | 7 | 6 | ||||||||
Net deferred loss from cash flow hedges (net of tax of $2, $-0- and $-0-)
|
(4 | ) | — | — | ||||||||
Reclassification of deferred loss (gain) from cash flow hedges realized in net income
(net of tax of $2, $-0- and $-0-)
|
(4 | ) | — | 1 | ||||||||
Other comprehensive income (loss)
|
(87 | ) | 7 | 7 | ||||||||
Comprehensive income
|
$ | 359 | $ | 379 | $ | 449 |
December 31,
2009
|
December 31,
2010
|
|||||||
(in millions)
|
||||||||
ASSETS
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents ($151 and $198 related to VIEs at December 31, 2009 and 2010,
respectively)
|
$ | 740 | $ | 199 | ||||
Investment in marketable securities
|
300 | 367 | ||||||
Accounts receivable, net ($44 and $49 related to VIEs at December 31, 2009 and 2010,
respectively)
|
790 | 835 | ||||||
Accrued unbilled revenues
|
485 | 340 | ||||||
Inventory
|
327 | 375 | ||||||
Non-trading derivative assets
|
39 | 54 | ||||||
Taxes receivable
|
— | 138 | ||||||
Prepaid expense and other current assets ($34 and $39 related to VIEs at December 31, 2009 and
2010, respectively)
|
223 | 274 | ||||||
Total current assets
|
2,904 | 2,582 | ||||||
Property, Plant and Equipment, net
|
10,788 | 11,732 | ||||||
Other Assets:
|
||||||||
Goodwill
|
1,696 | 1,696 | ||||||
Regulatory assets ($2,886 and $2,597 related to VIEs at December 31, 2009 and 2010,
respectively)
|
3,677 | 3,446 | ||||||
Non-trading derivative assets
|
15 | 15 | ||||||
Investment in unconsolidated affiliates
|
463 | 468 | ||||||
Other
|
230 | 172 | ||||||
Total other assets
|
6,081 | 5,797 | ||||||
Total Assets
|
$ | 19,773 | $ | 20,111 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
Current Liabilities:
|
||||||||
Short-term borrowings
|
$ | 55 | $ | 53 | ||||
Current portion of VIE transition and system restoration bonds long-term debt
|
241 | 283 | ||||||
Current portion of indexed debt
|
121 | 126 | ||||||
Current portion of other long-term debt
|
541 | 19 | ||||||
Indexed debt securities derivative
|
201 | 232 | ||||||
Accounts payable
|
648 | 667 | ||||||
Taxes accrued
|
148 | 156 | ||||||
Interest accrued
|
181 | 171 | ||||||
Non-trading derivative liabilities
|
51 | 68 | ||||||
Accumulated deferred income taxes, net
|
406 | 407 | ||||||
Other
|
445 | 438 | ||||||
Total current liabilities
|
3,038 | 2,620 | ||||||
Other Liabilities:
|
||||||||
Accumulated deferred income taxes, net
|
2,776 | 2,934 | ||||||
Unamortized investment tax credits
|
16 | 9 | ||||||
Non-trading derivative liabilities
|
42 | 16 | ||||||
Benefit obligations
|
861 | 906 | ||||||
Regulatory liabilities
|
921 | 989 | ||||||
Other
|
361 | 438 | ||||||
Total other liabilities
|
4,977 | 5,292 | ||||||
Long-term Debt:
|
||||||||
VIE transition and system restoration bonds
|
2,805 | 2,522 | ||||||
Other
|
6,314 | 6,479 | ||||||
Total long-term debt
|
9,119 | 9,001 | ||||||
Commitments and Contingencies (Note 13)
|
||||||||
Shareholders’ Equity
|
2,639 | 3,198 | ||||||
Total Liabilities and Shareholders’ Equity
|
$ | 19,773 | $ | 20,111 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Cash Flows from Operating Activities:
|
||||||||||||
Net income
|
$ | 446 | $ | 372 | $ | 442 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||
Depreciation and amortization
|
708 | 743 | 864 | |||||||||
Amortization of deferred financing costs
|
29 | 37 | 27 | |||||||||
Deferred income taxes
|
487 | 269 | 199 | |||||||||
Unrealized loss (gain) on marketable securities
|
139 | (82 | ) | (67 | ) | |||||||
Unrealized loss (gain) on indexed debt securities
|
(128 | ) | 68 | 31 | ||||||||
Write-down of natural gas inventory
|
30 | 6 | 6 | |||||||||
Equity in earnings of unconsolidated affiliates, net of distributions
|
(51 | ) | (3 | ) | 13 | |||||||
Changes in other assets and liabilities:
|
||||||||||||
Accounts receivable and unbilled revenues, net
|
(82 | ) | 283 | 101 | ||||||||
Inventory
|
(109 | ) | 236 | (54 | ) | |||||||
Taxes receivable
|
— | — | (138 | ) | ||||||||
Accounts payable
|
87 | (237 | ) | (34 | ) | |||||||
Fuel cost over (under) recovery
|
45 | (5 | ) | (9 | ) | |||||||
Non-trading derivatives, net
|
(25 | ) | 28 | (5 | ) | |||||||
Margin deposits, net
|
(182 | ) | 116 | 7 | ||||||||
Interest and taxes accrued
|
(118 | ) | (41 | ) | (2 | ) | ||||||
Net regulatory assets and liabilities
|
(366 | ) | — | 14 | ||||||||
Other current assets
|
(27 | ) | 27 | (2 | ) | |||||||
Other current liabilities
|
29 | 6 | (1 | ) | ||||||||
Other assets
|
(20 | ) | (1 | ) | (8 | ) | ||||||
Other liabilities
|
(8 | ) | 3 | 4 | ||||||||
Other, net
|
(33 | ) | 16 | (2 | ) | |||||||
Net cash provided by operating activities
|
851 | 1,841 | 1,386 | |||||||||
Cash Flows from Investing Activities:
|
||||||||||||
Capital expenditures
|
(1,020 | ) | (1,160 | ) | (1,509 | ) | ||||||
Decrease (increase) in restricted cash of transition and system restoration bond companies
|
(11 | ) | 26 | (5 | ) | |||||||
Decrease (increase) in notes receivable from unconsolidated affiliates
|
(175 | ) | 323 | — | ||||||||
Investment in unconsolidated affiliates
|
(206 | ) | (115 | ) | (18 | ) | ||||||
Cash received from U.S. Department of Energy grant
|
— | — | 90 | |||||||||
Other, net
|
44 | 30 | 22 | |||||||||
Net cash used in investing activities
|
(1,368 | ) | (896 | ) | (1,420 | ) | ||||||
Cash Flows from Financing Activities:
|
||||||||||||
Decrease in short-term borrowings, net
|
(79 | ) | (98 | ) | (2 | ) | ||||||
Revolving credit facilities, net
|
1,110 | (1,441 | ) | — | ||||||||
Proceeds from commercial paper, net
|
— | — | 183 | |||||||||
Proceeds from long-term debt
|
1,088 | 1,165 | — | |||||||||
Payments of long-term debt
|
(1,373 | ) | (222 | ) | (783 | ) | ||||||
Debt issuance costs
|
(26 | ) | (10 | ) | (2 | ) | ||||||
Payment of common stock dividends
|
(246 | ) | (276 | ) | (319 | ) | ||||||
Proceeds from issuance of common stock, net
|
80 | 504 | 416 | |||||||||
Other, net
|
1 | 6 | — | |||||||||
Net cash provided by (used in) financing activities
|
555 | (372 | ) | (507 | ) | |||||||
Net Increase (Decrease) in Cash and Cash Equivalents
|
38 | 573 | (541 | ) | ||||||||
Cash and Cash Equivalents at Beginning of Year
|
129 | 167 | 740 | |||||||||
Cash and Cash Equivalents at End of Year
|
$ | 167 | $ | 740 | $ | 199 | ||||||
Supplemental Disclosure of Cash Flow Information:
|
||||||||||||
Cash Payments:
|
||||||||||||
Interest, net of capitalized interest
|
$ | 586 | $ | 624 | $ | 609 | ||||||
Income taxes (refunds), net
|
(84 | ) | (9 | ) | 207 | |||||||
Non-cash transactions:
|
||||||||||||
Accounts payable related to capital expenditures
|
96 | 84 | 137 |
2008
|
2009
|
2010
|
||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||
(in millions of dollars and shares)
|
||||||||||||||||||||||||
Preference Stock, none outstanding
|
— | $ | — | — | $ | — | — | $ | — | |||||||||||||||
Cumulative Preferred Stock, $0.01 par value; authorized
20,000,000 shares, none outstanding
|
— | — | — | — | — | — | ||||||||||||||||||
Common Stock, $0.01 par value; authorized 1,000,000,000 shares
|
||||||||||||||||||||||||
Balance, beginning of year
|
323 | 3 | 346 | 3 | 391 | 4 | ||||||||||||||||||
Issuances related to benefit and investment plans
|
6 | — | 7 | — | 9 | — | ||||||||||||||||||
Issuances related to convertible debt conversions
|
17 | — | — | — | — | — | ||||||||||||||||||
Issuances related to public offerings
|
— | — | 38 | 1 | 25 | — | ||||||||||||||||||
Balance, end of year
|
346 | 3 | 391 | 4 | 425 | 4 | ||||||||||||||||||
Additional Paid-in-Capital
|
||||||||||||||||||||||||
Balance, beginning of year
|
3,046 | 3,158 | 3,671 | |||||||||||||||||||||
Issuances related to benefit and investment plans
|
112 | 86 | 114 | |||||||||||||||||||||
Issuances related to public offerings, net of issuance costs
|
— | 427 | 315 | |||||||||||||||||||||
Balance, end of year
|
3,158 | 3,671 | 4,100 | |||||||||||||||||||||
Accumulated Deficit
|
||||||||||||||||||||||||
Balance, beginning of year
|
(1,194 | ) | (1,008 | ) | (912 | ) | ||||||||||||||||||
Cumulative effect of change in accounting principle (see Note 6(e))
|
(15 | ) | — | — | ||||||||||||||||||||
Balance, beginning of year (as adjusted)
|
(1,209 | ) | (1,008 | ) | (912 | ) | ||||||||||||||||||
Net income
|
446 | 372 | 442 | |||||||||||||||||||||
Common stock dividends — $0.73 per share in 2008, $0.76 per
share in 2009 and $0.78 per share in 2010
|
(245 | ) | (276 | ) | (319 | ) | ||||||||||||||||||
Balance, end of year
|
(1,008 | ) | (912 | ) | (789 | ) | ||||||||||||||||||
Accumulated Other Comprehensive Loss
|
||||||||||||||||||||||||
Balance, end of year:
|
||||||||||||||||||||||||
Adjustment to pension and postretirement plans
|
(127 | ) | (120 | ) | (114 | ) | ||||||||||||||||||
Net deferred loss from cash flow hedges
|
(4 | ) | (4 | ) | (3 | ) | ||||||||||||||||||
Total accumulated other comprehensive loss, end of year
|
(131 | ) | (124 | ) | (117 | ) | ||||||||||||||||||
Total Shareholders’ Equity
|
$ | 2,022 | $ | 2,639 | $ | 3,198 |
|
•
|
CenterPoint Energy Houston Electric, LLC (CenterPoint Houston), which engages in the electric transmission and distribution business in the Texas Gulf Coast area that includes the city of Houston; and
|
|
•
|
CenterPoint Energy Resources Corp. (CERC Corp. and, together with its subsidiaries, CERC), which owns and operates natural gas distribution systems. Subsidiaries of CERC own interstate natural gas pipelines and gas gathering systems and provide various ancillary services. A wholly owned subsidiary of CERC Corp. offers variable and fixed-price physical natural gas supplies primarily to commercial and industrial customers and electric and gas utilities.
|
December 31,
|
||||||||
2009
|
2010
|
|||||||
(in millions)
|
||||||||
Materials and supplies
|
$ | 138 | $ | 164 | ||||
Natural gas
|
189 | 211 | ||||||
Total inventory
|
$ | 327 | $ | 375 |
Weighted Average
|
|||||||||||
Useful Lives
|
December 31,
|
||||||||||
(Years)
|
2009
|
2010
|
|||||||||
(in millions)
|
|||||||||||
Electric Transmission & Distribution
|
27 | $ | 7,325 | $ | 7,586 | ||||||
Natural Gas Distribution
|
31 | 3,436 | 3,642 | ||||||||
Competitive Natural Gas Sales and Services
|
26 | 69 | 71 | ||||||||
Interstate Pipelines
|
58 | 2,524 | 2,594 | ||||||||
Field Services
|
46 | 931 | 1,583 | ||||||||
Other property
|
25 | 485 | 529 | ||||||||
Total
|
14,770 | 16,005 | |||||||||
Accumulated depreciation and amortization:
|
|||||||||||
Electric Transmission & Distribution
|
2,737 | 2,805 | |||||||||
Natural Gas Distribution
|
825 | 954 | |||||||||
Competitive Natural Gas Sales and Services
|
13 | 16 | |||||||||
Interstate Pipelines
|
223 | 265 | |||||||||
Field Services
|
27 | 43 | |||||||||
Other property
|
157 | 190 | |||||||||
Total accumulated depreciation and amortization
|
3,982 | 4,273 | |||||||||
Property, plant and equipment, net
|
$ | 10,788 | $ | 11,732 |
2008
|
2009
|
2010
|
||||||||||
Depreciation expense
|
$ | 478 | $ | 496 | $ | 531 | ||||||
Amortization expense
|
230 | 247 | 333 | |||||||||
Total depreciation and amortization expense
|
$ | 708 | $ | 743 | $ | 864 |
December 31,
|
||||||||
2009
|
2010
|
|||||||
Beginning balance
|
$ | 63 | $ | 82 | ||||
Accretion expense
|
7 | 5 | ||||||
Revisions in estimates of cash flows
|
12 | (3 | ) | |||||
Ending balance
|
$ | 82 | $ | 84 |
Natural Gas Distribution
|
$ | 746 | ||
Interstate Pipelines
|
579 | |||
Competitive Natural Gas Sales and Services
|
335 | |||
Field Services
|
25 | |||
Other Operations
|
11 | |||
Total
|
$ | 1,696 |
December 31,
|
||||||||
2009
|
2010
|
|||||||
(in millions)
|
||||||||
Securitized regulatory assets
|
$ | 2,886 | $ | 2,597 | ||||
Unrecognized equity return
|
(232 | ) | (216 | ) | ||||
Unamortized loss on reacquired debt
|
67 | 61 | ||||||
Pension and postretirement-related regulatory asset (1)
|
813 | 838 | ||||||
Other long-term regulatory assets
|
143 | 166 | ||||||
Total regulatory assets (1)
|
3,677 | 3,446 | ||||||
Estimated removal costs
|
818 | 868 | ||||||
Other long-term regulatory liabilities
|
103 | 121 | ||||||
Total regulatory liabilities
|
921 | 989 | ||||||
Total regulatory assets and liabilities, net
|
$ | 2,756 | $ | 2,457 |
|
(1)
|
CenterPoint Houston’s actuarially determined pension expense for 2009 and 2010 in excess of the 2007 base year amount is being deferred for rate making purposes and is being addressed in its current rate application pursuant to Texas law. CenterPoint Houston deferred as a regulatory asset $32 million and $26 million in pension and other postemployment expenses during the years ended December 31, 2009 and 2010, respectively. Deferred pension expense of $32 million and $58 million at December 31, 2009 and 2010, respectively, is not earning a return. Other regulatory assets that are not earning a return were not material at December 31, 2009 and 2010.
|
|
•
|
reversed the Texas Utility Commission’s ruling that had denied CenterPoint Houston recovery of a portion of the capacity auction true-up amounts;
|
|
•
|
reversed the Texas Utility Commission’s ruling that precluded CenterPoint Houston from recovering the interest component of the EMCs paid to retail electric providers (REPs); and
|
|
•
|
affirmed the True-Up Order in all other respects.
|
|
•
|
reversed the district court’s judgment to the extent it restored the capacity auction true-up amounts;
|
|
•
|
reversed the district court’s judgment to the extent it upheld the Texas Utility Commission’s decision to allow CenterPoint Houston to recover EMCs paid to its former affiliate Reliant Energy, Inc. (Reliant Energy, Inc., formerly known as Reliant Resources, Inc., changed its name in 2009 to “RRI Energy, Inc.” in connection with the sale of its Texas retail electric business, and again in December 2010 to “GenOn Energy, Inc.” in connection with the merger of one of its wholly owned subsidiaries with Mirant Corporation. For convenience, we refer to this company as “RRI” in the context of discussing transactions relating to our formation, our pending true-up appeal and other historical matters, and as “GenOn” in the present and future context, unless stated otherwise.);
|
|
•
|
ordered that the tax normalization issue described below be remanded to the Texas Utility Commission as requested by the Texas Utility Commission; and
|
|
•
|
affirmed the district court’s judgment in all other respects.
|
Outstanding Options
Year Ended December 31, 2010
|
|||||||||||||||
Shares
(Thousands)
|
Weighted-Average
Exercise Price
|
Remaining Average
Contractual
Life (Years)
|
Aggregate
Intrinsic
Value (Millions)
|
||||||||||||
Outstanding at December 31, 2009
|
4,513 | $ | 17.95 | ||||||||||||
Expired
|
(399 | ) | 17.25 | ||||||||||||
Cancelled
|
(207 | ) | 31.48 | ||||||||||||
Exercised
|
(830 | ) | 10.05 | ||||||||||||
Outstanding at December 31, 2010
|
3,077 | 19.27 | 1.3 | $ | 12 | ||||||||||
Exercisable at December 31, 2010
|
3,077 | 19.27 | 1.3 | 12 |
Outstanding and Non-Vested Shares
Year Ended December 31, 2010
|
|||||||||||||||
Shares
(Thousands)
|
Weighted-Average
Grant Date
Fair Value
|
Remaining Average
Contractual
Life (Years)
|
Aggregate
Intrinsic
Value (Millions)
|
||||||||||||
Outstanding at December 31, 2009
|
2,583 | $ | 14.62 | ||||||||||||
Granted
|
1,130 | 14.21 | |||||||||||||
Forfeited or cancelled
|
(350 | ) | 17.24 | ||||||||||||
Vested and released to participants
|
(295 | ) | 18.09 | ||||||||||||
Outstanding at December 31, 2010
|
3,068 | 13.84 |
1.1
|
$ |
37
|
Outstanding and Non-Vested Stock Shares
Year Ended December 31, 2010
|
|||||||||||||||
Shares
(Thousands)
|
Weighted-Average
Grant Date
Fair Value
|
Remaining Average
Contractual
Life (Years)
|
Aggregate
Intrinsic
Value (Millions)
|
||||||||||||
Outstanding at December 31, 2009
|
951 | $ | 14.36 | ||||||||||||
Granted
|
440 | 14.26 | |||||||||||||
Forfeited or cancelled
|
(25 | ) | 13.38 | ||||||||||||
Vested and released to participants
|
(270 | ) | 16.65 | ||||||||||||
Outstanding at December 31, 2010
|
1,096 | 13.78 |
1.2
|
$ |
17
|
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
Performance awards
|
$ | 15.40 | $ | 12.42 | $ | 14.21 | ||||||
Stock awards
|
15.09 | 12.30 | 14.26 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Stock options exercised
|
$ | 2 | $ | 2 | $ | 4 | ||||||
Performance awards
|
6 | 7 | 5 | |||||||||
Stock awards
|
5 | 4 | 4 |
Year Ended December 31,
|
||||||||||||||||||||||||
2008
|
2009
|
2010
|
||||||||||||||||||||||
Pension
Benefits
|
Postretirement
Benefits
|
Pension
Benefits
|
Postretirement
Benefits
|
Pension
Benefits
|
Postretirement
Benefits
|
|||||||||||||||||||
(in millions)
|
||||||||||||||||||||||||
Service cost
|
$ | 31 | $ | 1 | $ | 25 | $ | 1 | $ | 31 | $ | 1 | ||||||||||||
Interest cost
|
101 | 27 | 113 | 28 | 102 | 25 | ||||||||||||||||||
Expected return on plan assets
|
(147 | ) | (12 | ) | (98 | ) | (9 | ) | (109 | ) | (10 | ) | ||||||||||||
Amortization of prior service cost (credit)
|
(8 | ) | 3 | 3 | 3 | 3 | 3 | |||||||||||||||||
Amortization of net loss
|
23 | — | 68 | — | 59 | — | ||||||||||||||||||
Amortization of transition obligation
|
— | 7 | — | 7 | — | 7 | ||||||||||||||||||
Benefit enhancement
|
1 | — | — | — | — | — | ||||||||||||||||||
Net periodic cost
|
$ | 1 | 26 | 111 | 30 | 86 | 26 |
December 31,
|
||||||||||||||||||||||||
2008
|
2009
|
2010
|
||||||||||||||||||||||
Pension
Benefits
|
Postretirement
Benefits
|
Pension
Benefits
|
Postretirement
Benefits
|
Pension
Benefits
|
Postretirement
Benefits
|
|||||||||||||||||||
Discount rate
|
6.40 | % | 6.40 | % | 6.90 | % | 6.90 | % | 5.70 | % | 5.70 | % | ||||||||||||
Expected return on plan assets
|
8.50 | 7.60 | 8.00 | 7.05 | 8.00 | 7.05 | ||||||||||||||||||
Rate of increase in compensation levels
|
4.60 | — | 4.60 | — | 4.60 | — |
December 31,
|
||||||||||||||||
2009
|
2010
|
|||||||||||||||
Pension
Benefits
|
Postretirement
Benefits
|
Pension
Benefits
|
Postretirement
Benefits
|
|||||||||||||
(in millions, except for actuarial assumptions)
|
||||||||||||||||
Change in Benefit Obligation
|
||||||||||||||||
Benefit obligation, beginning of year
|
$ | 1,710 | $ | 426 | $ | 1,866 | $ | 450 | ||||||||
Service cost
|
25 | 1 | 31 | 1 | ||||||||||||
Interest cost
|
113 | 28 | 102 | 25 | ||||||||||||
Participant contributions
|
— | 6 | — | 7 | ||||||||||||
Benefits paid
|
(111 | ) | (42 | ) | (115 | ) | (50 | ) | ||||||||
Actuarial gain
|
129 | 29 | 85 | 24 | ||||||||||||
Medicare reimbursement
|
— | 2 | — | 3 | ||||||||||||
Benefit obligation, end of year
|
1,866 | 450 | 1,969 | 460 | ||||||||||||
Change in Plan Assets
|
||||||||||||||||
Fair value of plan assets, beginning of year
|
1,276 | 135 | 1,432 | 146 | ||||||||||||
Employer contributions
|
20 | 28 | 8 | 29 | ||||||||||||
Participant contributions
|
— | 6 | — | 7 | ||||||||||||
Benefits paid
|
(111 | ) | (42 | ) | (115 | ) | (50 | ) | ||||||||
Actual investment return
|
247 | 19 | 176 | 12 | ||||||||||||
Fair value of plan assets, end of year
|
1,432 | 146 | 1,501 | 144 | ||||||||||||
Funded status, end of year
|
$ | (434 | ) | $ | (304 | ) | $ | (468 | ) | $ | (316 | ) | ||||
Amounts Recognized in Balance Sheets
|
||||||||||||||||
Current liabilities-other
|
$ | (9 | ) | $ | (9 | ) | $ | (9 | ) | $ | (9 | ) | ||||
Other liabilities-benefit obligations
|
(425 | ) | (295 | ) | (459 | ) | (307 | ) | ||||||||
Net liability, end of year
|
$ | (434 | ) | $ | (304 | ) | $ | (468 | ) | $ | (316 | ) | ||||
Actuarial Assumptions
|
||||||||||||||||
Discount rate
|
5.70 | % | 5.70 | % | 5.25 | % | 5.20 | % | ||||||||
Expected return on plan assets
|
8.00 | 7.05 | 8.00 | 7.05 | ||||||||||||
Rate of increase in compensation levels
|
4.60 | — | 4.60 | — | ||||||||||||
Healthcare cost trend rate assumed for the next year
|
— | 7.50 | — | 8.50 | ||||||||||||
Prescription drug cost trend rate assumed for the next year
|
— | 8.00 | — | 8.50 | ||||||||||||
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)
|
— | 5.50 | — | 5.50 | ||||||||||||
Year that the healthcare rate reaches the ultimate trend rate
|
— | 2014 | — | 2017 | ||||||||||||
Year that the prescription drug rate reaches the ultimate trend rate
|
— | 2015 | — | 2017 |
December 31,
|
||||||||||||||||
2009
|
2010
|
|||||||||||||||
P
ension
Benefits
|
Postretirement
Benefits
|
Pension
Benefits
|
Postretirement
Benefits
|
|||||||||||||
(in millions)
|
||||||||||||||||
Unrecognized actuarial loss
|
$ | 162 | $ | 15 | $ | 151 | $ | 18 | ||||||||
Unrecognized prior service cost
|
16 | 9 | 15 | 7 | ||||||||||||
Unrecognized transition obligation
|
— | 3 | — | 2 | ||||||||||||
Net amount recognized in accumulated other comprehensive loss
|
$ | 178 | $ | 27 | $ | 166 | $ | 27 |
Pension
Benefits
|
Postretirement
Benefits
|
|||||||
Net loss (gain)
|
$ | (24 | ) | $ | 3 | |||
Amortization of net loss
|
13 | — | ||||||
Prior service credit
|
(2 | ) | (4 | ) | ||||
Amortization of prior service credit
|
1 | 2 | ||||||
Transition obligation
|
— | (1 | ) | |||||
Total recognized in comprehensive income
|
$ | (12 | ) | $ | — |
Pension
Benefits
|
Postretirement
Benefits
|
|||||||
Unrecognized actuarial loss
|
$ | 12 | $ | — | ||||
Unrecognized prior service cost
|
1 | 2 | ||||||
Amounts in accumulated comprehensive income to be recognized in net periodic cost in 2011
|
$ | 13 | $ | 2 |
December 31,
|
||||||||||||||||
2009
|
2010
|
|||||||||||||||
Pension
Qualified
|
Pension
Non-qualified
|
Pension
Qualified
|
Pension
Non-qualified
|
|||||||||||||
(in millions)
|
||||||||||||||||
Accumulated benefit obligation
|
$ | 1,770 | $ | 94 | $ | 1,860 | $ | 94 | ||||||||
Projected benefit obligation
|
1,772 | 94 | 1,875 | 94 | ||||||||||||
Fair value of plan assets
|
1,432 | — | 1,501 | — |
1%
Increase
|
1%
Decrease
|
|||||||
(in millions)
|
||||||||
Effect on the postretirement benefit obligation
|
$ | 18 | $ | 16 | ||||
Effect on total of service and interest cost
|
1 | 1 |
Pension
Benefits
|
Postretirement
Benefits
|
|||
Domestic equity securities
|
25-35%
|
14-24%
|
||
Global equity securities
|
7-13%
|
—
|
||
International equity securities
|
17-23%
|
3-13%
|
||
Debt securities
|
30-40%
|
68-78%
|
||
Real estate
|
0-5%
|
—
|
||
Cash
|
0-2%
|
0-2%
|
Fair Value Measurements at December 31, 2009
(in millions)
|
||||||||||||||||
Total
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant
Observable Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
|||||||||||||
Cash
|
$ | 11 | $ | 11 | $ | — | $ | — | ||||||||
Common collective trust funds (1)
|
733 | — | 733 | — | ||||||||||||
Corporate bonds:
|
||||||||||||||||
Investment grade or above
|
193 | — | 192 | 1 | ||||||||||||
High yield
|
2 | — | 2 | — | ||||||||||||
Equity securities:
|
||||||||||||||||
International companies
|
162 | 160 | 2 | — | ||||||||||||
U.S. companies
|
96 | 96 | — | — | ||||||||||||
Cash received as collateral from securities lending
|
114 | 114 | — | — | ||||||||||||
U.S. government backed agencies bonds
|
55 | 55 | — | — | ||||||||||||
U.S. treasuries
|
50 | 50 | — | — | ||||||||||||
Mortgage backed securities
|
39 | — | 39 | — | ||||||||||||
Asset backed securities
|
27 | — | 24 | 3 | ||||||||||||
Municipal bonds
|
22 | 2 | 20 | — | ||||||||||||
Mutual funds (2)
|
21 | 21 | — | — | ||||||||||||
International government bonds
|
12 | — | 12 | — | ||||||||||||
Real estate
|
9 | — | — | 9 | ||||||||||||
Obligation to return cash received as collateral from securities lending
|
(114 | ) | (114 | ) | — | — | ||||||||||
Total
|
$ | 1,432 | $ | 395 | $ | 1,024 | $ | 13 |
|
(1)
|
30% of the amount invested in common collective trust funds is in fixed income securities, 31% is in U.S. equities and 39% is in international equities.
|
|
(2)
|
48% of the amount invested in mutual funds is in fixed income securities and 52% is in U.S. equities.
|
Fair Value Measurements at December 31, 2010
(in millions)
|
||||||||||||||||
Total
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant
Observable Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
|||||||||||||
Cash
|
$ | 3 | $ | 3 | $ | — | $ | — | ||||||||
Common collective trust funds (1)
|
890 | — | 890 | — | ||||||||||||
Corporate bonds:
|
||||||||||||||||
Investment grade or above
|
122 | — | 122 | — | ||||||||||||
Equity securities:
|
||||||||||||||||
International companies
|
133 | 133 | — | — | ||||||||||||
U.S. companies
|
131 | 131 | — | — | ||||||||||||
Cash received as collateral from securities lending
|
112 | 112 | — | — | ||||||||||||
U.S. government backed agencies bonds
|
34 | 34 | — | — | ||||||||||||
U.S. treasuries
|
62 | 62 | — | — | ||||||||||||
Mortgage backed securities
|
8 | — | 8 | — | ||||||||||||
Asset backed securities
|
10 | — | 10 | — | ||||||||||||
Municipal bonds
|
28 | — | 28 | — | ||||||||||||
Mutual funds (2)
|
55 | 55 | — | — | ||||||||||||
International government bonds
|
17 | — | 17 | — | ||||||||||||
Real estate
|
8 | — | — | 8 | ||||||||||||
Obligation to return cash received as collateral from securities lending
|
(112 | ) | (112 | ) | — | — | ||||||||||
Total
|
$ | 1,501 | $ | 418 | $ | 1,075 | $ | 8 |
|
(1)
|
24% of the amount invested in common collective trust funds is in fixed income securities, 42% is in U.S. equities and 34% is in international equities.
|
|
(2)
|
74% of the amount invested in mutual funds is in fixed income securities and 26% is in U.S. equities.
|
Level 3 Investments
|
||||||||||||||||
Year Ended December 31, 2009
(in millions)
|
||||||||||||||||
Corporate
bonds
|
Asset backed
securities
|
Real
estate
|
Total
|
|||||||||||||
Balance, beginning of year
|
$ | 1 | $ | 3 | $ | 14 | $ | 18 | ||||||||
Unrealized losses relating to instruments still
held at the reporting date
|
— | — | (5 | ) | (5 | ) | ||||||||||
Balance, end of year
|
$ | 1 | $ | 3 | $ | 9 | $ | 13 |
Level 3 Investments
|
||||||||||||||||
Year Ended December 31, 2010
(in millions)
|
||||||||||||||||
Corporate
bonds
|
Asset backed
securities
|
Real
estate
|
Total
|
|||||||||||||
Balance, beginning of year
|
$ | 1 | $ | 3 | $ | 9 | $ | 13 | ||||||||
Unrealized losses relating to instruments still
held at the reporting date
|
— | — | (1 | ) | (1 | ) | ||||||||||
Purchases, sales, issuances, and settlement (net)
|
— | (1 | ) | — | (1 | ) | ||||||||||
Transfer out of Level 3
|
(1 | ) | (2 | ) | — | (3 | ) | |||||||||
Balance, end of year
|
$ | — | $ | — | $ | 8 | $ | 8 |
Fair Value Measurements at December 31, 2009
(in millions)
|
|||||||||||||||
Total
|
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
|
Significant
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
Level 3)
|
||||||||||||
Mutual funds (1)
|
$ | 146 | $ | 146 | $ | — | $ | — | |||||||
Total
|
$ | 146 | $ | 146 | $ | — | $ | — |
|
(1)
|
65% of the amount invested in mutual funds is in fixed income securities, 26% is in U.S. equities and 9% is in international equities.
|
Fair Value Measurements at December 31, 2010
(in millions)
|
|||||||||||||||
Total
|
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
|
Significant
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
Level 3)
|
||||||||||||
Mutual funds (1)
|
$ | 144 | $ | 144 | $ | — | $ | — | |||||||
Total
|
$ | 144 | $ | 144 | $ | — | $ | — |
|
(1)
|
73% of the amount invested in mutual funds is in fixed income securities, 19% is in U.S. equities and 8% is in international equities.
|
Postretirement Benefit Plan
|
||||||||||||
Pension
Benefits
|
Benefit
Payments
|
Medicare
Subsidy
Receipts
|
||||||||||
2011
|
$ | 142 | $ | 33 | $ | (4 | ) | |||||
2012
|
148 | 34 | (5 | ) | ||||||||
2013
|
149 | 39 | (5 | ) | ||||||||
2014
|
149 | 40 | (6 | ) | ||||||||
2015
|
149 | 42 | (6 | ) | ||||||||
2016-2020
|
762 | 225 | (42 | ) |
|
(1)
|
Natural gas contracts are subject to master netting arrangements and are presented on a net basis in the Consolidated Balance Sheets. This netting causes derivative assets (liabilities) to be ultimately presented net in a liability (asset) account within the Consolidated Balance Sheets.
|
|
(2)
|
The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling 674 billion cubic feet (Bcf) or a net 152 Bcf long position. Of the net long position, basis swaps constitute 71 Bcf and volumes associated with price stabilization activities of the Natural Gas Distribution business segment comprise 51 Bcf.
|
|
(3)
|
The net of total non-trading derivative assets and liabilities is a $39 million liability as shown on CenterPoint Energy’s Consolidated Balance Sheets, and is comprised of the natural gas contracts derivative assets and liabilities separately shown above offset by collateral netting of $95 million.
|
Fair Value of Derivative Instruments
|
||||||||||
December 31, 2010
|
||||||||||
Total derivatives not designated
as hedging instruments
|
Balance Sheet
Location
|
Derivative
Assets
Fair Value (2) (3)
|
Derivative
Liabilities
Fair Value (2) (3)
|
|||||||
(in millions)
|
||||||||||
Natural gas contracts (1)
|
Current Assets
|
$ | 55 | $ | (1 | ) | ||||
Natural gas contracts
(1)
|
Other Assets
|
15 | — | |||||||
Natural gas contracts (1)
|
Current Liabilities
|
10 | (143 | ) | ||||||
Natural gas contracts (1)
|
Other Liabilities
|
— | (35 | ) | ||||||
Indexed debt securities derivative
|
Current Liabilities
|
— | (232 | ) | ||||||
Total
|
$ | 80 | $ | (411 | ) |
|
(1)
|
Natural gas contracts are subject to master netting arrangements and are presented on a net basis in the Consolidated Balance Sheets. This netting causes derivative assets (liabilities) to be ultimately presented net in a liability (asset) account within the Consolidated Balance Sheets.
|
|
(2)
|
The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling 626 Bcf or a net 72 Bcf long position. Of the net long position, basis swaps constitute 63 Bcf and volumes associated with price stabilization activities of the Natural Gas Distribution business segment comprise 26 Bcf.
|
|
(3)
|
The net of total non-trading derivative assets and liabilities is a $15 million liability as shown on CenterPoint Energy’s Consolidated Balance Sheets, and is comprised of the natural gas contracts derivative assets and liabilities separately shown above offset by collateral netting of $84 million.
|
(1)
|
The Gains (Losses) in Expense: Natural Gas includes $(181) million and $(115) million of costs in 2009 and 2010, respectively, associated with price stabilization activities of the Natural Gas Distribution business segment that will be ultimately recovered through purchased gas adjustments.
|
December 31, 2009
|
December 31, 2010
|
|||||||||||||||
Investment
Grade(1)
|
Total
|
Investment
Grade(1)
|
Total
|
|||||||||||||
Energy marketers
|
$ | 6 | $ | 6 | $ | 5 | $ | 8 | ||||||||
Financial institutions
|
2 | 4 | 1 | 1 | ||||||||||||
Retail end users (2)
|
1 | 44 | — | 60 | ||||||||||||
Total
|
$ | 9 | $ | 54 | $ | 6 | $ | 69 |
|
(1)
|
“Investment grade” is primarily determined using publicly available credit ratings and considering credit support (such as parent company guaranties) and collateral, which encompass cash and standby letters of credit. For unrated counterparties, CenterPoint Energy determines a synthetic credit rating by performing financial statement analysis and considering contractual rights and restrictions and collateral.
|
|
(2)
|
Retail end users represent customers who have contracted to fix the price of a portion of their physical gas requirements for future periods.
|
Quoted Prices in
Active Markets
for Identical Assets
(Level 1)
|
Significant Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Netting
Adjustments
(1)
|
Balance
as of
December 31,
2009
|
||||||||||||||||
(in millions)
|
||||||||||||||||||||
Assets
|
||||||||||||||||||||
Corporate equities
|
$ | 301 | $ | — | $ | — | $ | — | $ | 301 | ||||||||||
Investments, including money
market funds
|
41 | — | — | — | 41 | |||||||||||||||
Derivative assets
|
1 | 77 | 5 | (29 | ) | 54 | ||||||||||||||
Total assets
|
$ | 343 | $ | 77 | $ | 5 | $ | (29 | ) | $ | 396 | |||||||||
Liabilities
|
||||||||||||||||||||
Indexed debt securities
derivative
|
$ | — | $ | 201 | $ | — | $ | — | $ | 201 | ||||||||||
Derivative liabilities
|
12 | 194 | 11 | (124 | ) | 93 | ||||||||||||||
Total liabilities
|
$ | 12 | $ | 395 | $ | 11 | $ | (124 | ) | $ | 294 |
|
(1)
|
Amounts represent the impact of legally enforceable master netting agreements that allow CenterPoint Energy to settle positive and negative positions and also include cash collateral of $95 million posted with the same counterparties.
|
Quoted Prices in
Active Markets
for Identical Assets
(Level 1)
|
Significant Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Netting
Adjustments
(1)
|
Balance
as of
December 31,
2010
|
||||||||||||||||
(in millions)
|
||||||||||||||||||||
Assets
|
||||||||||||||||||||
Corporate equities
|
$ | 368 | $ | — | $ | — | $ | — | $ | 368 | ||||||||||
Investments, including money
market funds
|
54 | — | — | — | 54 | |||||||||||||||
Derivative assets
|
— | 73 | 7 | (11 | ) | 69 | ||||||||||||||
Total assets
|
$ | 422 | $ | 73 | $ | 7 | $ | (11 | ) | $ | 491 | |||||||||
Liabilities
|
||||||||||||||||||||
Indexed debt securities
derivative
|
$ | — | $ | 232 | $ | — | $ | — | $ | 232 | ||||||||||
Derivative liabilities
|
8 | 167 | 4 | (95 | ) | 84 | ||||||||||||||
Total liabilities
|
$ | 8 | $ | 399 | $ | 4 | $ | (95 | ) | $ | 316 |
|
(1)
|
Amounts represent the impact of legally enforceable master netting agreements that allow CenterPoint Energy to settle positive and negative positions and also include cash collateral of $84 million posted with the same counterparties.
|
Fair Value Measurements Using Significant
Unobservable Inputs (Level 3)
|
||||||||||||
Derivative assets and liabilities, net
|
||||||||||||
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Beginning balance
|
$ | (3 | ) | $ | (58 | ) | $ | (6 | ) | |||
Total unrealized gains or (losses):
|
||||||||||||
Included in earnings
|
(11 | ) | (1 | ) | 4 | |||||||
Included in regulatory assets
|
(10 | ) | (16 | ) | (1 | ) | ||||||
Purchases, sales and other settlements, net:
|
||||||||||||
Included in earnings
|
6 | 3 | (2 | ) | ||||||||
Included in regulatory assets
|
(41 | ) | 66 | 8 | ||||||||
Net transfers into Level 3
|
1 | — | — | |||||||||
Ending balance
|
$ | (58 | ) | $ | (6 | ) | $ | 3 | ||||
The amount of total gains for the period included in earnings
attributable to the change in unrealized gains or losses relating
to assets still held at the reporting date
|
$ | 7 | $ | 1 | $ | 4 |
December 31, 2009
|
December 31, 2010
|
|||||||||||||||
Carrying
Amount
|
Fair
Value
|
Carrying
Amount
|
Fair
Value
|
|||||||||||||
(in millions)
|
||||||||||||||||
Financial liabilities:
|
||||||||||||||||
Long-term debt
|
$ | 9,900 | $ | 10,413 | $ | 9,303 | $ | 10,071 |
TW
Securities
|
Debt
Component
of ZENS
|
Derivative
Component
of ZENS
|
||||||||||
Balance at December 31, 2007
|
$ | 357 | $ | 114 | $ | 261 | ||||||
Accretion of debt component of ZENS
|
— | 20 | — | |||||||||
2% interest paid
|
— | (17 | ) | — | ||||||||
Gain on indexed debt securities
|
— | — | (128 | ) | ||||||||
Loss on TW Common
|
(139 | ) | — | — | ||||||||
Balance at December 31, 2008
|
218 | 117 | 133 | |||||||||
Accretion of debt component of ZENS
|
— | 21 | — | |||||||||
2% interest paid
|
— | (17 | ) | — | ||||||||
Loss on indexed debt securities
|
— | — | 68 | |||||||||
Gain on TW Securities
|
82 | — | — | |||||||||
Balance at December 31, 2009
|
300 | 121 | 201 | |||||||||
Accretion of debt component of ZENS
|
— | 22 | — | |||||||||
2% interest paid
|
— | (17 | ) | — | ||||||||
Loss on indexed debt securities
|
— | — | 31 | |||||||||
Gain on TW Securities
|
67 | — | — | |||||||||
Balance at December 31, 2010
|
$ | 367 | $ | 126 | $ | 232 |
December 31,
2009
|
December 31,
2010
|
|||||||||||||||
Long-Term
|
Current(1)
|
Long-Term
|
Current(1)
|
|||||||||||||
(in millions)
|
||||||||||||||||
Short-term borrowings:
|
||||||||||||||||
Inventory financing
|
$ | — | $ | 55 | $ | — | $ | 53 | ||||||||
Total short-term borrowings
|
— | 55 | — | 53 | ||||||||||||
Long-term debt:
|
||||||||||||||||
CenterPoint Energy:
|
||||||||||||||||
ZENS(2)
|
— | 121 | — | 126 | ||||||||||||
Senior notes 5.95% to 6.85% due 2015 to 2018
|
750 | 200 | 750 | — | ||||||||||||
Pollution control bonds 4.00% due 2015(3)
|
151 | — | 151 | — | ||||||||||||
Pollution control bonds 4.70% to 5.95% due 2011 to 2030(4)
|
581 | 290 | 562 | 19 | ||||||||||||
Other
|
— | 7 | — | — | ||||||||||||
CenterPoint Houston:
|
||||||||||||||||
First mortgage bonds 9.15% due 2021
|
102 | — | 102 | — | ||||||||||||
General mortgage bonds 5.60% to 7.00% due 2013 to 2033
|
1,762 | — | 1,762 | — | ||||||||||||
Pollution control bonds 3.625% to 5.60% due 2012 to 2027(5)
|
229 | — | 229 | — | ||||||||||||
System restoration bonds 1.833% to 4.243% due 2011 to 2022
|
645 | 20 | 601 | 43 | ||||||||||||
Transition bonds 4.192% to 5.63% due 2011 to 2020
|
2,160 | 221 | 1,921 | 240 | ||||||||||||
CERC Corp.:
|
||||||||||||||||
Convertible subordinated debentures 6.00% due 2012
|
— | 44 | — | — | ||||||||||||
Senior notes 5.95% to 7.875% due 2013 to 2037 (6)
|
2,747 | — | 2,747 | — | ||||||||||||
Commercial paper (7)
|
— | — | 183 | — | ||||||||||||
Other
|
1 | — | 1 | — | ||||||||||||
Unamortized discount and premium
|
(9 | ) | — | (8 | ) | — | ||||||||||
Total long-term debt
|
9,119 | 903 | 9,001 | 428 | ||||||||||||
Total debt
|
$ | 9,119 | $ | 958 | $ | 9,001 | $ | 481 |
|
(1)
|
Includes amounts due or exchangeable within one year of the date noted.
|
|
(2)
|
CenterPoint Energy’s ZENS obligation is bifurcated into a debt component and an embedded derivative component. For additional information regarding ZENS, see Note 9(b). As ZENS are exchangeable for cash at any time at the option of the holders, these notes are classified as a current portion of long-term debt.
|
|
(3)
|
These series of debt are secured by first mortgage bonds of CenterPoint Houston.
|
|
(4)
|
$527 million and $237 million of these series of debt is secured by general mortgage bonds of CenterPoint Houston at December 31, 2009 and 2010, respectively.
|
|
(5)
|
These series of debt are secured by general mortgage bonds of CenterPoint Houston.
|
|
(6)
|
$550 million senior notes due February 2011 are not reflected in the current portion of long-term debt as of December 31, 2010 because the notes were refinanced in January 2011.
|
|
(7)
|
Classified as long-term debt because the termination date of the facility that backstops the commercial paper is more than one year from the date noted.
|
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Current income tax expense (benefit):
|
||||||||||||
Federal
|
$ | (221 | ) | $ | (103 | ) | $ | 40 | ||||
State
|
11 | 10 | 24 | |||||||||
Total current expense (benefit)
|
(210 | ) | (93 | ) | 64 | |||||||
Deferred income tax expense (benefit):
|
||||||||||||
Federal
|
437 | 251 | 220 | |||||||||
State
|
50 | 18 | (21 | ) | ||||||||
Total deferred expense
|
487 | 269 | 199 | |||||||||
Total income tax expense
|
$ | 277 | $ | 176 | $ | 263 |
Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Income before income taxes
|
$ | 723 | $ | 548 | $ | 705 | ||||||
Federal statutory income tax rate
|
35 | % | 35 | % | 35 | % | ||||||
Expected federal income tax expense
|
253 | 192 | 247 | |||||||||
Increase (decrease) in tax expense resulting from:
|
||||||||||||
State income tax expense, net of federal income tax
|
40 | 18 | 2 | |||||||||
Amortization of investment tax credit
|
(7 | ) | (7 | ) | (7 | ) | ||||||
Tax law change in deductibility of retiree health care costs
|
— | — | 20 | |||||||||
Increase (decrease) in settled and uncertain income tax positions
|
8 | (5 | ) | 14 | ||||||||
Other, net
|
(17 | ) | (22 | ) | (13 | ) | ||||||
Total
|
24 | (16 | ) | 16 | ||||||||
Total income tax expense
|
$ | 277 | $ | 176 | $ | 263 | ||||||
Effective tax rate
|
38.4 | % | 32.1 | % | 37.3 | % |
December 31,
|
||||||||
2009
|
2010
|
|||||||
(in millions)
|
||||||||
Deferred tax assets:
|
||||||||
Current:
|
||||||||
Allowance for doubtful accounts
|
$ | 10 | $ | 11 | ||||
Deferred gas costs
|
7 | 32 | ||||||
Other
|
— | 21 | ||||||
Total current deferred tax assets
|
17 | 64 | ||||||
Non-current:
|
||||||||
Loss and credit carryforwards
|
42 | 49 | ||||||
Employee benefits
|
366 | 346 | ||||||
Other
|
51 | 48 | ||||||
Total non-current deferred tax assets before valuation allowance
|
459 | 443 | ||||||
Valuation allowance
|
(5 | ) | (3 | ) | ||||
Total non-current deferred tax assets, net of valuation allowance
|
454 | 440 | ||||||
Total deferred tax assets, net of valuation allowance
|
471 | 504 | ||||||
Deferred tax liabilities:
|
||||||||
Current:
|
||||||||
Unrealized gain on indexed debt securities
|
$ | 366 | $ | 391 | ||||
Unrealized gain on TW securities
|
57 | 80 | ||||||
Total current deferred tax liabilities
|
423 | 471 | ||||||
Non-current:
|
||||||||
Depreciation
|
1,887 | 2,086 | ||||||
Regulatory assets, net
|
1,298 | 1,256 | ||||||
Other
|
45 | 32 | ||||||
Total non-current deferred tax liabilities
|
3,230 | 3,374 | ||||||
Total deferred tax liabilities
|
3,653 | 3,845 | ||||||
Accumulated deferred income taxes, net
|
$ | 3,182 | $ | 3,341 |
December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Balance, beginning of year
|
$ | 82 | $ | 117 | $ | 187 | ||||||
Tax Positions related to prior years:
|
||||||||||||
Additions
|
20 | 56 | 9 | |||||||||
Reductions
|
(2 | ) | (25 | ) | (4 | ) | ||||||
Tax Positions related to current year:
|
||||||||||||
Additions
|
17 | 56 | 60 | |||||||||
Settlements
|
— | (17 | ) | — | ||||||||
Balance, end of year
|
$ | 117 | $ | 187 | $ | 252 |
2011
|
$ | 15 | ||
2012
|
12 | |||
2013
|
7 | |||
2014
|
6 | |||
2015
|
4 | |||
2016 and beyond
|
15 | |||
Total
|
$ | 59 |
For the Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions, except per share and share amounts)
|
||||||||||||
Basic earnings per share calculation:
|
||||||||||||
Net income
|
$ | 446 | $ | 372 | $ | 442 | ||||||
Weighted average shares outstanding
|
336,387,000 | 365,229,000 | 409,721,000 | |||||||||
Basic earnings per share
|
$ | 1.32 | $ | 1.02 | $ | 1.08 | ||||||
Diluted earnings per share calculation:
|
||||||||||||
Net income
|
$ | 446 | $ | 372 | $ | 442 | ||||||
Weighted average shares outstanding
|
336,387,000 | 365,229,000 | 409,721,000 | |||||||||
Plus: Incremental shares from assumed conversions:
|
||||||||||||
Stock options(1)
|
760,000 | 451,000 | 470,000 | |||||||||
Restricted stock
|
1,772,000 | 2,001,000 | 2,585,000 | |||||||||
3.75% convertible senior notes
|
4,636,000 | — | — | |||||||||
Weighted average shares assuming dilution
|
343,555,000 | 367,681,000 | 412,776,000 | |||||||||
Diluted earnings per share
|
$ | 1.30 | $ | 1.01 | $ | 1.07 |
(1)
|
Options to purchase 2,617,772, 2,372,132 and 1,458,598 shares were outstanding for the years ended December 31, 2008, 2009 and 2010, respectively, but were not included in the computation of diluted earnings per share because the options’ exercise price was greater than the average market price of the common shares for the respective years.
|
Year Ended December 31, 2009
|
||||||||||||||||
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
|||||||||||||
(in millions, except per share amounts)
|
||||||||||||||||
Revenues
|
$ | 2,766 | $ | 1,640 | $ | 1,576 | $ | 2,299 | ||||||||
Operating income
|
285 | 253 | 287 | 299 | ||||||||||||
Net income
|
67 | 86 | 114 | 105 | ||||||||||||
Basic earnings per share(1)
|
$ | 0.19 | $ | 0.24 | $ | 0.31 | $ | 0.27 | ||||||||
Diluted earnings per share(1)
|
$ | 0.19 | $ | 0.24 | $ | 0.31 | $ | 0.27 |
Year Ended December 31, 2010
|
||||||||||||||||
First
Quarter
(2)
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
(3)
|
|||||||||||||
(in millions, except per share amounts)
|
||||||||||||||||
Revenues
|
$ | 3,023 | $ | 1,756 | $ | 1,908 | $ | 2,098 | ||||||||
Operating income
|
357 | 263 | 327 | 302 | ||||||||||||
Net income
|
114 | 81 | 123 | 124 | ||||||||||||
Basic earnings per share(1)
|
$ | 0.29 | $ | 0.20 | $ | 0.29 | $ | 0.29 | ||||||||
Diluted earnings per share(1)
|
$ | 0.29 | $ | 0.20 | $ | 0.29 | $ | 0.29 |
|
(1)
|
Quarterly earnings per common share are based on the weighted average number of shares outstanding during the quarter, and the sum of the quarters may not equal annual earnings per common share.
|
|
(2)
|
During the first quarter of 2010, CenterPoint Energy recorded a $21 million charge to income tax expense as a result of a change in tax law upon the enactment in March 2010 of the Patient Protection and Affordable Care Act and the related Health Care and Education Reconciliation Act of 2010.
|
|
(3)
|
During the fourth quarter of 2010, CenterPoint Energy recorded a $21 million gain on the sale of non-strategic gathering assets by its Field Services business segment. CenterPoint Energy also recorded a $24 million decrease in income tax expense related to the effects of re-measuring accumulated deferred income taxes associated with the restructuring of certain subsidiaries.
|
Revenues
from
External
Customers
|
Intersegment
Revenues
|
Depreciation
and
Amortization
|
Operating
Income
|
Total
Assets
|
Expenditures
for Long-Lived
Assets
|
|||||||||||||||||||
As of and for the year ended December 31, 2008:
|
||||||||||||||||||||||||
Electric Transmission & Distribution
|
$ | 1,916 | (1) | $ | — | $ | 460 | $ | 545 | $ | 8,880 | $ | 481 | (5) | ||||||||||
Natural Gas Distribution
|
4,217 | 9 | 157 | 215 | 4,961 | 214 | ||||||||||||||||||
Competitive Natural Gas Sales and Services
|
4,488 | 40 | 3 | 62 | 1,315 | 8 | ||||||||||||||||||
Interstate Pipelines(2)
|
477 | 173 | 46 | 293 | 3,578 | 189 | ||||||||||||||||||
Field Services(3)
|
213 | 39 | 12 | 147 | 826 | 122 | ||||||||||||||||||
Other
|
11 | — | 30 | 11 | 2,185 | (4) | 39 | |||||||||||||||||
Reconciling Eliminations
|
— | (261 | ) | — | — | (2,069 | ) | — | ||||||||||||||||
Consolidated
|
$ | 11,322 | $ | — | $ | 708 | $ | 1,273 | $ | 19,676 | $ | 1,053 | ||||||||||||
As of and for the year ended December 31, 2009:
|
||||||||||||||||||||||||
Electric Transmission & Distribution
|
$ | 2,013 | (1) | $ | — | $ | 480 | $ | 545 | $ | 9,755 | $ | 428 | (5) | ||||||||||
Natural Gas Distribution
|
3,374 | 10 | 161 | 204 | 4,535 | 165 | ||||||||||||||||||
Competitive Natural Gas Sales and Services
|
2,215 | 15 | 4 | 21 | 1,176 | 2 | ||||||||||||||||||
Interstate Pipelines(2)
|
456 | 142 | 48 | 256 | 3,484 | 176 | ||||||||||||||||||
Field Services(3)
|
212 | 29 | 15 | 94 | 1,045 | 348 | ||||||||||||||||||
Other
|
11 | — | 35 | 4 | 2,261 | (4) | 29 | |||||||||||||||||
Reconciling Eliminations
|
— | (196 | ) | — | — | (2,483 | ) | — | ||||||||||||||||
Consolidated
|
$ | 8,281 | $ | — | $ | 743 | $ | 1,124 | $ | 19,773 | $ | 1,148 | ||||||||||||
As of and for the year ended December 31, 2010:
|
||||||||||||||||||||||||
Electric Transmission & Distribution
|
$ | 2,205 | (1) | $ | — | $ | 582 | $ | 567 | $ | 9,817 | $ | 463 | |||||||||||
Natural Gas Distribution
|
3,199 | 14 | 166 | 231 | 4,575 | 202 | ||||||||||||||||||
Competitive Natural Gas Sales and Services
|
2,617 | 34 | 4 | 16 | 1,190 | 2 | ||||||||||||||||||
Interstate Pipelines(2)
|
464 | 137 | 52 | 270 | 3,672 | 102 | ||||||||||||||||||
Field Services(3)
|
289 | 49 | 25 | 151 | 1,803 | 668 | ||||||||||||||||||
Other
|
11 | — | 35 | 14 | 2,184 | (4) | 25 | |||||||||||||||||
Reconciling Eliminations
|
— | (234 | ) | — | — | (3,130 | ) | — | ||||||||||||||||
Consolidated
|
$ | 8,785 | $ | — | $ | 864 | $ | 1,249 | $ | 20,111 | $ | 1,462 |
|
(1)
|
Sales to subsidiaries of NRG Retail LLC, the successor to RRI’s Texas retail business, in 2008, 2009 and 2010 represented approximately $635 million, $634 million and $583 million, respectively, of CenterPoint Houston’s transmission and distribution revenues. Sales to subsidiaries of TXU Energy Retail Company LLC in 2008, 2009 and 2010 represented approximately $151 million, $182 million and $185 million, respectively, of CenterPoint Houston’s transmission and distribution revenues.
|
|
(2)
|
Interstate Pipelines recorded equity income of $36 million, $7 million, and $19 million (including $33 million related to pre-operating allowance for funds used during construction during 2008) in the years ended December 31, 2008, 2009 and 2010, respectively, from its 50% interest in SESH, a jointly-owned pipeline. These amounts are included in Equity in earnings of unconsolidated affiliates under the Other Income (Expense) caption. Interstate Pipelines’ investment in SESH was $307 million, $422 million and $413 million as of December 31, 2008, 2009 and 2010 and is included in Investment in unconsolidated affiliates.
|
|
(3)
|
Field Services recorded equity income of $15 million, $8 million and $10 million for the years ended December 31, 2008, 2009 and 2010, respectively, from its 50% interest in a jointly-owned gas processing plant. These amounts are included in Equity in earnings of unconsolidated affiliates under the Other Income (Expense) caption. Field Services’ investment in the jointly-owned gas processing plant was
|
|
|
$38 million, $40 million and $55 million as of December 31, 2008, 2009 and 2010, respectively, and is included in Investment in unconsolidated affiliates.
|
|
(4)
|
Included in total assets of Other Operations as of December 31, 2008, 2009 and 2010, are pension and other postemployment related regulatory assets of $800 million, $731 million and $704 million, respectively.
|
|
(5)
|
Included in expenditures for long-lived assets of Electric Transmission & Distribution is $145 million and $26 million for 2008 and 2009, respectively, related to Hurricane Ike.
|
Year Ended December 31,
|
||||||||||||
Revenues by Products and Services:
|
2008
|
2009
|
2010
|
|||||||||
(in millions)
|
||||||||||||
Electric delivery sales
|
$ | 1,916 | $ | 2,013 | $ | 2,205 | ||||||
Retail gas sales
|
6,216 | 4,540 | 4,412 | |||||||||
Wholesale gas sales
|
2,295 | 902 | 1,250 | |||||||||
Gas transport
|
756 | 691 | 785 | |||||||||
Energy products and services
|
139 | 135 | 133 | |||||||||
Total
|
$ | 11,322 | $ | 8,281 | $ | 8,785 |
Report of Independent Registered Public Accounting Firm
|
66
|
Statements of Consolidated Income for the Three Years Ended December 31, 2010
|
69
|
Statements of Consolidated Comprehensive Income for the Three Years Ended December 31, 2010
|
70
|
Consolidated Balance Sheets at December 31, 2009 and 2010
|
71
|
Statements of Consolidated Cash Flows for the Three Years Ended December 31, 2010
|
72
|
Statements of Consolidated Shareholders’ Equity for the Three Years Ended December 31, 2010
|
73
|
Notes to Consolidated Financial Statements
|
74
|
Report of Independent Registered Public Accounting Firm
|
119
|
I — Condensed Financial Information of CenterPoint Energy, Inc. (Parent Company)
|
120
|
II — Valuation and Qualifying Accounts
|
125
|
For the Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Expenses:
|
||||||||||||
Operation and Maintenance Expenses
|
$ | (12 | ) | $ | (17 | ) | $ | (12 | ) | |||
Taxes Other than Income
|
1 | — | — | |||||||||
Total
|
(11 | ) | (17 | ) | (12 | ) | ||||||
Other Income (Expense):
|
||||||||||||
Interest Income from Subsidiaries
|
12 | 8 | 8 | |||||||||
Other Expense
|
(5 | ) | (5 | ) | (8 | ) | ||||||
Gain (Loss) on Indexed Debt Securities
|
128 | (68 | ) | (31 | ) | |||||||
Interest Expense to Subsidiaries
|
(38 | ) | (25 | ) | (26 | ) | ||||||
Interest Expense
|
(162 | ) | (149 | ) | (132 | ) | ||||||
Total
|
(65 | ) | (239 | ) | (189 | ) | ||||||
Loss Before Income Taxes
|
(76 | ) | (256 | ) | (201 | ) | ||||||
Income Tax Benefit
|
32 | 113 | 79 | |||||||||
Loss Before Equity in Subsidiaries
|
(44 | ) | (143 | ) | (122 | ) | ||||||
Equity Income of Subsidiaries
|
490 | 515 | 564 | |||||||||
Net Income
|
$ | 446 | $ | 372 | $ | 442 |
December 31,
|
||||||||
2009
|
2010
|
|||||||
(in millions)
|
||||||||
ASSETS
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$ | — | $ | — | ||||
Notes receivable — subsidiaries
|
493 | 530 | ||||||
Accounts receivable — subsidiaries
|
72 | 59 | ||||||
Other assets
|
16 | 68 | ||||||
Total current assets
|
581 | 657 | ||||||
Other Assets:
|
||||||||
Investment in subsidiaries
|
5,562 | 6,115 | ||||||
Notes receivable — subsidiaries
|
151 | 151 | ||||||
Other assets
|
751 | 723 | ||||||
Total other assets
|
6,464 | 6,989 | ||||||
Total Assets
|
$ | 7,045 | $ | 7,646 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
Current Liabilities:
|
||||||||
Notes payable — subsidiaries
|
$ | 306 | $ | 900 | ||||
Current portion of indexed debt
|
121 | 126 | ||||||
Current portion of other long-term debt
|
490 | 19 | ||||||
Indexed debt securities derivative
|
201 | 232 | ||||||
Accounts payable:
|
||||||||
Subsidiaries
|
17 | 27 | ||||||
Other
|
40 | 1 | ||||||
Taxes accrued
|
416 | 318 | ||||||
Interest accrued
|
29 | 19 | ||||||
Other
|
1 | 1 | ||||||
Total current liabilities
|
1,621 | 1,643 | ||||||
Other Liabilities:
|
||||||||
Accumulated deferred tax liabilities
|
122 | 124 | ||||||
Benefit obligations
|
426 | 460 | ||||||
Notes payable — subsidiaries
|
750 | 750 | ||||||
Other
|
7 | 10 | ||||||
Total non-current liabilities
|
1,305 | 1,344 | ||||||
Long-Term Debt
|
1,480 | 1,461 | ||||||
Shareholders’ Equity:
|
||||||||
Common stock
|
4 | 4 | ||||||
Additional paid-in capital
|
3,671 | 4,100 | ||||||
Accumulated deficit
|
(912 | ) | (789 | ) | ||||
Accumulated other comprehensive loss
|
(124 | ) | (117 | ) | ||||
Total shareholders’ equity
|
2,639 | 3,198 | ||||||
Total Liabilities and Shareholders’ Equity
|
$ | 7,045 | $ | 7,646 |
For the Year Ended December 31,
|
||||||||||||
2008
|
2009
|
2010
|
||||||||||
(in millions)
|
||||||||||||
Operating Activities:
|
||||||||||||
Net income
|
$ | 446 | $ | 372 | $ | 442 | ||||||
Non-cash items included in net income:
|
||||||||||||
Equity income of subsidiaries
|
(490 | ) | (515 | ) | (564 | ) | ||||||
Deferred income tax expense
|
90 | (19 | ) | (16 | ) | |||||||
Amortization of debt issuance costs
|
7 | 5 | 6 | |||||||||
Loss (gain) on indexed debt securities
|
(128 | ) | 68 | 31 | ||||||||
Changes in working capital:
|
||||||||||||
Accounts receivable/(payable) from subsidiaries, net
|
(65 | ) | 86 | 78 | ||||||||
Accounts payable
|
— | 14 | (16 | ) | ||||||||
Other current assets
|
2 | (16 | ) | (27 | ) | |||||||
Other current liabilities
|
(111 | ) | 59 | (111 | ) | |||||||
Common stock dividends received from subsidiaries
|
746 | 109 | 9 | |||||||||
Other
|
(7 | ) | (1 | ) | 6 | |||||||
Net cash provided by (used in) operating activities
|
490 | 162 | (162 | ) | ||||||||
Investing Activities:
|
||||||||||||
Short-term notes receivable from subsidiaries
|
134 | (411 | ) | (37 | ) | |||||||
Net cash provided by (used in) investing activities
|
134 | (411 | ) | (37 | ) | |||||||
Financing Activities:
|
||||||||||||
Revolving credit facility, net
|
133 | (264 | ) | — | ||||||||
Proceeds from long-term debt
|
300 | — | — | |||||||||
Payments on long-term debt
|
(907 | ) | — | (490 | ) | |||||||
Debt issuance costs
|
(4 | ) | — | (2 | ) | |||||||
Common stock dividends paid
|
(246 | ) | (276 | ) | (319 | ) | ||||||
Proceeds from issuance of common stock, net
|
80 | 504 | 416 | |||||||||
Short-term notes payable to subsidiaries
|
20 | 285 | 594 | |||||||||
Net cash provided by (used in) financing activities
|
(624 | ) | 249 | 199 | ||||||||
Net Decrease in Cash and Cash Equivalents
|
— | — | — | |||||||||
Cash and Cash Equivalents at Beginning of Year
|
— | — | — | |||||||||
Cash and Cash Equivalents at End of Year
|
$ | — | $ | — | $ | — |
Column A | Column B | Column C | Column D | Column E | ||||||||||||||||
Additions | ||||||||||||||||||||
Balance at
Beginning
of Period
|
Charged
to Income
|
Charged to
Other
Accounts
|
Deductions
From
Reserves (2)
|
Balance at
End of
Period
|
||||||||||||||||
Description |
(in millions)
|
|||||||||||||||||||
Year Ended December 31, 2010:
|
||||||||||||||||||||
Accumulated provisions:
|
||||||||||||||||||||
Uncollectible accounts receivable
|
$ | 24 | $ | 30 | $ | — | $ | 29 | $ | 25 | ||||||||||
Deferred tax asset valuation allowance
|
5 | (2 | ) | — | — | 3 | ||||||||||||||
Year Ended December 31, 2009:
|
||||||||||||||||||||
Accumulated provisions:
|
||||||||||||||||||||
Uncollectible accounts receivable
|
$ | 35 | $ | 36 | $ | — | $ | 47 | $ | 24 | ||||||||||
Deferred tax asset valuation allowance
|
5 | — | — | — | 5 | |||||||||||||||
Year Ended December 31, 2008:
|
||||||||||||||||||||
Accumulated provisions:
|
||||||||||||||||||||
Uncollectible accounts receivable
|
$ | 38 | $ | 54 | $ | 3 | $ | 60 | $ | 35 | ||||||||||
Deferred tax asset valuation allowance
|
18 | (1 | ) | (12 | ) (1) | — | 5 |
|
(1)
|
The 2008 change to the deferred tax asset valuation allowance charged to other accounts represents a reduction equal to the related deferred tax asset reduction in 2008 for remeasurement of state tax attributes, net of federal tax benefit. A full valuation allowance for this deferred tax asset was established in prior periods.
|
|
(2)
|
Deductions from reserves represent losses or expenses for which the respective reserves were created. In the case of the uncollectible accounts reserve, such deductions are net of recoveries of amounts previously written off.
|
CENTERPOINT ENERGY, INC.
|
|
(Registrant)
|
|
By:
/s/ David M. McClanahan
|
|
David M. McClanahan
|
|
President and Chief Executive Officer
|
Signature
|
Title
|
|
/s/
DAVID M. MCCLANAHAN
|
President, Chief Executive Officer and
|
|
David M. McClanahan
|
Director (Principal Executive Officer and Director)
|
|
/s/
GARY L. WHITLOCK
|
Executive Vice President and Chief
|
|
Gary L. Whitlock
|
Financial Officer (Principal Financial Officer)
|
|
/s/
WALTER L. FITZGERALD
|
Senior Vice President and Chief
|
|
Walter L. Fitzgerald
|
Accounting Officer (Principal Accounting Officer)
|
|
/s/
MILTON CARROLL
|
Chairman of the Board of Directors
|
|
Milton Carroll
|
||
/s/
DONALD R. CAMPBELL
|
Director
|
|
Donald R. Campbell
|
||
/s/
DERRILL CODY
|
Director
|
|
Derrill Cody
|
||
/s/
O. HOLCOMBE CROSSWELL
|
Director
|
|
O. Holcombe Crosswell
|
||
/s/ MICHAEL P. JOHNSON
|
Director
|
|
Michael P. Johnson
|
||
/s/
JANIECE M. LONGORIA
|
Director
|
|
Janiece M. Longoria
|
||
/s/
THOMAS F. MADISON
|
Director
|
|
Thomas F. Madison
|
||
/s/
ROBERT T. O’CONNELL
|
Director
|
|
Robert T. O’Connell
|
||
/s/ SUSAN O. RHENEY
|
Director
|
|
Susan O. Rheney
|
||
/s/ R. A. WALKER
|
Director
|
|
R. A. Walker
|
||
/s/
PETER S. WAREING
|
Director
|
|
Peter S. Wareing
|
||
/s/ SHERMAN M. WOLFF
|
Director
|
|
Sherman M. Wolff
|
||
Exhibit
Number
|
Description
|
Report or Registration Statement
|
SEC File or
Registration
Number
|
Exhibit
Reference
|
||||
2
|
—
|
Transaction Agreement dated July 21, 2004 among CenterPoint Energy, Utility Holding, LLC, NN Houston Sub, Inc., Texas Genco Holdings, Inc. (“Texas Genco”), HPC Merger Sub, Inc. and GC Power Acquisition LLC
|
CenterPoint Energy’s Form 8-K dated July 21, 2004
|
1-31447
|
10.1
|
|||
3(a)
|
—
|
Restated Articles of Incorporation of CenterPoint Energy
|
CenterPoint Energy’s Form 8-K dated July 24, 2008
|
1-31447
|
3.2
|
|||
†3(b)
|
—
|
Amended and Restated Bylaws of CenterPoint Energy
|
|
|
|
|||
4(a)
|
—
|
Form of CenterPoint Energy Stock Certificate
|
CenterPoint Energy’s Registration Statement on Form S-4
|
333-69502
|
4.1
|
|||
4(b)
|
—
|
Rights Agreement dated January 1, 2002, between CenterPoint Energy and JPMorgan Chase Bank, as Rights Agent
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2001
|
1-31447
|
4.2
|
|||
4(c)
|
—
|
Contribution and Registration Agreement dated December 18, 2001 among Reliant Energy, CenterPoint Energy and the Northern Trust Company, trustee under the Reliant Energy, Incorporated Master Retirement Trust
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2001
|
1-31447
|
4.3
|
|||
4(d)(1)
|
—
|
Mortgage and Deed of Trust, dated November 1, 1944 between Houston Lighting and Power Company (“HL&P”) and Chase Bank of Texas, National Association (formerly, South Texas Commercial National Bank of Houston), as Trustee, as amended and supplemented by 20 Supplemental Indentures thereto
|
HL&P’s Form S-7 filed on August 25, 1977
|
2-59748
|
2(b)
|
4(d)(2)
|
—
|
Twenty-First through Fiftieth Supplemental Indentures to Exhibit 4(d)(1)
|
HL&P’s Form 10-K for the year ended December 31, 1989
|
1-3187
|
4(a)(2)
|
|||
4(d)(3)
|
—
|
Fifty-First Supplemental Indenture to Exhibit 4(d)(1) dated as of March 25, 1991
|
HL&P’s Form 10-Q for the quarter ended June 30, 1991
|
1-3187
|
4(a)
|
|||
4(d)(4)
|
—
|
Fifty-Second through Fifty-Fifth Supplemental Indentures to Exhibit 4(d)(1) each dated as of March 1, 1992
|
HL&P’s Form 10-Q for the quarter ended March 31, 1992
|
1-3187
|
4
|
|||
4(d)(5)
|
—
|
Fifty-Sixth and Fifty-Seventh Supplemental Indentures to Exhibit 4(d)(1) each dated as of October 1, 1992
|
HL&P’s Form 10-Q for the quarter ended September 30, 1992
|
1-3187
|
4
|
|||
4(d)(6)
|
—
|
Fifty-Eighth and Fifty-Ninth Supplemental Indentures to Exhibit 4(d)(1) each dated as of March 1, 1993
|
HL&P’s Form 10-Q for the quarter ended March 31, 1993
|
1-3187
|
4
|
|||
4(d)(7)
|
—
|
Sixtieth Supplemental Indenture to Exhibit 4(d)(1) dated as of July 1, 1993
|
HL&P’s Form 10-Q for the quarter ended June 30, 1993
|
1-3187
|
4
|
|||
4(d)(8)
|
—
|
Sixty-First through Sixty-Third Supplemental Indentures to Exhibit 4(d)(1) each dated as of December 1, 1993
|
HL&P’s Form 10-K for the year ended December 31, 1993
|
1-3187
|
4(a)(8)
|
|||
4(d)(9)
|
—
|
Sixty-Fourth and Sixty-Fifth Supplemental Indentures to Exhibit 4(d)(1) each dated as of July 1, 1995
|
HL&P’s Form 10-K for the year ended December 31, 1995
|
1-3187
|
4(a)(9)
|
|||
4(e)(1)
|
—
|
General Mortgage Indenture, dated as of October 10, 2002, between CenterPoint Energy Houston Electric, LLC and JPMorgan Chase Bank, as Trustee
|
CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002
|
1-3187
|
4(j)(1)
|
|||
4(e)(2)
|
—
|
Second Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002
|
CenterPoint Houston’s Form 10- Q for the quarter ended September 30, 2002
|
1-3187
|
4(j)(3)
|
|||
4(e)(3)
|
—
|
Third Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002
|
CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002
|
1-3187
|
4(j)(4)
|
|||
4(e)(4)
|
—
|
Fourth Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002
|
CenterPoint Houston’s Form 10- Q for the quarter ended September 30, 2002
|
1-3187
|
4(j)(5)
|
|||
4(e)(5)
|
—
|
Fifth Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002
|
CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002
|
1-3187
|
4(j)(6)
|
|||
4(e)(6)
|
—
|
Sixth Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002
|
CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002
|
1-3187
|
4(j)(7)
|
4(e)(7)
|
—
|
Seventh Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002
|
CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002
|
1-3187
|
4(j)(8)
|
|||
4(e)(8)
|
—
|
Eighth Supplemental Indenture to Exhibit 4(e)(1), dated as of October 10, 2002
|
CenterPoint Houston’s Form 10-Q for the quarter ended September 30, 2002
|
1-3187
|
4(j)(9)
|
|||
4(e)(9)
|
—
|
Officer’s Certificates dated October 10, 2002 setting forth the form, terms and provisions of the First through Eighth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2003
|
1-31447
|
4(e)(10)
|
|||
4(e)(10)
|
—
|
Ninth Supplemental Indenture to Exhibit 4(e)(1), dated as of November 12, 2002
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
4(e)(10)
|
|||
4(e)(11)
|
—
|
Officer’s Certificate dated November 12, 2003 setting forth the form, terms and provisions of the Ninth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2003
|
1-31447
|
4(e)(12)
|
|||
4(e)(12)
|
—
|
Tenth Supplemental Indenture to Exhibit 4(e)(1), dated as of March 18, 2003
|
CenterPoint Energy’s Form 8-K dated March 13, 2003
|
1-31447
|
4.1
|
|||
4(e)(13)
|
—
|
Officer’s Certificate dated March 18, 2003 setting forth the form, terms and provisions of the Tenth Series and Eleventh Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 8-K dated March 13, 2003
|
1-31447
|
4.2
|
|||
4(e)(14)
|
—
|
Eleventh Supplemental Indenture to Exhibit 4(e)(1), dated as of May 23, 2003
|
CenterPoint Energy’s Form 8-K dated May 16, 2003
|
1-31447
|
4.2
|
|||
4(e)(15)
|
—
|
Officer’s Certificate dated May 23, 2003 setting forth the form, terms and provisions of the Twelfth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 8-K dated May 16, 2003
|
1-31447
|
4.1
|
|||
4(e)(16)
|
—
|
Twelfth Supplemental Indenture to Exhibit 4(e)(1), dated as of September 9, 2003
|
CenterPoint Energy’s Form 8-K dated September 9, 2003
|
1-31447
|
4.2
|
|||
4(e)(17)
|
—
|
Officer’s Certificate dated September 9, 2003 setting forth the form, terms and provisions of the Thirteenth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 8-K dated September 9, 2003
|
1-31447
|
4.3
|
|||
4(e)(18)
|
—
|
Thirteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of February 6, 2004
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(16)
|
|||
4(e)(19)
|
—
|
Officer’s Certificate dated February 6, 2004 setting forth the form, terms and provisions of the Fourteenth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(17)
|
4(e)(20)
|
—
|
Fourteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of February 11, 2004
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(18)
|
|||
4(e)(21)
|
—
|
Officer’s Certificate dated February 11, 2004 setting forth the form, terms and provisions of the Fifteenth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(19)
|
|||
4(e)(22)
|
—
|
Fifteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of March 31, 2004
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(20)
|
|||
4(e)(23)
|
—
|
Officer’s Certificate dated March 31, 2004 setting forth the form, terms and provisions of the Sixteenth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(21)
|
|||
4(e)(24)
|
—
|
Sixteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of March 31, 2004
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(22)
|
|||
4(e)(25)
|
—
|
Officer’s Certificate dated March 31, 2004 setting forth the form, terms and provisions of the Seventeenth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(23)
|
|||
4(e)(26)
|
—
|
Seventeenth Supplemental Indenture to Exhibit 4(e)(1), dated as of March 31, 2004
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(24)
|
|||
4(e)(27)
|
—
|
Officer’s Certificate dated March 31, 2004 setting forth the form, terms and provisions of the Eighteenth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(e)(25)
|
|||
4(e)(28)
|
—
|
Nineteenth Supplemental Indenture to Exhibit 4(e)(1), dated as of November 26, 2008
|
CenterPoint Energy’s Form 8-K dated November 25, 2008
|
1-31447
|
4.2
|
|||
4(e)(29)
|
—
|
Officer’s Certificate date November 26, 2008 setting forth the form, terms and provisions of the Twentieth Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 8-K dated November 25, 2008
|
1-31447
|
4.3
|
|||
4(e)(30)
|
—
|
Twentieth Supplemental Indenture to Exhibit 4(e)(1), dated as of December 9, 2008
|
CenterPoint Houston’s Form 8-K dated January 6, 2009
|
1-3187
|
4.2
|
|||
4(e)(31)
|
—
|
Twenty-First Supplemental Indenture to Exhibit 4(e)(1), dated as of January 9, 2009
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
4(e)(31)
|
|||
4(e)(32)
|
—
|
Officer’s Certificate date January 20, 2009 setting forth the form, terms and provisions of the Twenty-First Series of General Mortgage Bonds
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
4(e)(32)
|
4(f)(1)
|
—
|
Indenture, dated as of February 1, 1998, between Reliant Energy Resources Corp. (“RERC Corp.”) and Chase Bank of Texas, National Association, as Trustee
|
CERC Corp.’s Form 8-K dated February 5, 1998
|
1-13265
|
4.1
|
|||
4(f)(2)
|
—
|
Supplemental Indenture No. 1 to Exhibit 4(f)(1), dated as of February 1, 1998, providing for the issuance of RERC Corp.’s 6 1/2% Debentures due February 1, 2008
|
CERC Corp.’s Form 8-K dated November 9, 1998
|
1-13265
|
4.2
|
|||
4(f)(3)
|
—
|
Supplemental Indenture No. 2 to Exhibit 4(f)(1), dated as of November 1, 1998, providing for the issuance of RERC Corp.’s 6 3/8% Term Enhanced ReMarketable Securities
|
CERC Corp.’s Form 8-K dated November 9, 1998
|
1-13265
|
4.1
|
|||
4(f)(4)
|
—
|
Supplemental Indenture No. 3 to Exhibit 4(f)(1), dated as of July 1, 2000, providing for the issuance of RERC Corp.’s 8.125% Notes due 2005
|
CERC Corp.’s Registration Statement on Form S-4
|
333-49162
|
4.2
|
|||
4(f)(5)
|
—
|
Supplemental Indenture No. 4 to Exhibit 4(f)(1), dated as of February 15, 2001, providing for the issuance of RERC Corp.’s 7.75% Notes due 2011
|
CERC Corp.’s Form 8-K dated February 21, 2001
|
1-13265
|
4.1
|
|||
4(f)(6)
|
—
|
Supplemental Indenture No. 5 to Exhibit 4(f)(1), dated as of March 25, 2003, providing for the issuance of CenterPoint Energy Resources Corp.’s (“CERC Corp.’s”) 7.875% Senior Notes due 2013
|
CenterPoint Energy’s Form 8-K dated March 18, 2003
|
1-31447
|
4.1
|
|||
4(f)(7)
|
—
|
Supplemental Indenture No. 6 to Exhibit 4(f)(1), dated as of April 14, 2003, providing for the issuance of CERC Corp.’s 7.875% Senior Notes due 2013
|
CenterPoint Energy’s Form 8-K dated April 7, 2003
|
1-31447
|
4.2
|
|||
4(f)(8)
|
—
|
Supplemental Indenture No. 7 to Exhibit 4(f)(1), dated as of November 3, 2003, providing for the issuance of CERC Corp.’s 5.95% Senior Notes due 2014
|
CenterPoint Energy’s Form 8-K dated October 29, 2003
|
1-31447
|
4.2
|
|||
4(f)(9)
|
—
|
Supplemental Indenture No. 8 to Exhibit 4(f)(1), dated as of December 28, 2005, providing for a modification of CERC Corp.’s 6 1/2% Debentures due 2008
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(f)(9)
|
|||
4(f)(10)
|
—
|
Supplemental Indenture No. 9 to Exhibit 4(f)(1), dated as of May 18, 2006, providing for the issuance of CERC Corp.’s 6.15% Senior Notes due 2016
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2006
|
1-31447
|
4.7
|
4(g)(6)
|
—
|
Supplemental Indenture No. 5 to Exhibit 4(g)(1), dated as of December 13, 2004, as supplemented by Exhibit 4(g)(5), relating to the issuance of CenterPoint Energy’s 2.875% Convertible Senior Notes due 2024
|
CenterPoint Energy’s Form 8-K dated December 9, 2004
|
1-31447
|
4.1
|
|||
4(g)(7)
|
—
|
Supplemental Indenture No. 6 to Exhibit 4(g)(1), dated as of August 23, 2005, providing for the issuance of CenterPoint Energy’s 3.75% Convertible Senior Notes, Series B due 2023
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(g)(7)
|
|||
4(g)(8)
|
—
|
Supplemental Indenture No. 7 to Exhibit 4(g)(1), dated as of February 6, 2007, providing for the issuance of CenterPoint Energy’s 5.95% Senior Notes due 2017
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2006
|
1-31447
|
4(g)(8)
|
|||
4(g)(9)
|
—
|
Supplemental Indenture No. 8 to Exhibit 4(g)(1), dated as of May 5, 2008, providing for the issuance of CenterPoint Energy’s 6.50% Senior Notes due 2018
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2008
|
1-31447
|
4.7
|
|||
4(h)(1)
|
—
|
Subordinated Indenture dated as of September 1, 1999
|
Reliant Energy’s Form 8-K dated September 1, 1999
|
1-3187
|
4.1
|
|||
4(h)(2)
|
—
|
Supplemental Indenture No. 1 dated as of September 1, 1999, between Reliant Energy and Chase Bank of Texas (supplementing Exhibit 4(h)(1) and providing for the issuance Reliant Energy’s 2% Zero-Premium Exchangeable Subordinated Notes Due 2029)
|
Reliant Energy’s Form 8-K dated September 15, 1999
|
1-3187
|
4.2
|
|||
4(h)(3)
|
—
|
Supplemental Indenture No. 2 dated as of August 31, 2002, between CenterPoint Energy, Reliant Energy and JPMorgan Chase Bank (supplementing Exhibit 4(h)(1))
|
CenterPoint Energy’s Form 8-K12B dated August 31, 2002
|
1-31447
|
4(e)
|
|||
4(h)(4)
|
—
|
Supplemental Indenture No. 3 dated as of December 28, 2005, between CenterPoint Energy, Reliant Energy and JPMorgan Chase Bank (supplementing Exhibit 4(h)(1))
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2005
|
1-31447
|
4(h)(4)
|
|||
4(i)(1)
|
—
|
$1,200,000,000 Second Amended and Restated Credit Agreement dated as of June 29, 2007, among CenterPoint Energy, as Borrower, and the banks named therein
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2007
|
1-31447
|
4.3
|
|||
4(i)(2)
|
—
|
First Amendment to Exhibit 4(i)(1), dated as of August 20, 2008, among CenterPoint Energy, as Borrower, and the banks named therein
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2008
|
1-31447
|
4.4
|
4(i)(3)
|
—
|
Second Amendment to Exhibit 4(i)(1), dated as of November 18, 2008, among CenterPoint Energy, as Borrower, and the banks named therein
|
CenterPoint Energy’s Form 8-K dated November 18, 2008
|
1-31447
|
4.1
|
|||
4(i)(4)
|
—
|
Third Amendment to Exhibit 4(i)(1), dated as of February 5, 2010, among CenterPoint Energy, as Borrower, and the banks named therein
|
CenterPoint Energy’s Form 8-K dated February 5, 2010
|
1-31447
|
4.1
|
|||
4(j)(1)
|
—
|
$300,000,000 Second Amended and Restated Credit Agreement dated as of June 29, 2007, among CenterPoint Houston, as Borrower, and the banks named therein
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2007
|
1-31447
|
4.4
|
|||
4(j)(2)
|
—
|
First Amendment to Exhibit 4(j)(1), dated as of November 18, 2008, among CenterPoint Houston, as Borrower, and the banks named therein
|
CenterPoint Energy’s Form 8-K dated November 18, 2008
|
1-31447
|
4.2
|
|||
4(k)
|
—
|
$950,000,000 Second Amended and Restated Credit Agreement dated as of June 29, 2007, among CERC Corp., as Borrower, and the banks named therein
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2007
|
1-31447
|
4.5
|
|||
4(l)
|
—
|
$600,000,000 Credit Agreement dated as of November 25, 2008, among CenterPoint Houston, as Borrower, and the banks named therein
|
CenterPoint Energy’s Form 8-K dated November 25, 2008
|
1-31447
|
4.1
|
Exhibit
Number
|
Description
|
Report or Registration Statement
|
SEC File or
Registration
Number
|
Exhibit
Reference
|
||||
*10(a)
|
—
|
CenterPoint Energy Executive Benefits Plan, as amended and restated effective June 18, 2003
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003
|
1-31447
|
10.4
|
|||
*10(b)(1)
|
—
|
Executive Incentive Compensation Plan of Houston Industries Incorporated (“HI”) effective as of January 1, 1982
|
HI’s Form 10-K for the year ended December 31, 1991
|
1-7629
|
10(b)
|
|||
*10(b)(2)
|
—
|
First Amendment to Exhibit 10(b)(1) effective as of March 30, 1992
|
HI’s Form 10-Q for the quarter ended March 31, 1992
|
1-7629
|
10(a)
|
|||
*10(b)(3)
|
—
|
Second Amendment to Exhibit 10(b)(1) effective as of November 4, 1992
|
HI’s Form 10-K for the year ended December 31, 1992
|
1-7629
|
10(b)
|
|||
*10(b)(4)
|
—
|
Third Amendment to Exhibit 10(b)(1) effective as of September 7, 1994
|
HI’s Form 10-K for the year ended December 31, 1994
|
1-7629
|
10(b)(4)
|
*10(b)(5)
|
—
|
Fourth Amendment to Exhibit 10(b)(1) effective as of August 6, 1997
|
HI’s Form 10-K for the year ended December 31, 1997
|
1-3187
|
10(b)(5)
|
|||
*10(c)(1)
|
—
|
Executive Incentive Compensation Plan of HI as amended and restated on January 1, 1991
|
HI’s Form 10-K for the year ended December 31, 1990
|
1-7629
|
10(b)
|
|||
*10(c)(2)
|
—
|
First Amendment to Exhibit 10(c)(1) effective as of January 1, 1991
|
HI’s Form 10-K for the year ended December 31, 1991
|
1-7629
|
10(f)(2)
|
|||
*10(c)(3)
|
—
|
Second Amendment to Exhibit 10(c)(1) effective as of March 30, 1992
|
HI’s Form 10-Q for the quarter ended March 31, 1992
|
1-7629
|
10(d)
|
|||
*10(c)(4)
|
—
|
Third Amendment to Exhibit 10(c)(1) effective as of November 4, 1992
|
HI’s Form 10-K for the year ended December 31, 1992
|
1-7629
|
10(f)(4)
|
|||
*10(c)(5)
|
—
|
Fourth Amendment to Exhibit 10(c)(1) effective as of January 1, 1993
|
HI’s Form 10-K for the year ended December 31, 1992
|
1-7629
|
10(f)(5)
|
|||
*10(c)(6)
|
—
|
Fifth Amendment to Exhibit 10(c)(1) effective in part, January 1, 1995, and in part, September 7, 1994
|
HI’s Form 10-K for the year ended December 31, 1994
|
1-7629
|
10(f)(6)
|
|||
*10(c)(7)
|
—
|
Sixth Amendment to Exhibit 10(c)(1) effective as of August 1, 1995
|
HI’s Form 10-Q for the quarter ended June 30, 1995
|
1-7629
|
10(a)
|
|||
*10(c)(8)
|
—
|
Seventh Amendment to Exhibit 10(c)(1) effective as of January 1, 1996
|
HI’s Form 10-Q for the quarter ended June 30, 1996
|
1-7629
|
10(a)
|
|||
*10(c)(9)
|
—
|
Eighth Amendment to Exhibit 10(c)(1) effective as of January 1, 1997
|
HI’s Form 10-Q for the quarter ended June 30, 1997
|
1-7629
|
10(a)
|
|||
*10(c)(10)
|
—
|
Ninth Amendment to Exhibit 10(c)(1) effective in part, January 1, 1997, and in part, January 1, 1998
|
HI’s Form 10-K for the year ended December 31, 1997
|
1-3187
|
10(f)(10)
|
|||
*10(d)
|
—
|
Benefit Restoration Plan of HI effective as of June 1, 1985
|
HI’s Form 10-Q for the quarter ended March 31, 1987
|
1-7629
|
10(c)
|
|||
*10(e)
|
—
|
Benefit Restoration Plan of HI as amended and restated effective as of January 1, 1988
|
HI’s Form 10-K for the year ended December 31, 1991
|
1-7629
|
10(g)(2)
|
|||
*10(f)(1)
|
—
|
Benefit Restoration Plan of HI, as amended and restated effective as of July 1, 1991
|
HI’s Form 10-K for the year ended December 31, 1991
|
1-7629
|
10(g)(3)
|
*10(f)(2)
|
—
|
First Amendment to Exhibit 10(f)(1) effective in part, August 6, 1997, in part, September 3, 1997, and in part, October 1, 1997
|
HI’s Form 10-K for the year ended December 31, 1997
|
1-3187
|
10(i)(2)
|
|||
*10(f)(3)
|
—
|
Third Amendment to Exhibit 10(f)(1) effective as of January 1, 2008
|
CenterPoint Energy’s Form 8-K dated December 22, 2008
|
1-31447
|
10.2
|
|||
*10(g)
|
—
|
CenterPoint Energy Benefit Restoration Plan, effective as of January 1, 2008
|
CenterPoint Energy’s Form 8-K dated December 22, 2008
|
1-31447
|
10.1
|
|||
*10(h)(1)
|
—
|
HI 1995 Section 415 Benefit Restoration Plan effective August 1, 1995
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(h)(1)
|
|||
*10(h)(2)
|
—
|
First Amendment to Exhibit 10(h)(1) effective as of August 1, 1995
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(h)(2)
|
|||
*10(i)
|
—
|
CenterPoint Energy 1985 Deferred Compensation Plan, as amended and restated effective January 1, 2003
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003
|
1-31447
|
10.1
|
|||
*10(j)(1)
|
—
|
Reliant Energy 1994 Long- Term Incentive Compensation Plan, as amended and restated effective January 1, 2001
|
Reliant Energy’s Form 10-Q for the quarter ended June 30, 2002
|
1-3187
|
10.6
|
|||
*10(j)(2)
|
—
|
First Amendment to Exhibit 10(j)(1), effective December 1, 2003
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2003
|
1-31447
|
10(p)(7)
|
|||
*10(j)(3)
|
—
|
Form of Non-Qualified Stock Option Award Notice under Exhibit 10(i)(1)
|
CenterPoint Energy’s Form 8-K dated January 25, 2005
|
1-31447
|
10.6
|
|||
*10(k)(1)
|
—
|
Savings Restoration Plan of HI effective as of January 1, 1991
|
HI’s Form 10-K for the year ended December 31, 1990
|
1-7629
|
10(f)
|
|||
*10(k)(2)
|
—
|
First Amendment to Exhibit 10(k)(1) effective as of January 1, 1992
|
HI’s Form 10-K for the year ended December 31, 1991
|
1-7629
|
10(l)(2)
|
|||
*10(k)(3)
|
—
|
Second Amendment to Exhibit 10(k)(1) effective in part, August 6, 1997, and in part, October 1, 1997
|
HI’s Form 10-K for the year ended December 31, 1997
|
1-3187
|
10(q)(3)
|
|||
*10(l)(3)
|
—
|
Amended and Restated CenterPoint Energy, Inc. 1991 Savings Restoration Plan, effective as of January 1, 2008
|
CenterPoint Energy’s Form 8-K dated December 22, 2008
|
1-31447
|
10.4
|
|||
*10(m)
|
—
|
CenterPoint Energy Savings Restoration Plan, effective as of January 1, 2008
|
CenterPoint Energy’s Form 8-K dated December 22, 2008
|
1-31447
|
10.3
|
*10(n)(1)
|
—
|
CenterPoint Energy Outside Director Benefits Plan, as amended and restated effective June 18, 2003
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003
|
1-31447
|
10.6
|
|||
*10(n)(2)
|
—
|
First Amendment to Exhibit 10(n)(1) effective as of January 1, 2004
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2004
|
1-31447
|
10.6
|
|||
*10(n)(3)
|
—
|
CenterPoint Energy Outside Director Benefits Plan, as amended and restated effective December 31, 2008
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(n)(3)
|
|||
*10(o)
|
—
|
CenterPoint Energy Executive Life Insurance Plan, as amended and restated effective June 18, 2003
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003
|
1-31447
|
10.5
|
|||
*10(p)
|
—
|
Employment and Supplemental Benefits Agreement between HL&P and Hugh Rice Kelly
|
HI’s Form 10-Q for the quarter ended March 31, 1987
|
1-7629
|
10(f)
|
|||
10(q)(1)
|
—
|
Stockholder’s Agreement dated as of July 6, 1995 between Houston Industries Incorporated and Time Warner Inc.
|
Schedule 13-D dated July 6, 1995
|
5-19351
|
2
|
|||
10(q)(2)
|
—
|
Amendment to Exhibit 10(q)(1) dated November 18, 1996
|
HI’s Form 10-K for the year ended December 31, 1996
|
1-7629
|
10(x)(4)
|
|||
*10(r)(1)
|
—
|
Houston Industries Incorporated Executive Deferred Compensation Trust effective as of December 19, 1995
|
HI’s Form 10-K for the year ended December 31, 1995
|
1-7629
|
10(7)
|
|||
*10(r)(2)
|
—
|
First Amendment to Exhibit 10(r)(1) effective as of August 6, 1997
|
HI’s Form 10-Q for the quarter ended June 30, 1998
|
1-3187
|
10
|
|||
*10(s)
|
—
|
Letter Agreement dated May 24, 2007 between CenterPoint Energy and Milton Carroll, Non-Executive Chairman of the Board of Directors of CenterPoint Energy
|
CenterPoint Energy’s Form 8-K dated May 31, 2007
|
1-31447
|
10.1
|
|||
*10(t)
|
—
|
Reliant Energy, Incorporated and Subsidiaries Common Stock Participation Plan for Designated New Employees and Non-Officer Employees, as amended and restated effective January 1, 2001
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
10(y)(2)
|
|||
*10(u)(1)
|
—
|
Long-Term Incentive Plan of CenterPoint Energy, Inc. (amended and restated effective as of May 1, 2004)
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2004
|
1-31447
|
10.5
|
|||
*10(u)(2)
|
—
|
First Amendment to Exhibit (u)(1), effective January 1, 2007
|
CenterPoint Energy’s Form 10-Q for the quarter ended March 31, 2007
|
1-31447
|
10.5
|
*10(u)(3)
|
—
|
Form of Non-Qualified Stock Option Award Agreement under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated January 25, 2005
|
1-31447
|
10.1
|
|||
*10(u)(4)
|
—
|
Form of
Restricted Stock
Award
Agreement
under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated January 25, 2005
|
1-31447
|
10.2
|
|||
*10(u)(5)
|
—
|
Form of Performance
Share
Award under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated January 25, 2005
|
1-31447
|
10.3
|
|||
*10(u)(6)
|
—
|
Form of Performance Share Award Agreement for 20XX-20XX Performance Cycle under Exhibit 10
(u)(1)
|
CenterPoint Energy’s Form 8-K dated February 22, 2006
|
1-31447
|
10.2
|
|||
*10(u)(7)
|
—
|
Form of Restricted Stock Award Agreement (With Performance Vesting Requirement) under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated February 21, 2005
|
1-31447
|
10.2
|
|||
*10(u)(
8
)
|
—
|
Form of Stock Award Agreement (With Performance Goal) under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated February 22, 2006
|
1-31447
|
10.3
|
|||
*10(u)(9)
|
—
|
Form of Performance Share Award Agreement for 20XX — 20XX Performance Cycle under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated February 21, 2007
|
1-31447
|
10.1
|
|||
*10(u)(10)
|
—
|
Form of Stock Award Agreement (With Performance Goal) under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated February 21, 2007
|
1-31447
|
10.2
|
|||
*10(u)(11)
|
—
|
Form of Stock Award Agreement (Without Performance Goal) under Exhibit 10
(u)(1)
|
CenterPoint Energy’s Form 8-K dated February 21, 2007
|
1-31447
|
10.3
|
|||
*10(u)(12)
|
—
|
Form of Performance Share Award Agreement for 20XX — 20XX Performance Cycle under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated February 20, 2008
|
1-31447
|
10.1
|
|||
*10(u)(13)
|
—
|
Form of Stock Award Agreement (With Performance Goal) under Exhibit 10(u)(1)
|
CenterPoint Energy’s Form 8-K dated February 20, 2008
|
1-31447
|
10.2
|
|||
10(v)(1)
|
—
|
Master Separation Agreement entered into as of December 31, 2000 between Reliant Energy, Incorporated and Reliant Resources, Inc.
|
Reliant Energy’s Form 10-Q for the quarter ended March 31, 2001
|
1-3187
|
10.1
|
|||
10(v)(2)
|
—
|
First Amendment to Exhibit 10(v)(1) effective as of February 1, 2003
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
10(bb)(5)
|
|||
10(v)(3)
|
—
|
Employee Matters Agreement, entered into as of December 31, 2000, between Reliant Energy, Incorporated and Reliant Resources, Inc.
|
Reliant Energy’s Form 10-Q for the quarter ended March 31, 2001
|
1-3187
|
10.5
|
10(v)(4)
|
—
|
Retail Agreement, entered into as of December 31, 2000, between Reliant Energy, Incorporated and Reliant Resources, Inc.
|
Reliant Energy’s Form 10-Q for the quarter ended March 31, 2001
|
1-3187
|
10.6
|
|||
10(v)(5)
|
—
|
Tax Allocation Agreement, entered into as of December 31, 2000, between Reliant Energy, Incorporated and Reliant Resources, Inc.
|
Reliant Energy’s Form 10-Q for the quarter ended March 31, 2001
|
1-3187
|
10.8
|
|||
10(w)(1)
|
—
|
Separation Agreement entered into as of August 31, 2002 between CenterPoint Energy and Texas Genco
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
10(cc)(1)
|
|||
10(w)(2)
|
—
|
Transition Services Agreement, dated as of August 31, 2002, between CenterPoint Energy and Texas Genco
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
10(cc)(2)
|
|||
10(w)(3)
|
—
|
Tax Allocation Agreement, dated as of August 31, 2002, between CenterPoint Energy and Texas Genco
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
10(cc)(3)
|
|||
*10(x)
|
—
|
Retention Agreement effective October 15, 2001 between Reliant Energy and David G. Tees
|
Reliant Energy’s Form 10-K for the year ended December 31, 2001
|
1-3187
|
10(jj)
|
|||
*10(y)
|
—
|
Retention Agreement effective October 15, 2001 between Reliant Energy and Michael A. Reed
|
Reliant Energy’s Form 10-K for the year ended December 31, 2001
|
1-3187
|
10(kk)
|
|||
*10(z)
|
—
|
Non-Qualified Unfunded Executive Supplemental Income Retirement Plan of Arkla, Inc. effective as of August 1, 1983
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
10(gg)
|
|||
*10(aa)(1)
|
—
|
Deferred Compensation Plan for Directors of Arkla, Inc. effective as of November 10, 1988
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
10(hh)(1)
|
|||
*10(aa)(2)
|
—
|
First Amendment to Exhibit 10(aa)(1) effective as of August 6, 1997
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2002
|
1-31447
|
10(hh)(2)
|
|||
*10(bb)(1)
|
—
|
CenterPoint Energy, Inc. Deferred Compensation Plan, as amended and restated effective January 1, 2003
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2003
|
1-31447
|
10.2
|
|||
*10(bb)(2)
|
—
|
First Amendment to Exhibit 10(bb)(1) effective as of January 1, 2008
|
CenterPoint Energy’s Form 8-K dated February 20, 2008
|
1-31447
|
10.4
|
|||
*10(bb)(3)
|
—
|
CenterPoint Energy 2005 Deferred Compensation Plan, effective January 1, 2008
|
CenterPoint Energy’s Form 8-K dated February 20, 2008
|
1-31447
|
10.3
|
*10(bb)(4)
|
—
|
Amended and Restated CenterPoint Energy 2005 Deferred Compensation Plan, effective January 1, 2009
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2008
|
1-31447
|
10.1
|
|||
*10(cc)(1)
|
—
|
CenterPoint Energy Short Term Incentive Plan, as amended and restated effective January 1, 2003
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2003
|
1-31447
|
10.3
|
|||
*10(cc)(2)
|
—
|
Second Amendment to Exhibit 10(cc)(1)
|
CenterPoint Energy’s Form 8-K dated December 10, 2009
|
1-31447
|
10.1
|
|||
*10(dd)(1)
|
—
|
CenterPoint Energy Stock Plan for Outside Directors, as amended and restated effective May 7, 2003
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2003
|
1-31447
|
10(ll)
|
|||
*10(dd)(2)
|
—
|
First Amendment to Exhibit 10(dd)(1)
|
CenterPoint Energy’s Form 10-Q for the quarter ended March 31, 2010
|
1-31447
|
10.2
|
|||
10(
ee
)
|
—
|
City of Houston Franchise Ordinance
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2005
|
1-31447
|
10.1
|
|||
10(
ff
)
|
—
|
Letter Agreement dated March 16, 2006 between CenterPoint Energy and John T. Cater
|
CenterPoint Energy’s Form 10-Q for the quarter ended March 30, 2006
|
1-31447
|
10
|
|||
10(
gg)(1)
|
—
|
Amended and Restated HL&P Executive Incentive Compensation Plan effective as of January 1, 1985
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2008
|
1-31447
|
10.2
|
|||
10(gg
)
(2)
|
—
|
First Amendment to Exhibit 10(gg)(1) effective as of January 1, 2008
|
CenterPoint Energy’s Form 10-Q for the quarter ended September 30, 2008
|
1-31447
|
10.3
|
|||
*10(hh)(1)
|
—
|
Executive Benefits Agreement by and between HL&P and Thomas R. Standish effective August 20, 1993
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(hh)(1)
|
|||
*10(hh)(2)
|
—
|
First Amendment to Exhibit 10(hh)(1) effective as of December 31, 2008
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(hh)(2)
|
|||
*10(ii)(1)
|
—
|
Executive Benefits Agreement by and between HL&P and David M. McClanahan effective August 24, 1993
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(ii)(1)
|
|||
*10(ii)(2)
|
—
|
First Amendment to Exhibit 10(ii)(1) effective as of December 31, 2008
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(ii)(2)
|
|||
*10(jj)(1)
|
—
|
Executive Benefits Agreement by and between HL&P and Joseph B. McGoldrick effective August 30, 1993
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(jj)(1)
|
*10(jj)(2)
|
—
|
First Amendment to Exhibit 10(jj)(1) effective as of December 31, 2008
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(jj)(2)
|
|||
*10(kk)(1)
|
—
|
CenterPoint Energy, Inc. 2009 Long Term Incentive Plan
|
CenterPoint Energy’s Schedule 14A dated March 13, 2009
|
1-31447
|
A
|
|||
*10(kk)(2)
|
—
|
Form of Qualified Performance Award Agreement for 20XX — 20XX Performance Cycle under Exhibit 10(kk)(1)
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2009
|
1-31447
|
10(kk)(2)
|
|||
*10(kk)(3)
|
—
|
Form of Restricted Stock Unit Award Agreement (With Performance Goal) under
Exhibit 10(kk)(1)
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2009
|
1-31447
|
10(kk)(3)
|
|||
†10(ll)
|
—
|
Summary of non-employee director compensation
|
||||||
†10(mm)
|
—
|
Summary of named executive officer compensation
|
||||||
10(nn)
|
—
|
Form of Executive Officer Change in Control Agreement
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(nn)
|
|||
10(oo)
|
—
|
Form of Corporate Officer Change in Control Agreement
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2008
|
1-31447
|
10(oo)
|
|||
†12
|
—
|
Computation of Ratio of Earnings to Fixed Charges
|
||||||
†21
|
—
|
Subsidiaries of CenterPoint Energy
|
||||||
†23
|
—
|
Consent of Deloitte & Touche LLP
|
||||||
†31.1
|
—
|
Rule 13a-14(a)/15d-14(a) Certification of David M. McClanahan
|
||||||
†31.2
|
—
|
Rule 13a-14(a)/15d-14(a) Certification of Gary L. Whitlock
|
||||||
†32.1
|
—
|
Section 1350 Certification of David M. McClanahan
|
||||||
†32.2
|
—
|
Section 1350 Certification of Gary L. Whitlock
|
CENTERPOINT ENERGY RESOURCES CORP.
|
|
By:
/s/ Marc Kilbride
|
|
Name: Marc Kilbride
|
|
Title: Vice President and Treasurer
|
Attest:
|
|
/s/ Richard B. Dauphin
|
|
Name: Richard B. Dauphin
|
|
Title: Assistant Corporate Secretary
|
THE BANK OF NEW YORK MELLON TRUST
|
|
COMPANY, N.A.,
|
|
As Trustee
|
By:
/s/ Marcella Burgess
|
|
Name: Marcella Burgess
|
|
Title: Vice President and Trust Officer
|
No. __________
|
$ __________*
|
|
CUSIP No. __________
|
Attest:
|
|
Name:
|
|
Title:
|
THE BANK OF NEW YORK MELLON
|
|
TRUST COMPANY, N.A.,
|
|
As Trustee
|
Date of Authentication:
|
|
By:
|
|
Authorized Signatory
|
Date of
Adjustment
|
Decrease in Aggregate
Principal Amount of
Securities
|
Increase in Aggregate
Principal Amount of
Securities
|
Aggregate Principal
Amount of Securities
Remaining After Such
Decrease or Increase
|
Notation by
Security
Registrar
|
||||
No. __________
|
$ __________*
|
|
CUSIP No. __________
|
Attest:
|
|
Name:
|
|
Title:
|
THE BANK OF NEW YORK MELLON
|
|
TRUST COMPANY, N.A.,
|
|
As Trustee
|
Date of Authentication:
|
|
By:
|
|
Authorized Signatory
|
Date of
Adjustment
|
Decrease in Aggregate
Principal Amount of
Securities
|
Increase in Aggregate
Principal Amount of
Securities
|
Aggregate Principal
Amount of Securities
Remaining After Such
Decrease or Increase
|
Notation by
Security
Registrar
|
||||
[INSERT NAME OF TRANSFEROR]
|
|
By:
|
|
Name:
|
|
Title:
|
|
Address:
|
|
Dated:
|
Very truly yours,
|
|
Name of Transferor:
|
|
By:
|
|
Name:
|
|
Title:
|
|
Address:
|
CENTERPOINT ENERGY RESOURCES CORP.
|
|
By:
/s/ Marc Kilbride
|
|
Name: Marc Kilbride
|
|
Title: Vice President and Treasurer
|
Attest:
|
|
|
|
/s/ Richard B. Dauphin
|
|
Name: Richard B. Dauphin
|
|
Title: Assistant Corporate Secretary
|
THE BANK OF NEW YORK MELLON TRUST
|
|
COMPANY, N.A.,
|
|
As Trustee
|
By:
/s/ Marcella Burgess
|
|
Name: Marcella Burgess
|
|
Title: Vice President and Trust Officer
|
•
|
Annual retainer fee of $50,000 for Board membership;
|
||
•
|
Fee of $2,000 for each Board or Committee meeting attended;
|
||
•
|
Supplemental annual retainer of $15,000 for serving as a chairman of the Audit Committee or Compensation Committee; and
|
||
•
|
Supplemental annual retainer of $5,000 for serving as a chairman of any other Board committee.
|
Name and Position
|
Base Salary
|
|||
David M. McClanahan
President and Chief Executive Officer
|
$
|
1,130,000
|
||
Gary L. Whitlock
Executive Vice President
and Chief Financial Officer
|
$
|
540,000
|
||
Scott E. Rozzell
Executive Vice President, General
Counsel and Corporate Secretary
|
$
|
505,000
|
||
Thomas R. Standish
Senior Vice President and Group
President — Regulated Operations
|
$
|
487,000
|
||
C. Gregory Harper
Senior Vice President and Group
President,
Pipelines and Field Services
|
$
|
370,000
|
||
|
2006
|
2007 (1)
|
2008 (1)
|
2009 (1)
|
2010 (1)
|
||||||||||||||||
Net Income
|
$ | 427 | $ | 395 | $ | 446 | $ | 372 | $ | 442 | ||||||||||
Equity in earnings of unconsolidated affiliates, net of distributions | (5 | ) | (13 | ) | (51 | ) | (3 | ) | 13 | |||||||||||
Income taxes
|
59 | 193 | 277 | 176 | 263 | |||||||||||||||
Capitalized interest
|
(10 | ) | (22 | ) | (12 | ) | (4 | ) | (9 | ) | ||||||||||
471 | 553 | 660 | 541 | 709 | ||||||||||||||||
Fixed charges, as defined:
|
||||||||||||||||||||
Interest
|
608 | 632 | 604 | 644 | 621 | |||||||||||||||
Capitalized interest
|
10 | 22 | 12 | 4 | 9 | |||||||||||||||
Interest component of rentals charged to operating expense
|
19 | 16 | 15 | 12 | 26 | |||||||||||||||
Total fixed charges
|
637 | 670 | 631 | 660 | 656 | |||||||||||||||
Earnings, as defined
|
$ | 1,108 | $ | 1,223 | $ | 1,291 | $ | 1,201 | $ | 1,365 | ||||||||||
Ratio of earnings to fixed charges
|
1.74 | 1.83 | 2.05 | 1.82 | 2.08 |
|
(1)
|
Excluded from the computation of fixed charges for the years ended December 31, 2007, 2008, 2009 and 2010 is interest income of $4 million, interest expense of $9 million, interest income of $3 million and interest expense of $9 million, respectively, which is included in income tax expense.
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ David M. McClanahan
|
|
David M. McClanahan
|
|
President and Chief Executive Officer
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Gary L. Whitlock
|
|
Gary L. Whitlock
|
|
Executive Vice President and Chief Financial Officer
|
/s/ David M. McClanahan
|
|
David M. McClanahan
|
|
President and Chief Executive Officer
|
|
March 1, 2011
|
/s/ Gary L. Whitlock
|
|
Gary L. Whitlock
|
|
Executive Vice President and Chief Financial Officer
|
|
March 1, 2011
|